This assignment is the final section of the previous two works on an international expansion of the selected company Star Mart, which is based in Australia. Star Mart is a company that strategically collaborates with the fuel filling pumps to attract customers visiting such petrol stations. It has successfully attained a reputation in the local area through placing the stores mostly near to the Caltex Petrol Stations and approaching the local retailers. This is indeed a very effective move as it improves the performance when it comes to understand the demand in the local market (Laulajainen & Stafford, 2013). In the previous two assessments, some necessary point had been covered such as the external environment of the target market Thailand and types of market entry modes. The main purpose of this assignment is to recommend the highly necessary 4Ps to the company that could help it get the target customers. Additionally, the paper also discusses the objectives for the first 12 months. Moreover, it covers the making of plans for managing, measuring and controlling the operations.
1. Star Mart is a company that strategically positions its store locations mostly close to the Caltex Petrol Stations. This is indeed a good move because it would catch the attention of those customers who come to the petrol stations to fill up the required fuel in their respective vehicles. However, this is also true that very few people would think of spending time as they might be in hurry but this is also a fact that some would love to enjoy the snacks and the other important stuffs that are available at the Star Mart stores. It is more like shopping, eating while at the petrol stations to fill up the fuel. Another strategy of the company is to approach to the locally sourced suppliers. This is another important move, which has helped the company in understanding the needs of local people (Laulajainen & Stafford, 2013).
There are certain risks as well such as in case of supplier shortage against the high demand of customers. It can also be troubled if petrol stations catch the fire. This will indirectly influence the business of Star Mart. There can also be the losses of the assets that are there in the Star Mart. Fire threat can actually pose a serious threat to the company.
Since Thailand has an independent legislation, which means that Star Mart Company will have to come under some strict regulations. The restrictions will be such as following the prevailed prices of products and adhering to the labor laws. Furthermore, this also means that there will be probably no chance of winning the competitive edge based on cheap prices. Every single company will therefore get fair chances in the market (Jiwattanakulpaisarn et al., 2013).
Politically, Thailand is very unpredictable. Being a democratic country, it also offers challenging situations to foreign investors. This is due to the local leaders who might give efforts to disrupt the investments. Star Mart will have comparatively tougher political circumstances in Thailand. However, the success of the proposed venture will open up ample opportunities in the other Asian regions and the Middle East countries (Howell, 2013).
Culturally, Thailand is again challenging as it has followers of multiple faiths. Star Mart will be tested against different believers. It is really challenging to understand the demand of different groups. Additionally, different languages are spoken in Thailand, which is why it is necessary to have a multi skilled workforce well versed with the different languages. This might help the company in grabbing the attention of different ethnic groups in the country. The plan to target both the middle class and high class groups is a good proposed move for the Star Mart Company. This will certainly help the company compete against the other international companies operating in Thailand. To offer fresh vegetables and fast food products at a nominal price is another good move. This would ensure a significant fall of local customers to the stores (Howell, 2013).
There are certain challenges for the company; on the other hand it has ample opportunities there as well. The company might face challenge in finding the favor of political parties. In such situation, this would be difficult to have a good exploration of the potentials Star Mart has. Political parties could intentionally support the local companies. The strict legislations in Thailand would save Star Mart from any uncivilized business behaviors. The rate of vehicle sale is also going up in the country, which is good for Star Mart as more vehicles would then come to the stores.
2. The assessment has discussed in particular the different types of market entry strategy that are available in the market. Franchising is one of such type, which few companies use such as Subway (Nijmeijer, Fabbricotti & Huijsman, 2014). Franchising means giving license to other trusted companies that allow them operate independently under the name of the parent company. This is a good option to enter with as the franchised company would use extensive innovations to recover their invested amount. The threat of loss is also very minimal as the franchised firm would carry with them a fear to lose their invested amount if there license gets cancelled. Joint venture is the other option that many companies use. This is beneficial as it helps to assimilate with the different and the complex culture in the target market. Working in a joint venture with the local companies help the foreign investors penetrate the target market without giving much effort in understanding the different culture (Yan & Luo, 2016). Direct exporting is one of the oldest forms of international business. This involves the sending of products to the target international location through the various kinds of transporting mean. However, this might incur losses to the company during the fluctuating behavior of foreign exchange. If the currency of the exporting country is weaker then the companies operating under the country will experience a significant benefit margin. On the other hand, if the currency of the exporting country gets stronger then the companies under such countries would face the loss (Wei et al., 2014).
