It is necessary for the companies
for launching their products in foreign markets the organizations must learn
about the culture and various other factors of the foreign country. The culture
of the country includes norms, values, religions, and language. Companies require various essential information
about the culture of the country while launching their products in emerging
markets. The paper aims to analyze and evaluate factors that are affecting the entry
of new products in the emerging markets. The qualitative research method is
used in this study under the interpretative paradigm and inductive research approach.
Under the qualitative research methods, two cases studies have been discussing
in this study for sharing their success in the emerging markets. These case
studies are the success stories of Toyota and McDonald. Toyota is Japanese
companies and it discusses its stories in China meanwhile McDonald is the
international brands and it discusses its success story in India. It has been
analyzed in this study that there are the four major factors that can affect
the Products Entering in Emerging Market. These factors are advertisements, logistics,
strategy, and cultural factors. All of these factors are affecting
significantly products entering emerging markets.
Key Words on Factors Affecting Products Entering Emerging Market
Advertisements, logistics,
strategy, cultural factors, Emerging markets, McDonald, Toyota
Introduction
of Factors Affecting Products Entering Emerging Market
With the development of
globalization, you can easily understand the cultures, products, and
competition of different countries. So how to enter an emerging market and
occupy market share has become a very important strategy for the company. A
good product must have good marketing, and good logistics plus its own good
management can win market share. For example, the Toyota Company entered China
in the last century. With good quality and stable logistics, it has good
after-sales experience for customers. It has found a supplier in China, has a
complete supply chain, and reduced the direct search for suppliers from Japan.
The price has won the Chinese
market, and Toyota has built a car suitable for Chinese consumers according to
different cultures and different living environments, so Toyota entered the
Chinese market in a short time; As we know the restaurant industry in India
will out of pork products, McDonald's entered the Indian market. According to
the local culture of India, pork products were eliminated, suppliers were found
in India, and a complete supply chain was organized to reduce costs. So
successfully entered the Indian market. These two columns show that the
prerequisites for entering an emerging market are: first, good products;
second, respecting different cultures and different markets; third, finding a
complete supply chain and logistics in the local area; fourth, reasonable Entry
strategy.
It will analyze how a product
will enter an emerging market. For example, before entering the market,
research is there any policies, cultures, laws that have an impact on this
product. What is the competition in this market? Is there a substitute? And
establish warehouses, factories, market research, and find suppliers before
entering the market. Because when a product enters the market, competition has
begun. The core of competition is stability, high quality, reasonable price,
and perfect after-sales service. Just like the above, before entering the
market, understand local laws and policies, culture, is to enter this market in
a stable manner, and to develop stably in this market. The complete supply
chain is to increase competitiveness. This article is intended to help
companies that have plans or are about to enter emerging markets to help them
enter the market smoothly.
Background
of Factors Affecting Products Entering Emerging Market
Companies have to face different
issues when they going to enter an international market which is in one of the
most understandable things at different cornerstones of a specific culture. It has
stated as “for the better understanding of different aspects of a culture, it
could the classified into different categories to make it simple and easier.
One specific category could be self-sense and self-space. Appreciation and self-identity
in several cultures could be expressed in many ways. Instantly, this thing is
more acceptable to brag in some particular cultures while people will become
more humble in other cultures. Peoples exists in some particular cultures are
formal and more structured while others may be informal and lenient. So in
simple words, we can categorize the culture to make it easier to understand the
culture from different angles.
Increasingly the global world,
the businesses should adopt new changeable and manageable strategies to
particular market they want to enter easily, to compete and to survive.
International emerging markets with a large number of population in the world
like china have 1.4 billion population, Brazil having 210 million population
and India has 1.3 billion population are very popular and profitable targets
for foreign business to enter in because of larger populations,
underdevelopment of their economies and having the increasingly business-friendly
infrastructure. Cultural differences purely depend on the long term
organizational success in the new and foreign markets for better understanding
and embracing.
Many critical or complex problems
may occur when a company enters or tries to enter in the new market, it might
encounter, such as the cultural differences with the audience. The complete
concept related to the culture is quite broad, open and wide and it rather hard
to comprehend. Organizations must have to consider the differences like language,
religions, social standards and demographics to take cultural differences. When
a company enters a new market to enhance their businesses there could occur
some in problems which it might encounter, such as the cultural differences. For
cultural differences into consideration, companies have to take according to
the language, religions and social standards and demographics. The entering
process to enter in the market and the cultural shock could be less painful if
the company has the information and knowledge it needs.
For the sake of entry is also a
vital matter for companies, for example company needs to under find and
understand that what mode of entry is best for elected market (where company is
going to start the business ), and how to do combine the all modes of the entry
processes with cultural differences, stated by David Kilsgard 2008.
For expanding the particular
business into the new markets and segments could be expensive investment
because proposed company is newest ever in the new market where it must have to
learn first , give an awareness to buyers and have to set a the trends what
others could not do easily where the many organizations simply fail to do
successfully. While many of the competing companies will try to implant their
business model and their organizational culture to the different areas of the
particular segments of the market. They often take a wider look at one of the
most important steps during the planning and designing the culture. The amazing
thing of understanding the culture allows the organization to connect directly
to with your customer and to build up successful and profitable relationships
in ever-changing the whole global world.
The Chinese use the term to be
better 关系 (Guānxì) and Indians use (jugged) unique cultural
aspects that permeate every single country’s zeitgeist. Some examples that
point out the perspectives of life which are critical to a country or cultures’
collectives, it does put an effect consciously or subconsciously to every
person within the specific group. The truth is every company will find the
cultural differences around the whole world that want to expand their
businesses worldwide and they must understand these cultural aspects with the
business practices. It has been stated by the previous research that has been
done in several fields of the emerging markets, cultures, marketing as well as
the mode of entry and in addition to several members.
