Question

How does advertising affect industries in competitive markets? Fill in the blanks to complete the passage.

Answer 1

The very existence of the business is based upon the level of satisfaction gained by the customers through such a business. Customers may fall under different market segmentation and may respond differently to the same kind of a business. Ideal markets are to be identified before the business offers its products or services to the customers corresponding to such a market. Since the markets may differ, so shall their demands. Advertising here plays an important role in competitive markets in studying these markets and accordingly designing a customized advertisement for such a region or target market.

Hence being sensitive to the needs to individual markets may only help the businesses to create newer avenues or to tap upon better opportunities before any other competitor takes away the share of pie. The market share is very significant for the success of a business which could be facilitated by being sensitive to the individual markets’ needs hence. Moreover, customization even of mass scale, can help the customers to connect better with the Companies doing business in their regions. This shall in turn ensure more loyalty of the customers towards the Companies and the spread of good word around in the market, thereby helping the Companies to better the top lines. To market the same to the target market, Advertising and Promotions are highly significant.

For example;

In case of Localization strategy, it customizes the advertising and promotion of its products and services to best fit local needs. It customizes so as to acquire the positive local response in the international markets through the approach of multi-domestic strategies. It is help able to create a relationship well with the local customers of the country. Example could be Unilever Limited. Example could be Hindustan Unilever Limited (HUL), an MNC working in India. All the retail products of HUL (Hindustan Unilever Limited), a subsidiary of its Parent Company Unilever, has been known worldwide for its very efficient supply chain management even in the remotest part of India, 7th largest country in terms of land size and second largest in terms of Population. Hindustan Unilever Ltd. was formerly known as Hindustan Lever Limited. The Company renamed itself in the year 2007. It is India’s largest Company in Fast-moving Consumer Goods sector. It also amounts to country’s one of the largest exporters thereby focusing upon a vast chain of supply and distribution. HUL holds 40 factory units across India to manage its highly diversified line of retail products. The products are so well customized that it has been able to deeply connect with the localites of the nation.

Whereas in case of the Global standardization strategy, it is a Cost leadership strategy which is concerned with the Organizations that bear high manufacturing skills. In the situation where Global competitiveness is at higher level, this strategy could be undertaken. Under this strategy, rapid marketing expansion happens. There is an overall value addition in the technology. The database of the Global clientele with the track record of consistent growth is also seen. There are such efficient mechanisms in place that can help establishing the linkage between the supplier’s products with that of the Firm’s production processes. Further, it helps in achieving Economies of large scale production. It can focus upon efficient order sizes and seek the advantage of the low cost transport carriers owing to the bulk distribution of goods. Further, the products are so priced that generates favorable higher sales volumes.