SOLIJON, JEWELLE MAE P. BSA 2-A MGT.

210/ MWF/12:25-1:25 PM GLOBALIZATION AND THE CONSUMER NONDURABLES INDUSTRY The rise of globalization has created interdependent markets that highlight the pros and cons of leveraging foreign exchange. Many proponents of global business argue that mutual benefits derive from the global specialization of products and services. The general stance is that the benefits of globalization outweigh the economic and social costs by achieving higher efficiency and by providing GDP growth in underdeveloped regions. Globalization leads to the increased availability of diverse products, services, and technology. Through pooling knowledge and exchanging more goods and services, domestic economies expand and benefit from technological and medical developments. This increase in variety, even in basic goods, allows a Filipino to drink American wine and eat French bread while typing on a Chinese keyboard. Global exchange can allow the best of all worlds through specialization and maximizing various comparative advantages that involve quality or efficiency. In lieu with business industries, globalization has become extremely significant for all over the world. Not only is it important to expand into new markets, but it is important to localize enough to be accepted while still keeping your brand consistent worldwide. Corporations are beginning to see how difficult this balancing act can be. Expanding into new countries can lead to enormous profits, but it comes at a much higher risk. An example of an industry that thinks going global is very significant is the Consumer Nondurable Industry. This industry produces consumer non-durable goods or soft goods or consumables that are immediately consumed in one use or ones that have a lifespan of less than three years, such as cosmetics, cleaning products, personal products, apparel, footwear and food. One of the most successful companies that provide consumer non-durable goods is the Coca-Cola Company. Coca-Cola sells their over 3,500 beverages in over 200 countries and works with over 250 bottling plants around the world. The strategy that has made them so successful is keeping their brand consistent worldwide, while making product adaptations to accommodate local preferences. (http://www.coca-colacompany.com/our-company/) For example, in Mexico, Coca-Cola is made with sugar can rather than corn syrup. A spokesperson from Coca-Cola acknowledged that different sweeteners are used by the companys bottling partners in different parts of the world, for reasons having to do with price

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(http://www.nytimes.com/2009/10/11/magazine/11fob-consumed-

Consumer nondurables, such as Coca-Cola products which is known worldwide, focuses on its local scale operation. They were able to create global reach with local focus through their system, which comprises their Company and more than 250 bottling partners worldwide. All bottling partners work closely with customers -- grocery stores, restaurants, street vendors, convenience stores, movie theaters and amusement parks, among many others -- to execute localized strategies developed in partnership with their Company. Customers then sell the products to consumers at a rate of more than 1.8 billion servings a day. They have seemingly mastered the art of succeeding in different cultures, but they are certainly not the only ones (http://www.coca-colacompany.com/our-company/the-coca-cola-system). Barbie is a popular brand (made by Mattel) in many parts of the world. Its products have had huge success in Argentina, the United States, India, and many more. Its most popular product is its Barbie doll which is adored by many children all over the world. However, the iconic doll has not had success in every market like China. Mattel recently had to close their massive Barbie store in Shanghai, China. The failure was mainly due to a lack of focus for the store, and lack of interest in the brand from the Chinese. Since localization is such a critical part of globalization, companies are learning that traditional marketing research is not enough. The Barbie store did not adapt to the Chinese market as quickly as it should have (http://www.chinalawblog.com/2011/03/barbie_in_china_the_lessons_to_be_learned.html). Local business players can take advantage of the developments brought about by the consumer nondurables such as its needs for partners in the local region. They can gain new techniques and research developments through the entry of these highly-developed and cultural sensitive products. In the case of Barbies failure to dominate the local market in China, I believe that the Barbie brand can still do well it just needs a new strategy. They must have plans for small retail stores, seek out franchise customers to expand the Barbie products throughout China and would have a coherent merchandising and store strategy that would enable them to expand nationally throughout China. In general, there is no prefect formula for globalization. It is a constant learning experience for companies who choose to actively seek out new markets. Balancing risk with potential reward is the focus of every global company. The keys to success are doing your research, consulting with culture experts, and learning from your mistakes. Being ready to change or alter your strategy is essential for companies entering new markets and can ultimately determine your fate.