Global marketing - Advantage & Disadvantage

Global Marketing

Table of Contents
INTRODUCTION...........................................................................................................................4
ENTRY 1.........................................................................................................................................4
1 Explain the development of Global marketing concept............................................................4
2 Evaluate the different opinion of authors on “Development of global marking”.....................4
3 Real business example which support the Development of global marketing concept............5
ENTRY 2.........................................................................................................................................5
(a) Background of any BRIC country .........................................................................................5
(b) Evaluate the political risk for Brazilian country....................................................................5
(c) Discuss the trade, tariff & non-tariff barriers between the UK or Brazilian country.............6
(d) Review Economic environment of Brazil..............................................................................6
(e) Advantage & disadvantage of Naked Wines company to entered in the market of Brazil....7
ENTRY 3.........................................................................................................................................7
1 Real business world company...................................................................................................7
2 How given model help the company to entered in new market through right entry mode
decision........................................................................................................................................7
ENTRY 4.........................................................................................................................................8
1 Fashion retail choose to use franchise as an entry mode..........................................................8
2 Advantage & Disadvantage of using franchise as an entry mode............................................9
3 Benefits of franchise for fashion retailer..................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCE ................................................................................................................................11

INTRODUCTION
Global marketing means all the countries taking advantage in all over the world through
marketing. Organisation develop a strategy according to the other country's market condition and
it includes the sale of their product across the globe. Global marketing provides various
opportunities, which help to increase customer base or market share of that company. Purpose of
this portfolio is to provide the overview of BRICS market as well as political & economic
condition of Brazil. This report include BRIC market where the discussion about Brazil market
and Entry mode of new company contain the factors which influence or affect the foreign market
of Naked Wines company. Along with this, Boxfresh from fashion retailer use the franchise
option as a entry mode in the foreign market and what are it's advantage & disadvantage.
ENTRY 1
1 Explain the development of Global marketing concept
Global marketing is the biggest platform to target different market across the world.
Globalization is the part of global market where every company wants to expand their business
globally. For this, manager need to identify international opportunities or competition in the
foreign market because every sector has tough competition in the global market.
To the development of global marketing organisation required to globalise their networks
or business need to measure customer's requirement and nature of supplier in the worldwide area.
Organisation required to identify threat in the foreign market or competitive advantage as well as
the distribution network which increase the efficiency of market. Company can grow in the
global market if they majorly focus on their product that have worldwide demand (Resende Melo
and et. al., 2015).
2 Evaluate the different opinion of authors on “Development of global marking”
According to Dr. Philip Kotler, global marketing is the place where different organisation
tries to satisfy the need of consumers through providing variety of product & services in the
international market. Because marketing helps the business to identify the unsatisfying need &
desire of consumes.
According to Mark Burgess, Global marketing help the business to increase profitability
or expand market share. Which help the business to convert consumer's need into revenue of the
organisation.
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Both the authors have different opinion regarding development of global marketing,
where Philip Kotler's point of view development of global marketing help the consumers to
satisfy their need or desires. On the other have according to Mark Burgess, this concept helps the
organisation to expand their business globally which further increase the profitability, market
share or provide huge growth in the market (Al‐Khatib and et.al, 2016).
3 Real business example which support the Development of global marketing concept
Coca-Cola is US based manufacturing company which start selling their product in the
global market since 1919. Currently this company offer their products in more than 200 countries
through focusing consumers (Gillespie and Riddle, 2015). Taste of their products is similar in
every region, but the size, packaging, promotion or labelling is different accounting to country
where they sell their items. In the current market Coca-Cola is the world-famous brand in
beverages and they approximately produce 450 brands under their name (Eggers and Spirling,
2015).
Company follow the simple formula to become world famous in the global market and
that is provide refreshing drink within reasonable price to their customers. Coca-Cola company
follow the different advertisement approach that will change the process of message which
delivered to consumers. Organisation build their promotional strategies which influence the local
culture of every country. To expand their reach in the global market Coca-Cola company,
introduce variety of product with different local taste and include various beverage brands.
