Marketing in the Developing Economy of Country - Essay Example

? Marketing to a Developing Country of the Briefly describe the country that you have selected using the facts from the Country Commercial Guide. Explain why you decided to export to that country. Support your decision to export to that country with facts from the Country Commercial Guide. This essay explains a case study of marketing in the developing economy of China. The product chosen for business is Toy’s. It is the best strategy to internationally spread the business in a nation that shows rapid growth over the decades. China is a member of the five BRIC economies. It is estimated by the International Monetary Fund (IMF) that in 2013 the country will exhibit a growth of about 7.8% in its Gross Domestic Product. The growth rate of the country is significantly slowing down in the last 13 years because of the new believe of the policy makers. The policy makers in China now believe to have to sustained growth other than simply having a volatile high growth rate (Gordin, 2011). The country has adopted a new economic model that primarily intends to expand the sectors like consumption, service and innovation. Toys played by the children are luxury goods in nature. It is empirically true that the growing yield of per Capita income level will increase the purchasing power of the big strength of the Chinese population. The country had a strong socialistic economy, over the last few years the nation has adopted liberalization in free market principles. The state attempts to increase its consumption activities from 35% of its GDP to 50% from 2010 to 2015 (Buyusainfo, 2013).Thus precisely if a business owner intends to spread business internationally for the first time then the growing market of China can be a good starting point. China is a labor surplus economy so it would be easier for the business firm to expand its business with cheap waged laborers. Furthermore the country is expanding over its level of domestic consumption. The Chinese toy market is wide and competitive, thus first starting a business in China will make the firm more competitive. 2. Determine aspects of your business’ product that you may have to change in order to accommodate the selected foreign country’s needs (packaging, advertising, etc.). China is a country which is known all over the world for its rapid technological development. Chinese Toy’s and electronic goods are well known in the market for electronic gadgets. Thus a newly entering business of toys in the Chinese market should strategically plan its packaging, advertising and promotion in the market. When it comes to packaging the company must make ecological friendly packages for the toys. The product packaging must be attractive and colorful that it becomes catchy in the eyes of young children. The bright outlook of the packages must attract the children. The company in order to promote the sales of the toys must keep the provision of product trials. Children being able to play with the toys once would surely desire to buy them. The company should try to efficiently allocate its resources to spend a considerable amount on advertisements. Attractive advertisements in television would promote the sales of the toys. The company should adopt the policy of penetrating pricing. The price of the toys at the beginning must be lower than the prices set by the potential rivals in the market. Once the company achieves brand loyalty and trust from the consumers of China they can profitably increase the prices of the toys. Toys are luxury goods and people do intend to pay a lot for them (Som, 2013). 3. Create a plan that identifies emerging markets that you would like for your business to enter into overtime. The business that newly desires to international trade should always try to emerge its fame in the growing economies of the world. This is because in the growing economies per Capita income levels of the buyers increases rapidly. Indeed, if the purchasing power of commoners increases then it would become more likely for them to turn potential buyers for commodities of entertainment like toys. Considering the present market economic system the best plan to identify the emerging market for the business would be the decision to first penetrate in the BRICS. Brazil, Russia, India, China and South Africa are strongest growing economies in the world. It is estimated that by 2040 these economies would surely overtake the developing economies of the G6 countries in terms of GDP measured in US Dollars. The five BRICS has a great role to play in the global economy in the last few years (SAFPI, 2013). (Source: California State University, 2010) The BRICS comprise of 40% population in the world and constitute to a large share of the total GDP in the world. Even in this epoch of financial crisis these economies have shown considerable growth (Shabodien, 2013). 4. Determine the services that you will need to have in place to keep your business’ international customers satisfied. Note: The services can range from special transportation to special security or Internet services. Newly emerging business should always try to improve its services in order to enhance customer trust and loyalty (Buyusainfo, 2013). Thus this new business that is being considered in this essay should render several services to the international consumers to keep them satisfied. The company can give cleaning utensils for the toys sold to the buyers so that they can maintain the toys for a long time. Keeping the toys clean will help to maintain its looks in a way that it almost seems to be new. The company can provide after sales services as repairing for a period of one year after the purchase of the toys. Moreover, the business firm can serve customers by providing home delivery facilities, when toys would be purchased online. It often becomes difficult for parents to take their children in market places from where they can buy their choice of toys. So if the company offers sales online and deliver the products at home, they would surely be able to sell more toys. Children nowadays are more familiar with using internet in the computer, thus if the company can introduce a colorful website for its toys. 5. Determine where you will have the locus of decision making for the