Summary
Changes in the world economy cannot be ignored by local economies based on the impact they represent for all the regions that participate in the globalization process, which is why companies are forced to be more efficient.
In this work we study the relationship between distribution channels and the level of standardization of the marketing program of MNEs that operate in CD. Victoria Tam.
Introduction and justification
The first question that arises from the review of the topic is what type of research you want to carry out: pure or applied. And this leads us to try to define which is one and which is the other, and so we have that Starr (1979) says “the best definition of pure research is that it is not applied; that is, it has no immediate or obvious utility in increasing man's comfort or giving physical satisfaction or increasing his control over the environment. Pure research is therefore comparable to the quest for knowledge for knowledge. ”
After deciding on the type of research to be carried out, the most appropriate method to follow is sought, however Durkheim (1982) says that “Before investigating which method is appropriate for the study of social facts, it is important to know what the facts are called. "
It also tells us that social phenomena are things and should be treated as such, since everything is understood as something that is given, everything that is imposed on observation. It also presents us with several rules for conducting research: "It is necessary to systematically discard all previous notions", that is, the conventional character of a practice should never be assumed.
"Never take as the object of investigations more than a group of phenomena previously defined by certain external characters that are common to it and include in the same investigation all those who respond to this definition" (Durkheim, 1982).
The growth of cities is given, among other factors, by the commercial development that they can achieve due to their interaction with various markets, be they national or international.
Today the markets are increasingly globalized, that is, the trade and political barriers that countries had to protect their local markets have been decreasing with international free trade agreements and treaties.
There are different forms of integration of multinational companies (MNE, for its acronym in English) for their entry into different markets and according to Chan and Hwang (1992) so we find that they can be foreign direct investment (FDI for its acronym) in English), through franchises or through licenses.
This has caused the explosive arrival in recent years to CD. MNE's victory, so it is of interest to researchers to know the advantages that the plaza offers to investors, and if the way in which they satisfy their raw material needs for the development of their operations influences the level of standardization of their products. or services.
Development of the theory
The channel development theory presented by Gillespie (1996) attempts to describe and explain the patterns of change observed in marketing channels and to forecast future changes. It also tells us that there are two basic approaches to channel development theory that have special relevance to emerging markets: an approach to economic development and an approach where culture dominates.
In this stage theory, a hypothesis is presented in which wholesale and retail institutions move towards increasingly complex functions and product offerings. Therefore, channels in developing countries are similar to those in developed countries, and the paradigms that emerge from this approach can be applied in all nations or cultures.
Celly (1996) in his research tells us about the importance of distribution channels and the impact that the experience that the distributor has to serve the target market and its relationships with those in
charge of the marketing program has on the business result. the company.
It also states that the trust that the company has in its distributor will allow for better coordination that will be reflected in the fulfillment of its business goals.
Stanton (1998) refers to how companies can use existing channels or new ones to better serve their customers. By selecting their channels they try to get a differential advantage.
These might be.
Direct distribution or indirect distribution, channel made up of the producer, the final consumer and at least one level of intermediaries.
On the other hand, Rugman (1998) shows us that a conventional ethnocentric MNE will be characterized by a concentration of FSA (company-specific advantages) in the country of origin with a replication of production and production approaches. administration of the country of origin in the host country. In contrast, a geocentric MNE tries to strike a balance between its FSA and the interests of the host country.
The standardization of products or services is a reality in the field of global markets; however, the controversy centers on whether the strategy with which foreign companies penetrate the markets is more based on a global strategy or the adaptation of their products or services to the local markets.
It is Levitt (1983) who is perhaps the most representative author of the global and standardization strategy who states: “The result is a new commercial reality - the emergence of global markets for consumer products standardized on a previously unimaginable scale. Corporations maintain this new profit reality from huge economies of scale in production, distribution, marketing, and management. By transforming these benefits into globally reduced prices, they can overwhelm competitors who still live holding on to old interpretations of how the world works.
Salazar Carvajal, R (2005) affirms: “Globalization implies operating with relatively low costs, as if the entire world or the most important regions were a single entity. Selling the same and in the same way will result in a significant change in deciding to adopt new forms of management within companies framed in the new current of the global market, since the base of support for this process is a high level of competitiveness.
In the work of Subhash, C. Jain (1989) The factors that affect the standardization program are critically examined. In an attempt to establish a research agenda on the subject of Standardization, the author develops the research purposes for each factor.
The probability of the standardization program depends on various factors such as the type of market, the position of the market, the nature of the product and the environment.
The standardization of the international marketing strategy refers to a common price of the product, distribution and promotion program on a worldwide basis… The decision on standardization is not a decision between complete standardization and adaptation to the customer. There may be degrees of standardization.
The authors of "The Myth of Globalization" point out the three main ideas underlying the standardization approach to globalization, comparing it with what was established by Dr. Levitt.
