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Critically assess the concept of ‘Glocalization’ and discuss how it relates to the
‘standardization-adaptation debate’ that prevails in Marketing literature. Based on your
literature review, analyse, compare and discuss the extent to which two companies of your
choice use a ‘glocal strategy’ (i.e. standardize and adapt their marketing mix) in their global
marketing programmes.

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Part 1 – Literature Review
‘Glocalization’ is a process noun that is formed alongside the term ‘glocal’, from the blend
of the words global and local (The Oxford Dictionary of New Words, 1991: 134). The idea
of glocalization is said to derive from the Japanese dochakuka, which describes the way
agricultural farmers adapt ones farming techniques to local conditions. This concept has also
been adopted into Japanese business techniques for global localization, where a global
outlook is adapted to the local conditions (Robertson. R, 1995 p.28). The terms have more
specifically been used within business jargon since the 1980s, but their origin stems from
Japan, as the country itself has strongly developed its spatio-cultural significance and a strong
focus has historically been placed upon its relationship between the particular and the
universal (Miyoshi and Harootunian, 1989). According to The Oxford Dictionary of New
Words (1991: 134), glocalization is ‘one of the main buzzwords’ of marketing.
In a business sense, the idea of glocalization in some contexts, is closely related to micro-
marketing. This economic term refers to the advertising and tailoring of goods and services
on a global, or near-global basis, to local and particular markets which are increasingly
differentiating (Robertson. R, 1995 p.28). According to Robertson (1995), capitalistic
production for the increasing global markets, and the adaption to local conditions is not a
business response to the global variety that already exists- such as regional, societal, gender,
ethnic and civilizational variations. Rather, Robertson (1995) believes that micromarketing-
or in the more comprehensive phrase, glocalization- is a process that involves the
construction of increasingly differentiated customers, through inventing new customer
traditions. The example used within Robertson’s ‘Glocalization: Time-space and
homogeneity-heterogeneity’ (1995) to justify this argument is the diversification of the
tourism industry, of which he states is the ‘biggest industry of the contempory world’. He
goes on to cleanly state that ‘diversity sells’.
The importance of Globalization as a topic is growing within sociology, and in general social
and cultural theory as a whole. Interest within the globalization of economic relations- such
as the growth of multinational and transnational corporations, the enhancement of capital
mobility across international borders, increased international competition from Newly
Industrialized Countries (NICs), and the expansion of trade and foreign investment- has been
accustomed into the everyday consumption of social science and public affairs alike (Cox, K.
1997). The economy is experiencing a ‘global shift’ as its spatial organization undergoes
dramatic change through the making of new economic geographies. Kevin R. Cox (1997)
explains within his work ‘Spaces of Globalizaton: Reasserting the Power of the Local’ that
the new political geographies emerging alongside those of the economic, face implications
within their macroeconomic policy and politics of local economic development. This stems
from the rapidity of shifts in production and the intensification of competition between firms
in different locations.
In the most general sense, globalization, as an encompassing compression of the world as an
entirety, involves the linking of localities; with similarities to the ‘invention’ of tradition, this
also requires the invention of locality (Hobsbawm and Ranger, 1983). The form of the
global-human condition is cemented by societies, the international system of societies,
humankind and individuals; it is the change in relationships and emphasis upon these aspects
of human life that the contempory world as a whole has solidified (Robertson. R, 1995 p.35).

