Global Marketing Mix and Finance Math

Introduction

To be successive in the global market, each organization need to have a global marketing mix and global mindset. In other words, multinational and national organizations require structuring their process such that they meet the global standards to compete effectively with others. The initiative considers marketing within an integrated economy, which is stateless and with minimal restrictions. According to De Mooij (2018), global marketing involves understanding the different cultural paradoxes to achieve global competitiveness. Although the state of globalization is low for developing countries, the developed countries are making well-integrated markets. The global marketing activities must be integrated at a global level (Gillespie, & Riddle, 2015). One critical consideration is that there is a need to address the forces of globalization and localization. As a marketer, there is the need to think strategically since the global market present different challenges, and as such, the need to respond decisively to the competitive market. The marketing strategies need to be defined to enhance cost reduction to achieve profitability at the worldwide market. From the performance of different multinational companies, it is clear that real change has been taking place within the business planning focus (Gluck, Kaufman, &Walleck, n.d.). In the marketing, initiative organization needs to be committed to building a strong brand name, which will be recognized worldwide to overcome these barriers.

Globalization has changed the way of doing business, especially in developed countries such as the US. Managers need to be oriented to other cultures in their way of doing business to achieve alternative benefits. The ability to adapt and use the style which is most acceptable to the particular country market is a characteristic of having a global mindset. The world economies have been transformed significantly, and hence, all organizations need to be proactive in using diversity. For leaders to influence the multicultural world and business environment, they need to have a global mindset. The unicultural lens that initially helped employees to interpret and understand their surroundings is now a critical obstacle in performing business today, especially in the developed countries (Javidan, 2010 May 19). This paper is based on the discussion of global marketing strategies, globalization, and the need to have a global mindset. A global strategy such as a global mindset and global marketing strategies are crucial for survival in the current international market since there is a critical transformation of the worldwide economies through global connectedness.

(2) Global Marketing Mix

The global marketing strategies refer to the initiatives to coordinate the marketing efforts from different regions of the world. For all the elements of the marketing mix such as product, place, price, and promotion, the marketer reconsider the need to include characteristics of multicultural dimensions. A multinational organization like Boeing often focuses on standardization of the marketing mix elements to ensure that they meet the global standards (Coe, & Yeung, 2015). Boeing is a US-based company, but in its global marketing strategies, several adaptations are made to the conditions of the other countries. The company has offices in countries other than the US in which it markets its products. The company has the strength to compete in the global market with other companies such as Airbus, and the purpose is to ensure it expands the market potential. Efforts to launch production plants in other countries like Europe and Asia are initiatives to capture the global market. With the presence of information and communication technology (ICT), organizations manage to collect useful information about the markets and develop marketing strategies.

Global Marketing Strategies and Organization Goals

A global marketing strategy by the organization is an essential tool for achieving different organizational goals. Every organization adopts a global marketing strategy to increase its profitability and to improve the customers’ value. The role of the marketing strategy to each of the goals is discussed below. Positioning each of the elements in the global environment will help to improve the organization performance, promoting competitiveness. Many organizations conflicts hinder development and cultural change. For instance, the systems of organized labor increase production costs and local market constraints reduce revenue; hence, global marketing strategy would be necessary to polarize such forces.

Addressing Cost Reduction

A global marketing strategy enhances cost-effectiveness. By establishing standard methods of production and packaging as well as the promotion of the products, costs efficiency would be attained. By maintaining the operations of an organization nationally, it leads to increased costs. With a global marketing strategy, the organization will have a standardized process. The process helps to reduce duplication and waste of resources. For instance, promotion initiatives are designed such that no such costs would be duplicated across cultures (Steenkamp, 2017). The product design, packaging, and advertising will be uniform, which would help maintain the costs low. In the absence of global marketing strategies, an organization incurs similar costs such as in promotion that can otherwise be avoided. A global marketing mix is characterized by uniformity of products and services. Also producing a large number of identical units will offer the organization economies of scale. In the absence of global marketing strategies, the organization incurs duplicated costs of providing nonstandard products and services. Considering products that are unique in each of the subsidiary company significantly raises the operation costs. In terms of the distribution of products coordination in the various subsidiary also leads to a significant reduction in the costs. With global marketing strategies, the product prices and delivery are well coordinated, and hence, critical control measures are employed.

