BU7411 International Marketing

BU7411 International Marketing Strategy Assignment Sample

 

1. Introduction

Domino’s belongs to the UK’s master franchise of international fast food pizza delivery chain Domino’s plc. Headquarters of this organization is in the UK and its operating income as per the financial record of 2020 is 10.9 crores GBP (Dominos.co.uk, 2021).http://BU7411 International Marketing Strategy Assignment Sample

This organization is an international brand that sells its fast-food pizza across the world and in current days, it has become one of the favourite fast-food brands for consumers. Strong competitors of this organization are Pizza Hut, Deliveroo, Papa Murphy’s, Sbarro, Pizza, Jet’s Pizza, Papa John’s, Slice, and others (Dominos.co.uk, 2021).http://BU7411 International Marketing Strategy Assignment Sample China has been chosen as the new foreign market where this organization can expand its business effectively.

2. Market entry issues

Market entry is an essential step towards expanding business in the international business market by capturing the consumer market based on its cultural differentiation.

Stepping forward to enter an international market is highly challenging as the new market can possess different cultural norms, business ethics, and other rules and regulations (Wales et al. 2019).http://BU7411 International Marketing Strategy Assignment Sample Besides that, existing organizations and huge competition in that business market may increase the level of challenges to market entry for that organization.

In this case, Domino’s, which is a renowned brand of fast food such as pizza, has expanded its business successfully in various international markets. However, increased competition in the Chinese food chain market has generated many challenges for Domino’s such as cultural issues and marketing issues.

Cultural issues

Different countries have different cultures and differences in consumer behaviour that can leave a huge impact on the market entry of an organization. Different cultural people consume different kinds of food and in terms of enhancing the food chain business, Domino’s can face cultural issues.

The main food product of this organization is pizza that is made of bread, cheese, vegetables, chicken, and other ingredients. As stated by Shen, Puig & Paul (2017), Chinese have issues with lactose intolerance and for this reason, they do not consume any dairy products. Instead, they have replaced dairy food products with tofu and soymilk which is costlier than dairy products.

Domino’s includes cheese as one of the main ingredients to pizza and that is made of dairy products which can cause stomach intolerances to customers. However, due to cultural differences, a huge difference in the food habits of the Chinese has also been generated.

Replacement of cheese that is made of dairy products with cheese made of soya milk can solve this issue to some extent. As argued by Nieborg & Poell (2018), soya milk is costlier as compared to dairy milk which can increase the production cost of an organization. In this aspect, Domino’s can face financial issues due to cultural differences and different food habits.

China is known as a huge business market that gives opportunities to everyone to expand their business in the Chinese market. In the case of Domino’s, the Chinese government may give them this opportunity to expand their business in China and earn more revenue.

According to the view of Schellenberg, Harker & Jafari (2018), China is operated as a socialist market economy that has remained untapped and mysterious for international businessmen. Open opportunity for business expansion provided by the Chinese government has increased this competition as every business organization has shown an interest in entering the Chinese market.

Marketing issues

Proper market analysis is required to mitigate marketing-related issues in a new foreign market by expert market analysts. As per the view of Sugiyarti & Aryan (2017), poor marketing of a new organization can cause promotion-related issues which can generate issues with effective marketing.

Cultural and geographic differences generate distinct changes in consumer behavior which can create challenges for new entrants in marketing. For example, consumers from China prefer to purchase fine quality products at a cheap price which can create issues in marketing activities. Consumers in China have been trending from mass-market products to premium products in the current business days.


BU7411 International Marketing Strategy

Figure 1: Marketing issues

(Source: Lindsay, Rod & Ashill, 2017)

Time has changed that helped Chinese consumers in improving their living standards and for that reason, consumers have upgraded their choice towards high quality and good taste. In the words of Lindsay, Rod & Ashill (2017), Chinese consumers are very health-conscious and are concerned about food safety.

In this aspect, being a new market entrant, convincing Chinese consumers regarding the food safety of pizza that consists of dairy products such as cheese is challenging. Therefore, Domino’s has faced issues regarding its marketing process due to differences in its consumer behavior.

2.1. Marketing analysis tools

Data analysis is the key factor for market analysts to make a proper analysis of the consumer market based on multiple things. Digital marketers need to possess effective skills and techniques to manage and measure their marketing performances in various marketing or promotional campaigns.

