Discuss About The Positioning On Differentiated Product Markets?
International marketing is the most suitable business strategies undertaken by the local business organizations for exploring new markets. International marketing allows the domestic business organizations to invade new markets and expand the business successfully. According to Terpstra, Foley and Sarathy (2012), due to change of demands and expectations of the customers, the market of the host country becomes saturated after some time. Therefore, loss of business and customers are noticed due to stalling of the business. Thus, international marketing is a good opportunity that organizations can utilize for sustaining in the competitive market.
This report introduces the international expansion of a domestic Australian fruit juice company, named The Daily Juice. The Australian fruit juice company has aimed for international expansion in the UK after a thorough analysis of the needs and demands of the country. The company only manufactured orange juice when it was established. In addition to, the report also sheds light on the target customers, suitable market entry strategy, and product positioning.
The Daily Juice is a native fruit juice company of Australia that manufactured only orange juice. In 1989, the company started with only 12 people committed to a broad vision. The company aimed towards manufacturing healthy and delicious orange juices that melt in the mouth of the customers. The company has gained high recognition among the customers in Australia for their healthy and delicious orange juices. Based on the popularity, the company launched different types of fruit juices for the Australian population. The new range of juices included Nourish Berry, Nourish Green and Nourish orange. Additionally, the company produced juices in both breakfast bottles and family pack. Over 25 years, the Daily Juice has served the Australian market and now aims towards international expansion for exploring new markets and niches (Dailyjuice.com.au, 2017).
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Political |
· Politically stable government · Proactive nature of the government influencing betterment for the entire population |
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Economical |
· 6th largest economy in the world · First industrialized country in the world |
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Social |
· Unhealthy lifestyle · Obesity among the population |
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Technological |
· One of the leading countries facilitating scientific development · Use of technology in regular life |
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Legal |
· Legal policies affected by Brexit · Reasonable tax policies |
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Environmental |
· Business Sustainability · Country promoting renewable energy |
Political: The UK is one of the most politically stable countries with the proactive nature of the government. The government of the country is always ready to take actions for the betterment of the entire population. As the political decisions are still influenced by the British monarchy, political corruption is hardly noticed. Moreover, the government of the UK is welcoming host business organizations that can be beneficial for the country and its people (Jones and Norton 2014).
Economical: Over the past years, the economy of UK is ranked as the sixth largest in the world. The country has the most highest GDP around the world as GBP is the highest among all the currencies in the world. Reports suggest that the current GDP of the UK is $2.62 trillion (King et al. 2014). Additionally, the UK is one of the oldest industrialized countries in the world thereby, facilitating foreign investors and business organizations.
Social: Socially, the UK is one of the countries that live the unhealthiest lifestyle due to high-calorie content in the diet. Due to an unhealthy lifestyle, the majority of the population of the country including children, young adults, adults and elderly people suffer from obesity and various other diseases. This is because the majority of the UK population consumes fast food as their staple diet thereby, affecting their health (Croker et al. 2016).
Technological: The UK is one of the oldest countries that has incorporated and facilitated technological development in their daily life. The vast use of technology has influenced the international business organizations and investors (Xia, Yang and Zhu 2013). Therefore, the international business organizations are able to use the technological advancements for expanding their business in the UK market.
Legal: Compared to the other factors, the legal framework of the UK is more strict thereby, making it difficult for the international business organizations and investors. The tax implied for the international business organizations are higher with respect to the domestic organizations. Post-Brexit, the changes in the legal system might make in unfavorable for the international business organizations (Laws et al. 2012).
Environmental: The UK promotes sustainable business opportunities that are beneficial for the environment and the society. Moreover, the UK has taken various measures for the betterment of the environment (Crane and Matten 2016).
Therefore, based on the PESTLE analysis, selecting the UK by the Daily Juice Company is justified.
According to the reports, the majority of the people in the UK lives an unhealthy lifestyle due to the nature of the diet and food consumption. Therefore, obesity and along with other diseases are frequently noticed in the UK population. The NHS data suggests that 24.9% of the diseases in the UK is due to unhealthy diet and lifestyle (Nhs.uk, 2017). Around 528% women and 65% men were diagnosed to be obese in the UK in the year 2014, that is almost 26% increment in the number of obese people in the UK. In addition to, in every five children more than one are suffering from obesity due to unhealthy diet and ignorance among the parents (Health and Social Care Information Centre, 2017).
According to the aforementioned diagram, it can be said assumed that unhealthy diet is prevalent throughout the UK. Based on the market analysis, the Daily Juice Company has selected the children, young adults, and adults as the target customers. As the target customers selected by the Daily Juice Company included different demographics, the company need to implement the psychographic method of targeting customers. The company analyzed the flavors preferred by the children, adults and young adults. Based on the preferred flavors, the company launched Nourish Berry and Nourish Green for the customers.
