MKT744 Global Marketing and Sales Develoment Assignment Sample 2023
Introduction
International marketing can be defined as a process through which organizations plan, promote, direct and price the products and services flow to the end customers in multiple nations through several designed activities to improve overall performance (Srinivasan, 2016).
Any organization needs to plan its marketing activities so that global profitability and sustainability can be attained, and competitive advantage can be gained for business growth.
This report focuses on international marketing and global strategy in relation to the proper chocolate company situated in Ireland looking for expansion in Bulgaria. The report will present a PESTEL analysis of the host country and will further introduce an international marketing strategy for successful development in Bulgaria.
Moreover, the report will also evaluate the internal market of the firm and methods of entry in the global market for the selected organization. Lastly, the report will assess the after-effects of an organization’s chosen strategy on stakeholders and other interest groups. The report will also outline how the organization can identify their potential customers into the target market and make a decision of expansion.
International marketing and global marketing environment
International marketing is defined as a set of marketing mix activities by an organization where the organization implements the marketing activities through a multinational process of planning.
It also leads to executing the price, promotion, distribution, of an idea, product, and other strategies for meeting the individual and organizational objectives by creating exchange involving international transactions taking place between governments and various industrial markets as well (Srinivasan 2016).
Global marketing is a concept of marketing framework through which an international organization adopts the designing, introducing, distribution, promotion, and maintenance of its products in the global arena (Kotabe and Helsen, 2020). The global marketing process has several dimensions leading to product design, packaging, labeling, branding, and warranty, and other advertising strategy concerning each country and after-sales service support (Forsgren, 2017).
The concept includes standardization and customization of advertisement, branding, and different strategies specified to each country. It is more than selling the product and efforts towards creating a positioning through which the products can be promoted in the global market through which profitability and competitive edge in be attained (De Mooij, 2018).
Figure 1: Global marketing concepts
(Source: Self-Made, 2021)
A global marketing environment can be defined as a process through which all factors and forces external and internal to an organization affect the overall marketing strategies through which a successful relationship is built and maintained with the target customer (Hollensen, 2020).
Figure 2: Global marketing environment
(Source: Global Marketing Environmental Factors Affecting Marketing Strategy, 2021).
PESTLE analysis of Bulgaria
| Political | Economic | Social | Technological | Environmental | Legal |
| It consists of government policies, political stability, and level of bureaucracy. | This consists of economic growth, inflation rates, unemployment level, and GDP growth factors. | The social factors consist of demographics, including culture, norms, values, language systems, and other societal impacts. | This includes the level of technology present in the country and investment made in advancement and up gradation of technological methods to produce and supply products and services. | Environment factors comprise climate conditions, natural resources availability, and laws governing environmental protection. | Legal factors include all the laws and regulations governing business and worker’s interests, such as labor laws, environment laws, judicial systems, and many more. |
Political:
The political environment in Bulgaria is volatile as there are frequent protests, changes of ministers, political situations, media scandals, and corrupt practices. This leads to destabilizing the country’s industries, businesses and uncertain policies and leadership changes, making administration more complicated and delaying the decision-making process.
It enjoys free trade of goods and services and export-import processes. Bulgaria is a member of the EU, and the government practices include corruption, lack of laws, and replacement of high-end positions that constantly contribute to volatile economic performances and the environment (Mihailova, 2020).
Economic:
Bulgaria still lacks development with low wages and employment opportunities that create poverty in rural areas, and long-term unemployment leads to income disparities. The GDP in Bulgaria is around 45% of the Year 2830 percent of that generated in urban areas, and the country includes a high proportion of retired individuals, low productivity, low income, and lack of various professions other than agriculture and forestry, which leads to less competitiveness and attractiveness of different industries (Bulgaria Economic Outlook, 2020).
It saw the GDP growth from 45.7 billion Euros to 60.7 in 2019; economic development in percentage has decreased from 4.0 to 3.4 %; however, the consumption has increased. Unemployment has fallen over the years but still last to fulfill the needs of the larger population (Vasileva, 2018). The prolonged health crisis and uncertainty of the pandemic have led to a contraction of economic growth. The per capita income in the year 2019 was 8717 Euros.