The issues will found related to
the interesting cultural differences and the effect of culture has on companies
marketing strategies as well as the mode of entry of their choices. We are just focusing on that what the other
Swedish companies consider to be their main concerns related cultural
differences when companies are going to enter in the foreign, multinational or
international market and how they should solve the issues. As I mentioned above
states that the companies often take a wider look at one of the most important
steps during the planning and designing the culture.
The amazing thing of
understanding the culture allows the organization to connect directly to with
your customer and to build up successful and profitable relationships in ever-changing
the whole global world. Companies must have to solve the issue and that could emerge
from the cultural differences. We need to work with the Swedish companies,
including different industries that might be entered in the market several
years ago, and the east European markets instead of companies that just
recently entered those markets.
The main reason of conducting
this research is that many organizations are always looking for new
opportunities to expand the business in the emerging markets and their
attraction for their eastern European markets comes into place mostly from the
new political freedom in those countries and the respected cultures, this
concept has been taken and stated Hollensen, 2007.
For a new country which has been
entered in the business which is established by the company itself in, there a
new culture exists which may create an issue to the company in the many areas
for expansion of business and it is caused by the cultural difference has been
showing in figure 1.1 of on your handbook. This notion is simply aimed to
research which kind of and how many issues have to deal with the Swedish
companies when they entered in the Eastern European markets and how they fix
that kind of highlighted problems. That means that this concepts concerns about
when the many Swedish companies entered in the new markets, they had faced many
several issues that did create the complexity to expand the business, at that
time what the policies they adopt and design and how they resolve those issue
successfully.
From this research a guide for
other companies planning to enter east European markets that have been created.
When a company enters a new market to enhance their businesses there could
occur some in problems which it might encounter, such as the cultural
differences. For this purpose the guide based on instructions will combine all
the areas an which are discussed in the previous research, it will help them to
avoid and or to deal with these issues and giving the best ways of
possibilities to solve them that could cause the cultural differences. The
whole research aims that how Swedish companies entered in the eastern European
markets which are selected the higher level of marketers of the proposed
companies, what problems and issues had they faced at the time, what were the
strategies had been designed then and how to did apply those strategies on
those problems to fix.
Culture
of Factors Affecting Products Entering Emerging Market
According
to Luo, (2001) culture is referred to as the one most
important factors that are affecting the entry of the new products in emerging
markets. The foreign entry processes and decisions are influencing by the
cultural differences among the home and host countries. The companies’ needs a
lot of training to know about the procedures for overcoming the cultural
barriers that can move from the low risks entry modes towards the high-risk
ones. This procedure includes shifting from the culturally proximate countries
towards the more distant of the countries. The perceived distance among the
host and home countries according to the case of the business practices,
culture and economic systems.
The location familiarity can also
determine by it such as the garter and shorter location familiarity. This study
computed the cultural differences according to the composites index that is
used in the various models of the serval researchers. The data related to the cultural differences
also can be accompanied by the theories of the Hofstede. There are several theories that discuss the cultural
differences. The cultural differences between the home and host country are the
most important essential elements when the host country wants to launch its products
in another country. Such as there are
large differences in the culture of India and China. If the Chinese company
wants to launch its products in the Indian markets than they have to learn
about the cultural environments of India. They need to know about the cultural
perspectives of the home country (India) according to the various dimensions
as; masculinity versus femininity, uncertainty versus avoidance, power distance
and individuality (Luo, 2001).
Strategy
of Factors Affecting Products Entering Emerging Market
Here are some beneficial strategies
which are mentioned this research and tell that how companies can overcome from
those issues when they are trying to get entered in the new selected areas and
new segments of the markets in the whole world.
Advertising
Strategy of Factors Affecting Products Entering Emerging Market
Is the most commonly used
strategy which is used to communicate and giving more the awareness of about
the product of any kind of service to the customer or end-users who are
targeted in the new market segment? It plays a role for a product to make it
famous. It also plays an essential role throughout the purchasing process
decisions in the new market. There are two types of advertising have been used
for that purposes the one is an internet advertising and the other one is
commercial based advertising which could be played on the TV Channels or could
be played or conduct as a campaign which heavily appreciated for awareness and
enhancement in the expansion of the business.
Pricing
of Factors Affecting Products Entering Emerging Market
The pricing strategy should also
be very nice and attractive, always try to price any product in the round
figures that could attract the audience and it is highly recommended. If a
competitor exists in the market and you have some assets to survive and could
feel happy in the least profit then you must use least prices with the round
figures.
Pronounced strategy of Factors Affecting Products Entering Emerging Market
A formal way is that, by using
some commercials and advertising you need to go with a pronounced strategy
which creates a huge consciousness in the customer’s eye and your product will
be awaited.
Advertisements
of Factors Affecting Products Entering Emerging Market
According
to Okazaki, (2010) the advertising messages must be consistent along
with the values of the local culture and the companies are seeking for the strategies
to make the advertisements according to the values and beliefs of the people
who are living in the country. Moreover,
it has been observed by the numerous studies that the values of the local
culture are reflecting by the advertisements that are more persuasive compared
to those companies that are ignoring them. It is more important and significant to
identify the perspectives that are relevant to the impacts of culture on
advertising.
Therefore, for this insistence,
there is increasing criticism in the markets related to the national cultures
of the society in the cases of the related simple binaries, for example, the difference
among the collectivist and individualist’s culture. Specifically, the idea is
questioned by the branding is referred to as the universal technique that is argued
about the ways of culturally infected for arraigning the world. According to these
points, the brands are considered as the most important and complex cultural
forms that are deeply rooted in the context of the social, geographical and
historical (Okazaki, 2010).
