Competition in an industry presents itself in various ways. Thus, a company should always seek a means of gaining a competitive advantage over its competitors. Michael Porter’s industry analysis approach is a useful mechanism of ascertaining where the power in a market lies. In the lead industry, there are several companies producing lead products which mean that the competition is high. Rivalry within the industry is high because of the high rate of substitution within the industry.
The threat of substitution, according to Michael Porter, regards a situation where the clients of a company can get a similar product that fulfills a similar need from a different source at comparatively lower prices (Yeonshin et al., 2016). That means that the customer base of the organization will be affected. The threat of substitution increases because the product is also imported by other companies which render the competition even stiffer.
Gaining a competitive advantage against the competition requires that Swansea TV embraces a new marketing strategy and that is digital marketing. The use of this mechanism will increase the company’s ability to connect to more clientele which will increase the customer base of the organization. The following are mechanisms that Swansea will use to gain traffic over the Internet:
Referral traffic
Persuading other websites to connect to Swansea TV website is costly and time-consuming. For example, some will demand remuneration for creating traffic while some may not agree. Averting this situation is possible through the use of referral traffic. That can be done by creating website content that is good to the extent that other sites seek linkage from the Swansea TV website (Barry et al., 2015).
An instance can be traced back to the Google’s Panda update regarding the kick in the proverbial teeth. The content was attractive so much that eBay was willing to purchase. Having attractive content on the website will require prolific content writers who are creative and innovative.
Implementation of schema micro data
Corredoira and Sood (2015) define schema markup as a code or semantic vocabulary put on a website with the purpose of helping search engines provide much more informative outcomes. Therefore, the schema can tell the search engine the meaning of the data on a website and not just what it says. For the users, this is helpful while they search the internet. For Swansea TV, this will be extremely helpful in ensuring that the website is among the first options that come when someone searches for related content.
Digital marketing:Email marketing
Critchlow et al. (2016) describe email marketing as a direct marketing form involving the use of electronic mail as a medium of disseminating fundraising or commercial messages to a specific audience. Swansea TV can seek to use this mechanism as it is one of the simplest digital marketing tools to employ. It is also less costly, and the fact that it is a direct means of reaching out implies that it has great potential of directing traffic to the company’s website.
It entails crafting a message to the potential clients of the organization driving them towards the Swansea TV company website (Summers, Smith and Walker, 2016). That means that the message will advertise the competitive prices of the company’s products as a basis of attracting the clients.
Conversion tracking
This is a tool whose purpose is to show the events that take place once a customer clicks on an advertisement (Xia and Pedraza-Jiménez, 2015). That is, it informs the owner if the customer signed up for the business newsletter, downloaded the app, called the business call center or even if they purchased the product. Swansea TV will utilize the server to server tracking method which stores the tracking information on the servers instead of using cookies. The need of a conversion approach is to evaluate the success of the digital marketing approaches that will be used.
References
Barry, A. E., Johnson, E., Rabre, A., Darville, G., Donovan, K. M., & Efunbumi, O. (2015). Underage Access to Online Alcohol Marketing Content: A YouTube Case Study. Alcohol & Alcoholism, 50(1), 89-94.
Corredoira, L., & Sood, S. (2015). MEETING NEW READERS IN THE TRANSITION TO DIGITAL NEWSPAPERS: LESSONS FROM THE ENTERTAINMENT INDUSTRY. El Profesional De La Información, 24(2), 138-148. doi:10.3145/epi.2015.mar.07
SUMMERS, C. A., SMITH, R. W., & WALKER RECZEK, R. (2016). An Audience of One: Behaviorally Targeted Ads as Implied Social Labels. Journal Of Consumer Research, 43(1), 156-178. doi:10.1093/jcr/ucw012
Xia, H., & Pedraza-Jiménez, R. (2015). CHINESE SOCIAL MEDIA STRATEGIES: COMMUNICATION KEY FEATURES FROM A BUSINESS PERSPECTIVE. El Profesional De La Información, 24(2), 200-209. doi:10.3145/epi.2015.mar.14
YEONSHIN, K., SANGDO, O., SUKKI, Y., & HWASHIN HYUN, S. (2016). CLOSING THE GREEN GAP: THE IMPACT OF ENVIRONMENTAL COMMITMENT AND ADVERTISING BELIEVABILITY. Social Behavior & Personality: An International Journal, 44(2), 339-351. doi:10.2224/sbp.2016.44.2.339
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PANDORA is global fashion jewelry from Denmark. It has at least ten thousand retailers in the international market. It reflects in its stable brand loyalty from its customers. The PANDORA brand is unique and of high quality. It has made PANDORA get the brand awareness regarding marketing. In the year 2015, as it was disclosed on 2012 financial reports, three hundred and seventy-five PANDORA concepts stores were opened. Opening more stores aimed to create PANDORA brand image.
Hence, they were keen to visual effects of showcase so as to attract the target customers in sensitivity manner and motivate them to minimize the decision-making steps and purchase it as soon as possible, (Bucuta, and Balgaradean, 2016). Due to their lower pricing, fast fashion trends, friendly and relaxed customer services in their stores make customer’s decision making simple and improve the trust for the management.
PANDORA have benefited from fast fashion, flexible strategies, renewal of goods which make it simple for the customers to believe their perceived risk so as to have product involvement highly when making informed decisions, (Howeidi, and Nguyen, 2016). PANDORA has more than a thousand products that satisfy the individual expression. Their brand does express personality.
For example; their essence bracelet is assumed to bring different inspiration or wishes. On every festive season or holiday, PANDORA will come up with new products that are related to the gift giving, holiday and cultural value in ritual ways to cover on grooming, (Anca, and Cristina-Maria, 2016). It makes people relate to reality and loves the brand of PANDORA.
In Europe, PANDORA recorded a twenty-eight percent revenue growth. The primary market that contributed in large part to this was the United Kingdom. The revenue of Pandora in the United Kingdom rose by seven percent through the second quarter of this fiscal year. The income was heightened by an opening of seven subsidiaries concepts stores which brought the number of the PANDORA concept stores to two hundred and nine.
Andersen stated that “these are another set of fantastic which we are all incredibly proud of- to be a presence in every major UK town and city is a phenomenal achievement.” Additionally, he proceeded by saying that “After eight years at Pandora, it has been both challenging and immensely rewarding, watching the brand grow and resonate so well with women of all ages.”I am delighted with the progress the brand has made in the UK, in particular in such a competitive industry and on what is widely considered a tough high street to crack.”
The company had a steady momentum in Europe where they recorded a 28% increase in sales revenue. Among the 28%, the United Kingdom contributed a half of the growth of income. The high momentum was fostered by three factors that influence consumer behavior, and they are Motivation, Perception, and Identity, (http%3A%2F%2Fwww.retailgazette.co.uk%2Fblog%2F2016%2F08%2Fpandoras-uk-sales-account-for-a-quarter-of-companys-emea-region-growth&usg)
Motivation
Consumer motivation is the force to satisfy wants and both psychological and physiological during the acquisition of products and services. PANDORA recognized motivation as a compelling and impelling force that is required in its concepts stores. To understand how motivation applies it’s important to comprehend three behavioral models and foresee on how customers will act to them, (Grunert, Hieke, and Wills, 2014)
First is the Maslow’s Hierarchy of Needs. Abraham Maslow describes personal development through satisfaction and identification of the hierarchy of needs from basic needs to complex psychological needs, (Anderson, 2014). Maslow suggested that these motivating drives work more or less one after the other. If one level is entirely or partially met, there is always hunger to next level and the feeling is more intensely. PANDORA used the Maslow’s hierarchy comprehensively to comprehend what motivates their target customers and how the motivation can be utilized in a broader variety of ways to clients and individuals across the globe.
Secondly is the Dichter’s Major Consumption Motives. It was established in 1950 where Dichter on behalf of Procter and Gamble conducted research on customers’ demands that motivates the buying of the Ivory Soap, (Ahn, Duan, and Mela, 2013). He deduced that “bathing as a cleansing ritual has a symbolic appeal among consumers, signifying purification from the taints of the world.”
From the research, Dichter steered the growth of a tremendously winning advertising campaign. According to Dichter, the consumption of goods is determined by twelve vital motives which are security, eroticism, power-masculinity virility, individuality, social acceptance, moral purity, magic mastery, and social connectedness, mastery over the environment, femininity, and status.
Lastly is the Sheth’s Consumer Motives. The incentives were developed to foresee customer’s decisions. Although it was meant for traveling decisions, Sheth’s model also applies to other goods and services. Sheth secluded five dimensions of motivation, each leaning to an attainment of particular goals, (Wind, Thomas, and Sheth, 2014). Also, the functional motive entails the utility of goods or services or the work it performs.
Besides, the emotional motive is attained by the attractiveness or appearance of a good or service. Furthermore, the social motive is revealed in the esteem or status value of a good or service. Additionally, the situational motive is activated by unforeseen advantages of a good or services and lastly the curiosity motive which is simply the concern aroused by a good or a service.
PANDORA has used the Sheth’s models to foresee the brand choices by customers. Various brands, for example, the ones with charms are associated with the emotional motives. It gives the customer the power to decide what kind of a meaning their jewelry possesses and they make them buy or not to buy. The choice of PANDORA brand whether golden or silver or silk is associated with functional and social motives.
By comprehending the customer’s motivation, PANDORA can better target products and services to attain the demands of particular market segments such as the United Kingdom. For example, PANDORA can advertise about the charm jewelry that has meaning of given personalities and incidences, pleasing the demand of the traditional or older customers who used to purchase jewelry with no meaning at all.
Perception
Consumer perception measures the growth of perception through various variables and recognizes those factors that influence the buying decision of the customer. Customer usage and purchasing of any good depend on with their perception towards the goods, (Font, and Guerrero, 2014). Perception is widely developed regarding how effectively and efficiently a product has been marketed or advertised.
PANDORA has employed all its hard work in marketing so that to acquire or attain the consumer’s attention and the positive feeling on the consumer’s thoughts. The customer perception can be well recognized by the taste and preference of the good, color, and shape, (Tieman, Ghazali, and Van Der Vorst, 2013)
There are several physical factors that affect perception. Those are a mode of payment, availability, regular supply of product, accessibility, durability and quality, (Fall Diallo, Chandon, Cliquet, and Philippe, 2013). Product quality is categorized into two. First is the perfect quality and second is the expected quality. The special quality contains the real benefits attained from the buying of the product. On the contrary, the apparent quality contains the customer expectations from the goods.
At first, the perception qualities of the good of PANDORA were weighed as customer’s perception of the quality of good offered by Denmark. Researchers and scholars argue that expectations, country of origin and perception fosters to cognitions. It also puts importance on specific goods and marketing characteristics. These were regarded as the factors that drove customers to marketplace or the concept store where the jewelry was marketed or sold.
Price determines the purchasing power of the customer. Normally, a price is regarded as the primary determinant of the customer’s brand choice when selecting a good or service. It is comprehended that when a customer is experiencing a purchasing decision for good buying, then the consumer is more concerned about the prices of the goods and scrutinize prices keenly, (Jin, He, and Zhang, 2014).
