Assignment Sample International Marketing and Brand Management
Introduction
Any organization in order to grow in the international market field is required to implement proper strategy within itself. Several factors are required to be focused by a company in order to increase its international market. In a society of globalization, market observation is highly required in order to understand the different marketing tools focusing on which the market improvements are required to be made. Different factors like people, products, demands, supply, promotion, packaging, place etcetera impacts on the image of a brand in the international market. In order to increase sales within the international market an organization is required to connect to these different factors of a country. Different strategies are required to be implemented in order to study the current social situation within the country so that the organization can be able to develop a proper study. Brand management is required to be done in a proper manner so that a higher amount of people within the countries can know about the existence and products which are being made by the company.
Part 1: Brand analysis
The UK based retail brand which has been chosen for this scenario is Primark. Primark is one of the most popular fashionable clothing chains within the UK (primark.com, 2021). The brand is highly popular within the UK for the products which are being made by them and for the longevity and unique designs of the clothes that they offer. Primark operates almost over 188 stores in the UK and is now looking for expanding its business in the international market as well. The different details regarding the brand have been explained here in a detailed manner so that the potential of the brand can be looked into.
Brand introduction
Primark is basically a fashion and clothing brand which produces different fashionable clothes and accessories (primark.com, 2021). The bags which are being produced by them are one of the most fashionable things that they offer. The company is basically an Irish company that has headquartered in London. Unique designs and catchy looks are the main USP of the brand which has increased the youth connection with the brand. The company produces clothing for men, women and kids. Different home decorations as well as beauty products are also being sold by Primark.
Brand portfolio
The first Primark store was opened in 1969 in Dublin. The initial name of the company has been Penneyes and currently the company has over 380 retailing stores within thirteen countries of America and Europe. In 1973 he brand opened its first store within the UK. The brand currently operates over 188 stores within the UK. Along with time through providing the buyers of the company with an amazing quality of products the brand not only has gained a lot of revenues but also has gained the faith and love of its customers which has been helping the company to grow further in a proper manner (Huerta-Álvarez et al. 2020, p. 413). The largest Primark store is situated within the high street of Birmingham which occupies almost 160000 square feet of space and the shop has a spread of five floors. From women and men’s products the different products which are being sold by the company, also includes baby care products, products for home decoration, kids and baby beauty products. Different inspirational stories are also available within the websites of Primark in order to motivate the customers in various manners and through various stories.
Brand elements
Different brand elements impact on the popularity of the brands. The name of a brand for instance plays a highly important role in terms of increasing popularity of a brand (Yu et al. 2020, p. 54). The more a brand name is easily pronounceable or catchy towards the customers; more number of customers is going to recognize the company in a relatively easier manner. A simple logo of a company also impacts on the customer minds. Logo signifies the brand and the importance of any brand. In the case of Primark the logo of the company has greatly been accepted by its customer base, helping the company to increase its popularity. Other elements like quality of the product, designs and colors impacts on the popularity of any brand.
Brand equity
The value of Primark within the market is really high (primark.com, 2021). The clothing retailer shop has over 388 retailer shops which sell high end fashionable dresses and other products as well. The brand equity of Primark is high which has been generated from the value of the brand. The retailer stores have helped the company to grow British pounds amounting 1.1 billion in the year 2019. The profit margin of the company has helped the company to become one of the biggest retailing companies within the UK.
Keller’s brand equity model is being applied within Primark in order to look into different important aspects within the organization. The brand equity model of Keller implements that the role of an employee within the organization in case of the most common question which are being asked by the customers (Elia et al. 2020, p. 994).
Brand mantra
The mantra refers to the faith which is being believed by the company in the business. Every brand requires a morale value to which the standard of the brand depends on. In the case of Primark, their motto is to look at everyone as a family member and everyone is like an extended family member to them. The motto that the company believes is to provide amazing quality of fashion within an amazing price range.
Part 2: International Market analyses
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SLEPT analyses of three culturally distinct market
The SLEPT analysis is a model that is applied to examine the environment of a business. It depends on the PEST analysis with one extra dimension and it stands for social factors, legal factors, economic factors, political factors, and technological factors. In this context, the brand Primark wants to move its business into three different countries. Three different countries are different in their cultural and other factors. Primark must apply proper strategies before entering into these three new markets (primark.com, 2021). Therefore, Primark requires a proper SLEPT analysis to compare the business environments of these three new markets. Three chosen markets are China, Russia, and Brazil.