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Therefore, according to Robertson (1995), the global should not be seen as counterpoised to
the local, but rather the local be included within the global.
Technology has been a driving force in the proletarianization - an important form of
downward social mobility in Marxian theory (Karl Marx, 1848)- of communication, transport
and travel. The telecommunications revolution and emergence of new firm spatial divisions
of labor has resulted in, what some academics proclaim, the worldwide convergence of
commonality, alongside the growing peripheries of the First World and the emergence of
industrial spaces such as the Silicon Valley (Cox, 1997). As a result, impoverished people
and those in isolated locations are now eager for the modern allurements that are seen, heard
and experienced through the vessel of new technologies. The product of this being a new
commercial reality, described in Theodore Levitt’s ‘The Globalization of Markets’ (1983) as
an emergence of global markets for consumer products on such a magnitude that was
previously unimaginable. This new reality has allowed corporations to reap the benefits of
economies of scale in marketing, production, distribution and management at an alarming
rate. Taking advantages of these benefits, corporations who translate them into the reduction
of world prices can quash competitors who still operate under outdated assumptions about
how the world works (Levitt, 1983).
It is now a worldwide necessity for modern services, goods and technology due to the highly
plausible possibility of raising living standards, increased entertainment, and to lighten and
enhance work. Even countries who place their ancient heritage and traditions at the forefront
of their culture, such as Iran, demand the wholesale transfer of modern technologies, goods
and services (Levitt, 1983). Marketing activities on a global scale aim to utilize maximum
standardization, integration and homogenization across markets throughout the world (Kotler,
2009) – a strategy used by multinational managers subsequent to Levitts article in ‘The
Harvard Business Review’ to achieve a least-common-denominator positioning that would be
successful across all cultures (Holt, Quelch, Taylor, 2004). Consideration of the differences
within political, economic, social and cultural environments, however, are integral issues to
address when developing such marketing strategies in order to ensure the success of the
brand. Alternatively, creating a localized strategy encompasses the customization of both the
product and the communication program for each unique market (Schiffman, Lazar, Kanuk,
2009).
The last four decades has seen a large body of academic literature and research devoted to the
standardization-adaption debate; should companies follow a strategy that is standardized
across all national markets or develop a strategy that is adapted to each national market
uniquely (Levitt, 1983; Wind, 1986; Yip, 1989)? For a company operating within multiple
markets, the decision to standardize or adapt is vital for its success as the consumer has
become more savvy, and international competition enhanced due to the acceleration of the
globalization movement (Nasir & Altinbasak, 2009). Through the advances in logistics,
transportation, and the development of new information and communication technologies, the
pressure upon international companies to achieve their financial goals has become more
challenging than ever.
Studies upon standardization were first conducted by Elinder (1965) in the article ‘How
International Can European Advertising Be?’, who initially analyzed the standardization of
promotion, followed by studies concerning product. Within recent years however,
standardization studies have comprised of all elements of the marketing mix – product,
promotion, price and distribution (Ozsomer & Simonin, 2004; Vrontis & Kitchen, 2005).

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The main drivers behind the standardization within a marketing strategy, namely the
marketing mix, have been these enhancements alongside multilateral trade agreements and
the free flow of services, goods, capital, information and people (Keegan and Green, 2008).
Nasir and Altinbasak (2009) state within ‘The Standardization/Adaption Debate: Creating A
Framework for The New Millennium’ that standardization within the marketing mix
promotes such benefits as cost reductions in production and marketing due to economies of
scale, better resource utilization, experience transfers, the building of international brands and
company images, and better coordination of international operations due to the reduction in
managerial complexity (Vrontis, 2003; Keegan and Green, 2008; Altınbaşak et. al. 2008;
Melewar and Vemmervik, 2004; Craig and Douglas, 1996; Yip, Loewe, and Yoshino, 1988).
Bruce Kogut (1989) counter argues within ‘A Note on Global Strategies’ that the
standardization strategy can be hindered through cultural and socio-economic differences,
and could result in a company’s alienation by failure to cater to the local consumers needs.
Supporters of the adaption school of thought – an organization adapting its marketing mix to
each environment (Ang & Massingham, 2007) - believe that the success of a company lies
within the cultural differences between nations. Boddewyn et al. (1986) stated within
‘Standardization in International Marketing: is Ted in fact Levitt right?’ that the major
barriers to standardization are the differentiations within national tastes, habits, regulations
and technical requirements. Scholars of the adaption strategy believe that the most proficient
marketing strategy encompasses the stage of product life cycle, stage of economic and
industrial development, media availability, purchasing power, legal restrictions and
technological development (Nielsen, 1964; Britt,1974; Lipman, 1988; Cavusgil et al., 1993;
Theodosiou and Leonidou, 2003). They argue that adaption favors the understanding of
distinct customer needs and wants, which leads to the attainment of higher sales and long-
term profitability which is the basic purpose of a company, rather than the cost reduction
achieved by cross national standardization.
Cavusgil, Zou, and Naidu (1993) suggest within their work ‘Product and Promotion Adaption
in Export Ventures: An Empirical Investigation’ that it is not a case of whether a company
should standardize or adapt their marketing strategies, rather how much to adapt them. Many
authors reject the notion of an extreme use of one or another strategy, and instead combine
the two simultaneously – coining the term ‘glocalization’. Vrontis (2003) believes that
multinational companies should focus upon the facets of operations that require global
standardization and those that need adaption, simultaneaously; standardizing the elements
that bring benefits and adapting the elements that satisfy the local market.

