Essay on The Globalization of Markets

Words: 6989
Pages: 28

The globalization of markets
Theodore Levitt

The worldwide success of a growing list of products that have become household names is evidence that consumers the world over, despite deep-rooted cultural differences, are becoming more and more alike - or, as the author puts it, "homogenized." In consequence, he contends, the traditional MNC's strategy of tailoring its products to the needs of multiple markets may put it at a severe disadvantage vis-a-vis competitors who apply marketing imagination to the task of developing advanced, functional, reliable standardized products, at the right price, on a global scale. A powerful force drives the world toward a converging commonality, and that force is technology. It has proletarianized
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"High-touch" products are as ubiquitous as high-tech. Starting from opposing sides, the high-tech and the high-touch ends of the commercial spectrum gradually consume the undistributed middle in their cosmopolitan orbit. No one is exempt and nothing can stop the process. Everywhere everything gets more and more like everything else as the world's preference structure is relentlessly homogenized. Consider the cases of Coca-Cola and PepsiCola, which are globally standardized products sold everywhere and welcomed by everyone. Both successfully cross multitudes of national, regional and ethnic taste buds trained to a variety of deeply ingrained local preferences of taste, flavor, consistency, effervescence and aftertaste. Everywhere both sell well. Cigarettes, too, especially American-made, yearly make global inroads on territories previously held in the firm grip of other, mostly local, blends. These are not exceptional examples. (Indeed, their global reach would be even greater were it not for artificial trade barriers.) They

exemplify a general drift toward the homogenization of the world and how companies distribute,financeand price products. ^ Nothing is exempt. The products and methods of the industrialized world play a single tune for all the world, and all the world eagerly dances to it. Ancient differences in national tastes or modes of doing business disappear. The commonality of preference leads inescapably to the standardization