Sunday, October 6, 2019

How globalization implicate the international business Essay

How globalization implicate the international business - Essay Example In the context of this paper, the definition of globalization that would be more relevant is the following: globalization is ‘a cluster of technological, economic and political processes that reduce the barriers to economic exchange across borders’ (Drezner 2008, p.10). A key sector of international business that has been affected by globalization is marketing. In fact, in regard to marketing globalization has a particular characteristic: it focuses on ‘the creation of marketing strategies as though the entire world were a single entity’ (Pride and Ferrell 2004, p.135). A company that highly reflects the promotion of globalized marketing is Nike: the specific company promotes its products worldwide by employing the same marketing strategies (Pride and Ferrell 2004). For Nike, the use of such marketing strategy is feasible, and effective, since the firm has a strong brand name internationally; in such business culture, the above marketing approach can significantly contribute in the further increase of the firm’s popularity, as a global brand (Pride and Ferrell 2004). The case of Nike implies that globalization in marketing could benefits business performance, but under certain terms, as explained above. In practice, globalization has been found to result both to benefits and disadvantages for international businesses. An important benefit of these businesses, as resulted from globalization, is the ‘creation of global markets’ (Debrah and Smith 2003, p.8). In these markets, international businesses are able to secure the high quality of their products but at lower prices, as compared to the markets in the pre-globalization period (Debrah and Smith 2003). The limitation of business costs, a benefit usually achieved by establishing business units in developing countries, is an important benefit for international businesses but also a drawback for employees: in firms operating globally the rights of employees are often disregarded and wages can be

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