ENTRY 2
(a) Background of any BRIC country
Brazil is the country of South America that contain half of the continent's landmass.
Brazil is the fifth largest country in the world I comparison to Russia, China, Canada or US. This
country faces the 4600 miles of Atlantic Ocean or more than 15700 km inland area. It is the only
country where people speak Portuguese and it cover the 3-time zone. Amazon is the 2nd longest
river in the world and Brazil cover the around 60% location (Jadhav, 2012).
(b) Evaluate the political risk for Brazilian country
Political risk of Brazilian country include Foreign Direct Investment (FDI) which is
restricted in several sector such as stock market. There are political & social tension is very high
due to corruption. Price of commodity will change at higher rate in international market. Existing
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government will reduce the budget deficit which ballooned to more than 10% of GDP in 2015.
Change in the value of currency is affected through various incidents such as wars, revolutions
and other political activities. Political system of Brazil includes the various scandals which affect
the country and create risk for example Lava Jato corruption scandal which is considered as the
biggest corruption scandal in Latin America where they arrest minor criminals who revealed that
they laundering money for Petrobras (Brazil's state owned company). Below representing data
show the political risk of Brazilian country:
Long term political risk which rated from low to high, low indicate the 1 or high risk
indicate the 7. above data represent the political risk from 2014 to 2018. During the 4 index
points minimum 3 points in 2014 and maximum 5 index points in 2017. These indicators provide
the comparative trend from 2014 to 2018 (Quer, Claver and Rienda, 2012).
(c) Discuss trade, tariff & non-tariff barriers between the UK or Brazilian country
Tariff is a tax which is levied on products traded internationally. Both countries that are
UK and Brazil have identified some trade and tariff barriers, which are as, mention below: There
are various products which can be trade between these two nations such as: hazardous products
which includes illegal drugs, offensive weapon, rough diamonds etc. Two countries cannot trade
weapons and other hazardous item. Without paying the import and export duty products cannot
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transfer. Both nations can't transfer those products which are injurious for the health of human
being (Gillespie and Riddle, 2015).
Trade barriers: there are some Goods which is restricted to entered in the UK market such
as illegal drugs, offensive weapon, rough diamonds, self defence spray and personal daily items
import. In addition, some other items also restricted like, firearms, explosive & ammunition.
Non- trade barriers: Non-tariff barriers include trade barrier, embargoes, warrant, and
charge. It is applicable on the countries where they are restricted to trade with other countries not
in form of import & export of good or not any other business relation.
Tariff barriers: UK is the part of the EU and commercial policy is regulated by the
European Commission. Along with this, Common External Tariff (CET) is applicable to other
countries including Australia.
(d) Review Economic environment of Brazil
Brazil is the eighth largest economy of the world and there is unequal distribution of
income. Inflation rate in February 2013 is 3.89% and it is the highest rate from past three years.
Below mention graph will represent the inflation rate from 2018 to 2019:
Illustration 1: Inflation rate
Source: Inflation rate in Brazil, 2019.
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Brazil entered in the recession in the period of 2015 and it was happened because of the
price fall on commodity as well as reduce the consumption of goods. Economy recover in 2017
and in 2018, GDP increase from 1% to 1.4%. Current Rate of unemployment is 12% which is
still high and they regularly face the social issues regarding high level of inequality in the
country among the people (Pao and Fu, 2013). So it important for the Brazilian country to to
build flexible trade policy that will help the other countries to enter in Brazil for expanding their
business and set up their industry. It will help to decrease unemployment rate of Brazil because
current rate is very high according to 2018 which is mention in the below graph:
Illustration 2: Unemployment rate
Source: Unemployment rate in Brazil, 2019.
(e) Advantage & disadvantage of Naked Wines company to entered in the market of Brazil
Advantage:
Currently Brazil is growing country which is beneficial for the company and it will
provide the Naked Wines a diversify consumer base. It will increase the product life cycle as
well as it provides the huge growth in the market through variation in wine range. Naked Wines
can attract more consumers with the help of their uniqueness in the products.