Still
logistics of Factors Affecting Products Entering Emerging Market
The global operations are used to
attain the market penetration and cost-saving and certainly, due to this the
risk are accompanied by this. In the
emerging markets supply chain is the point at where the whole series of the major
risks are presented by which the plan can be challenged particularly. It needs to design the design as well as
implementing the sophisticated strategies for mitigating and managing the
risks. The risk related to the supply chain is considered as the complicated equation
of the risk that is occurring to the business among the delivery of the final
products and extractions of the raw material. While seeking for the emerging
markets the supply chain managers are considered about the entire aspects of
the risks such as; for paying the customs charges, the selections of supplier
and for firing and hiring. There are the various key risks related to the
supply chain management and these are included as;
Political Risk, Geophysical Risk, Trade Risk, Operational Risk, and Economic
Risk.
Research
Objectives of Factors Affecting Products Entering Emerging Market
The major aim of this research
study is to identify the factors that are affecting the new products into an emerging
market. This study delves into subjects: the entry of a new product and that
too in an emerging market.
To be studied in more detail
regarding the factors that affect the entry of new products into a market.
To evaluate the characteristics
of emerging markets that have been studied in this research
To identify the factors that are affecting
the entry of new firms in emerging markets.
To access the various factors as
to suggest which factor play an important role for new products entering
emerging markets.
To measure the influence of
culture on the product entering the market.
To establish the strategies for
launching new products in emerging markets.
To access the role of
advertisements for launching new
products in emerging markets
To measure the effects of
logistics for the consumer experience in the emerging markets.
Research
question of Factors Affecting Products Entering Emerging Market
Under this heading, I will study
what is the key to affecting products entering emerging markets such as culture,
Strategy, advertisement and still logistics. How to solve these problems, or
what problems will arise in terms of cultural factors.
What influence does different
culture have on the product entering the market?
What is the enterprise entry
strategy? How to compete?
Does advertising have a driving
role in product sales and word of mouth?
Does logistics affect the
consumer experience and how does it affect it?
What are the factors that are
affecting the entry of new firms in emerging markets?
What is the role of
advertisements for launching new products in emerging markets?
Literature
Review of Factors Affecting Products Entering Emerging Market
The definitions of the cultural
differences and culture in the context of the East Asian countries are discussed
in the extensive manners in this chapter. Moreover, it discusses the various
models of entry which are available for the companies that are entering the new
markets and it also discusses the advantages and disadvantages of them. The
different economical models are also explained in these chapters and it also explains
the ways how these models can be utilized for analyzing the cultural model. The
impacts of the culture and cultural differences on the strategies of the companies
are also discussed in this chapter.
Entering new markets is always a
challenging task that requires a meticulous study of the market environment and
the factors that are associated with the transition of entering new markets.
For a business to launch any product in the market, it is essential to first
conduct a deep analysis of the market and ensure due diligence so that the
company can ensure that the new venture would be profitable. For this many
factors have to be given consideration. Inadequate research into these factors
could cause serious financial damage to the business because the company
expanding its product reach would not be able to understand the consumers and the
business environment existing in the country. These factors have been
collectively identified as the Euro monitor International Four Pillars for
market entry strategy.
The first pillar is market and it
includes factors like macroeconomic stability, consumer market size, growth,
and openness. The second pillar is populations – it helps in analyzing the
demographics of the market and how business products would be received in the
market environment. The third pillar is accessed which would include factors
such as infrastructure and availability of internet. The fourth pillar is the business
environment that focuses on the overall regulatory environment in which the
business operates.
The first pillar is concerned
more about the structure of the market which is defined by factors such as
macroeconomic stability, consumer market size, growth and openness (Boumphery, 2015). Macroeconomic
stability refers to the economic conditions in the country and the fiscal and
monetary policy followed. Moreover, inflation, the balance of payments and the
overall economic environment of the country play a role in facilitating
business. Thus, macroeconomic stability becomes an important factor. This is
followed by the size of the market so that it can be ascertained whether the
product would generate enough demand or not. Moreover, the growth of the market
is also important. A stagnant market will not be suitable for investments and
therefore, a market with high rates of growth in terms of purchasing power that
can generate steady demand would be ideal. Lastly, the openness of the market
is also important. Market openness refers to the liberalization of markets. The
more open and liberalized a market, the greater are opportunities for entering
the new market (BusinessWire,
2014).
The second pillar focused on the
demographics and is quite pivotal. It is essential to know where the target
market lives, its age, habits, size and growth trends. Moreover, it is also
important to know where they live that is in urban or rural settings and what
kind of lifestyles they have. All these considerations must be factored in when
making the decision to launch a new product in the market.
The third pillar relates to
access. Firstly, the market structure is important as mentioned as factor one.
If, for instance, the product market is a monopoly there will be high barriers
to entry and exit but it would be relatively easy to enter and exit if the
market is competitive in nature. More important is the physical accessibility
which is determined by the infrastructure and the availability of connectivity
such as the internet. The better the communication network in terms of roads,
rails and other means of transportation the greater the prospects for success
of new products entering the market (Boumphery,
2015).
Moreover, the internet in today’s age has become more important as it is being
used as a marketing tool as well. Therefore, it has also become important that
there are a great number of internet users so that products can be marketed
online.
Lastly, the business environment
is another very important factor. There are different factors that contribute
to the business environment including ease of doing business, regulations,
factors such as corruption and the human capital available in the country (BusinessWire, 2014). The business
environment with respect to ease of doing business varies in different
countries. In developing countries, there is the problem of corruption and
nepotism which makes conducting business difficult. However, in developed
countries, the regulations are quite strict which also adds to the cost of
doing business and can be difficult in themselves. Thus, this factor has to be
given consideration when new products are launched in the markets.
