Marketing environment contributes a lot toward the success of a company. Therefore, in making decisions regarding domestic and global marketing, it is paramount that market study and survey is carried out. Some of the marketing environmental factors that influence the success of a business both globally and domestically include global economic interdependence, demographics and physical infrastructure, cultural differences, social responsibility and ethics, legal obligations, political systems, international relations, and technology. The factors mentioned are external and influence marketing activities of an organization or a company (Willoughby, 2006).
The company that I am focusing on is the Coca Cola Company which is a global company, widely known for its famous drink, coca cola. It is obvious that the company started its production and marketing in its country of origin. However, over the years, it has registered a tremendous growth and has become global. The success of Coca Cola Company is attributed to the wise and informed marketing decisions it has made in the past. The company has been able to study the market choice of entry before entering it. Its domestic and global marketing decisions have been influenced by the above mentioned environmental factors.
According to Mullins & Walker (2013), global economic interdependence refers to a situation where a particular state depends on another for a good or service, and the other nation depends on this state on for what it is not able to produce. Additionally, it also implies that the economies of different organizations are connected such that any negative effect on one organization has a negative influence on the other. Consequently, a problem experienced by one company will be felt by another company that is linked with it. Coca Cola Company has signed many agreements with companies of various states globally. Coca Cola Company is dependent on other companies for the provision of resources so that it carries out its production process. Coca Cola Company relies on other companies for the distribution of its products in varied states. Thus, any negative effect experienced by these distributors and suppliers will negatively influence the processes and activities of the company (Willoughby, 2006).
Many nations are beginning to practice free trade, where there are no barriers of entry of traders into and out of it. Trade policies and agreements have been passed in the past. Such practices need to be studied before a company considers gaining access to the foreign nations. According to Willoughby (2006), a law was passed by the World Trade Organization after its foundation in 1995. The law required that goods taken into a country had to undergo thorough checks before gaining access. Its aim was to ensure that the goods have proper requirements that a state has set for domestically produced commodities. Actually, that benefited many companies as it meant that no country would favor a company to enter its products into the country. Besides, it ensured that companies would get equal chances of accessing a state; hence many companies got encouraged to spread globally. Coca Cola Company has benefited from that law as it has experienced continual expansion globally. Free trade contracts have also facilitated its access to other nations at no cost and set up centers for its distribution purposes (Bekemans & Bruges, 1993).
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Demographics and Physical Infrastructure
Demographics refer to the characteristics of the population, which include age, population size, population growth, education level, dependency level, gender, and birth rates. A company targets population as a market for its produce. Thus, it is vital for a company to carry out an intense study on the population, so as to be sure of the target market. Literacy level of a country is paramount in trying to access a country for business purposes. If the literacy level is low, then chances of growth and expansion in the country are very minimal. However, chances of expansion are high in a country that has a big population, low dependency level, low literacy level and where the population is dense. Thus, in making its decision of global and domestic marketing, Coca Cola Company has always relied on such information for the purpose of its expansion. Knowledge of such information is paramount as it enables a company identify with business opportunities or threats that come with them. Such factors have contributed to the expansion of Coca Cola Company’s marketing activities both domestically and externally. Physical infrastructure, on the other hand, contributes a lot to the success of a company’s marketing activities. Infrastructure in this case refers to the roads and communication facilities. The availability and unavailability of such infrastructure influence a company’s decision of wanting to invest in a country. Coca Cola Company’s marketing decisions of going global have been influenced by the state of physical infrastructure in various countries. Availability of a good and efficient physical infrastructure has facilitated the expansion of Coca Cola Company. The company has expanded domestically in the country of origin and globally with the aid of physical infrastructure. Legal obligations ensure that a country and its people are safe from any harm.
Nations are composed of people with diverse culture which varies from region to region. For example, the cultures of the American people are different from those of the African origin. Thus, a company needs to ensure that the culture of people in a particular country allows individuals to have certain items or not. Such knowledge enables one make a wise marketing decision. The problem of cultural difference has not a great influence on the Coca Cola Company as it produces a drink which can be bought by anyone (Luck, 2010).
Social Responsibility and Ethics Vs Legal Obligations
Social responsibility and ethics are about doing what is right. It is vital that a company should not only get concerned with giving its customers total satisfaction and gain profits. The company also needs to be concerned with the long term welfare of humanity at large. Companies need to be conversant with rules and regulations governing such social responsibility before going marketing in varied nations. Legal obligations refer to the rules and policies that government has come with to control business activities. Gomez (2007) states that it is the duty of an organization to act responsibly and adhere to the regulations of a given state. For example, many countries require companies to give back to the society through scholarships of free aid to society. They are also required to produce goods that are healthy and safe. Coca Cola Company has acted responsibly and produces drinks that are safe. Social responsibility and ethics is important since it ensures that any company that does marketing in a particular country benefits this country and not just gains from it (Gomez, 2007).
Political Systems and International Relations
Political systems refer to the government ruling a given state and stability of this state. Thus, if the political system of a state is not stable, marketing activities are interfered with and cannot produce any good results. Otherwise, marketing activities go on smoothly, and a company is able to register a fast and tremendous growth rate. International relations refer to the relationships that exist between various countries. Two nations may be at war with each other, while others may be at peace with each other. Thus, countries at war influence marketing decisions negatively. Countries at peace trade with each other well. They, thus, influence marketing decisions of a company positively. Coca Cola Company studies such political systems and international relations of various countries before making its marketing decisions. The company has done so in the past and succeeded in their expansion objectives (Mullins & Walker, 2013).
Influence of Foreign Corrupt Practices Act of 1977 and Local, National, and International Legislation
Foreign Corrupt Practices Act of 1977 is a federal law in the USA. The law has two provisions; one of them tackles accounting transparency qualifications, and the other one is dealing with bribery of overseas officials. The law ensures that companies have legal entry into a state and that proper goods get access into a state. Therefore, every company gets an opportunity of selling its goods in different countries.
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Technologies matter when it comes to decision on domestic and global marketing. The level of technology influences a company’s decision of marketing. If a country is behind technologically, then a company will not want to invest in such a nation as the chances of expansion in this state are nil. However, for a technology state, a company will be fast in making a positive decision towards investment. Technology influences a company in a positive way. Thus, a nation that has improved technologically will enable a company expand with its marketing activities. Coca Cola Company has gained its success thanks to technology, all the way from production to consumption (Luck, 2010).
A company or business need to study critically the above mentioned factors before making a decision regarding domestic and global marketing. The factors discussed above influence marketing decisions. A company should make a decision based on all the factors, since studying of only one factor is not enough and will not lead to the best decision.