The advantages / disadvantages of standardized international marketing
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Standardization is the process by which a company makes it methods, especially its production processes, uniform/identical throughout its organization. Whereas for adaptation, a company would change their methods such as the price, promotion, packaging and/or the product itself in order to fit the needs and preferences of the market or a particular country. Adaptation occurs when any element of the marketing strategy is modified to achieve a competitive advantage when entering a foreign market. The advantages of standardization is the consistency of the product throughout the world and the cost savings from having identical the product. Standardization helps cut costs when the company produce the same products and reuse the established marketing and distribution systems where the company gets economies of scare benefits in production and buying. It also helps improve communication and performance.
The advantages of standardization is that it helps cuts costs by lowering installation costs, reducing need to maintain large inventories, and lowering maintenance costs thus also allows a company to take advantage of economies of scale when purchasing supplies. It helps improve the management and design with less customization needed, enabling interchangeability of components, and provides practical application of expert knowledge enhancing operability and improves performance. Standardization helps to building the product image. The simplicity aspect, of a similar quality standard and cost for a product, attracts consumer interest. The ability to identify itself with similar characteristics regardless of where the consumer is helps create a positive image of the product and attract customer loyalty.
Additionally, the positive review by customers is beneficial for your product as they can easily market the product’s customized qualities through word of mouth. Improved quality also the advantages of the standardization. A business that supplies a standardized product has a high potential for producing good quality products since the production operations concentrate on one product. The business also has the opportunity to research on techniques to input on the product to increase its quality standards and improve the consumer base. The enterprise can easily identify the statistics of the product’s popularity in the market and the factors contributing to its decline and success in the market thus allowing it to look for the most suitable strategy to rectify any negative feedback.
Since the product is the same wherever you buy it, it is wholly undifferentiated. It is not unique in anyway. This leaves the obvious opportunity for a competitor to design a tailor-made, differentiated or branded product that meets the needs of local segments. Of course products have different uses in different countries (for example cycling is a leisure activity in some nations, and a form of transport in others). Local markets have local needs and tastes. Therefore by standardizing, you could leave yourself vulnerable. The disadvantage of standardization is the loss of uniqueness. If a company builds up a customer base that serves a specialized market, standardizing its processes may mean it loses some of its former customers. Another disadvantage is the loss of responsiveness where when a company expands into a new market, there may be cultural differences which lead to different taste and likings of the market. In additionally, loss of responsiveness also the disadvantage of the standardization.
When a company expands into new markets, especially in foreign markets, standardization may work against the firm. While it may be cheaper for a restaurant to buy its trademark hamburgers in bulk, if it expands into a new market where people buy chicken much more often, its standardization measures may make it slower to respond to market conditions and end up costing money. Besides that, Standardization product unsuited to some aspects of business. Standardization may be advantageous in some areas of business, such as production, but some aspects of a business should be tailored to the customers’ needs.
Customer service, advertising, distribution and product pricing must be driven by local market conditions to be successful. Stifles creativity and response time is the disadvantage of the standardization. Standardization has the potential to get a business into a rut. Standards, once implemented, soon become the status quo and may become entrenched in the corporate culture, making them hard to change when change is needed. However, market conditions often change, and companies that change quickly are best positioned to take advantage of them. Standardization may also stifle creativity, particularly in product design.