The report aims to discuss different social as well as cultural conventions that influence the marketing approaches of the company and the buying behaviour. It discusses the operations of the company briefly then critically evaluate the global marketing strategies with support of various theories and approaches. The report finds and analyses the reason of selecting the market of China for having great potential, all the factors affecting the consumer segmentation and behaviour. The report finally concludes with the recommendation that the company must bring changes in its strategies to adjust the different culture of Chinese market.
For such a company like Assael Architecture Ltd, forming global marketing strategies has been proved to be easy (Sui and Sun 2016). After serving many companies and organizations as well as government in planning and designing construction, this company has decided to enter the global market. For this reason, it has found China to be a potential country with having great prospect for the urban development planning to prosper. Therefore, the company needs to have strong and efficient marketing strategies that will attract its intended audience.
Assael Architecture Ltd has been providing architectural services for more than 20 years in the UK. The company offers a range of urban design and master planning. This company is 70th largest architectural practice out of the 100 largest architecture companies in the UK. The principle studios of this firm is located in London (Assael.co.uk, 2018). Operating from the modern design studios located in London, this firm works nationally as well as internationally in the leisure, residential and mixed-use sectors. The company is certified with internationally recognised quality as well as environmental management system. Assael Architecture Ltd offers full architecture support services starting from preparation, designing and construction. It offers concept designing and technical designing in forming the master planning services. This firm employs lead consultants, contract administrators and employer’s agents who assist the lead designer as well as architect.
Before the company makes any move to its marketing strategies, it needs to introduce an effective market research. This will help the company to support budgeting and decision making for its new products and services. It will also help in identifying efficient market entry modes, marketing communications as well as customer initiatives (Li and Liu 2014). There are various marketing theories on marketing research. It is often segregated into two sets of definite pairs, either by the target market or, alternatively using the methodological approach. In analysing the target market the company needs consumer marketing research and Business-to-business (B2B) marketing research. The methodological approach includes Qualitative and Quantitative marketing research.
The qualitative approach is adapted to suit the psychology of the market research. Through this approach the marketers and the advertisers realise the actors affecting the consumer behaviour about a product. This approach includes identity theories in which the companies can identify the trends and needs of the consumers. There is a practical implication of this theory that helps the markets to construct consumer profiles which is the base of market segmentation (Babin and Zikmund 2015). Applying cognitive theory to the qualitative market research makes it easy for both the research participants as well as the marketers because this allow them to frame questions that provide relevant answers instead of superficial.
On the other hand, the qualitative marketing research theories help the companies to utilise easy techniques for marketing. Quantitative approach has positivist view that combines with the modern marketing perspectives and involve the seller and the buyer in an interactive process through which they reach a substantial agreement. This theory supports the validity of four Ps such as price, product, place and promotion. However, the critics like Sekaran and Bougie (2016), have argued that this method may lead to different types of errors originated from random sampling, research designing and hypothesis errors.
Thus, marketing research can be described as systematic as well as objective identification, assortment, analysis finally dissemination of the information for assisting management of the companies in their decision making process related to identify opportunities in marketing and find solution to various problems (Watson et al. 2018).
Selection of market is an important step for identifying the market entry modes and then invest. One of the major criteria that greatly influence the marketing and sustenance of the company in global market, is the proper judgement of growth potential of selected market (Chang, Luo and Ren 2014). This will help the company to grow its revenues by investing in that particular market. Market selection procedures can be conducted by following some steps:
The limits for selection of market is either the company related issues or the market related one. Company related issues chiefly depend upon the company’s strategies and objectives in one hand. On the other hand, the market related issues include analysis of market environment especially demand, supply, distribution chain and competition level (see appendix C). In addition to these factors, the companies’ marketing research for apt selection gets influenced by the country’s economic policy, business regulations, ethnic factors. In addition to this, there are political factors like currency stability, infrastructure and the country’s bureaucracy.
As the company aims to enter the Chinese market, it needs to judge the macro environmental factor of the market. China is a developing economy that attracts foreign investment through brilliant market opportunities (Ngai et al. 2015). It offers considerable savings in the labour costs, but the companies must aware of the differences in factors that often create risks and pose indecision for the foreign investors.
Political factors:
The people’s republic of China is a socialist country led by the working class. The government is encompassed with the systems of congresses of people and political party system under the political consultation of the country’s communist party (Yang et al. 2014). They participate in country’s basic policies as well as take responsibilities in important matters in economic, political, cultural as well as social affairs before adoption of any decision and their implementation. Therefore, there has been a high growth in economy since 1978 and offered huge opportunity for educational sector, employment, job as well as housing choices and cultural pursuits along with access to information. However, in recent years, riots have taken place in various parts of the country that has created an unstable condition for the foreign investment (Yu and Liao 2017). However, the government has taken firm measures for preventing such situation and create safe environment for the foreign investors.