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Part 2 – McDonalds & Coca-Cola
James L. Watson (2016) wrote within ‘Cultural Globalization’ that food is the oldest global
carrier of culture, and changes in the way that it is consumed or served could damage a
nations traditional beliefs. Both McDonalds and Coca-Cola are globalization stereotypes
within the food and beverage sector; McDonalds, an American fast food giant, currently
heralds its signature ‘golden arches’ logo in 117 countries worldwide, and Coca-Cola, who is
most famous for its soft drink branded under the same name, operates in over 200 countries
globally. Both companies have had to adopt their marketing mix- a concept formulated by
McCarthy (1975) as a foundation for a company’s marketing program - to suit a more local
market, attributing to their continued success in diverse locations.
Product
Adapting a product to a local market can be the result of multiple different factors such as
laws, customs, consumer preferences and local tastes. Religious beliefs have been the cause
of adaption within McDonalds’ menu within certain countries, such as Israel, where under
traditional Israeli beliefs, dairy and meat products should be separated in accordance to
Kosher practices. Therefore, staple McDonalds menu items, such as the Big Mac, are served
without cheese within certain outlets in Israel (McDonalds Israel, 2016). Similarly, the
Maharaja Mac, consisting of either a chicken or vegetable patty, is available within India to
replace the traditional beef version of the Big Mac sold in western nations, catering to Hindu
beliefs that the cow is sacred and should not be for human consumption (McDonalds India,
2016). Catering not only to religious preferences, McDonalds adapts its menu within each
country according to its traditional cuisine, for example in Italy customers can purchase the
‘Snack Al Parmigano’ – a cheese stick made from Parmesan cheese of which is famously
native to the Italian cuisine (McDonalds, Italy). The success of McDonalds in countries with
strict religious practices or strong national culture relies on the invention of such products in
order to avoid alienation, although the typical burger, fries and drink combination is
standardized across all outlets globally.
Coca-Cola have taken to expanding their product portfolio to cater for the diversification in
tastes transnationally – for example, Vio, a flavored milk brand was launched within India- a
country where milk is the most popular beverage to drink- to tap into the dairy segment
(Forbes, 2016). To further its global success, Coca-Cola have also reacted to the laws and
restrictions within certain nations. For example, they have engaged in a strategic partnership
with Chi Limited – a market leading dairy and juice company within Nigeria – as result of the
banning of importing juice by the Nigerian government (Forbes, 2016).
Price
The pricing strategy of McDonalds is one of localization as they have implemented different
pricing policies for each market. Vignali et al (1991) describes the basic framework of
McDonalds pricing strategies in six steps: selecting the price objective; determining demand;
estimating costs; analyzing competitor’s costs, offers and prices; selecting a pricing method
and; selecting a final price. The barometer of McDonalds pricing strategy is based upon
demand for the product itself, and the perception of price by the customer. For example, an
average meal would cost the equivalent of fourteen minutes of a Chicago office workers
wage, however, in places such as Nigeria the same meal would be perceived as luxury and

