Advantages and Disadvantages of Global Sales Marketing
Clarke Ricks School of Business,
Liberty University
BUSI 690: Policy and Strategy in Global Competition
Dr. Hicks
April 30, 2022
Advantages and Disadvantages of Global Sales Marketing
Working in the worldwide market is the chance to grow and develop for many companies.
However, you should understand both the positive and negative peculiarities of international
business processes to manage sales successfully. Firstly, take a look at the advantages of global
marketing.
1. You can reach a wider audience. If your company grows constantly, you can find out
that there are few consumers in the country to increase your revenue. This is the time to start
product promotion abroad. Global marketing allows you to sell more products, attract more
customers and enlarge your market share in different countries.
2. Your brand influence will increase. Building a well-known brand's reputation gives you
a powerful competitive advantage in local markets of different countries. Moreover, by
adopting your advertisements to the peculiarities of each culture, you can make the audience
more loyal to your company. Brands with a strong reputation, like Coca-Cola or Nike, can
influence not only consumers' purchases but their worldview and lifestyle.
3. You can reduce costs on product development. Working with the global market means
attaining the economy of scale that helps you avoid overspending, particularly on shipping raw
materials. Also, you can locate your plants or factories in the countries with loyal taxation
policies to save company's money. Global marketing allows businesses to sell worldwide and
reduce spending on raw materials by standardizing.
4. Your company can get much more feedback. This fact will influence the speed of your
growth directly. Knowledge of your brand’s weaknesses and problems in markets of different
countries means the possibility to improve them much faster. Global marketing can help you
gain feedback worldwide in a few clicks, especially by using social media advertising and email
marketing.
5. Local crises will not influence your company so much. If you are focused on the market
of a certain country, its economic or legislative problems may mean the end for your business.
However, diversifying risks will help you make this influence not so crucial. Sometimes, conflicts
with political organizations or competitors do not let companies succeed in the local arena.
Working with global markets allows businesses to avoid these problems or reduce their
influence.
Now you understand the advantages of selling to international consumers. Let's take a look
at the disadvantages of global marketing.
1. It can be difficult to overcome cultural barriers. Adopting your promotion strategy to
the global market means satisfying audiences with different cultural backgrounds. For example,
McDonald’s had to change their standard recipe and replace beef with vegetarian cutlets in all
their burgers in India because of the national values. If you want to succeed in a foreign market,
it is essential to deeply understand people's cultures and privileged consumer behavior types.
Some companies may not be so flexible, and it will be a roadblock to their product's promotion
in the global market.
2. Your company should adapt to the legislation of foreign countries. It can be costly and
risky to start working without understanding the laws and taxations of the new markets.
Sometimes businesses need lawyers’ help to make their start abroad smoother and avoid fines.
This process may be time-consuming, but it is necessary before launching the promotional
campaign.
3. It may be difficult to avoid overspending on buying raw materials. If you start working
with foreign markets without proper research, the inventory costs can increase significantly.
Firstly, it may be challenging to find the balance between supply and demand because the
results of your promotional campaigns will not be the same as in your country. Secondly, if you
start working with local suppliers, finding the cheapest resources in the area requires time to
save your costs.
Now you understand all the benefits and roadblocks of global marketing. In the next
section, we provide 3 strategies to promote your products worldwide successfully.
3 Global Marketing Strategies
While starting work with global markets, business owners face many difficulties with
product development and promotion. In this section, we explain the difference between two
approaches to global marketing and provide three widespread strategies to achieve success in
the international market.
Firstly, let us take a look at the approaches to doing business while working abroad. These
two types depend on how centralized product development is.
International approach involves product import and export. Usually, a company's
offices and plants are located in a home country while its products are sold worldwide. It allows
businesses to have centralized management and make changes in their products faster.
Multinational approach means that the company's offices and plants are located in a
few countries you work with. In such a way, businesses diversify risks and adapt their products
to different markets. Marketing strategy, pricing policy, and product line may vary too.
Now take a look at three main strategies of global marketing. They are more focused on the
product variety in different countries, not on the location of the company’s capacity.
1. Standardization. This strategy means that the product line, marketing, pricing, and
other elements are standardized in different countries. Top managers make the most important
decisions in the main office and there is little independence in local markets. This strategy
allows companies to save costs on raw materials by standardizing the production process. Also,
there are fewer investments needed to develop a product marketing strategy because it is the
same in all markets. The most well-known examples of companies with this strategy are Coca-
Cola, McDonald’s, and Apple.
2. Diversification. This strategy gives more freedom to the local offices and is often based
on the multinational approach. It means that the company may have completely different
products all over the world that can be united under the one brand’s name and logo. Such a
strategy allows businesses to diversify risks and develop the business in completely new areas.
Companies use it when there is a significant difference between the markets they work with.
The most famous example is Nokia which produced household appliances, mobile phones,
paper products, and many other things at certain times of its existence.
3. Segmentation. This strategy means that the company chooses a certain segment of the
audience to work with and produces only products for this segment in all countries. Marketing,
pricing policy, and product line can vary, but there is often a piece of standardization. It is the
most flexible strategy that gives some independence to international offices but allows to
incorporate the best company’s organizational decisions.
