Effects of Globalization on Customer Buying Pattern
Write an Essay on Globalization and the Diversity of International Consumption Patterns.
Globalization has helped in development of the country as well as helped in making the countries all around the world come closer (Scriven 2014). Globalization also helps in increasing the diversity among the customers. Earlier the customers were confined to the things that are produced in the country. Due to globalization, the customers are being able to get an idea about the things that are being produced in other countries as well and helping the people to know the culture of another country (Anand et al. 2015). They are able to use the things that are being used in other countries and getting to know the lifestyles of the customers from other countries. Hence, it can be seen that the consumption patterns among the customers are also changing rapidly due to the globalization. The globalization has also taken many steps so that trading could be made easy among the countries (Stromquist and Monkman 2014). The consumption patterns are changing mainly because they are able to get the products at a cheaper rate. The consumption pattern is not only limited to the consumption of things but has spread into the lifestyle patterns as well Many western countries are looking towards the eastern countries to adopt a lifestyle that is being used by another country. Due to globalization, business patterns are also changing. They are concentrating on the culture of a place to market their products to that place (MacDonald et al. 2014).
The essay will look into the effects of globalization and the diversity on the change on the consumption patterns of the customers. The essay will not look into the aspects of globalization from the perspectives of one country or place from the perspectives of the world.
The effect of globalization can be seen in the consumption patterns of the individuals as globalization has helped in changing the buying pattern among the customers (Yeyati and Williams 2014). As many countries are exporting the products to various countries the customers are being able to get the products an affordable price. Due to the boom in the Chinese electronics sector, the use of MP3 players, the smartphones and tablets has increased tremendously (Worldwatch.org 2017). They are getting the products at a cheaper rate as the companies from China are being able to give the products at a reasonable rate.
Impact of Free Trade Agreements on International Trade and Consumer Behavior
One of the biggest examples of globalization that have affected the consumption is the free trade agreement. One of the most famous free trade agreements that has taken place is North American Free Trade Agreement (NAFTA) (Chai, Rohde and Silber 2015). Due to the implementation of North American Free Trade Agreement, the barriers that were there in the trade have been removed. Thus, the transactions of goods, supplies and services are not easier. The implementation of North American Free Trade Agreement not only helped in removing the constraints and the barriers in trade, it has also helped doing in introducing a fair completion among the countries the individuals who are in the business. However, due the implementation of North American Free Trade Agreement, the consumers have been able to gain but the workers have been the biggest losers. (Stromquist and Monkman 2014) There has been huge job loss after the implementation of North American Free Trade Agreement.
Due to globalization, the consumers are open to more number of products, which is resulting in, or choices for the customers. They are not only able to make better choices; they are also able to compare the prices. Globalization has helped enhancement of the shipping among the counties and hence, it has helped in better purchasing power among the customers (Najam, Runnalls and Halle 2016).
A research has been done to see the change in the patterns of consumptions in the OECD countries. After the launch of World Wide Web, in the year 1989, it has been able to reach 50 million audiences from all over the world (Cleveland, Laroche and Papadopoulos 2015). The launch of the internet has been beneficial to make the customers aware of the lifestyle of the people all around the world. The customers from all over the world, they were being able to see the things that the people around the world wore, eat and the way they live. It has been found that due to globalization, consumption of the household goods has converged. However, due to globalization, it has been seen that there is not much differences in the consumer patterns among the OECD countries. Most of the OECD countries are developed and hence, there has not been much change in the consumer patterns (Worldwatch.org, 2017).
The 2008 report on OECD countries have also shown the growing inequality in the payment of wages. The report also suggests that the inequality rate has enhanced to a higher degree in between 1980s and 2000s. Interestingly, the report also suggests that cash transfers and income taxes became inefficient in controlling the inequality in the payment of wages. Globalization ahs also contributed in the inequality behaviours with those who are less skilled (Gopinath, Helpman and Rogoff 2014). The integration of foreign businesses has compelled the local government in choosing those people only who are skilled. The integrated business has no place for any compromise on the part of employee selection. This process has bettered the life of those who are educated and are highly skilled. On contrary to this, it has also kept low skilled persons deprived of flourishing career. They are left with no such developments for them. Moreover, globalization apart from bringing inequality in the payment of wages, it has also contributed in differences among skilled and less skilled (Beck 2015).