service center. Emerging a new business in China is always beneficiary because the economy of China is growing over 9% and have resisted the financial crisis in 2008.When the company desires to expand its business in China the locus of decision making should be introduced in a manner that would be able to eradicate the obstacles the company may face in the market of China (Kourdi, 2010). The language of the Chinese people is way different from English. The existing business officials may find it difficult to carry out business in China due to communication barriers. Thus the company should its representative offices in different parts of China appointing some Chinese employees who would easily be able to follow the changing regulations and norms of the government. The company should appoint several distributors to make sure that the toys manufactured reach every market in China. The pivotal decision to be introduced in the service center is to issue proper warranty cards along with the toys. The company must maintain the terms and conditions mentioned on the card. Like if a toy sold turns out to be defective, the company must appropriately replace it with a good one. The service center should carry its services with empathy and try to behave kindly with the customers. The location of the centre should be such that it is easily communicable for most of the people. 6. Assess all forms of foreign investment and determine the best option for long-term growth. Foreign investments are of various types, namely Foreign Direct Investments (FDI), Foreign Portfolio Investment (FPI), Official Flows and Commercial Flows. In the modern era of globalization and liberalization, any emerging business can never succeed without the contribution of foreign investments and foreign market (The State University of New York, 2013). Thus it can be analyzed the best types of foreign investments that an emerging business will require for its long term growth are FDI, FPI and Commercial Flows. The best option for the long term growth of the company will be to capture large amount of commercial flows that would help the company to expand its business in the long run. The new emerging business would require Commercial Flows which are loans sanctioned by commercial banks to business organizations who intend to expand operation in the foreign markets. FDI’s are investments made by the foreign investors in a business that help the organization expand into foreign markets. The company needs to pay an interest rate to the investors in return to the investments offered. A business firm can never progress without wholesome investments made by the investors all over the world. The above contexts discuss several tasks the new business must adapt to flourish its business in the forging markets. Construction of a new factory, improvements in the business such as added valuable properties, plants or equipments can only be done with FDI’S. If a company emerges as a global leader only then small scale stakeholders would be interested to invest in the stocks of its business. The last but not least attempt a business firm must adopt to expand its business is attracting FPI’S. These are the investments made by a company in the form of Equity shares or Debentures. The success of a joint stock company depends on the values of its shares and debt funds. 7. Determine the current brands exporting to the chosen country. Develop a brand name for the selected product that is unique to the chosen country and explain your rationale behind the brand name. There are many toy companies all over the world who export toys of various types in China (Zhenglai, 2009). The essay will consider two such companies that export toys in China. Hasbro Inc. is a very famous American multinational toy company. This company also engages in the production of board games. The company not only operates in China but also carries its business in almost all the countries in the world. The headquarters of the company is in Pawtucket, Rhode Island in U.S. Most of the products of the company are manufactured in East of Asia. Whenever any analysis is made for the market on toys one can never forget the name of ‘Barbie’, it is a doll manufactured by an American toy company Mattel, Inc. Ruth Handler designed a Barbie doll by copying its look from a German doll named Bild Lilli. The company now is not only a toy exporting company in China and other economies but also a contributor in the International Fashion Weeks. The brand name for the toy for the business firm considered here in this essay is “Fun Chinese Goodies.” This is a name that the consumers, mainly the children can easily relate. Toys are items to play and playing is always fun for everyone. Thus the rationale behind the chosen name of the brand is the relation to its true intrinsic value. The name of the country in the brand would attract the consumers of the concerned nation. References Buyusainfo. (2013). Doing Business in China: Country Commercial Guide for U.S. Companies. Retrieved from http://www.buyusainfo.net/docs/x_8454998.pdf. California State Assembly. (2010). Emerging Foreign Economies. Retrieved from http://ajed.assembly.ca.gov/emergingeconomy. (in-text missing) Gordin, A. (2011). Fluent in foreign business: grow your company by expanding into foreign markets. Bloomington: Xlibris Corporation. Kourdi, J. (2010). Business strategy: a guide to effective decision-making. London: Profile Books. SAFPI. (2013). Africa–brics Cooperation: Implications for Growth, Employment and Structural Transformation. Retrieved from http://www.safpi.org/news/article/2013/africa-brics-cooperation-implications-growth-employment-and-structural. Shabodien, F. (2013). Building BRICs to End Poverty: Actionaid. Retrieved from http://www.ngopulse.org/article/building-brics-end-poverty-actionaid. Som, A. (2013). The Logic of Luxury in Emerging Markets. Retrieved from http://knowledge.essec.edu/points-of-view/the-logic-of-luxury-in-emerging-markets.html. The State University of New York. (2013). What are the different kinds of Foreign Investment? Retrieved from http://www.globalization101.org/what-are-the-different-kinds-of-foreign-investment. Zhenglai, D. (2009). China's economy: rural reform and agricultural development. Singapore: World Scientific. Read More