Economic factors:
China has an open market since 1978 and it has converted its economy into market-oriented one. This method has positive impact not only on one particular country’s market but all the markets over the world. The financial reforms that China has executed over past 2 decades, have intensely affected both the individual initiatives as well as entrepreneurship (Lien and Cao 2014). As the result average income of the people has reached to the highest level reducing poverty level. The government of China has promoted more self-management for the state-owned enterprises to increase the competition in markets. This steps have created opportunities for its domestic enterprise to contact directly to the foreign ones. In addition to this, there has been a sharp growth in the foreign exchange reserves for increased import export. Chinese National Development and Reform Commission (NDRC) manage the FDI investment in Chinese economy (see appendix B).
Social factors:
China has a population over 1.3 billion which has concerned the government. The Chinses government has attempted to stabilise the growth and utilise this population for the growth of the country. Aiming to use the population prudently, the government has decided to provide necessary training and education so that this population may help the companies to build a huge and efficient workforce (Van Wormer and Besthorn 2017). The economy of the country has been influenced through the consumer lifestyles, education, collectivistic culture and surging disparity between the rich and the poor as well as between the urban and the rural areas. This factor can be one of interesting factors for the country’s economic growth.
Due to high population, the country has built a huge market for the foreign investors. There are 420 million internet users which is still growing. In addition to this, the science strategists have realized that China can gain the greatest opportunities in the technology fields which creates a scope for innovation in these areas (Luo et al. 2015).
Cultural factors:
The culture of the UK and China is completely different from each other. In this section, the Hofstede’s cultural model can be used to judge the deep drivers of the Chinese culture in respect to those of the culture of another country. In power distance dimension and uncertainty avoidance the county score high which means that there is a gap between the leaders and the employees of an organization and people of China are not comfortable with the unknown situation but need assurance (Beugelsdijk, Kostova and Roth 2017).
The culture supports the idea of collectivism where the people promote relationship and high long term orientation (see appendix A). They show capability to adapt traditions to the changed situations. China unlike western countries has restrained society and provide less support on the leisure and entertainment. All these factors have affected the consumer behaviour greatly. The Chinese people are cynic, pragmatic and aware of the new products (Bakir et al. 2015). Therefore, marketing modes influence their knowledge and regulate their decision making before buying. Demographic as well as geographic segmentation of the Chinese market will help the company to attract specific groups.
Conclusion:
Therefore, it can be concluded that the construction and designing market of China can be a potential market for Assael Architecture Ltd which is based on UK. The analysis of the findings of the market research reveal that there is a huge scope for the company to flourish. Moreover, the company has ample experience in conducting a successful business in the home country and know approaches of market research. This paper has discussed the macro environment of the selected market which support foreign investment in the construction industry. However, there are some cultural differences between the target market and home market of the company, which can be managed by adopting some strategic changes of the firm.
Chinese construction market is one of the largest construction markets in the world. Therefore, Assael Architecture Ltd can have a good prospect of flourishing in the international market. In order to penetrate Chinese market, it needs to bring changes in their marketing strategies but what strategies they have applied on other western countries cannot be applied on China because the culture and consumer is completely different here.
In entering the market, the company must imply for the online marketing, sales and branding. As the Chinese people get knowledge about the product they decide to buy therefore perfect branding is very necessary. In that case the company must have a Chinese name which will influence the buyers mind and build long term relationship.
In order to understand and reach the Chinese platform the company must assign with the unique digital ecosystem effective in China. These have active, large and impressionable audience that will help the firm to reach the consumers easily.
Diversification strategies can be a good choice for the firm to increase its competence, reduce costs therefore gain a better control over the supply chain. Capital along with labour productivity can be increased because the firms have opportunity to transfer skills and developed expertise in one business to another.
Collectivism leads to higher labour productivity and vertical Integration that involve the firm’s investment in the activities of supply chain. Strategic segmentation of the market will help in gaining more control over the market environment and increase knowledge about the client’s resources.
The company must utilise the belief and iconizing tendency of the Chinese market where the people believe in perfect competitive tools that help the company to get recognition, on the other way financial success in China.
Most importantly the company must take assistance from a mediator so that they can understand all the cultural differences of the home and the Chinese market. This will help the company to penetrate new market successfully and earn trust of the market to sustain.
References:
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Chang, E.C., Luo, Y. and Ren, J., 2014. Short-selling, margin-trading, and price efficiency: Evidence from the Chinese market. Journal of Banking & Finance, 48, pp.411-424.
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