Standardization disregards marked differences in markets. The following are the strong reasons for adopting standardization.
Why is standardization adopted in International Marketing?
1. Socializing forces prevailing worldwide are similar. They have fostered a homogenization of tastes, needs, and values in a significant segment of the population. This has resulted in a large global market with similar needs and wants. As a result, there is a worldwide demand for the same reasonably priced products of good quality and reliability.
Modern products usually fit into the lifestyles of urban consumers wherever they are. Studies identify that the needs of young urban professionals are similar to those of contemporaries in Singapore. This similarity can be found among significant segments of the global market. Families in New York need the same dishwashers as families in Paris. Families in Rome make similar demands on a washing machine as do families in Tokyo.
2. Product standardization leads to production economies. Economies of production, better planning, effective control and better use of creative managerial personnel are the advantages of standardization.
3. If cost is the only factor being considered in the foreign market, standardization helps reduce production costs. Obviously, minimizing production cost increases profits. Eg., Colgate Pomolive enjoys global market with standardized products.
4. There are other incentives for standardization which are available on global basis: lower unit design cost and easier monitoring of performance gain competitive advantage in international marketing. Thus, under the product extension strategy, the same product which is marketed domestically, is extended to foreign market.