Advertising As A Global Industry

The Global Economy

What's in your refrigerator and where did it come from? Although it may all have been purchased from your local Tesco's/Sainsbury's/Park'n'Shop/Welcome etc the diverse origins of the food you eat on a daily basis show what a global marketplace we are living in. Bananas from Costa Rica? Mangoes from the Philippines? Mineral water from France? Strawberries from Israel? Chocolate from Switzerland? Orange juice from South Africa? Bread made from wheat grown in America? Argentinean beef? New Zealand lamb? All of it flown fresh to your local supermarket for you to take your pick. The contents of your refrigerator will be very similar to the contents of refrigerators in Sydney, Singapore, Seattle, Salzburg and Shanghai. As you reach for a can of 7-Up you will be dressed in similar clothing (Gap, Nike, Levis, Benetton, Reebok) as your counterparts in Sydney, Singapore, Seattle, Salzburg and Shanghai. You will probably drink it whilst listening to the same CDs/watching the same movie. In many different ways those of us living in the First World in the 21st century are participants in a global economy.

Ever since the first circumnavigation of the world (1519-1521), traders have looked forward to the prospect of a global economy, the free exchange of goods in all different parts of the world. Now, the speed of communication and transport have made that concept much more of a reality, at least in the First World. The sale of products and services is no longer restricted by national or geographical boundaries, especially since the collapse of the USSR. To be truly successful in the marketplace, you have to be successful on a global basis. Many companies have responded to this by extending not just their sales but their operations - thus achieving transnational status. Most big ad agencies fall into this category, with offices in major cities across the world. The speed of modern telecommunications means that, time differences aside, it is possible to run a series of worldwide offices as one, with workers communicating by fax, email, telephone, teleconferencing, and via frequent business trips. It also means that businesses lose their national identity, and, that they become less and less beholden to individual governments and regional regulations. Tax dodges galore.

Many products and services fulfil basic human needs and wants (Maslow again) and there seems to be no good reason why a fizzy drink that sells successfully in Manchester won't be equally successful in Melbourne. This means that, within the context of a global marketplace, the company manufacturing the drink in England could sell it in Australia. However, they need the resources necessary for production and distribution, and they also need to inform their target market about their product. Only very large and ambitious companies can do this (Coca-Cola, Pepsi) and they take advantage of their ability to do so. It is only the successful, global companies that get their fizzy drink into both fridges (and they probably taste slightly different, being manufactured at different bottling plants). But is advertising that persuades the consumer to buy on both continents. Transnational companies rely heavily on advertising to communicate a consistent message to their market.

For further information on the global economy, ask your Economics or Business Studies teacher.


Hang On, What About Globalisation?

A global economy is only advantageous to manufacturers who have the resources to market and distribute their goods on a global scale, and to consumers who have the wealth to buy those goods. A global economy will really only work in everyone's favour when all trading nations are of a comparable economic status, with similar levels of industrialisation. Lack of equality in our current economic environment means that some nations are in a position to exploit others eg through cheap labour.

However, it seems that economic decisions made from the 19th century onwards (the move towards Free Trade policies, A-level history fans!) mean that a global economy is inevitable, and the process by which it is being achieved is known as globalisation. We're not there yet, and there is a great deal of Darwinian evolution to go on amongst manufacturing companies, but at some point in the future consumer culture will be fairly homogenous. Not completely so. At the moment, there are still strong differences between markets, with different regions showing preferences for different products. These different preferences may arise from something as basic as climate - the market for ski-jackets in Hawaii has never been strong - or may be the result of complex social or religious codes - vodka is not a big seller in Iraq. These differences are not going to disappear overnight, nor should they - the diversity of the human race should not be compromised for financial profit. Nonetheless, there are many products which can be sold to everyone everywhere in the world (Coca-Cola!!).

Advertising's role in all this is complex. Advertising is the channel through which manufacturers communicate with consumers, and this channel becomes doubly important when the manufacturer is from one continent and culture and the consumer is from another. Advertising can. on the one hand, be viewed as the evil agent of globalisation, steamrollering local values and ideals with meaningless global brand identities. On the other hand, it can be seen as route through which products are made relevant to regional markets, and through which global brands are given local identity and significance. It's a heated debate which is going to run and run. Advertising frequently comes a cropper when trying to introduce a product which has been successful in one market elsewhere, often for simple reasons of mistranslation. There is a list here of classic international advertising gaffes.

You will find all you need to know about globalisation at

Globalisation isn't just about economics - there are social, political and environmental issues too.


And the Role of the Internet?

Until the advent of the Internet in the early 1990s, advertising did not have a truly global, non-time-specific medium. The World Wide Web provides 24/7 access to promotional material for interested audience, and as such, has given a new boost to advertising as an industry. The jury is still out on web-based advertising - after all, a "click rate" of less than 1% on banner ads (when did you last click on one?) suggests that the audience is not really getting the message. However, as Bill Gates confidently predicted back in 1996, virtually all print ads you see nowadays contain a URL where consumers can find out more. This seems to be the key role of the internet - as a provider of product information. The problem is getting consumers to visit your site in the first place, and traditional advertising is increasingly acting as a teaser for the website.

The Internet is seen by many as an evil tool of globalisation, particularly in its present form, where it is more and more commercially driven, and more and more reliant on flash advertising. The internet was originally the preserve of academics and enthusiasts, with the main purpose of sharing information. What is it now?

How Does Advertising Work on A Global Basis?

It would seem logical to assume that an ad campaign which successfully sells a product in one region may work well in another, particularly if those two regions both speak the same language. Good advertising is about the effective communication of a simple message. However, there is still much discussion of how this works in practice - is advertising, inevitably, glocal - a combination of global ideas and local execution? For instance, a print ad or TVC may be shot using three different models, with different skin tones, for airing or publishing in different regions.

When thinking and writing about this topic, you will need to consider the following issues:>


Global or local is an issue which interests an industry which is currently involved in much searching self-assessment (and resultant downsizing). Ask any industry professionals you know about their opinion.