Levitt 1983, quoted by Douglas, 1987, wrote:
1. The needs and interests of consumers have a global trend towards homogenization.
2. People around the world are sacrificing preferences in product features, designs, functions, and the like for lower prices and high quality.
3. Substantial economies of scale in production and marketing can be achieved through providing global markets.
Universal price for low price and acceptable quality
Regarding this approach that guides and supports globalization, the authors of the Myth of Globalization object:
"Aggressive low pricing of quality products that meet the common needs of clients in markets around the world is believed to expand firm markets in the future."
Production scale economies
In this third objection raised by the authors, they point out:
"The third underlying idea in the globalization approach is that a key to this strategy is product technology and economies of scale can be achieved to provide global markets.
On the other hand, after making a detailed questioning of the subject, posing innumerable cases and assumptions, these authors conclude:
“The main thesis of this document is that the design of an effective global strategy does not necessarily require the marketing of standardized products and global brands. ” (Subhash, 1989)
It is a theoretical framework to determine the degree of feasible standardization in a particular case. The following key concepts are the basis of reasoned analysis for this framework.
- The probability of the standardization program depends on various factors such as the type of market, the position of the market, the nature of the product and the environment. The explanation of these factors is given in figure 1 The effective implementation of the standardization strategy is influenced by the perspectives of the organization. The total standardization is unthinkable. In the degree of standardization in a product / the market situation must be examined in terms of your long-term advantage.
Conceptually, the standardization of one or more parts of the marketing program is a function of five factors identified in Table 1. Individually and collectively these factors affect standardization differently in different decision areas “Subhash (1989)
The model taken from the authors is as follows:
In summary, the theoretical framework was taken from the theory of Subhash C. Jain (1989), managing the 6 elements as items, which allowed establishing the level of standardization.
Hypothesis Presentation
In the present work the hypotheses are
tested.- Ho.- the selection of the distribution channel does not impact standardization (H0: μ1- μ2 = 0)
H1.- the selection of the distribution channel impacts standardization (Ha: μ1 -μ20)
Research methodology
For the present study, a survey was carried out through the application of a questionnaire to a random sample among the existing MNE in CD. Victoria Tam.
Out of a total of thirty-three companies, a response was obtained from twelve of them, which represents 36.36% of the total market.
In the works consulted, the average response rate is 24.30%
The research is experimental, with 9 factors of which 3 correspond to the distribution channel construct and 6 to the standardization construct.
Presentation and analysis of results
With the results obtained with this information, the sample was validated through the determination of a confidence interval, it can be stated with 98% reliability that contains the average of the results of the questions.
To test the first hypothesis, the procedure for making comparisons in this case consists of calculating the differences of the n pairs of observations and calculating; that is, if you have:
Decision: if -tc-≥t (n-1, a / 2), H0 with a of significance is rejected.
When analyzing the data, we find that tc = 1.94 and that the value of tt (12-1, a / 2) is 2,201 at 0.05 level of significance, so we accept the Ho hypothesis and we can conclude that the choice of channel does influences standardization.
However, when doing the correlation analysis between the different variables we find the following results.-
1. Between the variable experience of the distributor (channels) and the variable commercial promotions (standardization) there is a statistically significant positive correlation (.568) at 5%
2. Among the variables that make up the standardization construct regarding the pairs of political variables of customer treatment vs. product positioning, there is a significant positive correlation (.563) at 5%.
3. the variable marketing vs. customer treatment policies is (.626) significant at 5%.
4. the advertising vs. product positioning variable is (.802) significant at 1%.
5. the variable advertising vs. customer treatment policies is (.658) significant at 1%
When graphing the responses of the questionnaires answered by the companies (graph 1) shows a standardization behavior, the middle line is presented, which reflects the level of standardization of the companies reviewed, denoting a mixed strategy.
conclusion
According to the results obtained, we can conclude regarding the standardization factor that, according to the revised theory, the behavior of companies is as expected.
However, with regard to distribution channels, it is necessary to rethink the approaches since the literature reviewed does not set parameters for us to follow, which allows us to say that it is a field that can be studied in depth so that in future works it can be evaluated with greater depth.
Bibliography
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Douglas SP and Wind Y. (1987), “The Myth of the Globalization”, Columbia Journal of Business, January 1987, pp 19 - 29.
Durkheim Émile, Las Rules del Sociológico Method, Spain, Morata, 1982, p.37
Gillespie, Kate and J. Brad McBride (1996) "Smuggling in Emerging Markets: Global Implications," Columbia Journal of World Business, Winter, 40-54.
Levitt, T. (1983) The Globalization of Markets, Harvard Business Review, May-Jun 1983, 20 Pages.
Rugman, Alan M. and Alain Verbeke (1998), ´Multinational Enterprises and Public Policy, ´ Journal of International Business Studies, 29 (1), 115 - 136.
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