Enhanced Customers Preference

A global marketing strategy promotes enhancing customers preference. In other words, the global marketing strategies will improve positive demand effect on the customers. The global marketing strategies include standardization of the products and hence increase the customers' exposure to the product. This leads to a positive impact on preferences. The level of competition that is built on standardized products leads to increased awareness. When products become common across countries, there is a likelihood for increased preferences among the customers. In this case, the effect arises from building the brand in which customer awareness rises. Global marketing strategies also include competitive imitation. The impact of this is to make the customers value for particular products. In other words, in the process of product standardization, some product and quality features are enhanced, promoting customers value for a given brand. The global marketing strategies also include price standardization, which would also increase the demand effect for a particular product. Customers' preference is also dependent on the fact that the quality of the products is improved. A company with more extended series maximize on investment in specialized technology and enhance it is consistent in the quality of the products that are produced. The consistency in the quality of the product will promote the customers' preference for a product even in the broader market.

Improved Program Effectiveness

Global marketing strategies increase organization competencies for a particular product and services. In the process of standardization of the needs of customers across cultures, the company will be exposed to information that enhances the building and improving particular programs. The company will be useful in promoting products within a specific country. The response to particular products helps the company to respond accordingly to the needs of the customers. The discoveries that are established in marketing a product for a specific market will be useful for marketing in another market. For instance, coca cola advanced its product in India in the late 20th century the discovery of religious barriers led to building new products and using that knowledge in marketing the products in similar cultures. For all the elements of the marketing mix, the GMS initiative increases awareness for a given intervention. Also, globalization shows that the needs of the consumers across the world have been harmonized and the customers even from a distance will prefer similar products (Skarmeas, Zeriti, & Baltas, 2016). A company will gather knowledge on the need for standardization of programs based on the customer's effectiveness. For all the elements of the product mix product, pricing, promotion, and distribution, the company will build on adaptation and standardization, which leads to improved program effectiveness.

Increased Competitive Leverage

The global marketing strategies will help a company to achieve a competitive advantage. This achieved both by cost reduction compared to the local competitors selling quality products at relatively low products. The GMS initiatives also increase the scope of the market, and hence, the company revenues will increase. As the company financial performance improvement, the company increases investment in technology and research for competitive advantage on quality products and services. The effect will also arise from the quick adaptation to the needs of customers achieving competitive advantage in new markets. Increased consumer awareness also promotes customer preference for a brand relative to competitors’ local brands.

Addressing the Needs to Achieve Economies of Scope

Global marketing strategies enhance cost-effectiveness from the scale and scope. In global marketing strategies, the economies of scope refer to the initiative to use the investment for producing a particular standardized product in producing other similar related products. Coca Cola achieve economies of scope. According to Sloman, Norris, and Garrett, (2013), the company provides a wide range of soft drinks other than the Coca Cola range. The latter is the renowned brand but the marketing initiatives that include the sale of these products enhance cost efficiencies. The company has invested in the diversification of the products in two ways. In 2007 the company announced expanding its product portfolio to include ‘flavored milk, energy, juice, and tea-based drinks' (Sloman et al., 2013) and the alcoholic goods markets. The company strategy is to utilize the production and distribution networks it has created in Coca Cola range to market these other brands. One of such networks is with the SAB Miller to construct a new brewery. For all the elements of the global marketing mix economies of scope can be enhanced, leading to decreased operation costs, which would allow for improved cost reduction. The global marketing strategies and the economies of scope are based on the fact that such initiatives would be found on the market efforts already established. The economies of scope are a product of adaptation to the changing customers' need and standardization efforts to ensure improved output. The diversification efforts that are based on a global scale would lead to improved efficiency.