The pricing strategy assists the consumers to maximize direct utility that they possess from the buying. On the contrary, when the customer come into contact with PANDORA brand that has fluctuating prices and apparent quality levels, the consumer will have to make the informed decision about the favorite they make on the ground of characteristics of the goods.
Customer favorite of good features differs according to the nature of the product as well as its economic and social nature of consumer. Goods characteristics are frequently eye-catching in nature. The characteristics model that was proposed by the Gwin and Gwin in two thousand and three posits that customer preference of good is based on maximizing their utility from the goods attributes subject to the financial shortage.
Some scholars argued that customer services and store images stimulated the consumer store choices and at the same time, location and parking facilities always have a negative effect on the consumer choice. On the case of PANDORA, the two hundred and nine concepts stores are strategically relocated, and they offer incredible customer services like free delivery of the jewelry. The consumer perception of store pictures and the characteristics pressured by types of goods, formats, shopping need and cultural value explains the store nature, parking facilities, place, kindliness of staffs are among the factors that pressure the customer’s choice of stores, (Claiborne, and Sirgy, 2015).
From the record, PANDORA added seven concept stores in the United Kingdom bringing the number to two hundred and nine. It means that PANDORA has offered or provided their customers will all basic needs that affect the choice of stores. The effect of store setting such as the eye-catching shelf, incredible services activities and facilities attract more customers to purchase more.
Store images are an important factor in store loyalty and store alternative. The perception towards stores is established significantly by visual attributes of a store such as a distance of store from home, size, and intangible factors such as the atmosphere of the store.
Although the store picture has been comprehensively analyzed all over the globe, there is a lot to be analyzed for the developing retail nature where consumers, as well as the store owners, are in solid phase and different and large retail formats by the prearranged retailers being moved out. What might build the high image and what forces the choice of a store in the long-term is the myth. The PANDORA new stores have the capacity to attract more customers into the stores because of their notions.
Identity
Identity construction is a significant improving sector in consumption theory. Description of how the customer makes choices among goods and services assist in describing the connection between the consumption and identity. The demand concept proposes that customers should select the goods which offer them maximum utility for their disposable income they possess where their utility is the pleasure of consuming the product, (McAlexander, Dufault, Martin, and Schouten, 2014).
An option to this perspective is that customers select goods which are closely equivalent to their aspired or popular personalities. The post-modern theorists like the Sartre would recommend that possession is significant to identifying who we are and offering a sense of being, (Hatch, and Cunliffe, 2013). Customers might select goods based upon their valued but offered multiple choices in the concepts stores; they may still choose the same product since it fits their personality.
For example, if a customer is to choose a PANDORA charm bracelet over A PANDORA jewelry with no charm, given another chance will still choose the PANDORA bracelet with charm since it warms his or her personality. Scholars argue that selecting goods is relatively simple since one thing is likely to strike us “symbolically more harmonious with our goals, feelings, and self-definitions than other.” The choice of goods and services offers the customers a chance to express their originality and act a way of communicating with others.
In the United Kingdom, there is so much relative wealth and choice. It makes it almost not surprising that consumption and shopping are the major leisure acts. Researchers suggest that culture and society are very significance to identity and consumption of products and services.
The detection of consumers’ identity building is significant for the retailers. It enables them to advertise to the right individuals at the right time while targeting their market group. It can only be achieved through close monitoring of the retail shopping behaviors, (Thompson, 2014). Inducements such as the loyalty cards can be used to gather data on consumption habit and attempt to recognize potentially loyal customers and profitable customers.
Additional processed data entailing the demographic, socio-economic and geographical data such as marital status, income bracket, postcode, age, and gender can be used to analyze the customers. For example, PANDORA target customers are women of all ages. They have products that suit the taste and preference of each woman no matter their age.
Identity is transformed through consumption. It is argued that the significance of the b body image to the self-theory regarding an evaluation of size and attractiveness and perception is mostly drastic and symbolic, (Tuškej, Golob, and Podnar, 2013). PANDORA focuses mainly on young population. It is because young people are more into consumption and identity. The goods they buy frequently have stable and strong representation as well as the social work.
The information about the PANDORA brand is used to build an identity based on the understanding of the “consumption ideals prevalent in popular culture.” It is believed that with time and culture changes, the identity is expected to adjust.
The connection between identity and consumption activities are described through the consumption the significance of possession, various selves, group identities and consumption concepts. Consumption choices assist in describing the identities of both the group and people either at unconscious or conscious level, (Ekinci, Sirakaya-Turk, and Preciado, 2013).Equally, an identity by itself may pressure the consumption behaviors.
Even if the relationship between identity and consumption might be controversial, it is motivating to consider the reason as to why we purchase goods and services over the others. The frequent asked questions whether they provide greater utility or not or are they cheaper or do they imitate our personalities? With the question above, PANDORA has been able to provide answers to their customers making them want to purchase more and more product from their concepts stores.
Conclusion
Conclusively, the three factors which are motivation, perception and identity have helped PANDORA to increase its sale revenue in the second quarter by 28%. PANDORA marketing strategy has been comprehensively effective because after analyzing their target market and population, they established a structure and mechanism which they could use to attract more customers. For example, establishing the jewelry with charms led to many people purchasing the products because they believed that the message possessed by the jewelry reflects their personalities.
It motivated a lot of its customers to purchase the jewelry even though the sense of being never changed, (Solomon, Russell-Bennett, and Previte, 2013). Their marketing strategies changed customer’s perception on how they viewed the concepts stores. When customers recognized the jewelry with charms, they would purchase the product with different images or visual effects to portray a meaning. For example, since they targeted the young population, they introduced love jewelry.
If friends or couples purchase the love jewelry, it changed their perception of how they are affected by each other. Their personalities drove them to purchase more and more products. Lastly, the store images bring the sense of what goes inside the store. It creates the identity that every customer wants to be associated with. PANDORA concepts store are modernized, and most of them are of glass. It makes it clear for every person to view from outside what is sold inside.
Since identity is majored on group personalities and peers have different opinion about the PANDORA jewelry brand, it attracts the potential customers to purchase the products so that to be identified as part of the PANDORA loyalty customers. Due to these consumer behavior tactics by the PANDORA, it was able to record a sales revenue increase of twenty-eight percent as compared to other quarters in the year 2015.
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The use of polysemy, intertextuality, and symbolism in advertising
The use of polysemy, intertextuality, and symbolism in advertising
Introduction
Advertising has become the most powerful tool in marketing for business and organizations. It’s an essential factor in the creation of brand awareness and enhancing trust among the consumers of advertising products. It is the process of communicating with current customers and potential buyers about goods and services (Linda Carlson, 2007). Given that the primary objective of advertising is to make people aware of certain products within the market, different companies have various approaches to ensuring they make more profits through advertising and keep off competition (Skorupa and Dubovičienė, 2015; Hackley, 2010).
These firms, for instance, Coca-Cola, Snickers, and Heinz -use sophisticated strategies and theories of advertising to accomplish their goals. Looking at some of the multinational companies ads, it’s easy to discern the creativity used by directors in making the commercials. Some of the concepts used by these companies include polysemy, intertextuality, and symbolism. The three concepts – as seen in some of Coca-Cola, Heinz, and Snickers advertisements and they offer strategic ways for the firms to ensure people relate well to the message put across in a simple way.
Advertising and polysemy
Advertisers and media practitioners have expressed difficulty in the interpretation of advertisement messages (Mark Ritson,Stepano, & Jonathan, 2010). More so, the current trends in advertising have focused on the ever-growing role of metaphors and its complexity. While the creators of advertisements have one or two messages to all the audiences, different people perceive the information differently (Hackley, 2010).
The perception of the adverts is associated with people’s beliefs, ideas, indoctrination, and attitudes. Polysemy refers to the presence of varying interpretations of the same advertisement message by the recipients. While advertising meaning refers to the decoding of a commercial that is influenced by the consumer’s culture, polysemy here implies the existence of more than two interpretations in the same advertisement by different audiences over time.
It simply means that two people can consume the same advert and get varying understanding of the message put across. It is, therefore, paramount that companies understand the concept of polysemy in advertising to ensure their advertising objectives have been well understood.
The Coca-Cola “Taste the feeling” commercial is a good example of advertisements that may bring both synchronic and diachronic polysemy’s in interpretation of the meaning. The advert begins with a bottle of Coke which is already full of the product and more coke is being poured until it overfills. There is no narration but a smooth, relaxing song by Swedish musician Avicii. We are then shown a scene of a lady with the bicycle helmet and eyeglasses.
She looks happy and gives her viewers a smile while sipping coke using a straw. After the drink, she looks even more energetic and starts playing with snowflakes. The interpretation here is that drinking coke makes one happy and lively. Other scenes from the advertisement follow, and one can see visuals of two young ladies sharing a coke, and immediately after they start smiling. One can also see happy- looking girls taking a ‘selfie’ after drinking coke.
The advert takes the viewers to a beach where a man and a woman are carrying a basket full of Coke filled bottles. Additionally, there is a scene of two people, a lady and a gentleman, who are seen taking a product from the same bottle using straws. Shortly after sharing the drink, they look directly at each other in an intimate manner. It appears they are going to kiss but the video changes to a different a scene.
Towards the end, viewers can see a well-dressed man using a mobile phone and holding a bottle of Coke in his left hand-likely waiting for someone. It’s then that a lady comes, and the scene again changes to a love-making part. This time the woman making love to the man is holding a bottle of coke. The last scenes are filed with happy looking people; the lady on the beach and another scene where people are dancing after taking the coke drink.
The Coca-Cola Anthem advertisement, used with the “Taste the Feeling Slogan,” has multiple interpretations, both synchronic and diachronic. At, first, one would believe that Coca-Cola product makes the consumer energetic, lively and happy. In another form of understanding, one would believe taking the drink makes the consumer active in love making.
Also, the two interpretations can occur between two different individuals, resulting to a synchronic polysemy. One can also interpret that the benefit of drinking coke is enhancing a lively and happy mood, but after watching the commercial several times, one might infer that the drink enhances love making, resulting to a diachronic polysemy.
Advertisers can intentionally use polysemy commercials to appeal to different audiences. Due to the fact that levels of understanding are influenced by variables such as beliefs, geographical location, social, and economic aspects, viewers will tend to interpret adverts differently.
The Snicker advertisements “You are not you when Hungry” is set in the ancient Chinese context, but with characters who look modern like Mr. Bean. The story in the advert is that of Mr. Bean in the company of Chinese Martial artists who appears to be intruding a highly guarded compound at night. Mr. Beans give the impression that he is a foreigner, and the skills of martial arts do not go well with him. While running on rooftops, he regularly falls and almost makes the team get caught.
After a failed jump from one roof top to the other, he accidentally lands down on the enemy’s chamber. Its then that he gets a snicker to eat. The advert ends by saying that “you lose focus when you are hungry.” So it seems that eating snickers makes one to be more focused. This is the basic and the most common interpretation of the Snicker commercial, but other interpretation can be seen. For a Chinese brought up into the culture of martial arts, the interpretation is that Snickers makes one an accomplished martial artists.