Growing Inequality in Income and Wages Due to Globalization
Globalization has brought inequalities in wages, income, living standard and others. Some statistics are extremely helpful in proving the point that globalization is good for inequalities and the developed countries. In the last two decades, the household income of the 10% of richer has inflated higher and quicker than the 10% of poorer. The report on the OECD countries do further reveal that the growth in income of the richer group have been nine times greater than the poorer group. The ratio does further worsen in some other parts of world such as Italy, the United Kingdom and Mexico. In those countries, the ratio is such as 10 to 1 in Italy, 14 to 1 in Israel and 27 to 1 in Mexico. These statistics clearly supports the fact that globalization is affecting bad in those who are underdeveloped countries. Globalization is good for someone but on some other point, it is a curse for some (Jean-Yves and Loïc 2013).
The consumption pattern among the developing countries has increased mainly because of the globalization (Scriven 2014). There has been able to see a rise in the consumption. The consumption pattern is different for the poorer countries, as they are mainly depended on the environmental impact. Even though the developing countries are facing a good time due to globalization, the rural population who are mainly depended on agriculture and farming are not being favored with this phenomenon (Anand et al. 2015). Most of the population in the poorer countries are depended in the environment and farming. Hence, if even if globalization has happened it is not been able to affect their consumer patterns (Cleveland, Laroche and Hallab 2013). The people who have come to the developing countries from the developed countries will also be facing issues due to the spending structure of the consumers. There have been certain negative effects on the consumer patterns due to globalization (Stromquist and Monkman 2014). The subsidy that the developed countries used to pay has been removed. As a result, the price of the agricultural products has been increased. Thus, there has been a change in the buying behavior of the consumers as they now have to pay more for the products.
When the rest of the world seem to be benefited due to globalization, the population of Nigeria might not be affected positively due to globalization (Cleveland, Laroche and Papadopoulos 2015). A huge change in consumer pattern is not visible among the population of Nigeria. The economic conditions of the people in Nigeria are not up to the mark so that they could change their consumer patters (MacDonald et al. 2014). The social and economic infrastructure do not let the people of Nigeria to change their consumer pattern. The case of Nigeria throws light on the fact that only globalization might not be able to change the buying behavior of the products (Yeyati and Williams 2014). The economic conditions hugely affect the patterns of the consumers.
Rise in Consumption Pattern in Developing Countries Through Globalization
Globalization has enabled and encouraged countries in going for some global companies for having some wider business area and a high revenue generation. Some have appreciated the globalization factor whereas some have criticized. The criticism was mainly for inequality in the international consumption behavior. Globalization has brought some benefits to the organizations across the globe. However, it has also compelled these organizations in showing their dual inside to the different parts of world. For example, an offshore employee working in the Middle East Countries is often paid fewer wages than compare to its local employee. An offshore employee is agreeing to work because of its needs. In other words, they are exploited for some money. This is one of such examples; however, it is strongly growing without any stoppages. The trend has been changed because of the impact of globalization. Globalization has brought people of different cultures at the same place. However, it has also created an invisible distances amongst them, which can only be seen from the eyes of criticism to the globalization (Hirst, Thompson and Bromley 2015).
When one hand, globalization has led to changes in the consumer patterns of the customers, on the other hand, it has resulted in change in the way of marketing the products and the marketers who are going to a different country for marketing the products (Scriven 2014). The culture is a part of marketing and hence, there is a need to keep a check on the marketing styles for the international customers. Cultural marketing is one such phenomenon, which has been given rise to by globalization (Chai, Rohde and Silber 2015). The change in the consumption pattern is mainly because of the cultural marketing. The marketers are being able to bring various ways of promoting the products based on the culture of the country (Anand et al. 2015). As a result, the customers are getting attracted to the products that are being marketed by the international countries.