Creating and Maintaining a Global Brand Name

The global marketing strategies are built on the fact that such considerations as building a brand name as an asset in the worldwide market. Most organizations benefit from a renowned global brand name. Boeing has a global brand name in the aerospace an asset that enhances the advancement of the operations. The global branding initiatives involve the marketing of a product under the same name worldwide, which enhances adopting in international marketing. Customers easily identify branded products across different countries. This increases the demand for the products over those of the competitors. Another advantage is increased customers confidence in the products. The global brand name can also be used to promote new products and programs within the product portfolio. Secondly, the initiatives to build a global brand create a competitive advantage (Teeboom, Leon, 2019 February 19). Companies like Boeing and Coca Cola uses the name as an asset for the advancement of marketing efforts in the international market. Considering that the companies take the direct responsibilities of the quality of their products within the global market to advance these initiatives, there is a direct benefit achieved from them. The global brand name also reduces the costs of marketing the products both locally and internationally.

(4) Global Mindset

The global marketing strategies take advantage of globalization, which has transformed the world economies into a single borderless frontier. This transformation that has occurred, especially among the developed countries, has pioneered the need to have a global orientation. Managers in business need to be oriented to other cultures in their way of doing business to achieve alternative benefits. The ability to adapt and use the style which is most acceptable to the particular country market is a characteristic of having a global mindset. Boeing has a global mindset shifting from being an American country a move that has pioneered some conflicts between the management and the local stakeholders, especially the employees.

Description of the Global transformation and Impact on Business

The global transformation has been a significant occurrence within the international market. There are minimal restrictions in marketing and selling products across the countries. The increased foreign direct investment is a clear indicator of the level of globalization that has been achieved in the international market. Boeing, an American based company recently established plant in the UK an initiative that indicate reduced trade barriers between the two regions (Lawrence, & Thornton, 2017). In many of the US firms, there is the increased integration of the skilled workforce from other countries. The technology companies in the US utilize the skilled workforce from the Asian countries. The restriction in the movement of the raw materials is minimal, an indication of the integration of the different economies. According to Noyes et al., 2019, there is evidence that shows that the developed countries are more globalized than the developing countries. One contribution to the level of global transformation is information and communication technology. The state of globalization has a significant impact on the US business and the work environment. The company in the US has a diverse workforce in efforts to increase global connectedness. The increased foreign work opportunities mean that there is a reduced likelihood to work in US-based firms.

Description of Global mindset and its transformation

Global mindset refers to the series of adaptation to the needs and characteristics of different cultures to maximize value. The global mindset is necessary for the managers considering the state of globalization. To survive in the international markets, managers need to have a global mindset. The global mindset will enhance integration and effective management of a diverse workforce. The initiative, in return, will promote the transformation of various techniques to achieve global competitiveness. The global mindset involves increasing the company skill set to deliver culturally sensitive interventions. The overall impact will be increased efficiency and cost reduction. A global mindset has helped the Boeing executive to promote strategic goals that overcome competition at the international market. The primary evidence is that there is an increased need to reduce labor costs and integrate new skills and technologies. The global mindset promotes the success of a company both locally and in the international market. Locally it enhances improvement in the quality of the product and a decrease in costs. The global mindset helps to improve management relationships with stakeholders in the company subsidiaries outside the US.