According to Punton (2006), consumers of advertisement usually read things that never existed and that were not intended by the creators of the commercials. However, there is a standard interpretation in the market shared by all people, although modern day commercials will always possess difficult rhetorical devices. Also, all forms of commercials encompass polysemy concept. Polysemy can either be synchronic or diachronic. The former refers to advertising that happens to two audiences at a certain point in time.
As such, the intended meaning is interpreted differently by different consumers. This is usually the case when the audiences have varying cultural backgrounds and beliefs. The latter, on the other hand refers to polysemy that occurs within an individual. The audience may have varying interpretations of the same commercial. The consumer sees the advert firsthand and then tries to decode the meaning, but with time and after watching the advert several times, other interpretations begin to emerge. Both synchronic and diachronic polysemy’s are critical in determining the success of an advert.
The HEINZ Ketchup, “Game Day 2016” hot dog commercial is extremely difficult to decipher. Dogs are seen running towards a team of men and women. The animals have loads of sack, and they seem to be in a competition. The individuals who stand to wait for the dogs in a finish line, have clothes labeled Heinz.
It’s not possible to tell whether the dogs are running to the people who have Heinz labels, or they are just competing in a race. One meaning is that Heinz Ketchup motivates people do compete favorably. Another possible interpretation is that the HEINZ product makes collaboration much easier by triggering a good feeling. The dogs are running together, and people are waiting to embrace them.
Use of Intertextuality
Advertisers have a way of engaging consumers through the application of intertextuality. Intertextuality is an important and very useful technique in advertising that involves a combination of quotations, parody and sometimes allusion. According to Liu and Thao (2013), intertextuality “is a network of textual relation.” Jinxia (2014) defines this concept in advertising as the relations that exist between texts. It refers to how one text depends on each other.
In other words, it explains how different texts in a piece of art refer relate with each other in deciphering a message. To make advertisements effective and for the readers to grasp the meaning, Jinxia notes that “Intertextuality connection in advertising language is important to make an advertisement easy-accepted and understood by the consumers.” The three aspects of intertextuality advertising, parody, allusion, and quotations, are traditional elements of intertextuality.
Citation, parody, and allusion make the consumers relate the texts given with previous ones (Withalm, 2003). Not only do they impress the viewers, but also grab the attention of the audience. The purpose of any advertisement is to persuade the consumers of the commercials into buying the product. This cannot be achieved without relating the advert and the audience in a good manner.
More so, the advertisers always seek to arouse people’s desire for the product promoting attention. This concentration value is made possible through intertextuality, where the consumers can relate certain aspects of the advertisements to their daily environmental conditions (Karlsson, 2007). This, in the long run, ensures that the audience remembers the advertisements. Most advertisements usually contain memes such as idioms, phrases, songs and other works that the consumers can relate to.
In the Snicker advertisement that features Mr. Bean’s, the characters seem to possess martial artistry. For an Asian audience, the advertisement uses the culture of Chinese martial arts to impress Asian audience. For a person outside China who does know of martial arts, the advert may look impossible to relate with. However, any Chinese person will always remember the commercial as it appeals to their way of living.
“Brotherly love business”- part of Coca-Cola global ‘Taste the Feeling’ campaign uses a version of Avicii song “Hey Brother.” To people who love Avicii songs, they will more likely relate with the advertisement and end up remembering the commercial. The theme of the initial Avicii “Hey Brother” is about love among family members, and especially the one between two brothers.
The song is calling for brothers to believe in their families, as “blood is thicker than water.” Likewise, the commercial by Coca-Cola depicts a brother who is being protected from bullies by his brother. The lyrics of the song used in the advertisement are also inter-texts of Avicii “Hey Brother Song.” The concept of using two related works in ads makes it easier for the advertisers to achieve their intended objectives; creation of a memorable and easy to remember advert.
Symbolism usage in ad commercials
Advertisers convey complex meanings by the use of symbols (Homes, 2008). Most of these symbols are visuals and they are usually are polysemy in nature. They therefore have the potential of inferring different messages to the consumers. While some are easy to interpret, others will require a comprehensive analysis (Percyand Elliott, 2009). Companies and organizations use logos as a way of branding. Symbols are things used to represent other things. They are signs and fall under the broad topic of semiotics (Holmes 2008).
In his book, “Fallibilism, Continuity, and Evolution” Pierce referred to semiotics as the analysis of the structures of meaning in verbal and non-verbal forms (Akpan, 2013). One of the most fundamental components of semiotics, according to Holmes (2008), is a sign. While a sign stands for something else, it is usually connected to an idea that it represents. This concept of the sign is interpreted by the person consuming the artwork and the sign, the object it represents, and the interpreter.
Some symbols are just simple logo-types like Coca-Cola and Siemens while others are complex like Subaru car manufacturers. The Subaru logo seen in most of the firm’s adverts contains six stars, with one bigger than the rest. The meaning of the stars requires an understanding of Japanese culture, and it’s difficult just to look at the logo for the first time and decrypt the meaning.
The stars are also symbolic. In astronomy and Japanese belief systems, there is a cluster of seven stars in the sky that is made up of seven sister stars. They are the nearest to the earth, and one of the seven stars is invisible. The Subaru logo, therefore, has seven stars, but visually there are six since one is invisible.
There are three categories of signs, icons, index and symbols. An icon represents an object by virtue of the features it has to the object. This includes a curved a drawing of stones falling to warn people that the area has stones that fall. An index sign, on the other hand, shows the connection that exists between the object and the sign. An example of index sign is smoke that is used to represent fire.
Finally, symbolism sign represents an object with the acceptance that the individual’s beliefs portrayed in the object (Elliott, and Wattanasuwan, 1998.). One good example is the use of color to represent different ideas and agendas of the advertisers. Black represents darkness and evil, while red represents blood and danger. One of the most important types of symbols used in advertising is use of color to.
For a good advertisement, the symbols used must relate to the company’s brand (Meenaghan, 1995; Jenkins, 2008). The Coca-Cola’s “A Coke for Christmas” commercial uses a character dressed like Father Christmas to symbolize the period and event of Christian’s 25th celebrations of Jesus Christ. To the Christian audience, the colors, and dressing of the character relates to Christmas.
There are also Christmas trees, and people are seen preparing in a similar version for Christmas season. The meaning of these symbols used in advertising will transfer to a brand, and the consumers will therefore desire to purchase the goods and services hoping to experience some of the emotions communicated in the advertisements.
“The brotherly love advertisement” by Coca-Cola where an older brother always bullies the younger one is full of symbols. However, the signs are not easy to relate and interpret. The story is a conflict between two brothers, where one is using his physical attributes to harass the smaller one. In most of the scenes, the older brother is dressed in blue whereas the smaller one is in red outfits.
While the choice of the color of cloth may look unimportant when interpreting the advertisements, it’s good to understand that the branding color of coca cola is red. Consumers of the product are always aware that red is the brand color for Coca-Cola. On the other hand, a rival company, Pepsi, uses blue as its brand color. As such, the colors symbolizes lack of formality in society (Leigh, and Gabel, 1992)
It therefore seems that the creators of the advertisement had the unintended message by giving the older brother blue colors and letting the younger one have a red color. In reality, both Coca-Cola and Pepsi have been for years been in a conflict which is also similar to the one depicted in the advertisements. If this statement is the true, the colors used imply that Coca-Cola is a “well behaved” company, younger brother, while Pepsi is the bully.
Interestingly, towards the end, the older brother saves the boy from other bullies yet he had been harassing in the beginning of the advert. In this last scene, the color of the older brother’s cloths changes to red, while the three boys harassing the smaller one are dressed in blue. While the roles have changed and there is harmony, the idea of the conflict between Coca-Cola and Pepsi is still intact.
The antagonist in the advertisement is in blue which symbolizes Pepsi while the protagonist is in the red symbolizing Coca-Cola. Finally, the opponents are trying their best to steal the drink from the young boy. This expresses the concept that Coca-Cola rivals are always trying to steal the firm’s ideas and intelligence. The fact that the bottle of coke is worth fighting for, the young boy feels bad when it’s taken away from him, signifies the idea and belief that coca-cola is something worthy possessing.
Conclusion
The purpose of any advertisement commercial is to create more awareness about a product and therefore increase sales revenue. However, the messages being portrayed in the advertisements are subject to varying interpretation and consumers are likely to react differently. There are key variables that are determinants of how people perceive meaning, ranging from education, age, beliefs, location, and attitudes.
For this reason, advertisers are forced to use a combination of different strategic concepts to drive their point home and subsequently achieve their objectives (Jenkins, 2008). These strategies include polysemy, intertextuality, and symbolism. The three strategies are meant to give the audience an effective advert that is memorable, engaging and relates to their way of living. They are used with powerful audios, a visual and technical device to sell the commodities and relate with consumer’s cultural settings. How well companies make use of these advertising concepts serves as a critical determinant of how far the advertisement will go in winning people’s loyalty to a firm’s brands.
References
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The article Marketing’s Contributions to Society by Willkie and Moore (1999) is a farfetched reflection of the numerous impacts of marketing to the society. I find the authors presentation of the benefits of the aggregate marketing system and how it continues to benefit the society argumentative and convincing. The article is largely a celebration of some of the aspects of marketing field to the society.
The authors, Willkie and Moore present the benefits of marketing by discussing its contribution to the larger economic issues .They further examine some of arguments raised by critics of an aggregate marketing system. Three of the major issues that have widely been covered in the article are marketing and economic development, effects on consumers and impacts of unethical marketing activities.
However, the article does not delve much into the benefits of engaging in ethical marketing, but rather focuses on the general economic and social benefits of aggregate marketing system. Perhaps the greatest benefit a firm can accrue from ethical marketing activity is not only propelling the
aspect forward, but that it may never be entangled in a legal lawsuit or ethical dilemma that can lead to losses and unnecessary cover up expenses.
Marketing and economic development
Aggregate marketing system has largely benefited the area of economic development. The articles argue that marketing is an entrepreneur and an organizer of resources. Areas with increased population in marketing tend to have a higher Gross Domestic product. In support of this argument, Patterson (2012) note that on an average of £1 spent on advertising- a form of marketing- the UK economy gains £6. This implies that for £16 billion of UK advertising in 2011, £100 was generated for the UK economy.
Advertising in UK helps export more than £2 billion in addition to presenting a strong international recognition where the UK can export a wide range of goods and services. This type of marketing has successfully supported advertising sectors of the economy such as photography, film production, music and entertainment. Patterson states that there are over 550 000 people employed by advertising, or involved in creation and production of advertising (2012).
Through marketing practices such as advertising, businesses are able to deliver a wide range of innovative and high quality products and service that can help match buyers and sellers more efficiently. This allows business with novel ideas to succeed faster and in a unique manner (Binsardi and Ekwulugo, 2003). The revue generated form advertising provides help provide valuable services to consumer’s such as news, entertainment and travel information.
These services are highly beneficial to the economy as they support online and high street sales. Nonetheless, it’s insufficient to define the role of marketing in terms of advertising alone. The role is broader with a critical role in the making of key economical functions. It’s at the core of diferent cycles of competition and innovation.
The treatment of aggregate marketing economy, according to Willkie and Moore (1999) is a complex political context. Government policies help determine opportunities for the contribution of marketing to the society (Theorell, 1996). Governments will usually pursue five possibly contradictory goals: income distribution, price control, payments balance and fuller employment. In social terms, marketing must be ethical and embedded in the society’s culture.
