Target Australia is a departmental store and mainly known as mid-price departmental store owned by Wesfarmers. In terms of numbers, this store is the largest detrimental store chain in Australia as they are operating with 302 stores across the country. Their primary product offerings include consumer electronic goods, homewares, clothing, cosmetics, fitness, etc. Company’s headquarters is currently situated at North Geelong, Australia and soon, they will move their headquarters to Williams Landing by the end of 2018. In the previous two tasks, company’s strategies has been analysed along with analysing the suitable market for expansion of the business. As per organizational functionalities, Indian market was chosen for the organizational expansion and in relation to this, several strategies have also been recommended in terms of market entry and other aspects for successful expansion in the target market. With regards to this, this task will showcase the requirement of marketing mix strategies in order to make the organizational move effective and efficient in terms of international expansion (Target Australia, 2018).
Primary aim of this report is to recommend appropriate marketing mix strategy in relevance with the attainment of organizational desired goals and objectives. Target Australia has chosen Indian market for the business expansion as it is one of the largest consumer market. Apart from this, growth rate of Indian economy stands on the third position in terms of fastest growing economies in 2018 across the globe. There are various other attractions which have influenced Target Australia to enter into Indian market and in relation to this, marketing mix strategy will be discussed which will help the organization to attain its desired goals along with discussing the plans for managing, measuring and controlling the international marketing effort of the organization in terms of successful expansion.
Target Australia was founded in 1926 and at that time, they were dealing in dress fabrics, furnishings and Manchester. Since then, organization has always moved towards growth and overall development and these elements have become the primary element of organizational success. Today, Target Australia serves each and every region in Australia with more than 302 stores. Target Australia’s operational area is different from the retail stores as they are known as mid-price store. Australian retail market is being saturated and further growth and development, organization has decided to move towards Indian market in terms of business expansion as well as in terms of accomplishing their desired goals and objectives (Barney, 2014). Following are the objectives of Target Australia for the first year after expansion in the Indian market:
In relation to the expansion of business, organizational primary objective is to grab the attention of their target audience. With regards to this, organization will deliver qualitative apparels for all customer segments and that too at lowest prices. Apart from this, organization will also deliver trending apparels as per the latest fashion trends in order to cope up with the demand of the target audience. Grabbing the attention of the target audience also falls under the category of SMART objectives (Brown & Bessant, 2013).
Indian market has been chosen for the purpose of expansion in order to enhance its presence in the global market along with grabbing a decent share in the target market in order to make organizational move successful and effective for the objective of expansion of the business. For the first year, organizational aim will be to enhance their overall profitability by 15-20% from the Indian market. Indian market is one of the largest consumer markets in the globe and this is the major attraction for all foreign companies to enter into Indian market. Number of middle class consumers is much high in Indian market, thus, chances for Target Australia are much high as it is a mid-price store in terms of boosting their profitability by the set profit margin (Eden & Ackermann, 2013).
Indian market has been chosen for the purpose of organizational expansion as it is one of the largest customer segments. The rate at which Indian economy is growing is one of the highest rates and this let the organization to choose Indian market for the expansion of their business. Setting brand positioning is one of the primary objectives of organization in relation with the business expansion. In consideration to this, it is required for the organization to adopt certain effective advertisement and promotional strategies in order to generate demand amongst the target audience along with objective of making its image different from the existing retail players in India. Setting effective and different brand image will ultimately help the organization in relation to the attainment of desired goals and objectives (Frynas & Mellahi, 2015).
Every organization set ups or expands its business with common objective of staying in the business environment for long run. With regards to this objective, it is necessary for the organizations to make their USPs unique, effective and efficient throughout the lifecycle of the organization. This helps the organization in making a different brand image in the target market and this strategy is also effective in terms of retaining its customers’ interest within the organization. Target Australia is a departmental store chain and primarily dependent upon the customers’ footfall. In order to attain sustainable growth and overall development in the target market, organization requires moulding their product offerings as per Indian customers’ taste and preferences. Along with this, organization could also introduce customisation strategy for enhancing customer satisfaction (Gamble & Thompson, 2014).
Target Australia has decided to expand their business in the Indian market after analysing impact of all internal as well external business environmental factors. With regards to this, organization has chosen joint venture entry mode in order to reach to target audiences’ demands and wants. Joint venture with a local firm will help the organization in terms of analysing Indian customers’ taste and preferences. With the objective to this, organization is required to adopt appropriate strategic frameworks in order to attain desired goals and objectives. In relevance to this, marketing mix strategy has been recommended to the organization in terms of making the expansion move successful (Goworek, McGoldrick & McGoldrick, 2015).
This is one of the most effective and efficient framework in terms of spreading awareness amongst the target audience along with the objective of setting up an effective brand image in the target market. Product, price, place and promotion are crucial elements of marketing mix strategy and in relation to this; organization could easily attain its desired goals and objectives (Ibef, 2018). Following are the elements of marketing mix strategy:
Product
Product offering of Target Australia is very huge through which organization has been able to target different customer segments. Their primary product offering includes clothes for men, women, and kids, electronics, consumer electronic goods, homewares, cosmetics, etc. Apart from this, organization is continuously expanding its product offering in order to target other customer segments’ demands. For Indian market, organization will focus on apparels in the first phase with the objective of setting their effective brand image. Indian market is one of the largest consumer markets and it is also known as mixed economy and it includes lower class, lower middle class, and upper middle class and upper class customer segments (Yan & Luo, 2016) .
