Retail marketing process is based on the sales of services and goods from the business organizations to the end users. This is the process by which the retailers are able to promote the interest and awareness based levels of the services and goods in order to generate the sales from consumers. The process of retailing is thereby based on different approaches which retailers are able to use in order to market the services and the goods. Different types of communication and advertising based tools which are able to grow the levels of awareness among the prospective consumers (Rezaei, Fahim and Tavasszy 2014). The development of a right marketing mix thereby plays an important role in the effective operations of the retail based organizations.
The report will be based on the analysis of the retail markets that have been established in two different countries which are located in different areas of the world. The different aspects that are able to affect the operations of different retail based organizations in these two countries will be analysed in the report.
The two countries that have been selected for the analysis in the report include Japan and Australia. The retail industry within the countries and different aspects which are able to affect the retail organizations will be a major part of the analysis. The ways by which the retail organizations in Australia are able to operate in Japan will be examined in the report.
Australia – According to Pantano et al. (2017), the retail based industry of Australia is considered to be a major contact point between the wholesalers or the manufacturers and the consumers. The industry is able to provide effective convenience points to the consumers so that they are able to acquire the required services and products. The advent of online shopping on the other hand was able to offer the products to the consumers with the help of different online platforms. The process of development of the Australian retail industry is thereby driven with the help of huge number of factors that include, the preferences of the consumers, advances in technologies and the different competitive pressures as well.
The retail industry of Australia had been quite isolated in nature due to the protected markets and the geographic position. However, with the increase in internet market based activities the Australian retail industry has been able to become much more open in nature. A major development in the Australia retail industry is based on the online shopping related activities. The retailers in Australia are able to carry out a range of functions which include, providing convenience to the consumers, developing a mechanism related to discovery of markets and the after sales services (Kasemsap 2018).
The goods can be purchased in smaller quantities by the consumers which are provided by the wholesalers and the manufacturers. The structure and nature of the Australian retail industry has evolved in a huge manner in the last few years which is thereby based on the changes which have taken place in different technologies. The structure of the market has started changing in an effective manner from the 19th century to the current position. The preferences of the consumers and the technological changes are the major factors that are able to affect the changes which have taken place in the Australian retail sector (Çifci et al. 2016).
Japan – The retail based industry of Japan has started changing after the process of Meiji Restoration in the country. The structure of the business in retail industry of Japan has faced many changes and turning points due to different aspects which include, income, population, technology, competition and the legal framework. These factors have led to the effective emergence of the different retail formats of the country. The rates of consumption of the consumers have been changing in the country. The retail based formats which are now being used in the country have changed in a huge manner from the previous situation (Kaul 2017).
A major turning point which is an important part of the retail businesses is considered to be the rise in competition between different domestic and global organizations in the country. The emergence of the new formats in Japan have further been a dynamic process which has led to changes in the structure of the market. The levels of innovation in the Japanese retail industry have increased and this has been able to act as a major factor which has led to high amounts of changes. The development of various new formats has also been able to play a major role in the ways by which Japanese retail industry and its structure has started changing (Zolnowski, Weiß and Bohmann 2014).
The levels of restrictions in the industry has also reduced in which has further been able to lead to effective changes in the country. The lack of growth which has been seen in the consumption of products in the Japanese retail industry is based on the decline in levels of population in the country. The country has started entering the era which is related to the decline in rates of population. The GDP rates of the country have also been affected by the changes in rates of population. The behaviour of the consumers had started changing from the year 2005. The competition based levels have thereby started increasing among the local stores and the global organizations which operate in the country (Çifci, Ekinci and Whyatt 2014).
