3.3 Impact of globalisation on global companies

• Define glocalisation


  when business have intention of distributing their goods on a global scale, but ensure they meet demand of their local consumers
• What is "ethnocentrism"


  idea of comparing other cultures with the qualities of the domestic culture
• How would ethnocentric consumers be beneficial to domestic firms

  may favour their domestic culture over others, meaning they are less likely to buy from foreign firms, thus reducing competition for domestic firms.
• What is a polycentric approach to business

  when global firms employ people from the host country in order to get a better understanding of the needs and wants from consumers in that country
• Give one cost benefit of advocating a polycentric approach

  cheaper to recruit an employee from the host country, due to low labour costs.
• Give one disadvantage of a firm operating in a different country with a different native language

  increases the chances of inaccurate translation, which can lower the quality of the firms products and therefore affect revenue
• Difference between mass and niche markets

  mass markets address all consumers, niche markets focus on a small group of consumers and a specific product
• Which market is likely to have a higher profit margin (niche or mass)

  Niche markets because these products are specialised to a specific consumer group, and so firms will demand a higher price,