Taxes & Economics World & Society

Glocalization: The Future of the Global Economy?

The term glocalization, coined by sociologist Roland Robertson, emerged in the 1990s. It is a way of explaining how global businesses adapt to local cultures. One of the best examples of this business practice is McDonald’s, the fast-food chain restaurant that is present in almost every corner of the world and attempts to cater to the particular tastes of every culture and society that is exposed to it.

For example, the things that McDonald’s offers in a Southeast Asian country are different from the ones found in a South American country or in North America. The concept of the McCafé existed in Europe years before it was introduced in Canada, and it often times mimics the local café culture found in certain cities like Paris. The products offered in one country can differ as well; you can only find the McLobster in Atlantic Canada but not in Central Canada.

(Funnily enough, the term McDonaldization also exists. It is used to explain how the fast-food restaurant business use predictability, calculability, efficiency, and control to serve customers, and it can be applied to any type of business.)

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In glocalization, global businesses take into account cultural sensitivities and practices in order to become accepted in a local community. Glocalization is a foil to the idea of offering the same product in every corner of the world to replace local products with universal ones dictated by foreign entities.

With this business practice in mind, global companies can enter local economies in a friendlier manner by offering familiar consumer goods without imposing foreign items that may not be successfully accepted by locals.

Top business executives have expressed the importance of paying attention to local business practices, products, and consumers in order to successfully enter diverse markets around the world. For instance, one Uniqlo store in London, England, features a section dedicated solely to products made by local businesses.

In that way, yes, glocalization is good because it promotes local goods and encourages consumers to purchase things they already like from a global company. It also builds customer loyalty because consumers will go back to the same store knowing that it will offer products in a manner they are familiar worth.

Furthermore, the business practice of glocalization connects to and promotes the idea that everyone in the world is connected to one another in this age of information sharing. The use of social media also promotes the practice of glocalization as social networks and search engines cater to the specific needs and interests of a particular culture. In essence, every individual with access to the internet is already practicing and consuming glocalization.

At the same time, we need to ask ourselves the following: how is glocalization actually affecting local businesses? With the case of Wal-Mart, there have been countless instances of the big chain store settling in small towns and decimating local businesses because of its presence and competitive prices.

Even South Park made an episode about the impact of Wal-Mart. Glocalization benefits global companies, promotes local practices and traditions, and caters to consumers of diverse backgrounds. However, it is also necessary to pay attention to the negative effects of this business practice.

At the end of the day, a global and foreign brand is fundamentally shaping the consumer goods available to local populations. Moreover, in spite of the success of adopting local practices, global companies can eventually change into introducing products that cater to a more uniform and less particular audience once the local community becomes trusting of a certain brand.

While this change might not be the case for every international company, we should consider how business practices are changing and what the positive and negative impact are in different countries. Furthermore, we need to consider how glocalization relates to the use of sweatshops to create consumer goods, which shows another negative side of international companies.

As we move forward into 2020, it could be good to pay more attention to how glocalization establishes itself and evolves in different settings.

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