Kelvin Nganga

 Global Marketing and Trade Environments Student’s Name Institutional Affiliation Instructor Date Abstract The global economic and trade environments have been changing rapidly in the last two decades as factors such as globalization, digital revolution, and regional integration. The EU has been central to these changes regarding how organizations tackle international marketing and commerce. This paper seeks to review the global and EU economic and trade environments with an aim of identifying the economic environment in the application of the principles of global marketing. This also looks into the possibility of how companies can use market orientation by country for new product and for existing product marketing. These factors thus help businesses understand successful market ventures internationally and factors to consider when venturing into other countries. Introduction The global and EU economies and trade are significantly different nowadays compared to 20 years ago. When planning for expansion the best thing that any business person can do is to understand these shifts when it comes to marketing. As we find in the subsequent chapters, the last two decades have witnessed a phenomenal growth in globalization, integration, and digitalization of economies. In this case, analyzing the presented multiple case study, it can be concluded that, for companies willing to internationalize to foreign countries, especially the EU, it is crucial to comprehend the economic environment and, if needed, adjust the marketing methods to the local requirements. This paper seeks to analyze how the principles of marketing can be applied to the global economy and EU foreign trade policies. It also covers the areas that managers should consider when new product or market expansion decisions are being made. 1. Economic Environment of the World and the European Union (EU) Global Economic Environment (Past 20 Years) It is necessary to state that the global economic environment has changed considerably in the past two decades. The world has become connected, integrated and interlinked through the concept of globalization of markets. But this has not been without some fluctuations such as the global crises of the year 2008 which drastically affected the pattern of international trade and the consumer. In the last decade studies revealed how industries have evolved and how ICT opened doors for companies to go international. Some of the arenas which have emerged as significant centers for global production, and which have presented some threats and opportunities to companies, are the emerging markets in Asia and Africa. The key primary macro environment trends that have also changed the business environment include the economic trends like the shift towards a sustainable environment, the embrace of the digital environment, and the increasing impact of supply chain management environment. For instance, COVID-19 led to the increased use of e-commerce and remote working in organizations so that they had to alter their international supply chain and brands’ communication strategies (Green & Keegan, 2020). Economic Environment of the European Union (EU) The EU is currently the most diverse economic area with intertwined markets, coordinated policies, and even a common currency – the euro. This economic integration has promoted movement of goods and services, and movement of capital across the Europe Union. However, the EU has also faced various challenges including the economic impact of Brexit and increased inflationary trend. Still, the EU presents one of the largest and influential economic zones in the global scale. The economic conditions of the EU are designed with fiscal balancing strategies, rigorous compliance and sustainable development orientation. The EU internal market is characterized by low tariffs and shared rules, which makes it a favorable environment for organizations that have ambitious plans on the international level. Nevertheless, it is important for firms that are planning to venture into this region to understand regulations in the EU, including very strict rules on consumer protection and environmental conservation. 2. Marketing Concepts from Chapter 1 Applied to the Global Economic Environment Chapter 1 of Global Marketing (Green & Keegan, 2020) introduces several key marketing concepts that are critical to understanding how companies can adapt to the global economic environment. Among these concepts, the most crucial ones are the marketing mix, the market segmentation, and the consumer behavior and these all come within the broader frame of economic environment that shapes regional markets. Market Segmentation and Global Marketing The first concept of marketing mentioned is market segmentation. It helps organizations to learn about certain sections of various countries or areas, which have to be targeted by the firms. In the case of the global economy, some of the considerations include income, culture, and preferences amongst the consumers. For instance, a firm, which is based in developed country, that is entering an emerging market in Asia need to reassess their price standard because the per capita income is lower than in developed countries and also because people in Asian countries have certain tastes and preferences on what they want to purchase. Marketing Mix in Global Context The other marketing mix factors, the product, price, place and promotion should also correspond with the economic environment of the targeted market. In developed economy such as the EU market, established plenty pricing strategies such as the premium pricing strategy, while in the emergent markets, companies require the value pricing. Other internal resources which may require amendment include the product offering since it may be compulsory to adapt to local peculiarities. For instance, McDonalds alters its foods offered in various countries depending on their traditional eating habits and beliefs. Consumer Behavior and Economic Condition Another aspect of the global economic setting is consumer behavior. Purchasing behavior depends on major components like the disposable income levels as well as the consumer confidence. Sometimes due to the poor economic situation or recession the consumers become more concerned about the price and thus the companies may shift their marketing tactics. For instance, when there was an economic downturn in the global market in 2008, most firms were encompassing more appealing brands and value-based promotions to capture buyers with tight budgets. 3. Applying Marketing Strategies for New and Existing Products The major strategies that require choices when expanding globally are those for new products and existing products. Decisions about these are made using the product/market matrix whose strategies include market penetration, market development, product development, and diversification. New Product Strategies For new product in the foreign market, it would be advisable that a company should adopt the Market development strategy which is a continuation of an existing product in a new market. This approach calls for considerable knowledge of the local market environment and customer needs. For example, an organization planning to invest in a new product such as a smartphone in Europe requires understanding competition, technological advancement and consumer trends on mobile phones. Existing Product Strategies For existing products, the company may employ the market penetration strategy, which involve a push towards a greater market share within a particular market. These might include ‘rude’ marketing, heavily advertised promotions, or introductions of new attractive bundled offers. In another case, product development strategies may be required if the company desires to launch a new version of the product in the foreign market that will meet the tastes of the local community. For example, Coke has sought to vary its taste and its container design in certain countries to suit these markets. The product/market matrix also assists organizations in relating their internationalization plans with the idea of market orientation. For instance, markets with a market-oriented culture that supports innovation of new products are responsive to new product publicity while markets with a traditional culture may encourage organizations to re-launch old products in a new form. Conclusion For the global economy and trade, it has been the period of essential changes during the past twenty years due to globalization, development of digital technologies, economic integration. The EU therefore has both opportunities and risks for the firms in terms of global reach. Combined with the use of marketing theories such as market segmentation, the marketing mix, and consumer behavior in relation to the global and EU economic environments, the strategies used by businesses for entering new markets should be more practical. With the help of Product/Market matrix it is also possible to get some direction for bringing out new products or existing products in the foreign markets. In conclusion, the knowledge of economic and trade environments is therefore of essence for any company wishing to triumph in a world that has been turned into a global village. References Green, M. C., & Keegan, W. J. (2020). Global marketing (10th ed.). Pearson.