Global Markets Essay Example

CBS. However, the situation changes completely outside of the US. Rupert Murdoch not only established a fourth TV network but also created a strong global network consisting of satellite and cable companies. This extensive network allows content from the US-based Fox network to be broadcasted worldwide through News Corporation's satellite network. Notable members of this network include BSkyB in the UK, Star TV in Asia, and ISkyB in India among other countries where News Corporation has alliances. Such an expansive network provides News Corporation with a significant advantage over the three American television networks – an advantage that is both costly and difficult to replicate.

Kao's Attack is the top laundry detergent brand in Japan, according to a survey of 170 leading brands. It is highly praised for its powerful cleaning ability and is even given as a gift. However, Kao's presence in the global detergent market is relatively small compared to giants like Procter ; Gamble, Unilever, and Colgate-Palmolive. This is mainly because Kao has limited operations outside of Japan and focuses on five major product businesses. In 1999, only 29% of Kao's sales were generated outside of Japan, with a significant portion going to nearby Asian countries. Unfortunately, this limited geographical reach hinders Kao's expansion efforts. Despite this challenge, Kao believes in its unique strengths such as identifying customer needs, conducting superior research and development (R;D), maintaining a strong sales force, and effectively managing profits.

Nestle is a company with expertise in marketing, distributing, and manufacturing food products. It has a robust global brand structure comprising of 10 corporate brands, 45 strategic product brands, 25 regional corporate brands, 100 regional

product brands, 700 local strategic brands, and approximately 7000 local brands (Parsons 1996). The company operates 522 factories across 81 countries to facilitate production in important markets. This extensive global presence enables Nestle to sell its products in both developed and emerging markets while fostering knowledge sharing and exchanging experiences among different regions.

Viacom has successfully established a strong advantage with MTV, its Music Television network. With a reach of 300 million households in 83 countries worldwide, MTV's brand identity holds great appeal to teenagers globally. The distribution of programs is made rapid through various MTV platforms such as MTV Europe, MTV Latin America, MTV Brazil, MTV Asia, MTV India, MTV Mandarin, MTV Japan, MTV Australia, and MTV Russia. Additionally, content can be tailored to suit local music preferences. The brand identity of MTV has also been extended to other ventures like MTV Books, MTV Films, and MTV On-Line. Over 50 international licenses have been obtained using this brand identity leverage. An example of this is the popularity of MTV On-Line, which has become the most visited area of America Online. The experience gained from operating internationally can also benefit other Viacom properties including Nickelodeon/Nick at Night, VH-1, ShowTime, and Viacom's Blockbuster video stores across 26 international markets.

The spatial arrangement of a company's assets and resources in various markets is crucial for its competitive strategy. The firm must establish a strong position and presence in key growth markets to become a leader in global markets. It also needs to maintain flexibility to adapt to changing demand, resources, and competition in international markets. Therefore, the spatial deployment, management, and effective utilization of the

firm's assets and capabilities are essential for establishing a global market position - referred to as the firm's "configural advantage."

The purpose of this article is to analyze the disparities between establishing a sustainable competitive advantage in global and domestic markets. International markets are inherently intricate due to their geographical dispersion, interconnectedness through trade flows, communication and distribution networks, and the presence of similar competitors or customers (Dicken 1998). The main contention of this article is that achieving a lasting competitive advantage in global markets hinges on three factors: (1) the degree of market integration and interlinkage, (2) the firm's strength and scope in international markets, and (3) how the firm manages and organizes its value-creating activities to sustain this position. The challenge lies in effectively aligning the firm's resources and operations with the spatial distribution of markets.

The article is organized as follows: First, we explore conventional methods for attaining a sustainable competitive advantage and their significance in global markets. Then, we analyze the spatial layout of activity systems. We also evaluate key factors of a configural advantage-market presence and position, strategic flexibility, and resource deployment speed before summarizing the implications on international marketing strategy.

Traditional Approaches To Building A Sustainable Competitive Advantage

The conventional methods of gaining a competitive edge involve surpassing competitors by offering a cheaper product or service or by standing out through differentiation. These advantages can be directed towards a broad market or a specific segment. It is worth noting that these approaches are not mutually exclusive. Having a distinct advantage does not mean ignoring costs, and implementing cost leadership does not mean lacking

differentiation. In fact, there are companies that excel in both cost leadership and differentiating their offerings, which is also known as "playing the spread" (Day 1990).

Recently, there has been a shift in focus towards the firm's assets or resource endowments that give it an advantage and help it build a strong position in the market (Rumelt, Schendel, and Teece 1991). According to Grant (1991), a firm must possess unique assets and capabilities to establish and maintain a competitive position. These capabilities should allow the firm to provide superior value to customers or deliver value in a more cost-effective way compared to competitors (Prahalad and Hamel 1990). Moreover, these capabilities should be rare, not easily replaceable, and difficult for competitors to imitate; otherwise, they will not remain distinctive (Barney 1991).

The foundation of a firm's position in the marketplace lies in its distinctive capabilities. When considering if these capabilities can be transferred to international markets to give the firm a sustainable competitive advantage, two important factors must be taken into account. The first is whether the targeted markets have unique customer needs and interests, competitors, and market infrastructure, and are separated by economic, political, and cultural barriers. These distinct aspects may require the firm to adapt its position and develop distinctive capabilities to meet specific local demands. The second factor relates to the location-specificity of assets and capabilities. For instance, production techniques or processes may need to be tailored to fit a particular cultural environment with specific labor or management skills. Moreover, channel bonding processes may need customization to suit distribution systems where channel relationships are based on trust and commitment.