Globalising isn’t easy

Luís Ángel Fernández Hermana - @luisangelfh
8 May, 2018
Editorial: 200
Fecha de publicación original: 1 febrero, 2000

It’s the bait that ensnares, not the fisherman or his rod

The exclusive World Economics Forum in Davos was even more exclusive than usual this year thanks, paradoxically enough, to globalisation. Following in the wake of the last World Trade Summit, this Swiss Alpine resort filled up with protesters wanting to remind the captains of capital that they are not alone in their concerns for the future of the planet. The police reinforced the message by converting the forum building into a fortress, locally. Within, the so-called “spirit of Seattle” cast its long shadow over the debates. Lawrence Summers, US Secretary of State summed up events with this resounding comment, “The greatest threat to our economic security lies in the insecurity that opposition reactions to an integrated global economy provoke.” By “our”, obviously, he meant “his”, that of the US.

This multi-faceted concept of globalisation, not always clearly understood and threatening to become one of the hot favourite diseases of the XXI century, is usually closely related to the Net Society that Castells and others have so thoroughly analysed. Although the idea of globalisation didn’t begin with the Net and won’t end with it either, it is strange that the economic phenomenon of globalisation in the Net from the electronic commerce point of view, has still not exploded. And that’s not all, the other thing is that, despite the considerable sums being moved by business on the Internet, most of this occurs largely within a local framework.

Consultants Ernst&Young have just published the study “World Commerce on the Net”, that surveys 3,000 companies that sell on the Net from Australia, Canada, France, the United States, Great Britain and Italy. As was to be expected, sales of products and services on the Internet have continued to rise considerably and are starting to turn into a domestic habit. Estimates for this year put these sales in the range of 50,000 million dollars a year. In Spain, according to the Asociación de Agencias de Marketing Directo o Interactivo (The Association of Agencies for Direct or Interactive Marketing), the combined figures for advertising and sales on the Internet reached 11,200 million pesetas in 1999. All the entrepreneurs consulted claimed to be satisfied with results, despite the fact that only 13% of the companies interviewed were making profits from electronic commerce.

The most interesting thing, though, is that, despite the global nature of the Net the majority of companies selling things on the Internet direct their business towards local markets. International sales represent just 5-25% of their turnover. In other words, the idea of 24-hour shops open all over the planet is a bit of a myth and not much else. For the moment, anyway. The “get global” strategy is becoming the major strategic concern of hundreds of companies operating on the Net. These policies confide not only in the instantaneous ability of the Internet in being able to keep its doors open 24 hours a day all week all over the world, but also in the hope that this is the way to wipe away present electronic commerce debts by multiplying the potential number of clients.

The leap into the global might, however, be more costly and complex than it at first appears to be, undoubtedly much more so than simple investment in “being on the Net” that is not always made good use of. As the Internet economy matures, present ideas still bogging e-commerce down –the excessive weight of technology to the detriment of the social presence of the users– must be overcome. This is the reason why we lose sight of the fact that the Internet is not a good substitute for real presence in the markets where companies wish to operate. This might be the case with some products, in business amongst companies, but only up to a certain point. And, of course, not in consumer commerce however much one tries to personalise it. In this case, the question of “going global” does not do away with the need for some kind of presence in other countries with the help, of course, of the Internet. In other words, going global means going local. And this goes for electronic commerce as much as for other activities where the fundamental thing is relationships amongst groups of people with common interests of all kinds, such as the consumption of particular products.

So, as happens with everything virtual, the incipient transnational online activity begins to establish its own patterns of behaviour and these, for the moment, have very little to do with with those of the culture of the multinationals that now find themselves in the eye of the storm of opposition to globalisation. This cultural clash, to a certain extent, explains some of the conflicts that trade is undergoing on a worldwide scale. Over the next few weeks we will be examining some of these differences.

Translation: Bridget King