Some marketing strategies have also been discussed in this assessment such as segmentation, target market and positioning. Segmentation means classifying the different groups based on demography, behavior and psychographic. Star Mart will offer products according to the interest of the divided groups. This is indeed a better and calculated step to move with. This would also allow them research appropriately on their classified groups. Star Mart has targeted both the middle and the high class families. It has also planned to offer fresh vegetables and fast food products to the local natives at affordable prices. This is indeed a very strategic move as this would help the company in standing up against the already operating international companies. This would also help the company in winning the hearts of local people. Star Mart has also planned to use the different social media platforms as their positioning strategy (Green, Whitten & Inman, 2012).
Following are the few objectives, which are planned with the new venture in Thailand:
Star Mart would follow the same tradition that it has followed in Australia. This would be a kind of departmental store mostly near to the reputed petrol stations. Henceforth, the products would be divided into varied segments such as cloths, foods, drinks, vegetables and few others like such. In the clothing segment, people of all groups would be targeted with specific focus on the kids and the teenagers. In the food segments, different kinds of fast foods stuffs would be targeted. This would help to attract the interest of the kids and the teenagers. In the drink section, there would be soft drinks as well as wine and bear. This will ensure an elevated customer base as this is for both the soft drink consumers and the alcohol consumers. Vegetables will also be an attracting point of the store. This would probably attract the local consumers. They will get fresh vegetables at affordable prices. Star Mart will ensure it maintains a healthy relationship with the local suppliers. Local suppliers will help to understand the trend in local market, which is very necessary to offer the products as per the demands of the customers (Cainelli, Mazzanti & Montresor, 2012).
Prices would be kept according to the segmented groups. Star Mart has targeted both the middle and the high income group. This is for such reasons the prices for the clothes would be as per the buying capability of the target groups. On the other hand, the prices for foods, drinks and vegetables would be kept at nominal rates. This will help the company attract the local public of the country. This will also attract the kids and the teenager groups for fast foods and drinks. However, it is comparatively more challenging to offer cheaper prices in Thailand because of the legislation system in the country. It is indeed much handful in Australia, which is why discounted stores are there in existence (Brimblecombe et al., 2017). It is little challenging to earn a good profit; however, Star Mart would strategically operate to gain the profit. Star Mart would offer elevated prices on products when there are high demands for a particular product.
The stores would be placed close to the different petrol stations. The joint retailing venture has worked for the company in Australia. This can also work for it in Thailand as well. Placing stores close to the petrol stations is a good strategy as this would attract those customers who are already there for different purpose. They are there for filling up fuels in their respective vehicles. However, there must be some other customers as well. The selected place is prone to risk as well such as the threat of catching fire in the petrol stations or running out of the suppliers. In the time of high customer demands three might be the deficit of suppliers. Catching fire is a serious concern. This can directly hamper the asset value of a premise. This can also disrupt the business for a significant time span.
Promotion-
Promotion would be done using various social media platforms such as Twitter, Facebook, YouTube, T.V. advertisements, newspaper advertisement etc. Promotion would also be conducted using the hoardings probably standing at the petrol stations. This would actually catch the attention of visiting customers at the different petrol stations (Foster et al., 2014).
The recommended 4Ps for the Star Mart Company has followed the adaptation method of marketing mix (Magnusson et al., 2013). It has tried to mix the standardization with the customization. Offering fresh vegetables and fast foods at nominal rates to attract a mass audience in the local area is an example of the selection. The choice was made keeping in mind the dependability on the local government for the retailing prices of commodities. The new venture was thought to earn a wider audience and an enhanced benefit. On the other hand, this was challenging to attain as the local government in Thailand has strict surveillance on the retailing process of different products. To nullify the impact of such process to some extent Star Mart Company has targeted the middle and the high class family as well for specific product line. This would give the company a much needed revenue generation.
International marketing effort can be managed by effectively selecting the different promotional strategies such as advertising the contents on the different social media platforms. This way the marketing would be done at the international platform. However, to manage it, it is necessary to measure the responses generated against the each selected stunts (O’Sullivan & Abela, 2013). The international marketing effort would be managed in Smart Mart with the help of following steps:
Once the performance of the adopted marketing strategies is measured, it is necessary to control the flaws in the operation if it is there. Following are some ways that could help Star Mart in controlling the flaws in the marketing activities at the global platform:
Conclusion
The objectives that have been set with this new venture in Thailand need to accompany with proper planning of marketing strategies as this is necessary to influence the behavior of some essential parameters such as ROI, sales and customer responses. It is necessary to manage, measure and control the different marketing strategies that have been selected by the Star Mart Company. Star Mart has rightly done the same thing by planning all the strategies to manage measure and control the international marketing activities. Additionally, Star Mart has smartly planned the segmentation of target customer. They have targeted the middle and the high income family with costlier goods. On the other hand, they have targeted the locals of Thailand with fresh vegetables at the affordable rates. The adaptation strategy of the company would probably provide it a good support in its future venture in Thailand.
References
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