In this case, marketing analytics tools can be helpful for market analysts to achieve their marketing and promotional goals (Gond & Brès, 2020).http://BU7411 International Marketing Strategy Assignment Sample These tools are beneficial for market analysts to increase their efforts for marketing activities through effective market analysis.

In terms of making marketing activities more effective and justifying investments for new market entry, marketing analysis tools are beneficial. Several tools have been described below that can be applied by the marketing team for Chinese market analysis:

BU7411 International Marketing Strategy

Figure 2: Marketing data analytical tools

(Source: Zainal, Hashim & Musa, 2021)

Google Analytics

This analytical tool can help the market analyst to track the traffic in the website of Domino’s and help them to understand the locations from where most of the visitors are coming.

It can also provide data on how long viewers are spending on their website which is beneficial to understand consumers’ interest to buy pizza. As influenced by Zainal, Hashim & Musa (2021), this is free of cost market analytical tool that can save the marketing and market analysis cost of an organization.

In this aspect, the application of Google Analytics can help Domino’s to identify the most preferred location to conduct marketing and promote their pizza in an innovative way. In terms of deeper market analysis, this tool can be integrated with Google AdWords and Google Data Studio which are other marketing data analytical tools.

MixPanel

This data analytical tool is effective in tracking events of an organizational website, product as well as mobile app. In this way, the marketing data analysts can get to know what the users do with their mobile apps and websites.

These kinds of activities help organizations to understand consumer behavior based on their total time spent and the total number of views for a particular product or service (Maknickienė, Stankevičienė & Maknickas, 2020).http://BU7411 International Marketing Strategy Assignment Sample In the case of Domino’s, this organization can be benefitted by knowing the exact customer zones where they can conduct effective marketing.

However, Google Analytics and MixPanel tools can give more effective results in terms of making proper market analysis for this organization so that it can enter the Chinese market. Proper promotional activities and enough marketing campaigns are also required for effective marketing.

3. Application of knowledge to the problem of market entry

3.1. Justification for the chosen target market

China has been chosen as the targeted market for business expansion of the famous fast-food company Domino’s which sells pizza across the world based on cross-cultural flavors. The government of China has paved the way for international business organizations to expand their business in this country.

The huge population of this country has provided foreign organizations with a huge consumer market for revenue generation (e Silva, Meneses & Radomska, 2018).http://BU7411 International Marketing Strategy Assignment Sample Ingredients and machinery needed for making pizza can be easily available in China at a cheap price and workers can be recruited at a lower remuneration.

The increased living standard of the Chinese population has influenced them to spend on good taste and healthy food products. People over China are ready to spend a huge amount purchasing their chosen products and services.

As stated by Schu & Morschett (2017), Chinese consumers do not prefer dairy products due to their lactose intolerances and Domino’s can use cheese made of soy products. The availability of skilled workers has helped this organization to recruit efficient bakers for baking delicious pizzas at a lower price. Apart from that, Domino’s can get the opportunity to apply for Foreign Direct Investment as it has many franchises across the world.

3.2. International market entry methods

International business market entry requires the selection of a specific country for business expansion and proper market analysis of the particular country is essential. In the case of Domino’s, the organization has determined to enter the Chinese market for effective business performance.

However, various market entry modes are there that can be applied by this organization for effective business development. For example, exporting, licensing, franchising, joint venture, foreign direct investment, subsidiary, piggybacking and others are some market entry modes (Watson et al. 2018).http://BU7411 International Marketing Strategy Assignment Sample

BU7411 International Marketing Strategy
Figure 3: International market entry methods

(Source: Maknickienė, Stankevičienė & Maknickas, 2020)

Partnering

Partnership business can be considered an effective method of business that can be applied by Domino’s for more profit and to increase its business sustainability.

For example, joint venturing with McDonald’s can be beneficial for Domino’s to increase its sales number and volume for more revenue. This organization is a popular food chain in China that is preferred by a majority of consumers in China (Ahi et al. 2017).http://BU7411 International Marketing Strategy Assignment Sample

Structured exporting

Structured exporting of products refers to the direct selling of products or selling goods to foreign markets for effective business performance. As suggested by Smith et al. (2021), exporting is considered to be an effective idea for entering foreign markets successfully.

Proper understanding of government rules and regulations, international business law, and market analysis can help an organization to enter a new foreign market and earn more profit. In this case, Domino’s cannot export their products directly to the foreign market as they sell handmade pizza in front of the customers by customizing that.