Disadvantage:
Huge capital requirement at the time of entering new market or if the expansion fail then
company hardly survive for long time in the market because Naked Wines is small enterprise.
Quality of wine also very important because company introduce in the new market, so consumer
firstly compare that product through its quality or price range. So organisation need to ensure
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that they produce quality product for the successful achievement of product dvelopment in the
new market.
ENTRY 3
1 Real business world company
Naked Wines is online retailer company which provide a wide range of wins to their
consumers at wholesale price. It is founded by the Rowan Gormley and currently they supply
their items across the UK, USA or Australia. This company also won the host award by National
Business Awards in the category of Online business. Naked Wines have More than 100 staff &
300000 customers and 100 independent wine maker in the 14 countries (Berger and Roman,
2015).
2 How given model help the company to entered in new market through right entry mode
decision
Entry mode decision is the initial stage where organisation take further step for future
activities in the foreign market. This model help the Naked Wines Company to entered in the
new market with the help of right entry mode. For this, firstly they have to identity external or
internal factors, which affect the business at the time of expanding their business in the new
market. External factors such as demand uncertainty, size & growth of market, trade barriers and
social culture distance between home & host country etc. Home country is UK, so it is important
for the Naked Wines's manager to reduce the gap among the social culture of the countries.
Because manager have to identity the social culture and than build their strategies which support
the decision to expand business in the new market.
Another external factor is Direct & indirect trade barriers which influence of affect the
Naked Wines company to enter in new market. Trade policies of every country is different so it
is manager's responsibility to identify the scope on that particular area to expand their business.
Internal factors also affect the organisation to enter in foreign market and it include the size of
firm and experience of international market. Size of the Naked Wines company also matter a lot
because very small size organisation not able to enter in foreign market due to lack of capital,
resources and market share. But it can enter because of their innovative ideas in the product rage
which is liked by the customers. Naked Wines is small size private sector company which have
enough capital, human resource power, decent market share or well known brand name among
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the consumers. So it not too difficult for the organisation to entered in foreign market but capital
investment can become barrier for the organisation. This issue also solved by the company to
take borrowing from the financial institution if they have profitable idea to expand their business.
Even Naked Wines already expand their business in USA or Australia.
Other internal factor is international experience, for this manager of Naked Wines
company need to analyse their later experience at the time of dealing international market. If it is
first time than company required intense research about foreign market to expand their business.
Manager required to identify the opportunities and then analyse their strength, capability or
capacity which help the Naked Wines to capture the foreign market.
Other than internal or external factors, launched product is the most important because
business can grow when consumer purchase their product. So basically manager need to identify
the demand of Wines on that particular market which is going to introduce by the Naked Wines.
Advantage of product differentiation also lead the business toward growth or help in expanding
their organisation. Basically, these factors affect the organisation so manager required to analyse
these factors or take right entry decision to entered in foreign market (Beck and Palmatier, 2015).
ENTRY 4
1 Fashion retail choose to use franchise as an entry mode
Boxfresh company choose the Indian market to provide franchise for the fashion retailer.
Company focus to expand their business in India through targeting niche market. Organisation
choose the niche marketing strategy to narrow their services through offering wide range of
products and target the profitable section of market. Boxfresh choose the franchise method to
enter in India and for this organisation have to provide patent product to their franchise and
provide them instruction regarding their items. How to handle the cloths in the shop it was also
instruct by the Boxfresh company. Organisation regularly give advices regarding marketing or
how to improve their business in the market.
2 Advantage & Disadvantage of using franchise as an entry mode
Advantage:
 Work under the established business such as Boxfresh provide good consumers response
because they already test the market and trends. Franchise is just to implement these
strategies again (Bowie and et. al., 2016).
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 Less chances to fail the franchise because company already have good name among the
consumers or market such Boxfresh. People are aware about that brand and they also
have their loyal customer which the best advantage of franchise (Bareša and Bogdan,
2017).
Disadvantage:
 No control of franchisee on business because they already prepare agreement of certain
rules & regulations (Charter and Polonsky, 2017).