SLEPT or PEST analysis is known as a framework that helps to explain the factors of macro-environment applied in the scanning of environmental components for strategic management. It can be considered as a part of external analysis at the time of performing market research or strategic analysis. This framework provides an overview of various factors of macro-environments that are considered to understand the market growth. SLEPT consists of five factors that can affect the macro environments of a business they are social, legal, economic, technological, and political factors. It provides an understanding of the long-term and broad trends and develops the organization in a proper position for making a strategic decision (HR and Aithal, 2020, p. 210). Here, the researcher is going to prepare the SLEPT analysis of three chosen culturally distinct markets in which Primark can enter potentially.
SLEPT analyses
| Factors | Brazil | Russia | China |
| Social factors | There is an economic inequality observe in the environment of Brazil because almost 20% of the Brazilian population lives under the poverty line. It can be observed that a large population of people is living with minimum incomes and present a considerable number of wealthy families are present in Brazil (Varadarajan, 2020, p. 45). The Brazilians are up-to-date in the sense of fashion therefore; Primark has a chance to grow their business in this market. | Russia is known as one of the largest countries globally. It is famous for its connection with the Soviet Union, resiliency, and so on. The social factors that can affect business in Russia are different religions like Christian, Islam, and spiritual citizens, rich culture, and decreasing rate of birth. | The cultural and social aspect has an essential role in business. The literacy rate of China is almost 90%, and almost 420 million people are using the Internet. Therefore, Primark has a chance to grow its business in China. |
| Legal factors | The written contracts of the employees are not needed in the law of Brazil. The Brazilian government motivates foreign active investments but puts limitations on various sectors such as financial institutions, postal services, and so on. Therefore, as a retail sector, Primark has a chance to enter the Brazilian market. | The government of Russia is controlling many businesses as well as media so corruption is a negative factor in Russia. Various rules are present related to overtime that can affect Primark in Russia. | The legal factors of property rights, tax policies, and consumer rights can affect the market of China. |
| Economical factors | In recent days, the potential growth of Brazil is high because of FDI inflow and large population. Central bank decreases the currency devaluation risk and government reduces the gap between poor and rich. The currency of Brazil is now overvalued that can affect a new business. | It is a well-known tourist destination but it suffers from various issues such as collapsed Soviet Union. Therefore, a change is required in the economic strategy of Russia. The country is vulnerable and restricted to the mining industry. | The economy of China is observing a high rate of GDP in recent days. It can be assumed that it can suppress the GDP of the US. |
| Political factors | Brazil is a powerful country of South America and also known as the middle of the power that influences various international affairs. The Brazilian government is stable and proactive and no such political instability is present in this country. It can observe the political situation of Brazil is changing overnight due to elections. The negative political factor is corruption that can affect the business of Primark because small businesses need to pay payments to the government officials before entering the Brazilian market. | Russia follows the system of Civil law and it belongs to a federation of semi-presidential. It can be observed that these two factors can overpower the market of Russia. | China is an attractive location globally and becomes one of the strongest countries. The political factors that affect the market of China are legal issues, governmental regulations, and so on. The informal and formal rules can affect the business in China. |
| Technological factors | In comparison with the United States and Russia, Brazil has a weak infrastructure of technology and investments in technology. In reticent days, the government is pushing IT organizations of Brazil and they are improving constantly (Tartière and Astolfi, 2017, p. 5). | The major stations and TV channels are powered by the government therefore; the residents can watch free television that is decided by the governments. The governments are developing high-tech zones and high-tech parks that can affect a business (Varadarajan, 2020, p. 46). | Technological factors are mobile telecommunication, production technology, purchasing mechanisms, and so on. |
Table 1: SLEPT of three different countries
(Source: Dave et al. 2017, p. 145)
- Competitor analyses for each market
The competitor analysis is known as the best tool to analyze and monitor a brand in a recent market. It has been observed that the Russian market consists of various competitors for Primark to expand their business. The competitors are Wild berries who are selling electronic goods, fashionable products, and foods. Other competitors are Ozon, AliExpress, Yandex, and so on. It can be observed that there is a high chance of expanding business in Brazil for Primark. There are high inflation and low growth in the existing Brazilian retail companies. The competitors of Primark in China market are very high because there are various retail companies are present in China such as Alibaba, Amazon China, vip.com, and so on (Thomassen et al. 2017, p. 2320).