Principal Leadership Challenges in Implementation of a Global Mindset

Implementing a global mindset is characterized by different challenges that affect leaders. One of the difficulties is a conflict with local stakeholders. For Boeing, a global mindset has pioneered conflict with employees. According to Peterson (2011), Boeing employees consider that the company is offloading opportunities abroad. The regional tension in which the company is most established disrupts the normal functioning and profitability. As the company outsource operation across cultures and increasing foreign investment, the locals strike on the lack of job security. In other words, there is tension for the sustainability of the company benefits. Globalization is yet to be fully achieved primarily for developing countries. In other words, the leaders have to focus investment only to some designated regions. The products are standardized at the expense of other potential markets. It is not easy to lead and manage a diverse workforce, and hence, leaders have to allow for culturally based groups which limit integration. Boeing leaders have approved for groups affiliation by cultures and promote team leadership through these groups. While this technique can enhance management, it reduces leadership control.

Conclusion

Globalization has transformed the world economies, and hence, there is a need to implement different global strategies to achieve economic benefits. Global connectedness among the developed countries is high while in developing countries it is relatively low. To survive in the international market, there is a need to implement global marketing strategies which enhance cost reduction and improvement in customer's value. Leaders and managers in a multinational organization are expected to adopt an orientation that favors the overall market. There are critical considerations that such decisions are the only way to survive in the multicultural based worldwide economy. Addressing the local and international needs of the market is a significant challenge to the global mindset. Trade across countries account for the exchange rate influenced by the economic factors those changes over time. The financial markets act as an essential indicator of these forces through the influence on foreign investment to a particular country.

Problem:

(a) Inflation rate and currency value in the global market

-UK inflation rate: 8%

-US inflation rate :4%

- The spot rate of USD 1.46=1 GBP

Forward Rate 1.08 GBP= 1.5184 USD (1+8%) = (1.46+4%) 1 GBP = 1.4059 USD Expected rate of appreciation for USD Spot Rate 1USD =1/1.46= 0.6849 GBP Forward Rate 1USD= 1/1.4059= 0.7113 GBP Appreciation =(Forward Rate-Spot Rate/Spot Rate)*100

Expected Rate of depreciation for GBP = (Forward Rate-Spot Rate/Spot Rate)*100

(b) Forward rate and transaction within 45 days

	USD	Chinese RMB
Interest Rate	3.2%	6.125%
For 45 Days Interest Rates (365 Days taken) (3.2*45/365:6.125*45/365)	0.3945%	0.7551%

Sport Rate 1 USD= 6.831 RMB Forward Rate=1.003945=6.88258

             * 1.003945= (1+0.3945%)

             ** 6.88258= (6.831+0.7551%)

Therefore 1 dollar=6.8555 (6.88258/1.003945*1)

Expected rate of appreciation for USD at the time of Delivery=

=0.3586% Thus, she is going to receive the dollars and the dollars is going to be appreciated so she will get more units of their home currency due to home currency is going to weak and dollar is going to up by 0.3586%, So, she needs to take any forward hedging strategy.

Forward hedging strategy is required when she feels that the home is going to be strong which results in she will get less number units of home currency when home currency is strong ,so she can short sell dollars by putting 45 days time.

(c) Factors that Determine the Foreign Exchange Rate and Link to Financial Markets

The definition of foreign exchange is a rate at which a country’s currency is converted into another country’s currency. The foreign exchange rates provide an overview of the country’s economic stability so it's important to be constantly monitored and analyzed. Several factors influence the exchange rates between countries. An expectation that the demand for a particular currency will increase cause a rise in the exchange rate. A country such as the US that has stable economic performance draw investment from other countries. The financial market thus influences the foreign exchange rate through changes in the investment to a given stock exchange market. The terms of trade also affect foreign exchange rates. The measures for the balance of payment, which shows an increase in export value over imports improve the terms of trade. The rise in revenue for exports increases the demand for a currency; hence, appreciation of the exchange rate. Public debts and deficits are not attractive to foreign investors and thus affect the foreign exchange rates (Engel, 2016). The primary link to the financial market is the influence on foreign investment decisions. The investment decisions are the key indicator of the changes in these factors. The foreign exchange rate determinants are directly linked to country economic performance and as such, enhance market equilibrium.

References

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