Businesses are now focusing on
emerging markets as the developed markets are somehow saturated and do not show
prospects for lucrative profits. Therefore, astute business planners focus on
newly emerging markets and to make use of the first-mover advantage. This has
both benefits and costs. There are benefits in the form of low labor cost,
welcoming attitude of the governments of host countries, low advertising costs
and less competition (Nakata
& Sivakumar, 1995). However, at the same time, adaptation
to these markets in required that are sometimes not technologically efficient
and have economic, social and political issues that could hinder the progress
of the business. Thus, entering new emerging markets can be a tricky business
and requires a thorough study and analysis of the market environment.
Koch (2001) analyzed that market
selection and the entry mode for selection are two aspects of one decision
process. He examines factors affecting the market selection and market entry
mode selection and divides them into three categories including external,
internal and mixed. The study concludes that there is a dominant role of the internet
in today’s day and age in facilitating international business and expediting business
processes and therefore, it should be studied in more detail. Thus, when the
product is launched, an appropriate mechanism in the form of advertising needs
to be devised so that the product and its message can reach the consumers. This
is essential for the product to be successful.
Emerging
Markets Explained
With the global world increase, a business can be utilized
or follow such strategies that they can easily enter into any type of market
and start their business in a new market easily. For foreign business the
emerging markets are China, Japan, and India that have large populations,
having the increasingly business-friendly infrastructure and growing economies
with their large setups. The world cultural differences are very important to
understand and embrace by those organizations who want to long term success in
new and foreign markets.
Every country has unique attributes to deal with others and
also perform business in the market. For that organization who wants to work
at, international must understand the cultural differences and determine the
business practices that are helpful in emerging markets and also provide a
better understanding of the new market. For emerging markets business have to
consider few factors related to new market like visit new market and consider
what are the requirements, demand and environment of the market, go to that
country, where you want to start business and meet with local people , come to
know their needs, their language and their market conditions (Lesley, 2018).
These all factors help to determine in what way to emerging
market is beneficial for the business. Observe the network of the market and
get knowledge about the dealing of people in that market. Every market has its
own specifications and uniqueness so determine all these before emerging the
market. Also, get the proper understanding that what is the way of living the
people and how they deal in their markets. Emerging markets are going to be
successful if a business knows all the flaws and benefits of the market and
with this also consider what the main areas of the market are and also
determine the strong and weak points of the market.
With all these factors is consider that expanding business
in a new market is a very expensive investment for the business because
sometime after considering all the things the business is going to be
unsuccessful and also move back to its previous market. Many different
organizations apply their organizational culture and business models in new
markets but they are failing to do the business because they forget to consider
the cultural differences and due to this they cannot run the business. A better
understanding of culture help to understand the customer and its requirement
and then profitable and successful relationship can be developed between
customer and business.
Successful companies utilize new and innovative strategies
that are not used at their previous s or home markets and determine a new way
to implement these strategies. The business also understands the institutional
differences between different countries and then enter that market which suits
best and then set strategies for such market and runs out the operations in
such a market to get maximum advantages or benefits. Country portfolio analysis
is used by a different organization to select the new market systematically.
With generating the potential profit they also consider the infrastructure of
doing business in that market. (Sinha, 2005)
Cultural
Factors of Affecting Products Entering Emerging Market
International markets are making things more interesting and
more promising as well as many of the markets are not only changing their
working style but also introducing some unique aspects to grow more in the
industry. In the previous time, there was a myth that if you are earning in
dollar or in any international currency only then you own successful business.
Now people have been changed as they use to bring the new innovations in a way
that they not only managed to earn in many international currencies but also
promotes their home country currency very much at international level.
Businesses if in search of entering any different market
they must adapt its policies and way of working so that it can grow in the way
it should be. Due to their increasingly business-friendly infrastructure,
growing economies and large populations the markets of Brazil, China is very
much idealized by people and people targets that industries in order to become
more successful. An organization that has some products to produce except the
fact that whatever they are making they must follow its appropriate norms and
ethics as the industry who work in an efficient manner would only grow higher
efficiently and successfully (LINDALIDAN, 2016).
The main thing that organizations should concern very
carefully is to take care of their workers working in their factories. The
aspects which new countries should learn and understand in order to become like
that, countries must be their everything like there way of working, their style
of treating their staff their religion, language, culture norms everything.
Emerging markets have a lot of charm and attraction in them in different ways
all cannot be brought to an end but some can be tried in order to become more
successful and more renowned in other companies comparison. The culture it is
following other countries is quite wide and it has many things that should be
considered into considerations. Different things have different aspects of
making a culture unique as many of the things going to happen in a different
way.
Cultures bring happiness and uniqueness in the aspect of
different companies going to follow the norms and technologies in terms of
making the atmosphere more improved and more beneficial. In order to achieve
what you want to do are working in the context of taking this rule as bending
rule. Whether the constrains is it whether operational, financial it is
navigated to have an accurate business sense to do the job. In an appropriate
business, manner tries to learn colloquialisms, nuances, and languages of local
and maintain an introduction with the market of the place where you want to set
your operations in it (Techo, 2018).
You can lose your meaning if you do not include meaning in
your translation and you must learn the languages properly as languages are the
foundation of a better and improved business manner. In a meaningful
relationship, the different aspects worked and they made an extraordinary and
meaningful experience of making the organizations more successful and
flourished. There may come any issues in businesses that can evaluate and
analyze in a way that they can have the way to bring change the following
issues are mentioned here:
During working in the organization, every business has to
face many problems and issues related to its field. According to the accomplishment
of their targets and obtain their goals, an organization has to perform very
well in all sectors or areas as a huge network going to run in the
organization. If the organization working on a small scale and it never manages
the issues related to globalization then it never approaches to large
scale. Lack of innovation makes you lose
in the competition with many other organizations because innovation makes your
services more attractive.