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therefore cost more in relativity to earnings; the same meal would equate to 11 hours 23
minutes’ wage for a worker in Lagos (Vignali, 2001). Further to this, the product life cycle
also plays a key role in determining the price of McDonalds products and demonstrates a
glocalized strategy; the US market is in the decline stage of the PLC so the Big Mac is priced
at £1.13, but the Japanese market is in the growth to maturity phase so the same product is
priced at £1.27. Prices had to be cut within the US market in order to re-establish lost
revenue, however prices could be raised within Japan with more success and profitability due
to the economic conditions of the country (Vignali, 2001).
Coca-Cola base their pricing strategies on those of their competition, namely Pepsi Cola who
have driven them to be constantly faster, better and smarter. If Pepsi Cola decide to drop their
prices to gain market share, Coca Cola will decrease their pricing on certain, but not all
products, specifically their 200ml cans within Pakistan and India (Dimanche, 2012). To
penetrate new markets, Coca-Cola utilizes a lower point price especially within markets that
are sensitive to price. The aim of this is to create strong brand awareness amongst the native
population and establish themselves as a dangerous competitor within the market. Once
Coca-Cola has immersed itself into their target market, the company then repositions itself as
a premium product – careful not to exceed their prices so customers shift to Pepsi Cola, but
not retaining a price where customers assume the product quality is low (Dimanche, 2012).
During the US recession in 2011, Coca-Cola reduced the prices of their products within the
US market in response to the economic decline. This strategic move received criticism from
shareholders, yet highlighted the strength of the brand to be able to weather brief periods of
price depreciation and adapt to the economic conditions of the market (Kokemuller, 2016).
Promotion
As with their product strategy, it would be naïve of McDonalds to ignore the range of cultural
differences faced within each country in regards to their marketing communications.
McDonalds utilizes the ‘brand globally, advertise locally’ (Sandler & Shani, 1991) maxim
within their promotional strategy to acknowledge consumer attitudes towards the product;
ethnic, moral and religious considerations and; usage patterns. To advertise their hamburgers
within the UK they used English footballer Alan Shearer as a figurehead, whereas in France
they used the French international goalkeeper Fabian Barthez; whilst conveying the same
message, using different personalities assists in appealing to different cultures (Vignali,
2001). A global marketing strategy used by McDonalds was the alliance with Walt Disney
where they agreed to share marketing rights over both films and food for a ten-year period;
this led McDonalds to produce toys within the ‘Happy Meal’ product for films such as
‘Finding Nemo’ and ‘Toy Story’. Due to the worldwide appeal of Disney, McDonalds did not
need to act locally for this campaign and the toys were standardized all over the globe (Elliot,
1996).
Coca-Cola operate under the ‘one brand’ strategy within their promotion after research
showed that customers did not understand the options available to them in regards to low
calorie and sugar alternatives. The aim of the ‘one brand’ strategy is to make choice ‘easier
and simpler’, using the same coloured packaging for each segment of the brand in all
locations (Coca-Cola, 2016). Futher to this, the Coca-Cola logo has been standardized all
over the world and been untouched since 1923 (Feloni, 2015), making the brand recognizable
and familiar to customers in every country.
Place

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McDonalds operate with strategic expansion in order to effectively manage capital outlays
with over half of their 36,000 stores being held by franchisees outside of America (Salisbury,
2015). McDonalds has been accredited by William Gould (1996) as being the first company
to try and export Americas love of fast food and changes in eating habits to other nations, at a
time when fast food was virtually unknown. By franchising to local people, the US brand
culture of McDonalds can be seen as being translated to suit local people in regards to
product and service through its interpretation and delivery. As a result, franchising has been
one of the key operations that has led to McDonalds’ international success.
The potential for international growth has been realized by McDonalds who infiltrate
countries at a time when there is a lack of competitor presence; for example, in 1998 they
added 415 stores in Japan, accounting for 25% of their system-wide additions, when there
was lack of alternative within the Japanese fast food market (Vignali, 2001). Though clearly
a globalization process, there is a local focus in regards to being able to convey ideas, best
practices and human capital across borders which will in turn strengthen its competitive
advantage.
Ease of access to Coca-Cola products is essential for company to retain brand loyalty, and its
distribution process is key to this success. Across the world, Coca-Cola products are sold
within cans and bottles in retail outlets and supermarkets, as well as in restaurants, cinemas
and vending machines. Whilst this is standardized throughout the Coca-Cola distribution
channels, the company retain a local focus by having over 250 bottling partners through out
the world (Coca-Cola, 2016). All bottling partners work closely with their customers - such
as convenience stores and restaurants- in order to effectively operate within multiple local
channels (Coca-Cola, 2016).
Product Price Promotion Place
Y axis
1= Adapted
2= Glocalised
3= Standardized

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Product Price Promotion Place
Y axis
1= Adapted
2= Glocalised
3= Standardized
It is clear to see, more in the case of McDonalds, that both companies have undertaken a
glocalization strategy to gain such leading positions within their respective markets. The
‘think global, act local’ (Taylor, 1991) perspective has been most strongly implemented
within the product variable of the marketing mix, as McDonalds and Coca-Cola have each
adapted their product range to suit local customers tastes and traditions within each country.
Coca-Cola have utilized the benefits of standardization, as outlined by Nasir and Altinbasak
(2009), through their ‘one-brand’ strategy which allows them to reap the benefits of
economies of scale. The company, shown by their reaction to the US recession in 2011,
displays strong signs of glocalized behavior through their alignment with the international
environment; Taylor (1991) states that a company should have “internal flexibility required
to implement its strategic goal” to be successful throughout global and local markets. The
global marketing programs of the two have similarities in that McDonalds franchise to local
people, and Coca-Cola use local bottling companies to access a localized consumer base, but
differ in regards to their long term pricing strategies, promotion and place. Both companies
have been successful in their glocal performance, and their strategies used evokes confidence
that they can continue to expand within international markets following this approach.

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