However this can be difficulty where diferent cultures fail to synchronize with prevailing marketing systems. Certain consumer characteristics like handling of finance, saving, ethical orientation and persuasion must be learned for the marketing system to function well.
Marketing has a critical effect on the aggregate demand although so many business persons have not realized the full contribution of marketing to the wellbeing of the economy (Min and Mentzer, 2000). Kinnear (1994) argues the reason is that benefits are not seen in the classic macroeconomic equation. They fail to look into efficiencies and skills form wholesaling, retailing and logistics.
The aggregate supply depends on capital stock, labor, raw materials and technology. Willkie and Moore (1999) argue that if economists’ equation were to identify the effects autonomous consumption and the value of marketing efforts in the economic system would be clear. This would in the end stimulate interest in calibrating that magnitude of these conditions.
Both regional and national marketing are a powerful tool for economic development. When done properly, regional marketing has the potential to attract foreign and domestic investment through effective policies (Bordaskaya, 2012; Thorne and Ferrell, 2002.). The marketing will further lead to preservation and development of intellectual capacity through the development of science and education.
Other benefits range from creation of favorable conditions for the development of small and medium sized firms, enlarging of existing institutions for economic and social expansion. Additionally, marketing encourages increased production by organizing and operating networks for communication and exchange (Weerawardena, 2003).
The equalization of demand and supply occurs through transport, storage and price where a special connectivity joins different locales in larger market. This ensures there is a place to provide efficiencies of scale and reduce the price of goods and services for the consumers. With time, these will serve as springboard for marketing and entrepreneurs.
Contributions to Buyers from Specific Marketing Activities
The article agrees that there are numerous competing firms in the aggregate system at time that presents uncountable benefits to the society in parallel. To understand the scope of these benefits, the article starts by examining the concept of utility. Distributing series add more value to the economy than production, and elementary utility which refers to extraction of crops and raw materials is arguably beyond market purview.
Other form of utility results from operations where marketing activities contribute by supplying essential inputs to the production process and the provision of insights from the marketplace. Place utility on the other hand represents the value added by offering goods needed by the buyers while marketing utility contributes to time utility by preplanning, and promotion activities. This ensures customers obtain goods when they need them. The final utility is possession utility which is offered through marketing transactions and allows customers use goods for the right purpose.
Marketers have paid significant attention to the purchase process given that they benefit from payments of purchases. Yet, the benefits received by customers result from consumption. Interestingly, each usage occasion creates an opportunity for another delivery from the system. The consumers will get multiple benefits from single purchase since one product can present more than one benefit. For example, a car can not only provide transportation service, but also music entertainment or shelter when it’s raining.
Also, facilitation of transaction process is one of the most powerful aspects of the marketing system in any given society. This saves consumers time and effort while maximizing purchase opportunities. Some of these benefits include extended store hours, free parking, stocked shelves, displays ad smooth checkout. Process for buyers credit enables some of the expensive purchases to be realized which would have otherwise been delayed. The channels of distributions at entry point for new products and services.
Ethical aspects of marketing
It’s not easy to understand the numerous benefits and implications of marketing without looking at the interplay between the ethical and legal aspects of the sector. Although the article fails to sufficiently diagnose ethical marketing and its role in the society, there is a clear argument by the critics of an aggregate marketing system. Some of these practices noted by the Willkie and Moore (1999) include stress conformity and promotion of materialism.
Furthermore, marketing discourages participation in non-economic activities like arts while undermining family ties, altering socialization and the enabling the practice of manipulative persuasion. Additionally, aggregate marketing leads to creation of artificial needs and wants, causes depletion of resources through continued exploitation of resources (Caudill and Murphy, 2000).
To maintain their competitive advantage and maximize market presence, firms might be entangled in illegal and unethical practices. Harris (2001) notes that marketing is either part of the law, or subject to the law. Consumers should be concerned about marketing of products and how companies present information (Carrigan and, 2001; Shaw, and Shiu, 2003.).
How do oil producing firm’s influence environmental research that goes against increased carbon dioxide emission? What is the role of big pharmaceuticals in health related researches? Do alcohol manufactures have a hand in research that supports moderate alcohol consumption? Even if the article seemed to avoid this aspect of marketing, there is a need for consumers to question the morality of marketing practices noting that many firms are primarily driven by desire make more profit.
According to Friedman (2000), firms are plunged in a universe of relationships where there are many stakeholders. The emergence of global groups of stakeholders has further complicated the globalization scenario. The competition has seen companies rush to identify creative and workable solutions to create a competitive edge. Marketing ethics therefore becomes a prerequisite for running any type of activity in the market place.
Verhezen (2005) adds that the role of ethics in marketing has been understood using two approaches. The first states that business executives have a sole responsibility to increase the shareholders’ value. The article contends that ethical business activities are rewarding, suggesting that choosing to engage in ethical marketing can enhance shareholder wealth. Due to the sensitivity of ethics and its implications, governments have lately established strict regulation measures to protect consumers from unethical marketing behavior (Azmi, 2006; Eon and Van Vuuren, 2010).
However these regulations are not sufficient enough. According to Geoghegan & Azmi (2005), a company that boasts of having a good regulation must have found ways to fit the ethical values of an individual agent and when it’s appropriate. One of the major functions of marketing is to create a positive corporate reputation.
Companies will spend a lot of money to improve their public image but all the effort is meaningless if it’s unethical. Fan (2005) defines s corporate reputation in terms of various attributes that form in the consumer’s perception about a products reliability, goodness, trustworthiness and reputation. Corporate reputation has also been referred to by (Fombrun, 2000) as being concerned with how people feel about a company based on the information they have the firms activities and past performance.
Conclusion
As seen in the article, Marketing’s Contributions to Society, marketing plays a key role in the development of social economic activity of any given society. There are several benefits ranging from advertisers, transporters, distributers manufacturers and wholesalers who get employed in marketing activities. This in turn leads to creation employment in news, entertainment, fashion, design and transport sectors.
Willkie and Moore have consistently held that marketing is the key driver of the economy that leads to economic development. If well played out well, marketing has the potential to attract foreign and domestic investment for the upward mobility of the society. Furthermore, marketing is a leading promoter of competition and product differentiation.
Coupled with innovation, marketing helps new entrants penetrate the market and remain competitive. Not only do consumers demand the products at a higher rate thorough marketing, but also become price sensitive. This benefit can be seen clearly in every market type ranging from transportation, flight, entertainment, tourism and manufacturing. At the core of marketing are the legal ad ethical aspects that have the capacity to ruin or polish any firm’s corporate reputation. Global competition and increased awareness of product features by the consumer’s has resulted to unhealthy competition for market dominance. However, only firms that understand proper marketing strategies while engaging in ethical and legal activities can sustain their customer base for a long time.
Reference
Azmi, R.A., 2006. Business ethics as competitive advantage for companies in the globalization era.
Binsardi, A. and Ekwulugo, F., 2003. International marketing of British education: research on the students’ perception and the UK market penetration. Marketing Intelligence & Planning, 21(5), pp.318-327.
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Fombrun, C. (2000) “The value to be found in corporate reputation”, Financial Times, 4 December
Friedman, Douglas (2000). “Ethics needed to be Part of the Cutting Edge”, Erlanger, Vol. 104, pp. 2-14.
Geoghegan, J. and Azmi, R. (2005). “Corporate Governance Enforcement: Between Institutional Investors and Social Pressure”, the Fifth Annual Conference of the Faculty of Commerce – Alexandria University on Corporate Governance, Alexandria, pp. 545-560.
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Thorne McAlister, D. and Ferrell, L., 2002. The role of strategic philanthropy in marketing strategy. European Journal of Marketing, 36(5/6), pp.689-705.
Verhezen, Peter (2005). “Integrity as Good Reputation”, International Conference on Ethics and Integrity of Governance: A Transatlantic Dialogue, Belgium
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Wilkie, W.L. and Moore, E.S., 1999. Marketing’s contributions to society. The Journal of Marketing, pp.198-218.
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Marketing activity in the modern day makes up a central aspect of social life with branding and advertising influencing consumption and shaping economic, cultural and political identifications of society. Understanding consumer behaviour is essential for marketers in targeting increased product sales as well as understanding the phenomenon of changing markets.
One of important hypothesis in economics and marketing is that economic decisions follow a rational process that enable consumers to maximize their utility given resource constraints of price and cost. Many people however make decisions based rather on their short-sighted judgment than on long-term plans for optimizing utility. Behavioural economics is founded on the claim that human decision process is driven more by emotions as opposed to only rational reasoning.
The recognition that emotions can manage our subconscious reactions to conscious perceptions has led to the need to adopt a more modernist understanding of consumer behaviour as it affects purchase decisions and marketing (Foxall, 2015). This report presents a critique of the traditional understanding of consumer behaviour and discusses how desire may be a more relevant way for marketers to understand contemporary consumer behaviour. Marketers require an understanding of consumer decision making in designing appropriate marketing strategies and promotional messages that would be more effective in influencing purchase decisions.
Background and Statement of the Problem
Customer behaviour is an integral concept in strategic marketing and planning, and is based in the context of consumer buying behaviour. In order to develop a framework for studying consumer behaviour, it is helpful to considering the evolution of the concept in research and marketing discipline. The concept of consumer behaviour emerged during the 1960s as a distinct field of study characterized by two broad paradigms, the positivist and non-positivist.
The positivist paradigm defines consumer behaviour using economic, behavioural, cognitive, motivational, trait or attitudinal and situational perspectives. These are referred to as the traditional perspectives of consumer behaviour and they pave the way for the development of the non-positivist paradigm. Positivism is typical of neoclassical economics that seek to describe and explain economic phenomena without referring to moral and ethical judgements.
The positivist paradigm is still the dominant paradigm explaining consumer behaviour. The traditional positivist perspective takes a utilitarian approach to consumption and emphasizes the supremacy of human reason and rationality in selecting the alternative with the highest utility value. The non-positivist paradigm represents an opposing view to positivist understanding of consumer behaviour.
Non-positivism encompasses the interpretive and postmodern perspectives of consumer behaviour that have emerged more recently after 1980. Non-positivist research into consumer behaviour seeks to arrive at a better understanding of human behaviour as it influences consumption processes and purchase decisions. The non-positivist perspective places greater emphasis on the symbolic dimensions of consumer choice rather than rational economic decision process (Deepa & Murugan, 2015).
Comparing the two perspectives yields a set of paradigms that frame the contrasting view of the postmodernist understanding of consumer behaviour as compared to the traditional understanding. Five dialectics of consumption can be identified in academic and research literature for understanding the contrasting ideas of consumer behaviour in the traditional and the modernist perspectives.
These are materialism versus symbolic consumer culture, the social versus the self, desire versus satisfaction, rationality versus irrationality, and creativity versus constraint (Brosekhan, Velayutham & Phil, 2013). This report will focus on understanding irrational desire in the modernist view as it compares to rational satisfaction in the traditional view of the consumer decision process. The report compares how the two perspectives influence purchasing behaviour and consequently effectiveness of marketing strategy.