Foreign direct investment

The prime rule to achieve foreign direct investment, an organization needs to possess an existing organizational property in any country. In this aspect, Domino’s has met the requirement which is considered to be quite influential in terms of getting the facility of foreign direct investment.

This entry mode can be adapted by Domino’s to enter the Chinese market successfully after making a proper market analysis of the country (Schu & Morschett, 2017).http://BU7411 International Marketing Strategy Assignment Sample

Acquisition

It is an innovative mode of market entry for international business organizations and through this mode, Domino’s can gain control of other organizations’ stock. In this aspect, the total profit of this food company can be increased so that they can invest in increasing their stock for pizza making (Maknickienė, Stankevičienė & Maknickas, 2020).http://BU7411 International Marketing Strategy Assignment Sample

3.3. Recommended market entry mode

Domino’s can be recommended with partnership and foreign direct investment modes of entering new business markets in different countries. Partnering with McDonald’s can be beneficial to understand consumer requirements regarding fast food.

According to Zainal, Hashim & Musa (2021), most of the consumers who belong to Generation Z prefer fast food and can digest that without any health issues. Besides that, partnering with an existing successful business organization from the same industry can help in increasing future business sustainability.

Apart from that, foreign direct investment can mitigate the headache of finding investors to invest in the project and benefit from business expansion.

4. Recommendations regarding adapting and standardization of marketing mix elements

Domino’s is a fast-growing pizza chain and delivery company that delivers a wide range of pizza to its customers. This food and beverage company has been growing leaps and bounds in today’s world.

The company encompasses innovative ideas and is committed to providing quality products to its customers. Besides, its dedication to its customer base has helped this company to secure one of the leading positions in the food and beverage industry.

Domino’s faces stiff competition with other players in the market such as KFC, Pizza Hut, McDonald and others. This encourages the company to establish a strong marketing strategy for this company which can help the company to attract more customers.

The marketing mix needs to be adopted appropriately accordingly and needs to be aligned with the objectives of a company. As narrated by Thabit & Raewf, (2018), it is significant for a company to adopt a proper marketing mix and align each of its elements with its organizational strategies.

This can enhance the chances of growth and sustainability of a company. Domino’s implements a 4ps marketing mix for promoting its business. Marketing strategies are considered to be essential for promoting products and services offered by a company.

Proper implementation and standardization of the marketing mix can help an organization to garner more customers which can be beneficial for its overall business. The 4Ps of the marketing strategy adopted by Domino’s comprises its four elements such as product, price, place, and promotion.

BU7411 International Marketing Strategy
Figure 4: 4ps marketing mix of Domino

(Source: Loo & Leung, 2018)

Proper adoption and standardization of these elements are considered to be significant for the accurate implementation of this strategy. It can help the company to obtain maximum benefits from the implementation of this marketing mix in its business.

Companies like Domino’s need to equip their marketing mix accurately which can provide them a better understanding of which elements need to be standardized and adopted to mitigate their existing issues. According to the view of Loo & Leung, (2018), a business organization faces several issues in running a business such as financial issues, marketing and promotion issues, sustainability issues, and others.

Accurate adaptation and handling of an established marketing mix in business can help companies like Domino’s to deal with these issues.

For instance, a suitable marketing mix can help this company to control its various elements such as promotion, place, and price which in turn can help the company to attract its target audience (Mahmoud, T. O. 2018). http://BU7411 International Marketing Strategy Assignment SampleThis, in turn, can assist the company to mitigate its financial issues and enhance its sustainability.

Product

Domino’s is well known for its quality and fresh products served to its customers. The boxes used by the company to serve food to its customers are specially designed to keep its foods fresh.

The marketing team of Domino’s has been dedicated to providing innovative ideas and approaches to this company in order to make its business more profitable. Domino’s implements the strategy of localizing the flavor of its products in order to seize new markets.

As argued by Al Badi, (2018), this strategy of localizing flavors has assisted Domino’s to attract more audience towards its products which has been profitable for its business. For instance, in Asian countries, Domino’s offers its products according to the taste of Asian people.

Particularly in India, Domino’s provides its authentic products with a touch of Indian flavors and spices to cater to more customers.

Domino’s offers a range of products to its customers ranging from a wide range of pizza to soft drinks and beverages. It also offers a variety of dips and desserts to its customers which helps this company to attract customers of all ages.

Price

Domino’s mainly targets the lower middle class and middle-class audience as quality food at a reasonable price is the motto of this company. This company has come up with a consistent and uniform pricing policy.

