International marketing defines the marketing principles of the company that conducted by the company to fulfill the needs of the customers across the borders. The report throws light on the expansion of the business outside the home country, the company selected for the expansion is Bread talk and the place selected for the expansion in Japan. The report reflects a mixture of the theoretical and the practical application of the primary marketing concept which include marketing strategy, environmental analysis and the marketing mix strategy of the company (Armstrong, et.al, 2015). Moreover, the paper shows the implementation of the plan that is essential for the expansion of the company in Japan.
Japan is the 5th ranked bakery product market globally with US$ 26.4 billion of the retail sales in 2014. The market is appropriate for the BreadTalk company as the industry in Japan is expected to grow in the near future. By the year 2019, the market size of the bakery products is going to be $28. Value sales of the baked good increase by 1% and reached to Yen 2.2 trillion in the year 2014 which was better than the previous year. The company will be able to achieve the growth and success opportunities in Japan (Agriculture and Agri-Food Canada, 2015).
Breadtalk Group established in the year 2000 and having the headquarters in Paya Lebar, Singapore. The company is Singaporean multinational food and Beverage Corporation who work with the motive to provide the delight customer experience to the customer. The company is able to satisfy the needs of the customers with the blend of the unique concepts that have envisioned new food cultures crossways bakery, food atrium divisions and restaurants (BreadTalk, 2017).
The major bakery product that is offered by the company is bread and cakes. Bread and cakes are considered as the main products of the company and company should provide these products in Japan. There are different dishes included in the menu of the company such as chocolate toast, cheese sausage, rice chiffon and various types of a donut. The company offers its product to those people who like to consume healthy bakery products and these people include teenagers, youth, and senior citizens (BreadTalk, 2017).
PESTLE analysis
PESTLE analysis is a framework or a tool that is used by the marketers of the company to analyze and monitors the external environment factors that can create an impact on the working of the company. BreadTalk also analyze the market of Japan for the company, this analysis is going to help the company in identifying whether the market is appropriate for the company or not (Adamkasi, 2016).
Political factors
The political factors include rules and regulations formed by the government, these regulations create the impact on the expansion strategy of the companies. The industry of the bakery is growing in Japan which shows that it is giving the employment opportunities to many people of the country so the government of the country welcomes the companies to expand the business. If any Breadtalk is willing to expand the business in Japan then the company have to face the political factors.
Economic factors
The economy of Japan is strong and it is top 5th largest economies in the world. The GDP per capita of the country is 38,894.47 (2016) and it shows a growth of the 1% as compared to the previous economy of the country. The GDP of the company shows that the purchasing power of the people in Japan is high and they can easily pay the high prices for the bakery products. The Breadtalk have an opportunity to expand the business and to generate the revenue (Frue, 2014).
Socio-cultural factors
Japan country has more than 127 million of the Japanese residents, the Japanese customer’s desire for the bakery product that is rich in the quality and nutritious. The products that Bread talk is going to offer to Japanese are made up of the food nutrition. The company tries to bring new dishes with flavors that can attract more and more people. At the time of vacations and tours, the company can make more of the revenue due to increase in the demand for the products (Frue, 2014).
Technological factors
Technological factors can affect the decision and strategies of the companies and the technology advancement enhance the competition among the companies. This is the reason most of the companies are adopting the advanced technology for their business activities. In Japan, technology advancement is on a hike, most of the companies make use of the automation system. The country is having stronger robotic development than the other countries. The Breadtalk Company can make use of the technology for offering products to the customer.
Environmental factors
The environmental factors consist of the climate changes, natural disaster and some other elements of the weather. Most of the population of Japan is situated nearby or in Tokyo because rest of the region or places of the country are surrounded by the forest and mountain. These environmental factors lead to the changes in the decisions of the sector. BreadTalk has started making the use of the paper bags rather than the plastic bags as the company is following the sustainability goals of the country (BreadTalk, 2017).