The deficiency of use of latest technology also makes you
less developed because it makes your workings ineffective and incompetent with
other competitors that are bad for the performance of your organization. There
are many types of issues are present in the market that may be faced by the
organizations in terms of getting success and fame in the market. These are: There are some times the policies and
rules are very much strict for the organizations that they disturb the working
of the organization dull and slow so that it cannot be able to get the growth
in a positive sense. (hoseph johnson, 2008)
Diversity expands negativity in the organizations as the new
techniques and strategies make the working little difficult for the employees
and when they are bound to do that tasks for the organization they did it but
not with the great efficiency as a must. There are many of the complexities can
be happened in the organization while they are working. Sometimes the
complexity became of the use of resources; sometimes the time cannot be managed
properly in the organization etc. These types of complexities make the working
process slow and ineffective. Sometimes employees or management gathers so much
information for completing a project that is not even relevant to the project. (Hunt, 2019)
There are many of the resources are used in terms of getting
that information but due to extra efficiency both the sources and information
get wasted. The strategies that are made by the organization in terms of
implementing and completing new projects must be according to the current
working trend. If these are not updated then they cannot be able to get success
in the organization’s working. When any change occurs I the strategy of the
organization then stakeholders are the one who notices this change. They invest
their money and they have complete right to keep in touch with all the changes
and events happen in the organization. When any change they have to feel some
issue so it’s better to tell them about new strategies and all the changes that
may affect them in the future and they get some issue related to that change. (Haire, 2019)
Globalization
& Advertising of Factors Affecting Products Entering Emerging Market
Advertising plays a pivotal role
in consumer decision making. There are different methods of advertising but
their effectiveness is dependent on the perceptions of consumers (Greyser
1972). Many studies have found that there is a strong link between consumer
attitudes and advertising which is also a precursor for the development of
consumers’ attitudes towards a brand (Mackenzie and Lutz 1988; Thorson 1981).
There have been other studies that have looked at the study of advertising and
consumer decision making from different aspects.
This includes studies that have
studied the impact of cross-culture differences on advertising. Other aspects
such as the role of emotions in advertising have also been studied. It has been
explaining that advertisements can be divided into two categories – thinking
ads which focus on factual information and feeling ads that focus on the
emotional aspect the product would have on the consumer. Based on this, consumer’s
base their decisions for purchasing a particular product. Other than the role
of advertising, the process of consumer decision making in itself is also an
interesting area of study. All marketing decision is based on the knowledge of
consumer behavior.” Logically speaking, the role of marketing and advertising
is aimed at reaching out to consumers.
Studies have revealed that
consumers are reached certain moments or touchpoints that are explained
metaphorically through the tunnel and includes factors such as awareness,
familiarity, and consideration of the product which leads to its purchase and
loyalty. Marketing and advertising have complex nowadays due to a variety of
medium available. Moreover, consumers have also become intelligent and
well-informed with the vast amount of information available. With the internet,
they can search for information, compare prices and brands and make the right
decisions. This means that consumer decision making is being influenced by
information available as well. Therefore, strategic analysis of consumer
decision making needs to be done so as to understand how consumers get
information and how they decide what to purchase based on this information
(Belch & Belch 2009
In an organization, there are many types of research methods
have been present. These are according to the strategy that has been made or
implemented in the organization that how it is working or responding to the
organization. The decision making is a
complete process that implemented or created after a specific consideration to
be taken effectively so that it provides the most efficient way in terms of
making the right decision for the right work to be solved effectively as a
must. It is very much important to make decisions according to the issue that
has been occurred in the organization. After identifying the issue you must
gather information about it to make a better solution to the issue. There may
be many of the issues and perquisites can be happened in the organization that
impacts on the correct decisions to be made by the management of the
organization.
The decisions must not be affected by those of the issues
and perquisites that make the decision more effective and efficient as a must.
All the decision must be taken with some proper set of instructions. Firstly
identify the issue and then explain its solution related to issue or problem.
The effective decision making gives very much benefit to the organization and
they also increase the value of the organization. So effective decision making
is very important for every organization (Sinclair, 2015).
Globalization is very important to enhance the scope of the organization
and with this also important to advertise the organization in the whole world.
After entering into a new market this is also very important to get advertise
because people must get some information about the new product and
advertisement is the best way to promote the product. With this, the techniques
must be used that help the advertisement at the global level because every
market has its own way to introduce new product so the organization has to
follow that method to promote its product among the customers.
The leader is an important part of the organization that has
to perform many functions and also take some important decision. On the other
hand, a leader has to maintain the level of satisfaction of thy customers as
well as of the employees. The level of satisfaction of employees change with
time and it depends on the policies of the organization. The change in the
organization is a very crucial matter for the employees as well as the leader.
That is why it is necessary for the leader to maintain the satisfaction level
of all stakeholders. Although the level of satisfaction of clients was good in
the last year, however, it declines due to the reception services and continues
to suffer a lot. (Kokemuller, 2019)
With the utilization of the model that has four frame
structure, that theorizes the inside of management, year of reaches and wisdom
of psychology, sociology, anthropology, and political science morph into a
model that has the ability to organized the organization into four frames. Each
frame is resembled mental model and has the ability to capture one of a
different picture of concerning organization like political, human resource and
symbolic. This frame is based on the idea as well as the assumption that
facilitates people in developing understanding; assemble information in a
pattern that is recessional and registers. This provides the leader more
comprehensive picture of the organization (saylordotorg.github.io, 2018)
Charles R. Taylor and Mary Anne
Raymond (2000) proposed in their journal that China has implemented an
innovative advertising law in the year of 2015, which includes stricter
regulations on advertisers who want to promote their products or services in
the country. These regulations cover-up equally for both the Chinese companies
as well as the foreign companies which do their business in China. The main
regulation of
is that it
disallows misleading content. Means that, an advertisement that features a
product or service which does not really exist or presented in inappropriate
information such as poor quality, wrong ingredients or price, etc. would be
considered misleading by the
. This law also prohibits advertisements from using terms such as “the most” and “the
best.” Thus, the companies which came from other countries such
as Japan with its “Toyota” should not use these type of term to make the
advertisement for its product (Taylor & Raymond, 2000).