Traditional Understanding of Consumer Purchase Behaviour
The traditional understanding of consumer behaviour views the customer as an economic man or rational consumer that is motivated into purchasing by facts, and reasonably considers the facts in making the purchase decision to possessively get the maximal benefit while expending the least work. As identified in classical economic writings, man is entirely rational and self-interested, and makes decisions based upon his ability to maximise utility whilst expending the minimum effort (Jemma, Zwick & Neville, 2016).
The rational consumer theory has become the basis of understanding the customer in the field of marketing and marketing communications. The rational consumer theory is not only applied in economics but is also used in other professional fields to interpret human decisions and actions that result from consumer behaviour following rational choice by the economically-minded man.
In order to make rational purchase decisions, a consumer would have to be aware of all available alternatives for purchase and consumption, and be able to rate each option correctly and select the most favourable alternative. This is however not the case in many decision situations and is no longer accepted as a realistic account of the human decision making process.
As put forward in such theories as the Satisficing Theory by Herbert Simons (1997, 1991), Prospect Theory by Kahneman and Tversky (1979) and other such theories that embrace bounded rationality, individuals are further described as seeking satisfaction rather than pursuing optimum choices (Trandafilovic, Pasic & Perunovic, 2013).
Consumers rarely have adequate market information and lack the motivation and time to make the most perfect decision. As a result, the decision-making process of consumers is often affected by less rational influences such as personal attitudes and perceptions, and social relationships and values (Diglel & Yazdanifard, 2014).
Desire in Contemporary Consumer Behaviour
Recent research studies in consumer behaviour show quite different findings from those expected following a rational man or positivist perspective. Different academic and professional disciplines, primarily in psychology and more recently neurology, have attempted to offer and define the possibility of irrational man in decision situations that supposedly require rational thinking.
The combination of economics and psychology has given rise to “behavioural economics” a scientific field that gives a completely different perspective on consumer behaviour. The field of behavioural economics especially offers an explanation of the various irrational influences that can impact the decision-making process of humans (Cisek et al., 2014).
Although a person is naturally motivated to make effective and rational decisions, humans often confirm their limited willpower and inadequate or incomplete account of information relating to the decision. These necessitate taking into account the other irrational component of the human decision making process, which are composed of different emotions that influence human thought process.
These include the desire for money, fashion and vanity, fear, pride of possession, health and comfort, and love and affection (Kovac, Grubor & Maric, 2016). Irrational elements in many cases exceed the expected rationality as has been proven in many behavioural studies experiments and researches such as McDaniel, Lamb & Hair (2006), Gobe (2006), Dunne (2005), Hanna & Wozniak (2001) and Stewart (1994).
Such studies have shown that emotions are strong psychological processes that get involved in subjective decisions in interpreting experiences of pleasure and displeasure, physiological impression, motor symptoms, and changes in the availability and orientation (Olivera & Kustrak, 2013).
According to recent researches by behavioural science experts including Kotler& Arm-strong (2008), Du Plessis (2007, 1991) and Altman (2006),emotions play an important role in the perception of advertising messages (Trandafilovic, Pasic & Perunovic, 2013). Emotions are called upon and used to assess the facts, events, situations and results of the decision and experience based on the subjective state of mind, and are used to evaluate the relationship that would lead to taking a position on the given purchase decision or marketing situation (Hill & Fombelle, 2013).
They therefore cause and affect other psychological processes including purchasing decisions, and can even cause a paradigm change in a person following an encounter with an advertising message.
Implications for Marketing
Economics is regarded as a non-experimental science that cannot rely on laboratory experiments and utilizes only field observations to arrive at theoretical postulates. In contrast, behavioural economics advocates for controlled experiments as an important part of research for verifying economic theory (Wei & Lu, 2013).In understanding the consumer purchase decisions-process that should be rational following logical and predictable steps, behavioural economics offers a completely different perspective.
In many consumer purchase situations such as insurance, saving, health care, fashion, and employment relationships, some elements of irrational behaviour are evident. The consumer has certain preformed expectations for these products that rational reasoning marketing messages might find impossible to change if the marketing message does not address the emotions and feelings of the customer (Srikant, 2013).
Application of knowledge contained in the postmodern perception of human behaviour has been labelled as neuro-marketing, which offers an alternative way of presenting marketing communication to customers. Behavioural economics applied in marketing deals with incorporating symbolism and stories in a reconstruction of the world in which consumers live.
Irrational factors that influence customer purchase behaviour are derived from human feelings, emotions and other sources in the environment such as class, social image, fashion, heritage and concern for the environment amongst others. Innovative marketing companies are using methods such as environmental awareness and social responsibility to better communicate their brand value (Foxall, 2015; Walz, Hingston & Andehn, 2014).
Instead of focusing on only communicating the rational properties of the product, marketers can offer a story behind the brand that will arouse emotions in the consumer to associate with and purchase the brand. Such an approach offers the opportunity for the customer to become part of the new constructed world by consuming the brand (Lee, Gregg & Park, 2013).
Conclusion
In the contemporary world, consumption, advertising and branding constitute central aspects of social life that continue to shape the economic, cultural and even political identifications of organizations and the people relating with them. Certainly, social and behavioural theory is now focusing on consumption as playing a central role in the way the economic world is constructed. Studying consumer behaviour enables marketers and market researchers to understand and predict how consumers would react to promotional advertising messages, and by extension, why they would make purchase decisions.
Jemma, Michal C., Zwick, D. & Neville, B. (2016). “The ideology of the ethical consumption gap”, Marketing Theory, 16(1), 21-38. UK: Sage Publications. Accessed from http://www.gla.ac.uk/media/media_451526_en.pdf
Kovac, Ruzica Z., Grubor, Aleksandar & Maric, Drazen (2016). “Impulsive consumer behavior”, International Journal of Multidisciplinarity in Business and Science, 2(2), 81-89. Accessed from http://hrcak.srce.hr/file/195744
Lee, S.Y., Gregg, A. P. & Park, S.H. (2013). “The person in the purchase: narcissistic consumers prefer products that positively distinguish them”, Journal of Personal and Social Psychology, 05, 335-352. Accessed from https://www.ncbi.nlm.nih.gov/pubmed/23773040
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An Analysis of Land Rover’s marketing activities using ethical framework
Land rover is a car company that is owned by Jaguar Land rover, which is a multinational car manufacturer. The company specializes in four wheel drive, and is currently one of the largest car manufacture in the world, operating in more than 100 countries.uit is one of several auto manufactures that are owned by Tata industry. In 2013, Jaguar land rover was crowned the Responsible Business of the Year Award due to its investment in new technologies that reduce emissions.
This helped the company gain recognition worldwide; therefore increasing is sales and profit turn out. This is one of the key distinguishing factors of the company from other manufacturers. Another factor that makes the company stand out is its undertaking in corporate social responsibility, where it has empowered many young people globally through helping them learn engineering and other technical courses.
Despite its many achievements, the company faces many ethical issues especially regarding its usage of leather to manufacture interiors. Leather is a major cause of environment pollution due to the harmful chemicals used driving tanning.
Ethical issues at stake
Ethical standards are critical to the reputation and brand image of any firm that seeks to retain its market base. Contemporary ethical issues revolve around marketing behavior, such as false advertising, stereotyping, subliminal messages, post purchase dissonance, exploitation of workers and environmental pollution. However, practicing ethical standards will not only guide an organization through its daily operations but increase production and corporate reputation (Kelchne, 2015). Ethical issues relate to various problems that will require an organization to choose between many available alternatives. One of the main ethical issues facing Land River is its use of leather for interior designs.
An ethical challenge facing Land rover is that it advocates for protection of the environment, yet its usage of leather does the contrary. The company terms the products used in the manufacturing processes as ecofriendly, but its usage of leather results in harmful chemicals that are bad for the environment. Leather has been regarded by the US Environmental Protection Agency as the greatest form of pollution to waterways and the environment in general. Leather is a hide of dead animals, and it therefore decomposes naturally.
To prevent the decomposition, leather companies use very harmful chemicals which when released to the environment, can pose serious health problems as they are great pollutants. Due to this, the company fails to maintain ethical standards that advocate against usage of harmful chemicals and pollution of the environment.
Harmful chemicals used by Land Rover
Due to the use of leather in interior designs, land rover uses harmful chemicals to naturally decompose the leather, which are great environmental pollutants. However, leather is made from animals hide and is vulnerable to decomposition. To prevent this decomposition, the materials are treated using harmful chemicals like trivalent chromium suphide and other pollutants ranging from sodium sulfhydration and cyanide.
The leather is also subjected to procedures that involve large amounts of pollutants like hair, salt, lime sludge, and protein. The use of leather not only puts the lives of Land Rover consumers at risk but also endangers the surrounding community by polluting the air, water supplies, and the land. As a result, the company fails to achieve the good rating in pollution and toxic category and hence experiences a diminishing public image and lost support from animal rights advocates.
There has been a wide concern over the significant range of chemicals in the interior of vehicles by Land rover and sometimes the chemicals exceed the normal level. The drivers who drive these vehicles are exposed to these harmful chemicals mostly through inhalation. This could cause a range of health problems ranging from cancer, breathing problems and allergies. These harmful chemicals by the leather manufactures include:
Trivalent chromium sulphate
During leather tanning, the manufactures use trivalent chromium sulphate, which contains high levels of chromium. Chromium has been acknowledged as one of the most toxic chemicals used by leather manufactures. T5he interiors of land rover are manufactured using this toxic chemical, which poses serious threats to the wellbeing of all those involved in the company affairs. Usage of chromium has been prohibited in most countries due to its toxicity and the health hazard it causes. The fact that Land Rover uses leather to make its interior decoration implies that the company does not practice ethical guidelines.
Arsenic
Arsenic is a toxic chemical used during leather tanning. The chemical has been associated with lung cancer for workers who are daily exposed to it. It is a harmful; chemical which when in contact with the skin, causes burning sensations and could have long term effects.
Animal rights
Another ethical issue facing land rover is failure to advocate for animal rights, especially since it uses leather which is a slaughter house by product. Animal Rights Organizations are against companies who manufacture their products using leather as doing so is killing innocent animals. The company does not engage in animal protection and this reflects negatively on it.
Leather comes from animals such as goat, buffalo, ostrich, lamb, and deer, among others. Other places also use kangaroos to manufacture bicycle tyres. These animals are endangered as they are subject to killing and slaughter by leather organizations. Land rover is subject to this ethical challenge since killing of innocent animals is a not ethical. The process of tanning entails using chemicals stabilizes the animal skins so they will not decompose.
Ethical principles
Ethical principles guide organizations to act in a professional manner so as to balance ethical considerations with the relevant professional values and to deal with consumers ethically. Businesses that behave ethically have been seen to have higher consumer loyalty than those who do not.
These businesses are concerned about the environmental issues surrounding them, and deal with day to day basis in the required ethical and professional standards. There are four major principles of ethics guiding organizations and these include the principle of autonomy, the beneficence principle, non-maleficience and the principle of justice.
The first principle is the principle of autonomy which states that organizations have a duty to respect the autonomy of other persons no matter the circumstances. It gives people a duty of not interfering with the decision of others but instead to empower and support those that they are responsible for. There should be honesty in their dealings and keeping promises made. Land Rover Motors, for instance, has an obligation to its consumers and all other stakeholders to provide quality designs from products that are safe and that conform to the laws of the environment.