Australia – The Australian retail industry had thereby started growing in size from the 20th century. The concept based on the establishment of modern retail based services has been an important part of the development that has been depicted by the industry. The new retail based model based on the development of malls was embraced by the Australian retail based sector. The first drive-in mall was thereby established in the country in the year 1957. The size of the industry has also started increasing in an effective manner after the 20th century. The different organizations which have been able to play a major role in the increase of size of the Australian retail industry mainly include, Wesfarmers and Woolworths. These two organizations have developed the operations of the industry in an effective manner (Ibisworld.com.au 2018).
The mall based culture in the country had thereby enabled the retailers to provide different types of speciality stores and products to the consumers under a single roof. The entertainment based factors of the industry had also started increasing in an effective manner due to the changes which have been seen the retail process. The global financial crisis which had taken place in the country in 2007 and 2008 had major effects on the sales of different retail based organizations in Australia. The entry of major global organizations within the Australian retail industry had major effects on the sales and levels of profitability of the domestic organizations. Another major development which had increased the business prospects of the industry is the introduction of self-service within the retail industry. This factor had played a major role in engaging the consumers within the shopping based process (Kpmg.com 2018).
The advancement in self-service had thereby taken place in the modern times based on the proper levels of adoption of the technologies which are user directed in nature. The preference of consumers had played a major role in increasing the levels of control and the cost based advantages as well. The Australian consumers had also started accepting the self-service based methods in such a manner which had further led to effective innovation within the industry. The size of Australian retail industry is also increased effectively with the help of franchising. The franchising based model had mainly originated in the United States which led to the increase in number of stores of different retail companies (Kpmg.com 2018).
This had played a major role in the ways by which organizations are able to operate in the retail industry. The process of franchising had been able to increase the expansion of the companies in both the domestic and the international market based areas. The retail organizations in Australia had also started introducing their private labels in order to operate in the industry effectively. The private labels were mainly introduced in order to sell the products of the company to the consumers in an exclusive manner. This is considered to be the most important factor which has led to the increase of size of Australian retail industry (Kpmg.com 2018).
Japan – The retail industry is Japan is however quite different as compared to that in Australia. The organizations which have their operations in the country operate in a completely different manner as compared to the ways by which the Australian organizations are able to operate. As compared to the retail industry of Australia, the mall based retail format is not quite prevalent in Japan. The smaller retail stores are quite common in the country. The dualistic nature of the economy of Japan is considered to be a major reason behind the structure of retail market. The distribution based activities in the country are also not quite effective for increasing the size of the retail industries which operate in the country (McKinsey & Company 2018).
The number of smaller retail stores in the country is thereby quite large as compared to that in Australia. The laws and the regulations which have been implemented by the government of the country has also been able to play a major role in the development of smaller stores. The obstacles have thereby been developed in the establishment of large stores in the Japanese retail based industry. The Large Retail Store Act which was thereby established in the year 1973 has been able to provide more importance to the size of the stores rather than its nature. The time which is taken by the government in order to review the applications which are placed for the development of new stores has also been able to cause negative effects on the ways by which retail stores have been established in the country (McKinsey & Company 2018). The ease with which retail stores are set up in Australia and the easy entry of global retail based organizations is not available in the retail sector of Japan. The behaviour which is depicted by the Japanese consumers can also be considered to be a major factor which is able to affect the operations of the different Japanese retail organizations. The effective entry of global organizations in the country is not easy and has been able to cause issues for the different retail based companies (Nguyen, Pham and Trieu 2018).
Australia – The Australian industry has started facing major challenges in the year 2018. The costs based on running day to day business operations is thereby considered to be the biggest challenge that is being faced by the retail companies. The rise which has been experienced in the operational costs of the retail organizations is considered to be a major challenge that has been faced in Australia. The future operations of the industry are also expected to face similar challenges based on various costs of production. The changes that are taking place in the industrial relation based laws have been able to affect the revenue levels of retail organizations in a huge manner (Ibisworld.com.au 2018).