According to Panchali Das (2007) in
his journal,
is a deliberate,
self-regulatory council recognized in the year of 1985 to stimulate liable
advertising and to improve public assurance in advertisements. The various laws
included advertisement as a whole and those linking to definite segments and
misuses methods of advertising unethical materials. Things that the foreign
companies from countries such as China and Japan should consider in producing
the advertisements for their business in India are; the advertisement should be true, the advertisement must
not be illegal, and, the advertisement must not misguide the society,
especially children. In addition to this, the roles of
are (Das, 2007):
To be responsible for protection in contradiction of the
indiscriminate usage of advertising meant for the promotion of the product
which is observed as menacing to the people or society which is not tolerable
for the society.
To make sure that advertisements perceive justice in the
market competition so that the customer’s requirement to be well-versed of
selections in the market and the standards of largely acknowledged competitive
behavior in business is both obliged.
No advertisement will be allowed to disparage any race,
class, or nationality. Likewise, such advertisements should be evaded, which is
in contradiction to the Indian constitution.
Vesa Peltokorpi and Fabian Jintae
Froese (2016) suggested that Advertising could be really expensive in Japan. As
a consequence, many local firms and distribution associates every so often
figuring out for certain type of collaboration commencing their foreign suppliers.
Not the entire companies could pay for placing their advertisements in Japan's
main national newspapers or else on Japanese television. Local and regional
newspapers along with the television stations, and also daily sports newspapers
are considered to be less expensive and may logical for a product with a
resilient perspective in a specific region or demographic fragment.
Moreover, the authors also stated
that to create and preserve business relationships in Japan, foreign companies
need to appreciate the Japanese business culture along with its social
practices. Irrelevance to local business societies of the foreign companies
from other countries such as India or China along with lack of obligation or
international business experience would lead to misinterpretations, and hence,
lost opportunities. In conclusion, the foreign companies need to understand the
requirements and expectations of the Japanese customer, such as product
quality, presence, display and packaging, delivery and also after-sales service
as well (Peltokorpi & Froese, 2016).
Enterprise
Entry and Consumer Behavior of Factors Affecting Products Entering Emerging
Market
According to Joseph Katie (2013),
the expansion of Toyota into the globe’s overcrowded and profitable market
place of China in the year of 2002 was noticeable by the usage of its Japanese
management framework that verified how the company such as Toyota is able to
produce amazing value through adopting long-term, corporation relations with
their suppliers. In applying its management framework to develop into China,
the management of Toyota’s identified that further prospects occurred intended
for cost reduction for the period of product preparation than in real expansion
production and improvement. By doing this, Toyota was objected costing to
assist its capability to strive in the viable Chinese market place (Katie, 2013).
On the other hand, Gong Sun,
Wangshuai Wang, Zhiming Cheng, Jie Li, and Junhua Chen (2017) mentioned in
their journal that since China is considered to be dedicated to its “reform
and opening” policy established in 1978, the economics of Chinese has
growth up, and greatest worldwide businesses have established a company in
China. Conversely, a number of foreign businesses are diffident to come into
the Chinese market place for the reason that they do not completely recognize
Chinese consumer behavior. Chinese consumer behavior is an undeniable fact of a
complicated matter, as consumer tendencies differ amongst dissimilar societies
and districts in China. Escalating and accepting the inclinations along with
the behaviors of dissimilar consumer societies in China is the main key to
whether arriving or increasing more into the Chinese market place (Sun, Wang,
Cheng, Li, & Chen, 2017).
Kunal N. Talgeri
(2013) in his article mentioned that, to be successful in India, Toyota trailed
the legendary Toyota Way. But then again, the country also trained the extremely
stiff Japanese company that is compensated to diverge when required. From the year of
2011, there has been an inclusive logic of gloominess in the market place; the
profitable environment has not been mainly worthy, where the prices of fuel
have increased as inflation. In addition to this, there is a cut-throat
struggle in the car market place—and the performance of Toyota has been stellar (TALGERI, 2013
).
In addition to this, a study by
Ramanuj Majumdar (2010) suggested that consumer behavior in India
powerfully gets the influence of the caste structure that classifies every
single society in the country. If this structure forms social variances, it
also lets reinforced contiguity relationships among those people within a
similar society. As a consequence, advertising a brand could really work a lot
through the relatives’ sanctions and Word of Mouth (WOM). In overall, the
consumers in India are becoming further committed to brands devoid of remaining
true to any of them. Certainly, they search for beyond the entire added-value
of the acquisition and the brand itself, rather than its status. Thus, the
foreign companies who wish to scope many consumers in this country should able
to make substantial hard work in market penetration (Majumdar,
2010).
Cultural
hindrances of Factors Affecting Products Entering Emerging Market
According to Kat Yamamoto and Robert
A. Lloydapan (2019), Japan is internationally well-recognized on behalf of its
specific culture, both in the context of material and character. The country is
also one of the greatest famous traveler destinations in the world, plus, Japan
is considered as the globe’s third main economic supremacy after the United
States and China. Even though Japan comprises vast business prospects, still,
many foreign companies state that they find a number of difficulties to start
up their business there. To some extent, it is a real fact. Japanese language,
high-rented cost along with various traditional business etiquette are certain
of the hindrances that the foreigners have to deal with their Japanese
colleagues.