Part 3: Strategy for Market Entry
- Selection and justification of new international market entry
Prior to the determination of the expansion into the international market, the environmental analysis needs to be performed. After the conduction of the external market analysis, it can be said that Brazil poses to be one of the potential markets where Primark can execute the task of new market entry. From the comparative analysis of the ease of doing business in the countries that had been determined, Brazil poses to be one of the most attractive options. Even though on a world rank, Brazil falls behind its alternatives, the ease of starting a business , ease of payment of tax, registration of property and enforcement of contract is relatively ranked higher than its alternatives (data.worldbank.org, 2021).
| Brazil | China | Russia | |
| World rank | 126 | 91 | 124 |
| Starting of a business | 79 | 151 | 111 |
| Construction permits | 99 | 179 | 178 |
| Registration of property | 49 | 40 | 45 |
| Protection of investors | 110 | 67 | 111 |
| Payment of tax | 43 | 122 | 105 |
| Trade across borders | 13 | 60 | 160 |
| Contract enforcement | 28 | 16 | 13 |
| Resolution of insolvency | 7 | 73 | 60 |
Table 2: Ease of doing business world ranking
(Source: data.worldbank.org, 2021)
Brazil poses to be one of the leading countries in the Latin America considering the opportunities of investment. The attractiveness of the market entry opportunity in Brazil is owing to the fact that foreign investments are generally welcome in Brazil (Cavallo, 2019, p.68). The country has been granted investment grade rating by most of the major agencies across the world which provides reassurance that entry into Brazilian market is a viable and profitable option. Additionally, the accounting standards along with the local auditing align with the International financial reporting standards, which provide a standardised auditing mechanism (Shahzad et al. 2019, p.118). Brazil is one of the countries, which has a rising attractiveness towards Foreign Direct Investment (FDI). This feature increases the investment opportunity of the country even further. The FDI has shown a positive upward curve recording a growth in the FDI. Forecasting analysis has shown that the positive trend is expected to continue in the future as well.
- Recommended market entry strategy
Market entry strategy proves to be one of the most essential tools in the aspect of market expansion as it provides clarity upon what is to be achieved and the process it is going to be done. There are a number of factors which influence the selection of the strategy that is to be selected and the consecutive influence it is going to have upon the business ( Watson et al. 2018, p.30). The different modes of market entry strategy are, Direct exporting, Licencing, Franchising, Partnering, Joint ventures, Acquisition, Turnkey projects, and Greenfields investments.
Primark makes use of the Koch’s model to select the appropriate strategy that is going to be used in the market entry strategy (Steenkamp, 2017, p. 243). Based upon the firm level analysis it can be said that Licensing emerges to be one of the preferred strategies for Primark to enter the Brazilian market. The strategy of Licensing is where the existing firm transfers the right of use of a product and service to another firm. Instances when the purchaser of the licensing agency has a relatively large market share the strategy proves to be very beneficial. Additionally the associated risks during the process of expansion and market entry are reduced significantly by adopting this technique (Adeola et al. 2018, p. 205). Primark can also capitalise on the country specific knowledge of the licensor agency. The licensee that is going to be entering into an agreement with Primark has better knowledge regarding the apparel industry of Brazil. Adoption of this strategy comes with the risk of damaging the reputation of the licensor. A licensee having a very poor reputation has the potential to ruin the reputation of Primark as well. Another disadvantage of this method is the reduced control of the licensor (Primark) over the licensee.
In the initial stages of Market entry, Primark can use this Licensing strategy. With The progression of time and the gaining of recognition within the apparel industry of Brazil, Primark needs to shift the aim towards total ownership (acquisition) or joint ventures of leading apparel retailers in the Brazilian market. Therefore, the licensing needs to be adopted for a limited amount of time, which needs to be followed, by acquisition or joint ventures to survive in the new market.