Social:
The social environment of Bulgaria mainly comprises Bulgarian belonging to orthodox Christian culture. The society consists of unusual and long-standing social customs following traditions, music, and architecture. Bulgarian is the most common language spoken (HADJITCHONEVA and GEORGIEV, 2017). Bulgaria’s social structure is characterized by reasonable living standards, rising unemployment, and the social isolation of minorities.
Society is witnessing a decrease in the agricultural sector and shifting towards services. Urbanization is increasing in search of better infrastructure and institutional and other basic facilities of hospitals and universities.
Social structure in the country is an indicator of low development and needs industrialization to reduce the social burden of funds by increasing the wages and fulfilling the basic amenities of a young population. This can be done by adopting modern technological solutions and providing opportunities in various service sectors.
Environmental:
The environment analysis consists of applying EPR systems for waste management. It also uses protected areas covering for agriculture use and has 2.6% area under forestation. The country also applied for the NDP programs in the year 2020 to strengthen the legal framework towards a greener economy. This leads to adapting a sustainable green environment and taking steps for considerable reduction in wastage, achieving target efficiency, low pollution, and enhanced environment protection (Bachev and Terziev, 2018).
The country also applies water pollution taxes for better environmental management. The country uses renewable energy resources and eliminates high carbon fuel resources leading to less CO2 emissions livestock leads to significant land uses and ecological problems.
The country needs to comply with environmental laws by organizing dumping of the waste and protecting the ecosystem and Aquatic life and biodiversity by using efficiency in water resources, less soil erosion, drinking water protection, and other forest life-preserving for managing and maintaining the current ecosystems.
Technological:
The technological environment of Bulgaria is very advanced and uses RFID and NFC Technology for making contactless and cashless transactions using online financial services and extensively using the internet network distributions.
The technological system consists of high-end transport and logistics automation that shortens the distances between the delivery of the products to the end consumers, leading to faster and accurate inventory management of retail stores and warehouses. The country also uses new technology by constantly investing in R&D (Mihailova, 2020).
Legal:
The legal environment consists of various regulations such as the spatial development act, the Regional development act, and the labour act-favouring workers. Besides this, the consumer protection act, personal data, and e-commerce protection, distance provisions of the financial services act are other acts that are present in the legal system (HADJITCHONEVA and GEORGIEV, 2017). The judicial system consists of the district, regional and supreme courts for providing justice and solving the major issues.
Analysis of potential market opportunities in Bulgaria
Bulgaria is a country that has seen an immense transformation over the past few decades and has shifted from a centralized and planned economy to an open market and middle-income country by lowering down the debt, restructuring economic growth, and enhancing savings. This has brought improvements in economic growth and living standards.
However, the political instability remains the same, and the level of corruption is still a major issue in the economic enhancement of the country. The country’s development is still a challenge and requires a faster transition and a greener growth path by using higher energy-intensive technology, speeding up the production, reducing the productivity and employment gap, and removing the institutional weaknesses and low governance.
The chocolate market in Bulgaria is equal to 22.50 million US Dollars in 2015 and is forecasted to reach 25.55 million by the year 2025 at a CAGR rate of 0.6 % annually; however, the growth will be 2.16 % less as compared to the period of 2015 to 2019. Recently the chocolate market has been affected by various factors such as increased concern for health and wellness, sustainability, and the demand for premium cocoa, which has made this industry the fastest growing premium chocolate product segment.
Consumption is highly increased by the content of flavonoids leading to better health; however, the industry is also experiencing competition from the Asia Pacific and Latin America besides local companies and internationally established organizations in Bulgaria such as Nestle (Vodenicharova, 2020).
The demand for chocolate in Bulgaria is high, and consumption of chocolate is assumed to be an average of 22-30 grams per person. The chocolate market in Bulgaria amounts to 350 million BGN per year, and every 5th consumer consumes chocolate in the country. The most passionate chocolate lovers are women aged 20 to 40 (Nikolova-Alexieva et. al. 2019).