Legal factors
The legal factors include many rules and regulations formed by the government of Japan. Each and every business that set their business in other countries has to follow the basic regulations which include minimum wage laws, employment contract, health and safety act along with some other act (Rasnan, et.al, 2016). The BreadTalk obey and respect these laws and this is the reason the company follows the laws and regulations.
Competitor Analysis
The competition is increasing day by day as more and more companies are expanding their business operations in international markets. Japan is well-known for the bakery market and for its bakery products. The competition among the bakery companies is increasing in Japan, if BreadTalk expands its business activities in Japan then the company have to face tough competition. In Japan, there are many companies who are offering the bakery products especially bread and cake (Technavio, 2015). The company will face the competition from various companies but out of these Mondelez International Inc. is leading bakery company in Japan. Apart from it, the company might face the competition from the Kellogg Co (having 3rd rank in a market), and Yamazaki Baking Co. Ltd. (having 5th rank) (Agriculture and Agri-Food Canada, 2015).
These leading bakeries knew the needs and the demand of the customers and according to that they introduce the products in the market but on the other hand, the BreadTalk is not aware of customer’s expectation. Along with this, the company needs huge fund for expanding the business in the market of Japan and to face the competition. Further, apart from the leading companies, there is a presence of many other middle size companies who can give tough competition to the BreadTalk.
The marketing strategy is known as a long-term and forward-looking approach that is used by the company to plan the fundamental goals to achieve a sustainable competitive advantage. BreadTalk recommended marketing strategy is discussed below.
Identification of Target market
Identification of the target market is helpful for the company to develop the effective marketing communication strategies. The target market is defined as a set of people who share the same characteristics and needs that the company willing to serve (Hemsley-Brown, 2017). In Japan, the BreadTalk Company have to identify their target market. The target market can be identified through current customer trends. In Japan, the consumers of the diverse variety of foods that consist of the superior taste, safe and nutritious and the products offered at the reasonable price. The people of Japan are willing to pay the high price for the high-quality food products that are able to fulfill the expectations. Hence, this clearly shows that if the company is able to provide the quality products in Japan market then the company can make the revenue easily (International Markets Bureau, 2010).
The identification of the target market is possible with the selection of the demographic segment to which the company is looking to target. These demographic factors include the age, education level, occupation, ethnicity, income, geographical location, and gender. Japan is experiencing a demographic and cultural shift as the company is dealing with the aging population with 22% of its people aged over 65 years (International Markets Bureau, 2010). BreadTalk targets teenagers, adults, senior citizen and the families as the product offered by the company are rich in quality. The income inequality is rising in Japan; the company offers the products to the middle and high-income group peoples. Most of the working class people like to consume the products offered by the company.
Market positioning
Positioning defines as a place that a particular brand occupies in the mind of the customers and shows how it is distinguished from the products offered by the competitors (Hollensen, 2015). In Japan, BreadTalk has to face the leading competitors who maintain a good position in the market and in the minds of the customers. To maintain the position in the market of Japan is not simple for the company. Though, with the help of high quality, diversification and innovations in the products company can enhance the position (Euromonitor International, 2015). Currently, in Singapore, the company is having the position in the quadrant which shows the moderate prices with the high quality. The company can try to make the same position in the market of Japan.
Market entry mode and strategy
Market entry mode
Modes of entry into a foreign market are the channels which your organization employs to gain entry to a new international market. There are different types of entry modes such as licensing, joint ventures, exporting and direct investment (Cavusgil, et.al, 2014). BreadTalk have to select one mode to enter the market of Japan. The joint venture will be the best and suitable mode of entry for the company. A joint venture is a business entity that is formed by the two or more parties with the motive to make the profit in the market. In this mode of entry both the parties share the ownership, returns, risks and governance (Killing, 2012).
BreadTalk have to identify the Japan bakery company who is ready to form the joint venture. Through, this joint venture the company will be able to face the competition easily as the company will grab the information from the other party. Both the parties can share the information with each other that is going to be helpful for the company to operate the business. The BreadTalk can take the help of the partners in understanding the needs and expectations of the customers so that the company can easily fulfill the needs of the customer and make space in a market (Beamish, 2013).
