Standardization vs globalization: a new perspective of brand
strategies
Medina, Jose F
;
Duffy, Mike F
.
The Journal of Product and Brand Management
7.
3
(199
8): 223
-
243.
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This paper argues that meanings given to standardiz
ation and globalization might have created
some confusion and precipitated potentially misleading research results in the literature. The
paper discusses the basic assumptions underlying the marketing function as a necessary point of
departure to build a s
ounder theory around these concepts. Findings confirm the lack of formal
definitions of these concepts in the marketing and management literatures. The authors redefine
the concepts of globalization, standardization, adaptation and customization with the h
elp of the
AMA
's and Webster's dictionaries. The new conceptualization is applied to a brand strategy
framework. Preliminary results show that standardization and globalization may be at opposite
ends of an evolutionary brand strategy process, whereas adaptation and cus
tomization are
intermediary stages. The paper discusses the findings and suggests future research possibilities.
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Jose
F.
Medina
: Assistant Professor of International Marketing,Division of Management of
Marketing, University of Texas at San Antonio, San Antonio, Texas,USA
Mike F. Duffy: Associate Professor of Marketing,Department
of Marketing, Minot State
University, Minot, North Dakota, USA
Introduction
The debate on "standardization" and"globalization" of international markets continues unabated.
Yet, a review of theliterature on the subject raises the question of what exactly these terms mean.
Even the AmericanMarketing Association's Dictionary of Marke
ting Terms (Bennett, 1988)
doesnot define the word globalization. Furthermore, the meanings of "adaptation"
and"customization" also come into question as they tend to mean the opposite ofstandardization
and globalization. Fashionable terms such as "global
standardization"do nothing but confuse
readers of the marketing literature; and nobody seems to know whatphrases such as "think global
act local" really mean.
One major problem appearsto be that empirical studies do not provide a sufficient theoretical
ba
sis to understand thesimilarities and differences reported. It is not clear that these authors
provide a definition orsome degree of measurability of what they intend to promote. This may
have led researchers astray,rendering subsequent findings potentiall
y misleading. Without
properly defining terms likestandardization and globalization, it is going to be difficult to build a
theory of theworld's consumer market.
This paper attempts to study the definitions ofstandardization, globalization, adaptation, an
d
customization as presented in the literature;and strives for a preliminary, operational definition of
these terms. First, we discuss theimportance of defining marketing terminology based on general
assumptions of what marketing meansto most academicians
and practitioners. Next, we include a
review of the literature on thedefinitions of standardization, globalization, adaptation, and
customization, and provide our owndefinitions based on this analysis. We continue with our own
conceptual framework of brand
attribute strategies. This section analyzes the evolutionary
process brands go through as they movefrom standardization to globalization. Then, we follow
with a summary and discussion of the newdefinitions with emphasis on standardization and
globalization
. Finally, ideas for future researchare explored.
The assumptions
Social science philosophers havepointed out that if a theory is to be properly tested, the
researcher's implicit assumptionswhich form the boundaries of the theory must first be
understood
(Weber, 1947). Thisnotion of boundaries based on implicit assumptions is critical
because it sets the limitations inapplying the theory (Bacharach, 1989). To develop a theory of
the globalization ofproducts from a marketing perspective, we must start by d
elineating the
boundaries of thetheoretical framework within which most marketers operate.
The basic assumptions made by themarketing function are presented in Figure 1. These
assumptionsare necessary to understand the fundamental marketing realities of a
market
-
driven
economy.They will enable us to examine the key influences on product strategy from the same
theoreticalstandpoint; and they will allow for a critical evaluation of the theory as it is
beingconstructed. When the "marketing community" consider
s the established
marketingassumptions no longer adequate to explain contemporary marketplace realities, the
resulting theorywill be modified as well.
The first assumption about the role of marketing goes to the heartof what makes it such a
dynamic discip
line
-
the exchange process. It is a widely understoodand accepted tenet in
economics and international trade that voluntary commercial exchanges betweenparties (i.e.,
producers and consumers) promote economic growth (Barth, 1997;Gwartney and Stroup, 1993)
.
The marketing function centers around the idea of creatingexchanges, whether that's
accomplished through the advertising of a product or throughdeveloping a more efficient
distribution channel (Houston, 1986). The motivation forcommercial exchanges rests
on the
principle of mutual benefits resulting from parties acquiringdifferential advantages through
competition for resources and specialization (Ricardo,1953).
Exchanges will not occur unless parties believe they possess something of valueto trade.
(Pro
ducers possess goods and services and consumers possess their income andsavings.) It is the
responsibility of the marketer to help the production function conceive aproduct consumers are
willing to trade their money for. Marketers interact as"mediators" be
tween production and
consumption, and the consumer will demand from thefirm a product that is worth their money.
Marketers also have the responsibility to learn(e.g., through marketing research) what specific
goals and benefits consumers seek. Thiswill fac
ilitate the creation of a product which will help
producers and consumers consummate atransaction.
To increase the chances that consumers are going to value a product, consumersmust be
specified
-
identified and selected (Fennell and Saegert, 1990). This
isthe second marketing
assumption important to understand the responsibilities of marketers. Thespecification of a group
of consumers begins after marketers have defined the firm's area ofexpertise (i.e., activity
-
domain). Defining the firm's area of exper
tiseinvolve identification of the product category in
which the firm chooses to compete and thecorresponding competitors. A group of consumers
known as the target market is then identified andselected based on this area of expertise. Next,
demand
-
creating
conditions affectingprospective customers are explored within the focal activity
-
one that corresponds to theproduct category
-
such as buying a brand of toothpaste (Fennell and
Saegert,1990). Ultimately, the responsibility of the marketer is to discover
customer
-
perceivedbenefits such that they are matched to specific product
-
category attributes. For
example, anunderlying product benefit such as "cavity protection" should correspond to a
specificproduct attribute such as "fluoride content".
The third ass
umption aboutmarketing is that the product is a bundle of both tangible and
intangible attributes designed tosatisfy the consumer (Kotler and Armstrong, 1993). Because the
product possesses inherentattributes that the consumer values, the product program o
f the
marketing mix is foundational instrategy development. In other words, there must first exist a
clear definition of theproduct/market relationship before any other element of the mix can be
seriously considered(Fennel and Seagert, 1990; Kotler, 1989).
There are at least two reasons why
theproduct program is critical from the corporate strategy standpoint. First, the marketer must
decidewhether the benefits sought by the targeted consumer are already offered by the
firm'sproduct line. If not, the firm m
ay need to modify its product line by creating a new brand,
or aninnovation. Secondly, the marketer should always be concerned with the transferability of
a"tested" product program to other potential markets.
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