 Brand already set the working areas to operate so it is difficult for the organisation to
across the limit because they are in mutual agreement.
 Biggest disadvantage of franchise is to damage the brand name or reputation. If another
franchise done anything then it will affect the other one franchise too (De Mooij, 2018).
3 Benefits of franchise for fashion retailer
Speed of growth: - To open more franchisee provide the growth at the same time or
capture the market through their effective leadership style. Franchising allow the franchise to
leverage human resources but not allow the financial leverage. They also allow them to compete
with big enterprises with the help this they can saturate market. Boxfresh company provide the
franchise of their brand which will help the business to grow very speedily and allow their
franchisors to perform their task in respect of achieving business goals & objectives. Because
fashion trends will change very rapidly so it beneficial to work along with it.
Increase profit margin: - Provide franchise to the organisation is profitable for the
franchisor because franchise done all the activities such selection of site, negotiate, hire trainer
from local marketing, accounting etc. So Boxfresh company earn the profit through providing
franchise to the Indian businessman. So basically franchise provide the benefits to the business
as well as the franchisor. Both the parties get the benefits because fashion never goes out of the
fashion.
CONCLUSION
From the above disillusion, it has been concluded that global marketing is the wider place
to promote their product & services. Development of global marketing concept is differing
according the different authors and how political or economical risk affect the BRIC market.
This report also includes the entry mode decision which affect the organisation to expand their
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business in foreign market. Along with this, further discussion is about franchise, it's advantage
& disadvantage or benefits to choose in fashion retail.
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REFERENCE
Books & Journals
Bareša, S., Ivanović, Z. and Bogdan, S., 2017. Franchise Business as a Generator of
Development in Central Europe. UTMS Journal of Economics. 8(3). p.281.
Beck, J. T., Chapman, K. and Palmatier, R. W., 2015. Understanding relationship marketing and
loyalty program effectiveness in global markets. Journal of International Marketing.
23(3). pp.1-21.
Berger, A. N. and Roman, R. A., 2015. Did TARP banks get competitive advantages?. Journal of
Financial and Quantitative Analysis. 50(6). pp.1199-1236.
Bowie, D., and et.al., 2016. Hospitality marketing. Routledge.
Bric, J. D., and et.al., 2016. Current state of virtual reality simulation in robotic surgery training:
a review. Surgical endoscopy. 30(6). pp.2169-2178.
Charter, M. and Polonsky, M. J. eds., 2017. Greener marketing: a global perspective on
greening marketing practice. Routledge.
De Mooij, M., 2018. Global marketing and advertising: Understanding cultural paradoxes.
SAGE Publications Limited.
de Resende Melo, P. L., and et.al., 2015. International analysis of the countries where Brazilian
franchise chains operate. Revista de Administração. 50(1). pp.26-39.
Eggers, A. C. and Spirling, A., 2015. The advantages and disadvantages of incumbency.
Gillespie, K. and Riddle, L., 2015. Global marketing. Routledge.
Jadhav, P., 2012. Determinants of foreign direct investment in BRICS economies: Analysis of
economic, institutional and political factor. Procedia-Social and Behavioral Sciences.
37. pp.5-14.
Pao, H. T. and Fu, H. C., 2013. Renewable energy, non-renewable energy and economic growth
in Brazil. Renewable and Sustainable Energy Reviews. 25. pp.381-392.
Quer, D., Claver, E. and Rienda, L., 2012. Political risk, cultural distance, and outward foreign
direct investment: Empirical evidence from large Chinese firms. Asia Pacific journal of
management. 29(4). pp.1089-1104.
Online
Development of Global Marketing by Dr. Philip kotler. 2019. [Online]. Available through:
<https://brainly.in/question/2873918>
Global marketing definition. 2019. [Online]. Available through:
<https://heidicohen.com/global/marketing-definition/>
Political risk. 2019. [Online]. Available through:
<https://www.theglobaleconomy.com/Brazil/political_risk_long_term/>
Unemployment rate in Brazil. 2019. [Online]. Available through:
<https://tradingeconomics.com/brazil/unemployment-rate>
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