On the other hand, these features
should not be embroidered. Instead, the appropriate indulgent of
the Japanese business culture is the finest method to success for any foreign
companies who are willing to discover the Japanese market place. Japan,
as well as China, are embedded in the Confucian moral code beliefs impelling
the entire feature of people’s lives comprising the practices of the businesses
as well. However, the authors also mentioned that the Japanese business leaders
are considered as quite humble to study from others who know better than
themselves and adjust to the changing national cultures, moral principles, as
well as foreign customs (Yamamoto
& Lloyd, 2019).
Jingchen Jiang and Yanqing Jiang (2015) described
in their journal that, as the fastest-developing main economy in the globe,
China endures to provide the international companies eye-catching investment
along with the business prospects. On the other hand, doing business in China
likewise means steering the difficulties that ascend commencing China's
exclusive ancient, governmental, and cultural backgrounds. China provides many
chances meant for new projects; the Chinese market place endures to raise
around
yearly, and it is
considered as the second biggest economy in the globe after the United States.
Along with the opportunity, the challenge also comes. There are some
significant challenges to deliberate when doing business in China. The business
people should have a number of sympathy to the Chinese culture along with it
influences on the business. Hierarchy functions as an essential portion of
business culture in China where the leaders and managers being further notable
than in lots of Western countries. One thing to be noted here is that the
leaders and managers in China really expect obedience without any question (Jiang &
Jiang, 2015).
According to Sandeep Kumar and Amit
Gautam (2017), India is not only famous as one of the firmest developing
countries around the world. Instead, the country is also going throughout a
period of extraordinary economic liberty, which conceding foreign stockholders
to have further access to its huge and diverse market place. Many of great and
young populace, as well as a durable export segment, expect the growing
businesses, through a prospective consumer foundation that far-off exceeds of
the greatest other countries within the advanced and emerging world.
India is famous as a country which varied in nature, which makes it quite
complicated for any marketer to classify the normal threads of Indian culture
along with its main values. There are lots of dissimilar sub-cultures live
together in Indian community with their particular unique norms, values, philosophies
as well as behaviors.
Consequently, in India, people
are mingled by receiving contribution as of their cultures along with their
main values. Effective companies place much exertion to appreciate the
exclusivity of general Indian language and further local languages. They also
figure out to discover a brand name and also the communication note that would
able to fit effortlessly within the background of the cultural dimension in the
country. However, there is still vague obstacles for foreign companies in
entering the Indian markets, and this hindrance is a negative state the
consumer’s perception toward the products. The country was viewed as "mirroring
buyers' general assumptions about the nature of items made in a specific nation
and the nature of individuals from that nation" (Kumar &
Gautam, 2017).
Theoretical Model of Factors Affecting
Products Entering Emerging Market
The theatrical model in the research
studies discusses the important construct that issued in the particular study
for analyzing and evaluating the effects of the independent variables on dependent
variables. This model also discusses
the relationship among all of these constructs. This model portrays the
dependent and independent variables as well.
Source of Data
collection of Factors Affecting Products Entering Emerging Market
The research study is conducted
by using both sources of data collection as a secondary source of data collection
and primary source of data collection. The secondary source of the data
collection is led towards the preexisting data that has been used for other
projects or discussions. The primary source of the data collection lades
towards establishing new concepts and theories. It includes two types of
research methods as quantitative and qualitative.
Research
methodology of Factors Affecting Products Entering Emerging Market
The qualitative research strategy is
used for conducting the research study. The qualitative research study leads
toward the previous existing theories and the concepts which are supporting the
serial business cases particularly in the context of the emerging markets. By
following the interpretative paradigm, the research study used a qualitative
research strategy.
These methods are used because the
research study is based on objective and subjective data. The qualitative
method is used only for verifying the previous theories. It is depicted by the
several research studies of the various authors that at a high level usually
the qualitative research study is conducted. In this research methods, the data
is only conducted in the forms of the Alphabets as compare to in the forms of
the numeric figures as in quantitative research method. The qualitative
research method absolutely relies upon interpretative paradigm as well as a researcher
whose follow an interpretative paradigm can only use a qualitative approach.
Qualitative
research is conducted on daily routines base of peoples and in own words of
peoples and the big fact about this research is that this research is
subjective and inductive in nature.
Research
philosophy of Factors Affecting Products Entering Emerging Market
The interpretative paradigm is used in
the research study. The exploratory research study follows the interpretative
paradigm for this research study under the qualitative research method. The
interpretative paradigm is used because it is easy to process of data
collection and data analysis. This study is objective in nature for that this
paradigm suits this study the most. The interpretative paradigm is used because
it is followed by previous researches and theories. The interpretative paradigm
is used in this study because the nature of reality in this paradigm is
socially constructed and multiple and this philosophy provides the brief
concepts for participate, Interactive and cooperative
views. This paradigm is the best fit for
this study because the study is related to particular social topics.
Research
approach of Factors Affecting Products Entering Emerging Market
Under the interpretative paradigm, the
inductive research approach is used to conducting a particular research study.
In the contexts of the investigation, the importance of the theory is referred
to as the specific points among the various research approaches as an inductive
and inductive research approach. By using
the inductive research approach this exploratory research study has been
conducted because the validity of this approach is much better for exploring
the theories of the various authors such as concepts and theories related CSR
are explained in the particular article.
The inductive research approach leads towards the development and
exploring the facts of the new theories and it is used for the qualitative
research methods. This approach is used in this study because there is not any
hypothesis developed in this study because the developments of the hypothesis
occur in the deductive research approach.
Data collection method of Factors Affecting Products
Entering Emerging Market
Observation methods are used for analyzing the data of the respondents
and the two case studies are used as a sample in this research study. Both of
these are discussed the success cases of the business as the case of the Toyota
and McDonald. Both of these business are discussed about their success stories
by following and implementing the strategies of the business.