- Recommendations for standardisation or Adaptation (Marketing mix framework)
Product adaptation refers to the modifications that are brought about or alternatives that are brought about in a product have to reach out to new markets and their new customers. Adaptation can also refer to the manufacturing of new products upon customisation of the already existing products in the new market (Kellner, 2017, p.545). In the product standardisation technique, the products are neither changed nor modified, neither is the marketing approach altered. Infiltration into the foreign market with a standard approach proves to be a very cheap method as no marketing strategy needs to be developed, but it brings about stagnancy in the business expansion, as all business environments are remarkably different.
According to Szelagowski and Berniak-Woźny (2019, p.23) product adaptation is essential for companies which wishes to export into the foreign nations. Adaptation of the adaptation techniques provides Primark, the upper hand in meeting with the foreign laws and regulations of the country in which it is planning to expand. As mentioned earlier, the licensing technique is going to prove an assistive measure to gain an understanding of the market in an more intricate fashion. Primark being one of the leading retailers having multi brand products needs to apply a specially fabricated marketing mix to attract the customers of the market that it plans to invade. The pricing of the products are kept relative low to attract the Brazilian customers. The products need to be aligned with the ongoing trends of the country with constants modifications and evolution.
- Intended points of Parity (POP) and Points of Differentiation (POD)
Points of parity state that the business has considerably grown to the limits of its competitors, basically according to its thriving demand from consumers. Primark has flourished to build substantial growth under the demands of the customers. The basic strategy that made them achieve their targets is by rendering better and liable products and trustworthy services.
On the other hand Points of differentiation provides the factors about the service and the products served by the company with their differences. This differentiation estimates and exhibits the actual differences of the products among the competitors. Following the marketing strategy of Primark, the products and services provided by the company have been able to gain brand loyalty and have increased their customer benefits. However, excessive measures of differences affect in loss of customers as their standard of quality of products and services lacks any benefits. It is recommended to Primark organizations to acquire proper balance in differences and embracing of points of parity such as provisions of better discounts, maintaining reliable products with affordable pricing or providing a diverse range of products in order to lead the company to its enhancements in a competitive manner in the existing markets of Brazil.
The initial significance of having Points of parity and points of differentiation in an organization is because differentiating goods and services increase their potential income (Teodorović and Popesku 2017, p.9). These differences are the only points that narrow down the limitations of consumer’s choices which ultimately prompt them to acquire a selective product.
The positioning of a brand is assessed according to its points of differences and points of parity through its brand loyalty and the products and services procured by them (Rant 2017, p.23). Points of parity refer to those alliances, which are merely unique to the brand and can be yielded by other brands this is where the business can be matched with the competitors. Points of differentiation are the benefits or qualities every consumer strongly correlates with a brand. This shows a positive evaluation of brands comparing with its competitors.
Proper strategic plan for a business in a new market and for its suitable evaluation it advisable to have good knowledge about the products demanded by the consumers in a particular place. This will generate a calculative measure through the establishment of business with diplomatic planning among the competitors in the existing market. Sometimes points of parity may not usually be the exact reason for choosing a particular but their absence in the plan may result in the decline of the brand. While endowment of differentiation becomes important. Substantially both are equally necessary to nullify the competition in the market.
Frequently it has seen that for any brand positioning in-depth concentration is given over the differences of a brand. This implies the benchmarks of the brands that it has set against themselves in the markets (Morgan et al.2018, p.73). However, it is truly believed that focusing only on the differences in brands will never achieve its growth in the battle of marketing. Therefore, at times many companies can work towards their negative pursuits or improve their positive features. Consequently, the business can make an accurate balance among the points of parity and points of differences, which are the critical factors, its succession.
Conclusion
Living in a time where globalization has become main stream it is required from every business organization that they try to increase their business on an international level. Different problems are to be faced while starting international expansion and the main problem of international expansion of a business is monetary ability of a company. Many companies are not being able to increase their market in the international areas due to the lack of monetary resources only. In case of expansion not only monetary resources but also proper analysis of the market situation where a company is going to expand itself is highly required so that the company can understand the requirements of the people within different countries. Primark has targeted to grow its business within Brazil. The potentiality within the market of Brazil is high and proper study of the Brazilian market and their choices and preference of clothing styles are required to be looked into so that Primark can produce clothing in Brazil, which can attract the people of Brazil. The price factor is required to be looked at as Brazil is one of the poor but developing countries. Primark is required to be put into somewhere so that the people of Brazil can afford the Primark products.
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