Chocolate companies are in the country are very limited, which are directed based on price and are produced by two or three International companies specializing in the chocolate business. Few private companies also produce low production of chocolate due to less consumption and shortage of raw material (Kopeva et. al. 2015).
In Bulgaria, approximately 180 5.4 million BGN of income was released from the sales of more than 28000 tons of chocolate in 2014. A variety of chocolate articles have high demands in the country, including the sale of white chocolate, chocolate figures, cocoa cakes, chocolate spread, and many other products (Slavova, 2017).
The top 10 company in the chocolate segment makes more than 175 million BGN approximately including 94.6 percent of the value of the local market in Bulgaria. Mondelēz Bulgaria is the world’s second-largest chocolate producing company and Bulgaria’s largest company in terms of production.
Thus, indicating that chocolate is highly demanded in Bulgaria and is preferred by all is a group but specifically targeted at young people, children, and middle age groups.
Overview of the company
The Proper Chocolate Company came into existence in 2016 by Patrick and KeliMarjolet. This company is situated in Ireland, but the demand for its chocolates is worldwide.
They started making bean-to-bar chocolates in Dublin. They bring out the optimum flavours after carefully roasting the finest beans that delights its customers. It deals in a variety of chocolates like chocolate hazelnut spread, organic chocolates, dark chocolate tablets, and many more.
Internal Environment
Internal environment refers to the factors affecting the atmosphere of an organization (Ibrahim and Harrison, 2020). It highlights the activities that are performed within an organization. SWOT Analysis is a tool to examine the internal environment of an organization (Teoli and An, 2019). The internal environment of the proper chocolate company is as follows:
| Strengths
The unique taste of its chocolates helps it to overcome its competitors. |
Weakness
It has a limited variety of its products to only confectionary space. |
| Opportunities
It can spread its business by establishing some stores all over the nation. |
Threats
It has to compete with large firms like Mondelez, Butlers, Ferrero, and many more. |
.
Objectives
The objectives of Proper chocolate company are as follows-
- Exceptional service– The proper chocolate company has the aim of providing outstanding customer service. The company has a primary focus on the creation of experiences.
- Teamwork– The Company believes that focusing on group goals is of utter importance rather than merely focusing on individual goals.
- Creativity– The Company fosters creative thoughts and ideas and values the innovations needed for changing ideas into reality.
Mode of entry in the international market
Although there are numerous market entry modes present for international expansion, including exporting, franchising, partnership, acquisition, and Greenfield investment, export is considered as the easiest way to enter into an international business, and most of the firms and small and medium enterprises adopt this way of entering into a Global Business.
Strategic Alliance is also a convenient way to enter into the foreign market (Kenyon et. al. 2016). It involves a contractual agreement between two or more business entities that work for a common purpose. In the context of the proper chocolate company, the organization can enter into the market of Bulgaria by creating a wholly owned subsidiary.
This is the process of developing a new venture in the host market. It can be said that this type of investment and establishment is costly and has a complex process, but this is suitable because the firms can have the maximum control over the operations in the host market and also has the potential to gain above-average Returns.
With the help of this mode of entry in expanding the business in Bulgaria, the proper chocolate company will have the opportunity to lead and manage the business following the policies of the home market. Also, the firm will have adequate control over the procedures and management (Albuam and Duerr, 2016).
In addition, in this case, the venture can hire employees among the locals of the nation to be convenient for the company to operate in the market and remove various cultural and language barriers. It will also become easy to gain domestic information and customer demands analysis.
Overview of the competitive landscape
It is revealed from the pestle analysis that Bulgaria is experiencing a significant transformation from the past few years, and the country is also focusing on improving its living standard. In addition to this, the consumption of chocolate products is increasing. As the people of the country are getting inclined towards consuming a Healthy lifestyle, using Organic products will help them.
As per the identification of potential marketing opportunities in the host market, it has been revealed that the chocolate companies in the nation are limited. Hence, the proper chocolate company can establish its business of chocolate hazelnut spread in the market, which is made of organic ingredients.