In order to attract Indian customers’ interest towards the organization and its products, they have moulded their product offering as per Indian customers’ demands and wants. Along with this, organization could also adopt customisation strategy so that customers could easily choose and make the products as per their requirements. From this way, organization will be able to enhance customer satisfaction along with the development of an effective brand image in the global market (Baker, 2014).
Price
Target Australia is known as a mid-price departmental store and they usually target lower middle class and middle class customer segment in terms of attaining their desired goals and objectives. Currently, organization is operating on fair pricing strategy which is one of the primary factors for targeting middle class and lower middle class customer segments. It has been recommended to the organization to adopt cost leadership strategy in the Indian market in order to combat against the existing retailers, other multinational retailers and local shops. Indian market is a huge consumer market and the total population of the country is approximately 1.32 billion. Nearly half of the total population falls under lower class and middle class segment, thus, it will be bit easy for the Target Australia to set up its effective brand image in the Indian market. It is recommended to the organization to adopt cost leadership along with the differentiation strategy in order to make their separate image in comparison to the existing players. This will help the Target Australia to grab a decent market share in the Indian market as well as in terms of attaining leading position in the global market (Cameron, 2017).
Price is the most determinant factor for middle class consumer segment and it directly affects their buying behaviour. In order to attract these consumer segments, most suitable pricing strategy would be cost leadership pricing strategy. In consideration to this pricing strategy, Target Australia would be able to grab the attention of their target customer segments along with combating with the intensive competitive conditions in the Indian market (David, 2011).
Place
This is another crucial and effective element of marketing mix strategy. In order to make organizational plans successful and positive result generators, place of distribution act as one of the most determinant factor. As Target Australia is expanding its business in the Indian market, thus, it is necessary for the organization to choose attractive places for setting up their stores which would be easy to reach for their target and potential customer segments. Place of distribution directly affects the sales and profitability, thus, it is recommended to the Target Australia to select centralised locations for setting up their stores in the Indian market. At the initial phase, organization will set up their stores in the big cities like Delhi, Mumbai, Chennai, etc. and later on, in the second phase, after attaining goals of the first phase, further expansion of the business will be done in other places of India (Gillespie & Riddle, 2015).
Apart from this, organization could also introduce their website with collaboration with a small or local retailer in order to enhance their approachability in the target market. With the help of internet, organization would be able to grab a huge market share in the Indian market along with expanding its reachability in most parts of the country. It will directly affect demand of their products and services and it will enhance organizational sales, revenues, as well as profitability. With the help of these tactics, strategies and frameworks, organization would be able to attain its primary goals of enhancing market share, sales, and revenues along with moving forward towards attainment of future goals of the organization. Place of distribution could also be decided as per the market share of target customer segments with the objective of enhancing its customer base along with the objective of gaining leading position in the target market (Hollensen, 2015).
Promotion
This is another effective element of marketing mix strategy and this element’s primary objective is to spread awareness amongst the target audience with regards to the organizational products and services. As Target Australia will enter into Indian market with their clothing section because Indian market is considered as the largest consumer of clothes. Primary reason behind this is the population of the country and clothes are treated as the basic necessity and falls under necessity goods. Apart from this, Target Australia is known for delivering mid-priced products and services which is the major factor for the organization in order to make their effective brand image in the Indian market (Lojacono, Misani & tallman, 2017). In relation to this, organization will make their promotional and advertisement campaigns unique as well as effective in order to spread awareness amongst them along with the objective of making organization efficient enough to boost its performance as well as with the objective of fulfilment of desired goals and objectives (IBEF, 2018).
It is recommended to the organization to make their promotional and advertisement campaign unique and the major focus will be imposed over digital marketing mediums as these are much effective in comparison to the traditional forms of marketing mediums. Approachability of digital marketing mediums is much high and their impact is much high in current business environment. Penetration of social media and internet is high and in relation to this, approximately 323 million people were using internet by the end of 2016 which was approximately 25% of the population at that time. Growth rate of internet users and social media users are continuously increasing and with regards to this, organizations have considered these platforms as the major attributes in terms of spreading awareness amongst the target audience as well as to enhance the demand of their products and services (Keegan & Green, 2015). Following are the promotional techniques which could be used for the purpose of spreading awareness amongst the target market with regards to the organizational products and services:
Apart from the digital mediums of marketing, organization will also focus over certain effective mediums of traditional marketing mediums. Major platforms of traditional marketing are newspaper, bill boards, magazine, etc. With the help of these platforms, organization could easily generate demand amongst its target audience along with the attainment of desired goals and objectives (Loh, 2018).
Conclusion
From the above analysis, it can be concluded that Target Australia would easily be able to expand its business in the global market by entering into Indian market. This decision will help the organization to reach towards its desired destination along with enhancing organizational presence in the global market. This report has discussed marketing mix strategy in relevance with the organizational functionalities and their objectives of expanding their business in the Indian market. In addition to this, organizational objectives have also been discussed in accordance with the organizational expansion in the global market.
References
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