The principle of justice states that everyone has an obligation to provide other people with whatever we owe them, or whatever they deserve accordingly. All people should be treated fairly and equally and no unfair burdens should be imposed on others. Organization wise, all organizations should treat all their stakeholders fairly by providing them with quality products, as they truly deserve. Doing so will foster good relationships with all those involved in the operations of the organization.
Beneficience principle states that we have a duty to bring about good in all our doings. People must take all necessary steps to prevent harm, by any means possible. The automotive industry has an obligation to use non toxic substances in their products, and provide commodities that are totally safe, to prevent any harm to the customers and workers handling them, and pollution of the environment by undertaking proper waste disposal . By using harmful substances in leather tanning, Land Rover goes against this ethical principle.
Principle of nonmaleficience states that people have an obligation to not harm others. If harm can be avoided, we are obligated to prevent or minimize the harm. We should not increase the risk of harm to others and should employ all necessary measures to prevent harm. For instance, organizations that pollute the environment go contrary to this principle. The company should therefore engage in other ecofriendly activities and do away with leather.
Ethical theories
Egoism theory
Egoism model states that an act is morally right if the person making the decision decides to pursue short goals and long term interests (Crane, 2007). Ethical theory, according to Ardakanini and Sharraf (2014) is one the most significant theories in the study of normative ethics. The theory gives people a right to increase their benefits in any situation.
However, the provisions made by this theory seem to approve Jaguar Land Rover’s decision to replace the plastic interior material with a leather ones despite the negative effects it may have on the environment. The moral significance of any action is described based on the same goal and only applies to a man who can decide between valuable and invaluable goals.
The life of living things is the primary criterion for determining their moral value; living things must make choices which make possibility the achievement of the concept of value. Ethical egoism is founded on the idea that life is the criterion of value for all living things; therefore any action taken by man must be directed at preserving life (Hartenian and Lilly, 2009).
Any action that undermines living things and leads to one’s destruction is unacceptable. This approach considers plants to be the simplest among all living things; they were created to keep themselves alive automatically and involuntary. This leads to the conclusion that any marketing activity that results to endangering of life, such as using leather interior with harmful chemicals, is unethical according to egoistic approach. Also, materials employed by Jaguar Land Rover have serious implications to living creatures in the air, land, and water.
Utilitarianism
According to the utilitarian theory of ethics, a state of affairs is the only thing that exhibits value. Utilitarian deny the claim that some actions have an inherent moral dimension, as deontologists believe. If an act has a wrong or right, then it can only be derivative, given by the right or bad states of affairs it produces. The core idea of utilitarian, according to Hinman (2014), is that an act should always be undertaken in a way that it will provide the greatest amount of good in the world.
Morality, which is about producing good consequences, exists to make sure the world is a better place. People should strive to do whatever will bring the most benefit. Utilitarianism is one of the consequentialism perspectives which state that people should seek the greatest happiness for the greatest number. The determinant of the value of an action is the amount of joy it brings, the number of people it gives happiness and the time that happiness lasts. This theory suggests that people find the meaning of ethics by considering the consequences of actions they take. Something is right if it brings goodness to the greatest number of individuals (Mil, 1993).
Ethical implications
Land Rover is a big multinational company that is composed of a variety of both internal and external employees, and these are the most affected by the ethical issues facing the company. The company has interactive relationship with all its stakeholders and the ethical challenges could affect these stakeholders negatively. These stakeholders include customers, suppliers, the government, employees, and the general public among others. Stakeholders are all the people directly or indirectly affected by the operations of n organizations, and these stand to be affected by the ethical issues facing the company.
The above woes facing Jaguar Land Rover have critical implications for not only then stakeholders, but for the company’s marketing activities, and can greatly influence how audiences respond to marketing messages. While the use of leather for the interior was justified as a reason to avoid giving consumers plastics, the alternative chosen is not only harmful but also pollutes the environment. This comes to the issue of marketing ethics, what is morally right and wrong, and what is ethical marketing and what is not (Smith and Murphy, 2015). It is important in marketing decorum, but also one of the most controversial concepts in marketing
Suppliers
The major ethical issue facing the company is its usage of leather, and the suppliers of these are perhaps the most affected by these ethical challenges. The chemicals used in turning skin into leather are very harmful and a combination of these results in the pollution of the environment. With these issues, the suppliers stand to lose. This is because these ethical issues could make the company result in recalling designs manufactured from leather and use other materials instead.
If this happens, the suppliers will count huge losses, as they will have lost potential customers. The supply of harmful chemicals poses a big ethical issue for the suppliers of these chemicals. With the company accused of using chemicals that pollute the environment, suppliers are faced with a problem on whether their products are really safe.
Customers
The customers are the most affected by the activities of the business. The usage of leather by the company to make interior designs implies that harmful chemicals are used in preventing natural decomposition. This reflects negatively to the consumers because nobody wants to purchase from a company that pollutes the environment.
Customers who advocate fro human rights will not purchase from the company due to the usage of leather, as this encourages the killing of animals. Pollution of the environment by the harmful chemicals used by Land rover will result in the damage of customer’s health, and this will lower the reputation of the company.
Employees
The employees who work in leather tanneries are at a risk of being in contact with the harmful chemicals, which could pose a challenge to their health and general well-being. These workers come in direct contact with the harmful chemicals, which could harm their health in the long run. In fact, many employees die of cancer that is possibly caused from exposure to these toxic chemicals. One major ingredient used in preventing decomposition of leather is Arsenic, which has been associated with lung cancer.
Course of action
Today’s business environment is at a constant state of change, and the consumers have the power to affect the future success of any given company. With these changes, organizations should aim at pleasing the consumers since they have the final say on whether to purchase the products offered by the company. The ethical issues facing Land Rover may reelect negatively to the consumers, who are more attracted to organizations that behave ethically.
Land Rover should thereafter implement measures and strategies that will reduce pollution of the environment, and that advocate for animal’s’ rights. More than ever before, consumers are concerned about ethics and will go fro the companies who care for the environment and the rights of animals. Environmental organizations should intervene in the company.
These should advise against or completely restrict the use of certain ingredients to manufacture their products. The competitors of Lush have come up with amazing products without the use of toxic ingredients, and Lush should also follow suit, so as to remain relevant in the highly competitive industry.
The company should go for more favorable means of tanning, such as vegetable tanned leather. This uses elements such as bark from trees and other natural plants, which pose less environmental risks. This will reduce the effects of harmful chemicals while at the same time protecting the environment. Land Rover should adhere to the rules and regulations that address the usage of harmful chemicals by the leather industries.
The company should also use other industry proven techniques such as recycling. Recycling reduces the levels of harmful chemicals in waste water by more than 21 percent. It involves reclaiming the harmful chemicals, such as chromium and this will capture the original chromium level by 25 percent. Advanced technologies should be used to reduce toxic chemical levels so as to reduce pollution and illnesses resulting from their use.
There are other designs for making interiors that do not involve the use of leather. New technologies and innovations have been implemented by other companies to manufacture parts, which are friendly to the environment. The company should invest in the latest technologies for manufacturing that will see it establish new designs that have no leather in them. Doing so will reduce the usage of toxic chemicals used during leather tanning, and will protect the health of all employees.
Conclusion
Over the past twenty years, changes in technology and introduction of new innovations have led to change in preferences, and today, consumers are keener to purchase produces from ethically responsible company. Land Rover as a multinational company should embrace new methods of production, which are ethical and environmental friendly as this will woo consumers to their side.
It is clear that organizations that are keen on environmental conservation of animal rights have more customers than those who do not. The company should therefore implement new strategies to ensure that they are more ethical in future, and this will lead to an increase in sales.
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E-COMMERCE STRATEGIES IN THE UK FASHION INDUSTRY. A CASE STUDY OF BURBERRY
Burberry is one of the most popular online retail brands and this success can be attributed to utilization of e-commerce strategies by establishing online marketing websites. E-commerce is attaining relevance in the fashion industry with progress being made online by the large fashion retailers. With the evolution of technology and introduction of new innovations, companies must strive to adapt to the new changes so as to survive in the stiff competition.
However, despite these changes, many businesses have not fully utilized e-commerce as the utilization is still underdeveloped. Organizations that have utilized e-commerce have proven to be successful and such is Burberry. Burberry is the perfect example of an organization that has fully utilized digital marketing strategy through e-commerce.
The brand utilizes the social platforms such as twitter and Facebook to reach out to all its customers by optimizing the content to suit each platform. For instance, it uses Facebook to showcase live streams of their products, a method that has seen it gain very many followers online.
There are various e-commerce strategies used by ten companies to advertise its brand and reach out to the customers, all of which have increased the profitability of the organization. Burberry is the one brand that has exemplified an outstanding digital marketing performance by using the various social media channels to attract young customers.
The result demonstrated further the influence e-commerce strategies and attitudes held by people have on the modernization of a company. The best strategies for e-commerce which proved to have a positive impact on modernization of a company include maintaining effective communication with employees of the company, always informing them about matters that pertain to the organization, paying attention to workers and slotting them in when making decisions, encouraging creativity along with innovation, creating an environment which is positive and maintaining motivation for employees, which was the case with Burberry.;;:;
This paper intends to develop a critical assessment of “Glocalization” concept. Furthermore, the paper intends to illustrate how “Glocalization” and the “standardization-adaptation debate” relate.
Part I
Critical Analysis Regarding Relevant Literature
Definition
“Glocalization” is a term used to demonstrate a concept in which, products which are marketed globally are able to adapt to different local markets. Therefore, “Glocalization” refers to a concept in which, within the global market, a given product or a given service, has a higher likelihood of succeeding, when it gets customized according to the culture or the locality where sales of that product are made (Bantimaroudis 2017).
Additionally, based on the “Glocalization” concept, products are designed for the benefit of a specific local market, whereas a simultaneous development of the same products occurs, with the aim of distributing the products globally.
“Glocalization” context in reference to Globalization
“Glocalization” is a term developed from a combination of two broad terms which are the term localization and the term globalization (Drori, Höllerer, and Walgenbach 2014, pp.85). Globalization refers to the global movement regarding interaction or integration by diverse people, different companies, along with governments from dissimilar nations (Frenkel 2014, pp.133).
In contrast, localization refers to the adjustment of original output by different companies within their domicile countries sense. Localization also refers to the suitability of a perception using another language or a different culture (Küster 2016, pp.203). Thus, “Glocalization” results from both the forces of localization, along with the forces of globalization.
The driving idea of “Glocalization” is creating an initial product with a precise foreign marketplace in mind. However, “Glocalization” is more effective and efficient in companies that employ decentralized authority. Notably, employing decentralized authority is a force of globalization.
“Glocalization” presents many benefits to companies, along with the communities utilizing the products developed by the companies involved, or the services offered by the companies. Thus, companies that employ “Glocalization” are able to attend to a bigger market which they have targeted (Akgün, Keskin and Ayar 2014, pp 610). Conversely, the community benefits from increased market competition, which results in a drop in the product prices.
