Analysis Of Theodore Levitt The Globalization Of Markets

Today, many companies enter the global market, and some companies have become extremely successful in the global marketplace and others still struggling. In Theodore Levitt’s article “The Globalization of Markets”, he states that a well managed corporation focuses on selling standardized products with high quality and low priced instead of focuses on selling on customized products with high cost. Levitt defines the differences between multinational corporation and global corporation, and adopts many specific examples to proves his view. He defines the multinational corporation who operates in many countries and adjust its product based on the taste of specific region. This will result in a high cost to produce the product because company have to input more resource into each individual product. However, global corporation sells similar product worldwide at relative low cost. According to Levitt, the cultural differences are becoming more and more “homogenized”; therefore, becoming a global corporation will lead to the successful of the company in the global market.

To further analysis his point, Levitt illustrates Coca-Cola as an example of successful global corporation. Today, Coca-Cola is a well-known brand worldwide because many people

For example, Henry Ford had developed the automobiles that was affordable to the middle class by using the assembly line. Even though he did not invent the automobile or assembly line, he was the one create the affordable cars to the America middle class by manufacturing the exact same cars. By manufacturing the same product, he was able to lower the price for each unit and lower the unit product cost of automobile as well. Hence, price is an essential factor that drives the consumers’ purchasing decision. Therefore, standardized product is an effective way to attract more consumers because the price is