Importance of Global Marketing
Political and legal environment have effects on the companies that want to do their business globally. The political and legal environments are the policies and laws of society and the present government that affect marketing. The political situations include the stable and unstable. This leads to creation of opportunities and threats. Knowing the political and legal environment is important because of the following reasons:
- It helps in the selection and operation in foreign markets- this happens through analysis of the stability of the government that the business intends to operate. The government laws are supporting the business or not are also an important issue to consider. The business must also know the relationship that exists between the home government and the host government (McDonald et al, pg.282). If the relationships are good, this allows the marketing of the business to move smoothly.
- It helps the business to identify and ways to eliminate risks- understanding the legal and political environment helps the global marketer to identify the risks in the business. The marketer will then analyze the risks and decide on the best way to act. If the opportunities are more than the threats, then the marketer proceeds to do business in that nation. This is mainly through the analysis of political issues and their affect the economy of a nation.
- They help in planning- understanding the political and legal environment is important because it helps in planning. The marketer will know the requirements that the law stipulates regarding doing business in the country. This involves getting licenses and permits to do business. This ensures that global marketing will happen without facing problems. The issues in the legal environment include the trade laws regarding tariffs, taxes and quotas. It helps the marketer to know how to gain entrance to the market.
Works Cited
McDonald, Frank, and Fred Burton. International Business. London [u.a.: Thomson Learning, 2002. Print.