The rise in competition in the market has further led to the lack of loyalty among the customers related to different brands. The understanding of needs of consumers is considered to be an important factor which needs to be considered by the retail companies. Data of the consumers is thereby considered to be a major factor which is able to affect the ways by which the company is able to offer the products and services to them. The competition in the retail industry also needs to addressed effectively by the retail organizations in order to maintain their position in the industry (Ibisworld.com.au 2018).
Japan – The retail industry in Japan is however facing different types of issues which are quite different from those which are faced in Australia. The levels of productivity in the Japanese retail industry are low. Different types of barriers are thereby evident in the market which have led to the lack of revenues of the industry as well. The major reason behind low productivity in the retail market of Japan is related to the presence of the unproductive traditional stores in the industry. More than 50% of total number of stores in the country are traditional in nature. This has been able to affect the overall revenues of the industry. The dynamics of the industry have also been affected in a huge manner by the unproductive stores which operate in Japan (Japanretailnews.com 2018).
The traditional stores however do not face any competition from the other organizations in the industry. The foreign retailers who operate on a large scale basis have to face huge levels of competition in the retail industry. The industry also faces major levels of external barriers based on the levels of productivity and revenues as well. The laws that have been imposed in Japan based on the operations of the retail organizations have been able to play a major role and create a barrier in the operations. The exit based barriers that are thereby present in the market is able to affect the operations of the traditional retailers (Japanretailnews.com 2018).
The retail industry of Japan thereby faces major issues related to the lack of large stores in the country. The country thereby needs to improve the laws and the regulations that are followed in order to increase the levels of profitability of the industry.
The cultural differences between the two countries can be analysed in an effective manner with the help of different factors which are a part of the Hofstede Model. The analysis of the two countries with the help of this model has been able to depict that there are many differences between the cultures which are able to affect the retail industries in a huge manner.
The power distance based score of Japan is higher as compared to that of Australia which has been able to depict that the hierarchical organizational structures are more prevalent in Japan. The Australian retail organizations thereby need to keep this in mind before they plan to enter the country. The individualism on the other hand is higher in Australia which depicts that the group based culture is followed in Japan. The long term orientation based activities in the organizations in Japan is however higher as compared to Australia which will further affect the policies that are developed by the retail organizations in the country (Hofstede-insights.com 2018).
For example, types of coffee which are sold in Australia are normal ground ones and the freshly brewed ones. Australia is also considered to be a major coffee consuming country of the world. However, the types of coffee offered to consumers are quite normal. On the other hand, coffee lovers from all over the world visit Japan for getting the proper taste of third wave coffee.
Figure 2 – Japanese Coffee of art
Source – (Japanretailnews.com 2018)
Conclusion and Recommendations
The report can be concluded by stating that the retail based industry and its operations is quite different in Australia and Japan. The retail industry in Australia is quite advanced and open in nature and that in Japan is developing. The retail based laws in Japan have been a major factor which has affected the operations of different organizations. The legal structure of the country has thereby been able to play a major role in the ways by which the retail industry operates. The lack of larger retail stores is also considered to be a major factor which has been able to reduce the levels of profitability of the industry. The format of stores and their operations is thereby quite different in Japan as compared to that which is followed in Australia. This has to be considered by the global Australian organizations before they plan to enter the Japanese retail market.
Recommendations – The recommendations that can be provided to the Australian retail industries before they enter Japan is based on the proper analysis of the laws and the policies. The market conditions also need to be analysed by the companies in order to start their profitable operations in the country. The cultural differences can also have major effects on the Australian retail organizations.
References:
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Hofstede-insights.com (2018). Country Comparison – Hofstede Insights. [online] Hofstede Insights. Available at: https://www.hofstede-insights.com/country-comparison/australia,japan/ [Accessed 26 Sep. 2018].
Ibisworld.com.au 2018. Retail Trade – Australia Industry Research Reports | IBISWorld. [online] Ibisworld.com.au. Available at: https://www.ibisworld.com.au/industry-trends/market-research-reports/retail-trade [Accessed 26 Sep. 2018].
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