Therefore, “Glocalization” effectively reduces the gap of inequality, whereby individuals who previously could not be able to afford certain products due to the market being controlled by the local monopolies, get the capability of purchasing the products at a cheaper cost.
Therefore, when the term globalization is used, it implies all activities that place globally such as services offered companies available, and people, all being connected globally. However, “Glocalization” describes both global activities along with local activities (Apetrei, Kureshi and Horodnic 2015, pp 1520). Thus, “Glocalization” involves simulation of global activities to the locals. Globalization is thus assumed to be a significant phenomenon globally.
Furthermore, globalization interrelates with post-Fordism. Through globalization, social impacts along with economic impacts are achieved. Therefore, a difference in power or the ability of a company results in uneven social development along with economic development. Consequently, the development of “Glocalization” from globalization is significant in forming both a socioeconomic reality along with a political reality (Asseraf and Shoham 2016, pp 492).
Before the emergence of “Glocalization” people understood the nation state as an acceptable scale for understanding sub-national processes along with international processes. As the nation state faded, then “Glocalization” emerged.
“Glocalization” is characteristic of frequent economic implications, institutional associations along with socio-cultural implications (Hatzithomas, Fotiadis, and Coudounaris 2016, pp1099). Furthermore, it is also evident that scrupulous manifestations regarding global processes may also be witnessed in existing localities, while the supposed duality linking global processes to local processes is not literal.
Notably, “Glocalization” is a combination of the globalization process and localization process. Localization processes involve human beings, single subjects, different organizations, and diverse communities (Japutra, Nguyen and Melewar 2015, pp 102). In contrast, globalization is influenced by the planetary developments. However, global processes are influenced by concrete localities. Thus, “Glocalization” can be interpreted to refer to the act of thinking globally but acting locally.
Markedly, “Glocalization” thus, demonstrates the capability of human beings in mentally overcoming different territorial scales. Considering the economic perspective, global processes are described as turbulent and also volatile. Furthermore, economic subjects that constitute the process of globalization are accessible in specific localities. Therefore, companies are concurrently strongly local and hugely global.
Notably, the reduction of scales used in regulating work, along with scales of social replica corresponds to the increasing scale relating to economic organization and production forces (Magnusson et al 2013, pp 45). “Glocalization” processes along with territorial re-definitions are dominant within the system of finances.
For instance, reports show that the “Speculative foreign exchange market” raised from $15 billion in the year 1970 to above $2 trillion currently (Matusitz 2015, pp84). Notably, to appropriately allocate the flow of finances, the space available and the location to be used are significant. Thus, “Glocalization” becomes significant in attending to the system of finances.
Moreover, “Glocalization” is constantly applied within large economic units. Companies tailor their products along with services based on interests shown by local markets in diverse parts of the globe, which are strongly differentiated (Meyer and Su 2015, pp150). Thus, pecuniary interests play a significant role in “Glocalization” processes. Within a standpoint of an institution, making the authority of a state weaker implies transferring activities to global levels along with local levels.
Reflection on how “Glocalization” concepts transmit to “Standardization-adaptation Debate”
Globally, the debate regarding the significance of standardizing the marketing mix used by multinational corporations or adapting to the local setting has taken over five decades. The debate is however affected by global technological changes and the international economic crisis (Qureshi 2016). The past four decades were characteristic of research regarding “standardization-adaptation debate”.
Notably, research conducted in the 1980s focused on the necessity of companies following adaptation strategies for individual national markets as opposed to having standardization within every national market (Romanov and Kononenko 2014, pp 436). The discussions revealed that while an increase in market similarity was witnessed, and homogenization of markets emerged, companies gained the advantage of marketing similar products or services globally using programs of marketing, which are standardized.
However, critics of the view above dispute that disparity in culture, politic or economics among nations gets underestimated in the view above. Thus, questions develop regarding standardization feasibility. Consequently, other researchers focused on the “contingency approach”, which pays more attention to the desired degree of standardization along with feasible standardization (Roudometof 2016, pp391).
Moreover, due to the modern information developments along with technologies used in communication the debate on standardization-adaptation has increased. In addition, there has been an increase in globalization stream along with the volatility of economic conditions (Roudometof 2014, pp18). The debate, therefore, aims at providing an appropriate framework that exhibits the dynamics associated with adaptation selection or standardization range in elements of a marketing mix that affects how a firm performs.
The framework to be developed is aimed at influencing the advancement of business internationally. Generally, the debate on standardization or adaptation of the strategy for marketing started as an argument on homogenization of world markets, influencing companies to put more emphasis on the match between consumers globally (Schmid, Grosche and Mayrhofer 2016, pp536).
The debate further developed to reveal that the advancement of technologies used in communication and technologies used in transportation influenced market strategies standardization, which also includes a promotion mix. Afterward, there was an increase in agreements regarding multilateral trade, goods, services, information, along with capital started flowing freely.
Thus, globalization was accelerated, which resulted in support towards standardization approach (Some and Issa 2017, pp 925). There was a further reduction in cost influenced by the economic balance in activities of production along with marketing, transfer of experience, utilization of resources in a better way, development of global brands along with company images as part of the benefits realized from having standardization.
Other literature developed the assertion that standardization of the practice of global marketing. Furthermore, the focus was directed on the degree of effects which related to standardization based on the fact that it was understood that when costs are low, there would be an increase in profits (Sudarevic, Radojevic and Lekovic 2015, pp 2740).
However, the debate also develops views claiming that appropriateness of standardization relies on the influence standardization levels have regarding financial performance. When a firm enters international markets, it has to adapt or standardize in their market mix. Elements of a market mix include product, price, promotion and place. Since the 1980s there have been debates whether to choose a strategy of adaptation or standardization (Bantimaroudis 2017).
Standardization can be defined as activities of the market coordinated in many countries that integrate standardized goods and serviced, products of similar brands, corresponding products presented in the markets and advertisement messages that are similar and are usually carried out in numerous countries at the same time (Virvilaite, Seinauskiene and Sestokiene 2015, pp106).
For those scholars who supported standardization, they argued that standardization leads to a greater volume of sales, increased profitability, low cost of production and integrated image worldwide. For adaptation, it was necessary when a firm wants to reach out new sectors of the market or rather when a firm wants to be a leader in the market.
In standardization strategy, there is centralized management of international operations, tastes and preferences of consumers are homogeneous and they completion is global while in adaptation strategy, the management is decentralized with its own country, consumers tastes varies since they are heterogeneous and they compete locally(Apetrei, Kureshi and Horodnic 2015, pp 1521).
A product is anything that a market offer for use or for consuming that satisfies utility. The product is the easiest to standardize in the market mix elements. Product standardization is whereby a company can export their goods and services without changing the product. This is due to homogeneity of products on the market. International companies make sure they develop a global product that can be accepted worldwide.
By choosing standardization strategy, organizations consider that they take into account the needs and demands of local people (Küster 2016, pp.204). Product adaptation strategy comes in when a firm fails to modify the product into a specific market. Products have to be differentiated by branding, changing the design and different packaging.
Distribution channels can be defined as a set of connections of agencies and institutions that link buyers and sellers in a market. Sellers need to understand the channels of distribution for it is a major contributor to company’s success. With a clear understanding of distribution channels, a firm can easily be a leader in the market (Bantimaroudis 2017).
The decision whether to standardize or adaptation depend on various factors such as product, culture and the consumers. Standardization of product is quite difficult due to large variations in distribution channels. Each country has different places of supply and different distribution channels. Places of supply can be supermarkets or even shops or internet (Some and Issa 2017, pp 926). Therefore, distribution channel can be easily adapted since a country differs in distribution infrastructure, habits of purchase and disposable income.
Thus, standardization may be compared to promotion adaptation. Promotion consists of marketing tools used by a firm to persuade consumers to buy the good or service and also builds relationships with customers. Promotion can be achieved through advertising, personal selling, public relations and sales promotion (Bantimaroudis 2017).
Promotion standardization means that firms will use the same promotion worldwide without changing it. By doing so the firms ensure that they minimize costs. Advertising is usually affected due to language barriers, religions, laws, availability of media and difference in the economy all of these factors creates a need for adaptation strategy (Bantimaroudis 2017). Adapting strategy can be done by modifying the advertisement such that each region has its own way of advertising. However, this could be costly.
Standardization can thus be judged against pricing adaptation. Price is the monetary value of a good or service. The decision whether to choose standardization strategy to depend on factors such as preferences of consumers, market competition, inflation and exchange rates and regulations imposed on trades e.g. tariffs and duties. Price standardization means that the centralized office is in charge of fixing the price and the price is applied to all international market (Apetrei, Kureshi and Horodnic 2015, pp 1521).
This strategy ensures risks are minimal but also the profits are not maximized here. In Price adaptation strategy, the price is decentralized to local regions and managers set up price depending on international markets and revenues from consumers (Bantimaroudis 2017). Prices differ from one region into another. This is advantageous because a company can take advantage of the difference in price and sell their products where the prices are high.
Advantages along with drawbacks of the different strategies of Global Marketing
Notably, “glocalization” is developed from the concept of a sphere of cooperation in development and the continuity of processes relating to post-millennial goals (Bantimaroudis 2017). Therefore, “glocalization” does not only imply an essential principle of execution, it also refers to the factors influencing how communities develop, along with having a balance in development globally. In contrast, standardization occurs when there are a variety of products to be exported.
Moreover, the products being exported based on standardization measures should be of acceptable quality (Frenkel 2014, pp.134). Thus, standardization is characteristic of the existence of life cycles. Due to standardization, product changes may be witnessed along with brand changes. Furthermore, standardization is expected to observe various approaches of promoting exports.
“Glocalization” is an efficient tool for developing diverse interest groups along with entire communities. Outstandingly, “glocalization” facilitates the improvement of skills possessed by representatives of diverse communities in simultaneously thinking globally and acting locally, at the time when they are making decisions that relate to activities conducted daily within the community (Akgün, Keskin and Ayar 2014, pp 611).
Consequently, “glocalization” has the potential of creating a society, which is coordinated. Additionally, “glocalization” processes assist in the expansion of development of local along with global communities, which are civic coordinated. “Glocalization” also aids in the creation of a balance in development (Bantimaroudis 2017). Thus, “glocalization” effectively reduces gaps that may exist between individuals and the community, a country and a city, Countries who are members of the European Union and countries having different development levels globally.
Therefore, “glocalization” addresses the aspect of standardization through developing theoretical stops along with viewpoints that relate to the longevity of daily life and the improvement of cooperation (Bantimaroudis 2017). Additionally, “glocalization” addresses adaptability by influencing topicality in the field of politics, topicality in education, topicality in community development along with society development, and topicality on daily life.
Thus, “glocalization” is a significant tool in the achievement of Millennium goals of development along with sustainable goals of development (Akgün, Keskin and Ayar 2014, pp 612). Furthermore, “glocalization” influences global education and existence of development cooperation. Due to “glocalization” processes, there is diversity in experiences along with comprehension improvement. Consequently, “glocalization” is able to demonstrate what good practices are and how the society can efficiently improve the practices.
