Global Marketing Management:

Planning and Organization

Chapter 12 CASES
GLOBALISATION BENEFITS CASES

McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Benefits of Global Marketing
▪ Economies of scale in production and marketing
▪ Transfer of experience and know-how across
countries
▪ Global diversity in marketing talent leading to new
approaches
▪ Marketing globally ensures that marketers have
access to the toughest customers
▪ Spreading the portfolio of markets brings stability of
revenues and operations to many global companies

12-2
Benefits of Global Marketing
▪ Economies Of Scale:
o Black & Decker Manufacturing Company—makers of electrical hand tools,
appliances, and other consumer products—realized significant production cost
savings when it adopted a pan-European strategy. It was able to reduce not
only the number of motor sizes for the European market from 260 to 8 but
also 15 different models.

o Similarly, Ford estimates that by unifying product development, purchasing,

and supply activities across several countries, it saves more than $3 billion a
year.

o While Japanese firms initially dominated the mobile phone business in their
home market, international competitors now pose growing challenges via
better technologies developed through greater global penetration.

12-3
Benefits of Global Marketing
▪ Transfer Of Experience and Know-how Across Countries:
o Unilever successfully introduced two global brands originally
developed by two subsidiaries. Its South African subsidiary
developed Impulse body spray, and a European branch
developed a detergent that cleaned effectively in European hard
water.

o Aluminum Company of America’s (Alcoa) joint venture partner

in Japan produced aluminum sheets so perfect that U.S.
workers, when shown samples, accused the company of hand-
selecting the samples. Line workers were sent to the Japanese
plant to learn the techniques, which were then transferred to
the U.S. operations.

12-4
Benefits of Global Marketing
▪ Access to the toughest customers :

o For example, in many product and service categories, the

Japanese consumer has been the hardest to please; the
demanding customers are the reason that the highest-quality
products and services often emanate from that country.

o Competing for Japanese customers provides firms with the

best testing ground for high-quality products and services.

12-5
Benefits of Global Marketing
▪ Stability of revenues:

o Firms that market globally are able to take advantage of

changing financial circumstances.
o For example, as tax and tariff rates ebb and flow around
the world, the most global companies are able to leverage
the associated complexity to their advantage.

12-6
THANK YOU

12-7