Discussion
and Analysis of Factors Affecting Products Entering Emerging Market
It has been analyzed in this study
that what are the major factors that can be barriers for launching a new
product in emerging markets. In this chapter of the research study, numerous
problems and arguments of the research paper have been discussed in extensive by
using the cases studies related to entering emerging markets. This chapter
discusses the case studies for evaluating and analyzing the impacts of the
factors on the entry of new products in emerging markets. The methods of the
cases studies are considered as the best solutions for analyzing the factors
that are affecting the entry of the new products in emerging markets. Moreover, by analyzing the case studies, the
complex phenomena of the cross-cultural workforce can be explained in an
effective manner for making sure the same output is achieved in the same
company and culture of the various business.
The issues related to the
interesting cultural differences and the effect of culture has on companies
marketing strategies as well as the mode of entry of their choices. We are just focusing on that what the other
Swedish companies consider to be their main concerns related cultural
differences when companies are going to enter in the foreign, multinational or
international market and how they should solve the issues.
Two case studies will be used in
this study as a sample size for analyzing factors like strategy,
advertisements, cultural and logistics for entering the new products in the emerging
markets. First one is the case of the Toyota and the other one in case of the McDonald.
Success stories of both this business are discussed in this chapter of the
study for analyzing the cultural, advertisements and logistics factors while
they were engaged in introducing their products in the entire region of the worlds.
It has been analyzed in this
study that the Toyota Company entered China in the last century. With good
quality and stable logistics, it has good after-sales experience for customers.
It has found a supplier in China, has a complete supply chain, and reduced the
direct search for suppliers from Japan. The price has won the Chinese market,
and Toyota has built a car suitable for Chinese consumers according to
different cultures and different living environments, so Toyota entered the
Chinese market in a short time. To be successful in India, Toyota trailed the
legendary Toyota Way. But then again, the country also trained the
extremely stiff Japanese company that is compensated to diverge when required. From the year of
2011, there has been an inclusive logic of gloominess in the market place; the
profitable environment has not been mainly worthy, where the prices of fuel
have increased as inflation. Thus Toyota has won the Chines and Indian markets
by focusing on their advertisements, strategies, logistics and cultural
factors. It became succeeded in the emerging markets.
It has been analyzed in this study
that the success stories of the McDonald in India are the speaking truth of the
cultural change in the emerging markets. The team of the McDonald accepted the product diversification
of India for launching their business in the Indian markets. According to the
news reports in Business today. In, ( 2019)
McDonald has earned the profit after the struggles of the 22 years. McDonald is selling its products according to
the specifications of the area and the cultures of the people who are living in
the various regions of India. In India it is posted by the Global fast-food chain of the
subsidiary McDonald it’s earned the profit after efforts of the 22 years in
India. To earn the net profit of
Rs 65.2 lakh has been managed by the company (Businesstoday
In, 2019).
It is indicated in the reports of
the BBC news that the McDonald face a lot of issues and barriers while
launching their products in India. Then
the Indian culture adapted by the McDonald and they started to launch new and
innovative products according to the norms and values of the Indian communities (Kannan, 2014). India is famous as
a country which varied in nature, which makes it quite complicated for any
marketer to classify the normal threads of Indian culture along with its main
values. There are lots of dissimilar sub-cultures live together in Indian
community with their particular unique norms, values, philosophies as well as
behaviors.
As stated by Shilpa Kannan, (2014) in her reports that McDonald is launching their products
by considering the target markets in the various regions of India. As McDonald introduced the “Aloo Tikki” for Indian
vegetarian society. The products are launched by the Indian community according
to its majority customers. By summing up the entire discussion it can be said
that the McDonald follows all its compliance in the Indian markets that’s why it’s
one of the success full business in the Indian markets.
Recommendations
& Conclusion of Factors Affecting Products Entering Emerging Market
Conclusion
on Factors Affecting Products Entering Emerging Market
It has been concluded that there
are several factors that have strong impacts on the Products Entering Emerging
Markets. Cultural Differences are the
most important and one of the major factors that are affecting products
entering emerging markets. Other factors are analyzed by discussing and
focusing on the case studies of the Toyota and McDonald that have launched their
products in serial regions of the World. This paper concludes the success story
of the Toyota in China and McDonald in India because Toyota is Japanese’s company
that has launched its business successfully in the Chinese’s markets.
It has been concluded that there
are four key factors that are affecting the products entering emerging markets.
The foreign entry processes and decisions are influencing by the cultural
differences among the home and host countries. The cultural differences between
the home and host country are the most important essential elements when the
host country wants to launch its products in another country. There is
increasing criticism in the markets related to the national cultures of the
society in the cases of the related simple binaries, for example, the
difference among the collectivist and individualist’s culture. While seeking
for the emerging markets the supply chain managers are considered about the
entire aspects of the risks such as; for paying the customs charges, the
selections of supplier and for firing and hiring.
Recommendations
of Factors Affecting Products Entering Emerging Market
It has been recommended that the
research must be focused on the serial factors than the cultural differences
and culture. Such as the beliefs and values of the people while they are
introducing their business to a new place. They also consider the infrastructure,
corruption and political stability of the country. The entrepreneurs or
business legends musty think about all things that can affect their business in
the new markets. They must have to conduct a survey for getting their views
about their products before direct launching of the products in Emerging
markets. The companies also must be considered such points as advertisements,
logistics infrastructure, cultural differences and strategies who have a willingness
for investing in the foreign markets.
Therefore if the researcher is
using various other factors than models and frameworks that are sued in this
study cannot be applicable. It will be
interesting points for this research if it would be used as the base pints for serial
other studies such as the research is conducted by using the quantitative data
as compared to qualitative data. The companies
must evaluate the market by developing the marketing strategy before launching
their business in emerging markets. The most important thing for companies is the
pre-launch trials. Every company needs per-launch trails before introducing its
products in the emerging markets. The
products must be launch by considering culture views of the organization
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