In standardization, market drivers constitute the following, products that are homogeneous, global channels and customers and transferrable markets. “Glocalisation” helps to improve access to these drivers. This leads to firms benefiting from economies of scale in production, marketing, management, and distribution hence firms maximizes their profits. Due to producing homogenous product or services firms reduces competition in the international market (Some and Issa 2017, pp 926).
There is also the advantage of improved customer fondness which can be attained by increasing appreciation and serviceability globally, increased quality of product and services which are achieved by concentrating resources on a small number of products (Bantimaroudis 2017). However, there are a number of setbacks such as there is a possibility of increasing currency risks, there might also be legal restrictions in some countries due to trade barriers.
Part II
Analysis of how Starbucks Company uses “Glocal” Marketing Strategies and how Costa Company uses “Glocal” Marketing Strategies
The extent of Starbucks Company’s “Glocal Strategy” application
Notably, Starbucks Company creates all its physical locations in a way that accommodates local nuances and cultural nuances. For instance, in China Starbucks Company introduced beverages, which are coffee-free, since there is a local detest of coffee in China (Qureshi 2016). Starbucks also designs its stores in a way that accommodates large groups. Thus, Starbucks creates a seating arrangement, which consumers can adapt more too. Furthermore, Starbucks has a digital strategy, which is “consumer-centric” (Qureshi 2016). Starbucks also incorporates online interaction with offline experience.
The extent of Costa Company’s “Glocal Strategy” application
In contrast, Costa’s most renowned “Glocal strategy” is engaging in partnerships with local companies. Furthermore, Costa relies on the negative publicity of prospective competitors as its “Glocal strategy” (Virvilaite, Seinauskiene and Sestokiene 2015, pp107). In China, for instance, Costa Company entered into a partnership with “Yueda Group”, which is Chinese Company. Thus, Costa Company is able to gain knowledge regarding the local Chinese market from the knowledge “Yueda Group” has regarding customers in China.
Difference in Starbuck’s “Glocal Strategy” and Costa’s “Glocal Strategy”
Starbuck focuses on creating all its physical locations in a way that accommodates local nuances and cultural nuances. In contrast, Costa relies on engaging with local companies in order to conduct its businesses. Thus, Starbuck is more global compared to Costa since, it relies on local nuances along with cultural nuances when creating its physical locations (Some and Issa 2017, pp 927).
Furthermore, Starbuck also penetrates more in the local markets compared to Costa since it conducts its own business without partnerships, hence relies on its own research. Additionally, Starbuck also uses a digital strategy, while Costa relies on strategies employed by its partners such as “Yueda Group”.
Reflection on Starbuck’s “Glocal Strategy” and Costa’s “Glocal Strategy”
Starbuck employs standardization in its “Glocal strategy” by developing theoretical viewpoints relating to the longevity of daily life. For instance, Starbucks creates a seating arrangement, which consumers can adapt more too. In contrast, Costa employs standardization by improving their cooperation with local companies in their target markets.
Furthermore, the “Glocal strategy” employed by Starbuck is influenced by the advancement of technologies used in communication and technologies used in transportation influenced market strategies standardization, which also includes a promotion mix. For instance, Starbuck has a digital strategy, which is “consumer-centric” (Qureshi 2016).
Conclusion
“Glocalization” is an emerging phenomenon in the business world. The paper above has developed a critical assessment of “Glocalization” concept and illustrated how “Glocalization” and the “standardization-adaptation debate” relate. From the paper, it has been clear that through “Glocalization” products which are marketed globally are able to adapt to different local markets.
Furthermore, the essay has revealed that standardization leads to a greater volume of sales, increased profitability, low cost of production and integrated image worldwide. To present a detailed analysis, the essay has considered the case of Starbuck Company along with Costa Company.
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Significantly, under this section the main object will be to analyze how a certain economic phenomenon by a business is likely to impact on the targeted group and consequently ascertain the end result of such undertakings. Thus, microeconomics gives us an insight of what is likely to be anticipated when certain changes are instigated with regard to the operations of a company and this is important because it can further aid in making proper decisions and initiating sustainable operating strategies.
For this section, the microeconomic issue identified is the cutting of prices of products or equally giving of offers by business. The table below briefly illustrates on the tangible issues that will be further discussed.
TOPIC
QUESTION
TOOL
PRICE CUTS/OFFERS
Why do businesses provide price cuts/offers on products?
Undisputedly, the pricing of a certain product eventually determines on whether it is likely to guarantee higher sales or losses. Ordinarily, customers are sensitive when it comes to the price of s product that they want to purchase because if it is not a pocket friendly price, then a majority will opt to buy an alternative product that will equally serve the same purpose but at a reasonable price (Dogan, et al 2013).
Similarly, when operating under a certain field competitors are bound to be present. This means that for one to outsmart them they have to come up with effective strategies to lure more customers to buying their products as compared to the rival’s and subsequently gain a large market share ( Pauwels & D’aveni, 2016). Hence, pricing seemingly plays a vital role under such circumstances.
Important to note is that before a business embarks on an initiative of providing price cuts on its products, there are certain essential factors that must be considered. This is so because not all price cuts may work for the advantage of the company. In fact, it is assumed that most price cuts tend to lead to low profit margin for the concerned business and this may hurt the overall operations of the business.
Among the things to be considered includes the long term implications of price cuts. For instance, one a price cut has been made and new customers have joined the bandwagon of purchasing it, increasing such a price thereafter may lead to loss of these customers as such a business must put in place other plans such as improving the quality of the product so as to demand a higher price because without such modification the initial price cut may end up hurting the business.
So as to answer the critical question of why do various businesses offer price cuts, the subsequent section of this paper will dwell on analyzing the various tools identified in discussing the economic issue.
Competition
Foremost, competition is one of the key features of any market. However, stiff competition may force a business out of the market as only the dominant participants get to have the larger market share. To mitigate such an event occurring, businesses are inclined to offer price cuts to their products so as to retain a fair share of the consumers in the market.
By giving such price cuts, it means that such a company can compete fairly in the area of operation. Accordingly, one can argue that consumer would often resort to buying products at reasonable prices, hence if one of the competitors is offering the same product at a higher price it is highly likely that they will lose buyers to the company that gives relatively cheaper pricing. In such a situation, to promote a fair competitive market, prices will thus be relatively proportionate as a result leading to a fair share of each participant in terms of customers and the market place.
Sales
Significantly, when a product does not sale it may eventually cause the business to succumb to losses. Thus, the concept of sales can be boosted in a twofold channel. First, for new products that have been introduced to a market it is imperative that price cuts are given so as to entice customers into buying the products.
On the other hand, when there are low buy outs of products, then a company may opt to initiate price cuts all in a bid to try and revamp the product. Generally, price cuts that aim to boost the sale of a commodity have to address a certain deficiency. In this way, having reduced prices serves as an effective tool in enhancing the purchase power of consumers towards a specified product.
Brand Promotion
Particularly, for new products that are unknown to consumers, it is vital that price cuts are provided. This is so because, often consumers may refrain from interacting with new products in the market based on aspects such as having a preference of the already existing ones. Such circumstances may impair the emergence of new businesses in that market. Thus, when price cuts are offered as incentives for customers, it id then highly likely that new consumers will indulge in buying the given product based on its reduced pricing.
Market dominance
Naturally, for businesses that operate in the same field of operation the market share that one has over the other largely matters. The market share determines the profit that a company expects to acquire from its sales. Hence, companies are motivated to initiate strategies that would put them at an advantage position over their rivals. One of the ways of doing this is by providing price cuts on the products of the business. Price cuts as aforementioned in the discussed sections are an allure for new customers.
When one business obtains new customers that belonged to a rival company it subsequently means that the former company acquires a large market share. However, such an undertakings has its downside in that it forms a platform for emergence of a monopolistic market structure whereby there is only one dominant player. When this happens, consumers are put in the liberty of that dominant player in the market because such a business has all the power and keys of controlling how that particular market will operate.
Economic recession
Notably, the economic state of a country determines how consumers of products will purchase and spend on products. In the case where the economy is booming and businesses are not financially constrained, consumers are highly likely to purchase products without much limitations or considerations such as on pricing. In this scenario, offering price cuts whereas fellow competitors are not may harm the business because consumers may not give too much concern about their spending.
On the other hand, when there is an economic slump, in that businesses are not doing as well as they would normally do this thus calls for effective measures to retain and attract customers so as to continue operating.
Under an economic recession situation, consumers would preferably want to spend less. To match with such changed dynamics, then one would argue that price cuts on the products of a business are the most viable solution to follow.
Market failure
Considering market failure is a concept that occurs as a result of inefficient allocation of certain resources within the market of operation, then such a situation is consequently likely to affect the operations of the company (Fabella, 2015). For instance, a monopolistic market structure may be deemed as a market failure ingredient based on the fact that new businesses will find it hard to compete in a market that is largely dominated by one player.
Nonetheless, in such a situation a company may opt to provide price cuts on its product so as to try and mitigate the market failure effects which if not diminished will certainly curtail the operations of the other businesses.
Government failure
Significantly, the government is duty bound to make sure that businesses operate in a fair and friendly environment. To do this, certain limitations must be imposed and constraining barriers broken down. For instance, take a situation whereby the government fails to monitor the operations of businesses through relative agencies, in such a situation certain business may drain consumers by instigation undertakings that would solely serve their own interest. One of such an undertaking may be over-pricing on the produced products.
However, such an undertaking may not suit all the businesses within the market as such prompting the need to lower prices of similar goods so as to counter the other business competitors.
SECTION SUMMARY
Nonetheless, there may exist factors that may affect this equilibrium price such that a business may be forced to make adjustments. This is of essence because without such alterations, a business is likely to operate under losses. The aspect of price cuts maybe one of the ways that business may use to reach certain equilibrium.
By giving price cuts it fundamentally indicates that a company aims at first increasing its sales and similarly obtains new customers. Importantly, aspects such as the profit margin that the business aims at must be considered before making such a move. In doing this, prior research is essential because without having knowledge of such information then a business may orchestrate its failure.
CONCLUSION
Foremost, markets are placed that are guided by certain distinctive features that must be observed and preserved so as to allow business to operate efficiently. For instance, without embracing the concept of fair competition between rival businesses, then one may triumph over the other leading to unfair labor practices.
Significantly, the importance of government intervention in market practices cannot be ignored. The government plays a key role in regulation of various aspects of the market so as to facilitate proper co-existence between the firms themselves and the consumers that they serve. Without such an intervention, evidently every business would seek to protect their own interests putting aside all other basic requirements such as offering quality products.
When it comes to the various macroeconomic issues that may affect the operations of markets, first it is important to note that such issues may have a direct effect on the activities of consumers and as a result end up curtailing the operations of the business in the end. Microeconomic issues should be looked at from a wider scope. Their particular effects should be analyzed in depth so that the right techniques are initiated to mitigate on their possible hazards.
Significantly, these issues should never be ignored before they may have adverse effects on the operations of the company as such creating the need to find way to move around them and benefit the business.
Finally, without fair market practices, not only does firms suffer but consumers too share in the same suffering. This calls for proper market practices that protect both the interests of the businesses and consumers so that none is inclined to spear-head their own interests on the expense of the other. Where unfair practices may emerge, it is imperative that even the firms themselves take personal measures and approaches to meditate on the negative consequences.
Reference
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