Market entry strategy
A market entry strategy is a planned method of delivering goods and services to the new target market. The company can make a strategy for the import and the export of the products (Blackburne, and Buckley, 2017). This is a fact that there is strong trade relationship between the Japan and Canada. Currently, there is import and export relationship between both the countries, the bakery product of Canada is in demand in Japan. Japan imported the US $9.5 million worth of the bakery products from Canada. In the near future, Japan has a potential to be target market for Canadian bakery products exports. BreadTalk should make the strategy for the exports of products that help the company in making revenue and expanding the business (Agriculture and Agri-Food Canada, 2015).
Marketing mix refers to as a set of tactics, actions that a company uses to promote its product or brand in the market. The marketing mix is the blend of the product, price, place, and promotion (Leonidou, et.al, 2013).
Product
The product of the BreadTalk includes bread, pastries, drinks, cake and these all products are offered by the company in the new and innovative form in Japan. In Japan, the company offers the different varieties of bread which consist of Carlee Crab, Chilli Crab, and bun. Most of the customers in Japan like to make use of these main products at the tea time or in evening. The strategy of the company is to offer healthy products with rich quality and with the diverse flavors. This strategy is formed considering the trend of the customers towards the food and strategy helps the company in attracting more customers towards the product.
Price
Price is one of the important elements of the marketing mix. BreadTalk targets the middle and high-income group people that simply mean that the company provides its products to the customers at the affordable prices. In Japan, the customers are not willing to pay high prices for the product until and unless the product is not able to meet the expectations of the customers. It is recommended to the company to make use of the value-based pricing strategy. In this value-based pricing strategy, the company keeps the price of the product based on the values of the product in the eyes of the customers (Khan, 2014). In Japan, the company is trying to make the space for the company for that the company has to provide the product to the customers in the prices they can buy it.
Place
The place or distribution system matters a lot for the companies who expand the business in the new market. BreadTalk should select the place in Tokyo market, as most of the Japanese like to live in Tokyo so the company can target more people at a time. Though, this is the fact that there are many distributors of the bread and cakes in the Tokyo market. The company will find a tough competition at these places but to achieve the success BreadTalk have to select the prime location.
Promotion
Promotion of the product and service is essential for each and every company in the competitive world. This activity of promotion helps the company in enhancing the revenue and sales of the company. BreadTalk Company can make use of this activity to enhance the sales and make the space in the new market of Japan. To promote the products the company makes use of the advertisement and the online media (Chandra, 2015). The company should make use of the strong tool for promoting the products in Japan.
Processing Time/ Packaging
Processing time and packaging show the way the company makes use of the resources for the effective processing and packaging of the product. The processing time might vary but the packaging material and the way is going to be the same. The packaging of most of the bread and cake is done according to the different categories and forms (Mathlouthi, 2013). Most of the packaging items used for packing the cakes and bread include metal cans, paper board’s cartons, glass bottles and the plastic pouches. But the BreadTalk decided not to make the use of the plastic packaging for packing the products so the company makes use of the cardboard boxes, paper bags, and zip bags made up of paper. The packaging of the products is done in such a way that the product offered by the company can be kept for a long time (Robertson, 2016). The aim of the company is to conduct activity of packaging in such a way that it will not impact the environment.
Conclusion
The report throws light on the BreadTalk Company who is looking to expand the business in overseas market to achieve the growth and success. The company should expand the business in Japan, the place is well known for the bakery products and rank on the 5th position across the world. The mode of entry recommended to the company is Joint venture because this is the only way left with BreadTalk to make the space and to face the competitors.
It is recommended to the company to take the advantage of the strong relationship between Japan and Canada in exporting the products to Canada. Further, the company should try to maintain the diversity of the products that they are offering to its customers considering the need of the Japanese. The marketing mix strategy is discussed in the report which shows the strategy that is going to be beneficial for the company to achieve the success. Moreover, the report further includes the packaging of the product.
References
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