After going through the various aspects of globalization and diversity, it can be concluded that it has positive effects on the consumption patterns. The companies from china are exporting the electronic goods to other parts of the world. Due to the growth of the electronic goods, th customers are purchasing more of smartphones and tablets. The North American Free Trade Agreement (NAFTA) has removed the barriers and hence, trading has become easier for the countries. Not much difference had been seen among the developed countries but the amount of money they used to spend on household items has decreased. The competition among the business owners has risen and they have to acquire more skilled workers, for their business to compete with the international countries. The globalization has seem to affect only the richer countries as they are able to gain access to the international products. The poorer countries have not been affected by the globalization as they have to depend on marketing for their living. The subsidy on the agricultural products has been removed and hence the price of the agricultural products has risen. Nigeria is not being affected due to globalization, as the economic structure does not let the people to spend on international products. Hence, it shows it is not only globalization, the economic structure comes to play when the effect is being studied on consumer pattern. The main reason behind the change in consumption pattern is cultural marketing, which is a product of globalization.
References
Anand, S.S., Hawkes, C., De Souza, R.J., Mente, A., Dehghan, M., Nugent, R., Zulyniak, M.A., Weis, T., Bernstein, A.M., Krauss, R.M. and Kromhout, D., 2015. Food consumption and its impact on cardiovascular disease: importance of solutions focused on the globalized food system: a report from the workshop convened by the World Heart Federation. Journal of the American College of Cardiology, 66(14), pp.1590-1614.
Beck, U., 2015. What is globalization?. John Wiley & Sons.
Chai, A., Rohde, N. and Silber, J., 2015. Measuring the Diversity of Household Spending Patterns. Journal of Economic Surveys, 29(3), pp.423-440.
Cleveland, M., Laroche, M. and Hallab, R., 2013. Globalization, culture, religion, and values: Comparing consumption patterns of Lebanese Muslims and Christians. Journal of Business Research, 66(8), pp.958-967.
Cleveland, M., Laroche, M. and Papadopoulos, N., 2015. You are what you speak? Globalization, multilingualism, consumer dispositions and consumption. Journal of Business Research, 68(3), pp.542-552.
Gopinath, G., Helpman, E. and Rogoff, K. eds., 2014. Handbook of international economics (Vol. 4). Elsevier.
Hirst, P., Thompson, G. and Bromley, S., 2015. Globalization in question. John Wiley & Sons.
Jean-Yves, H. and Loïc, V., 2013. OECD Insights Economic Globalisation Origins and consequences: Origins and consequences. OECD Publishing.
MacDonald, G.K., Brauman, K.A., Sun, S., Carlson, K.M., Cassidy, E.S., Gerber, J.S. and West, P.C., 2015. Rethinking agricultural trade relationships in an era of globalization. BioScience, p.biu225.
Najam, A., Runnalls, D. and Halle, M., 2016. Environment and Globalization: Five Propositions (2010). The Globalization and Environment Reader, p.94.
Najam, A., Runnalls, D. and Halle, M., 2016. Environment and Globalization: Five Propositions (2010). The Globalization and Environment Reader, p.94.
Scriven, J., 2014. The Impact of Globalization on the Consumer. The Nouman Business Review, pp.13-23.
Stromquist, N.P. and Monkman, K., 2014. Defining globalization and assessing its implications for knowledge and education, revisited. Globalization and education: Integration and contestation across cultures, 1.
Worldwatch.org 2017. Linking Globalization, Consumption, and Governance | Worldwatch Institute. [online] Worldwatch.org. Available at: https://www.worldwatch.org/node/814 [Accessed 20 Apr. 2017].
Yeyati, E.L. and Williams, T., 2014. Financial globalization in emerging economies: Much ado about nothing?. Economía, 14(2), pp.91-131.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