This helps the company to keep its base price in check and attract more customers. Considering its competition, Domino’s is evenly prized with Pizza Hut; however, its pricing is higher in comparison to KFC and Mcdonald’s. Therefore, price-conscious customers choose competitors like KFC and Mcdonald’s over Dominoes.

As opined by Othman et al. (2019), the marketing team of Domino’s can be advised to come up with innovative ideas and approaches to lower the prices of its products. As Domino’s targets the middle-class and lower-middle-class audience, enhancing its affordability can be the key to the success of this company. Domino’s can offer special discounts to its loyal customers at regular intervals to attract more customers towards its products and services.

Place

International place strategy is one of the major factors which can determine the growth and development of an organization. It is considered to be significant for a company to be placed properly to attract maximum customers to its offerings. Domino’s has maintained a direct channel with its customer base.

Its customers either place their orders through its website or call directly to place their order (Mahmoud et al. 2017).http://BU7411 International Marketing Strategy Assignment Sample It provides a 30 minutes delivery offer to its customers where products delivered after 30 minutes are provided for free to the customers. It is essential for Domino’s to standardize this element of its marketing mix.

The marketing team of Domino’s can be recommended to open its new outlets in places with high intensity and demands. It can make it easier for the company to fulfill its 30 minutes delivery services.

Promotion

The international promotion strategy of Domino’s involves maintaining direct contact with its customer base. This is one of the major factors which is responsible for the success of this company.

As suggested by Anjani, Irham & Waluyati, (2018), its sales largely depend on its telemarketing, it provides various offers to its customers through messaging and multimedia messages. Domino’s introduces new schemes and offers to promote its products to maintain its grip on its customer base.

It provides free delivery of its products which encourages word-of-mouth promotion for the company. The company at times offers 50% off to its loyal customers in order to retain customers. Besides, promotion through print and television advertising is a popular promotion strategy of Domino. Therefore, it can be stated in this context that the advertising team of Domino’s is actively involved in the promotion of its goods and services which boosts its sales.

5. Conclusion

The international marketing strategy of Domino’s has been interpreted in this study that has mainly focused on effective market entry modes and mixed marketing strategies.

It can be concluded from this study that Domino’s has successfully expanded its business across the world by customizing its taste and ingredients of pizza according to the consumer’s choice.

In terms of entering the Chinese market, it can face cultural and marketing-related issues that can be solved with effective marketing mix strategies. Partnership and foreign direct investment modes of entering new business markets in different countries have been recommended to Dominoes for successful entry in China.

References

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Al Badi, K. S. (2018). The impact of marketing mix on the competitive advantage of the SME sector in the Al Buraimi Governorate in Oman. SAGE Open8(3), 2158244018800838. Retrieved from: https://journals.sagepub.com/doi/pdf/10.1177/2158244018800838 [Retrieved on: 10th July, 2021]

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Othman, B., Harun, A., Rashid, W., Nazeer, S., Kassim, A., & Kadhim, K. (2019). The influences of service marketing mix on customer loyalty towards Umrah travel agents: Evidence from Malaysia. Management Science Letters9(6), 865-876. Retrieved from: http://m.growingscience.com/msl/Vol9/msl_2019_72.pdf [Retrieved on: 10th July, 2021]

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Smith, C., Ogutu, M., Munjuri, M., & Kagwe, J. (2021). The Effects of Foreign Market Entry Strategies on Financial Performance of Listed Multinational Firms in Kenya. European Journal of Business and Management Research6(3), 216-225. Retrieved from: https://www.ejbmr.org/index.php/ejbmr/article/download/517/497

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Thabit, T., & Raewf, M. (2018). The evaluation of marketing mix elements: A case study. International Journal of Social Sciences & Educational Studies4(4). Retrieved from: https://www.researchgate.net/profile/Thabit-Thabit/publication/324923406_The_Evaluation_of_Marketing_Mix_Elements_A_Case_Study/links/5aeb827a458515f59981df6e/The-Evaluation-of-Marketing-Mix-Elements-A-Case-Study.pdf  [Retrieved on: 10th July, 2021]

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Zainal, R., Hashim, F., & Musa, S. M. S. (2021). Financial and Market Decision-Making Tools for Housing Development. International Journal of Sustainable Construction Engineering and Technology12(1), 120-129. Retrieved from: https://publisher.uthm.edu.my/ojs/index.php/IJSCET/article/download/6978/4239

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