The Daily Juice Company has to encounter a tough competition in the UK market due to the presence of previously existing healthier juice alternatives for the population. Therefore, appropriate positioning of Nourish Berry and Nourish Green along with the Nourish Orange needs to be done for creating a unique image in the eye of the target customers. As mentioned by Daud et al. (2012), distributing free samples among the customers is the best way of making the product noticed in the eye of the target customers. Therefore, the Daily Juice Company can involve their staffs in distributing the free samples to the customers. For example, the company can set a stall in the market place and distribute the product. This will help in engaging numerous customers along with communicating with the customers personally. Personal communication with the customers about the product will help them is gaining a deeper understanding of it thereby, influencing their purchase decision. For example, while distributing the free sample, the staffs will share the healthier properties and benefits of the product and gain their attention. Additionally, the company can also advertise the newly launched range of juices through newspapers, brochures, and televisions (Sweeting 2013). Positioning the product in this way will influence the purchase decision thereby, allowing them to provide tough competition in the UK market.
After a thorough analysis of the external environment of the UK, the Daily Juice Company prefers using franchising as the market entry strategy. According to Grunig and Morschett (2012), the concept of franchising highlights the type of ownership in which a single brand name is shared by different ownership. Franchising is the cheapest and the fastest method of expanding business internationally (Laufs and Schwens 2014). Therefore, the franchisee will be allowed to use the trademark and business strategy of the Daily Juice Company. However, the franchisee needs to pay the monetary amount for using the trademark and the business strategies. Thus, based on the revenues generated, the Daily Juice Company needs to be paid royalties and some amount initially by the franchisee. According to the franchise agreement, The Daily Juice Company needs to offer the minimal support to the franchisee. For example, The Daily Juice Company needs to train the staffs and advertise the range of products in the UK market on behalf of the franchisee.
Conclusion
In this report, it can be concluded that the Daily Juice Company has decided to expand their business internationally after serving the Australian population over 25 years. After conducting a thorough analysis of the countries, the company has selected the UK for expanding their business. The primary reason for selecting the UK for the international venture was due to the unhealthy lifestyle and diet of the population. Based on the external analysis of the UK, the company has observed the proactive nature of the government that is looking for a healthier option for the population. The company has targeted the children, young adults, and adults due to the unhealthy lifestyle led by them. Moreover, the company has also launched three different flavors based on the preferred taste of the target customers. Delicious and flavorsome nature of the product is a healthy alternative for the customers. The Daily Juice Company selected franchising as the market entry strategy, as it is cheap and easy to expand. In order to communicate the product among the target customers, the company will distribute free samples of the fruit juice along with advertising it through television, newspapers, and brochures.
References
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and sustainability in the age of globalization. Oxford University Press.
Croker, H., Viner, R.M., Nicholls, D., Haroun, D., Chadwick, P., Edwards, C., Wells, J.C. and Wardle, J., 2012. Family-based behavioural treatment of childhood obesity in a UK National Health Service setting: randomised controlled trial. International journal of obesity (2005), 36(1), p.16.
Dailyjuice.com.au. (2017). About Us – Daily Juice. [online] Available at: https://dailyjuice.com.au/about-us [Accessed 14 Sep. 2017].
Daud, N.M., Aziz, H.A., Baharudin, N.H. and Shamsudin, S.F., 2012. Identifying the Determinant attributes of halal cosmetics product that influence its positioning strategy in Malaysian market. Journal of Applied Sciences Research, 8(1), pp.301-313.
Grünig, R. and Morschett, D., 2012. Evaluating market entry modes. In Developing International Strategies (pp. 123-148). Springer Berlin Heidelberg.
Health and Social Care Information Centre. (2017). Statistics on Obesity, Physical Activity and Diet. [online] Available at: https://content.digital.nhs.uk/catalogue/PUB20562/obAnswer:stify;”>Jones, B. and Norton, P. eds., 2014. Politics Uk. Routledge.
King, S., Glanville, J., Sanders, M.E., Fitzgerald, A. and Varley, D., 2014. Effectiveness of probiotics on the duration of illness in healthy children and adults who develop common acute respiratory infectious conditions: a systematic review and meta-analysis. British Journal of Nutrition, 112(1), pp.41-54.
Laws, P.M., Downs, A.M., Parslew, R., Dever, B., Smith, C.H., Barker, J.N., Moriarty, B., Murphy, R., Kirby, B., Burden, A.D. and McBride, S., 2012. Practical experience of ustekinumab in the treatment of psoriasis: experience from a multicentre, retrospective case cohort study across the UK and Ireland. British Journal of Dermatology, 166(1), pp.189-195.
Nhs.uk. (2017). Britain: ‘the fat man of Europe’ – Live Well – NHS Choices. [online] Available at: https://www.nhs.uk/Livewell/loseweight/Pages/statistics-and-causes-of-the-obesity-epidemic-in-the-UK.aspx [Accessed 14 Sep. 2017].
Sweeting, A., 2013. Dynamic product positioning in differentiated product markets: The effect of fees for musical performance rights on the commercial radio industry. Econometrica, 81(5), pp.1763-1803.
Terpstra, V., Foley, J. and Sarathy, R., 2012. International marketing. Naper Press.
Xia, Y., Yang, Z. and Zhu, Y., 2013. Porous carbon-based materials for hydrogen storage: advancement and challenges. Journal of Materials Chemistry A, 1(33), pp.9365-9381.
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