Organic and vegan ingredients preferred by people of different age groups and widely consumed in the UK (Hollesen, 2016). This product and offerings will attract customers and help gain a competitive edge in the chocolate industry of Bulgaria.
International marketing strategy
International marketing strategy includes all the methods and tactics used to market the services and products in the Host Nation.
Product:
Considering the case of the proper chocolate company, the company is launching its chocolate hazelnut spread in the Bulgarian market, which is made up of all Vegan and organic ingredients. The product will get a positive response in the host market as people concentrate on adopting a healthy lifestyle (Schlegelmilch, 2016). The UK origin product is made up of quality ingredients and can survive in the host economy.
Pricing decisions:
The company’s operating under the chocolate industry in Bulgaria is relatively low. Thus there is pretty little competition in the industry, and in this scenario, the pricing must be affordable for the target customers (The proper chocolate company, 2021). Therefore a competitive pricing strategy can be taken into consideration.
A competitive pricing strategy is a technique in which the product’s final price decided and fixed after evaluating and analysing competitors’ prices. Apart from this, to attract consumers early, a penetration pricing strategy can be taken into account. The cost of the product is kept low during the initial offerings.
Promotional efforts:
Intending to survive in the end in the Bulgarian market, the proper chocolate company has to keep an eye on the activities and strategies of the competitors. Further, to sustain in the market and develop a competitive profile by enhancing the awareness regarding the brand in the host market, practical promotional efforts are essential to address by the chocolate company.
The company can adopt advertisement and sales promotional techniques to tempt the customers and broad audience. Additionally, social media promotions are another technique to fascinate the public of the host country (Rana et. al. 2020). To establish the presence and developing brand image, the company can offer discounts and various cash back and vouchers on the buying of products that will influence the customers towards the first purchase.
Distribution choices:
The proper chocolate company can distribute its products by the physical medium as well as online channels. The website of the company can be designed in such a way so that it becomes easy for the customers of Bulgaria to buy the product and to track their orders. Fast and easy delivery is the best way to deliver accurate and reliable services to the customers.
Impact of decision on stakeholders competitors and public
The primary stakeholders of the proper chocolate company are its employees, customers, management, competitors, Government, and public (Gnizy, 2019). Employees and customers are the key stakeholders who have a significant interest in the company’s activities.
Every decision of the firm in the Bulgarian market impacts the stakeholders. In this regard, employees must be aware and understand the practices that the company is carrying out to sell its products.
On the other side, customers must be available with superior quality products and satisfy their needs. Considering the competitors, to sustain the host Nation analysing the competitor’s activities and strategies are crucial to form and modify the business functioning and tactics. Further, the decisions and functioning of the company must be made in an ethical manner and with transparency so that the public can trust the practices and keeps full faith.
Critical challenges to global expansion in the host market
Operating in the foreign market and expanding the business globally is a complex task and involves various challenges that the proper chocolate company will face (Schlegelmilch, 2016). Unfamiliar culture is the most significant challenge start the cited company will meet in going global. Due to the cultural differences in Bulgaria, it becomes difficult to assess the customer’s choices and analysing the differences that affect the sales.
People with different cultures, beliefs, and ideologies have diverse choices and demands. This factor is critical for the company to sustain itself in the international market. The language barrier is also an issue to survive in the worldwide market as different countries’ languages make communication difficult even between the employees and the management when the employees are hired from the host country.
The managerial policies and chain of command are also a dimension that varies from country to country, which brings complications in the processes (Pires et. al. 2015). Language barriers develop misunderstandings and ineffective communication, making customer relationship management problematic and hampers the brand image globally.
Domestic or local competition is another task that the cited company will face in the foreign market during expansion (Agwu and Onwuegbuzie, 2018). It is evident that usually, people of the host market trust and prefer to buy the products from the national corporations as they have an established brand existence, and people trust the company and its product.
In this scenario and competitive business environment, it will become hard for the chosen business venture to enter into the market and compete with domestic companies with well-recognized market value and customer base.
Justification of the decision by aligning PESTLE and international marketing strategy
After conducting the overall analysis, it can be said that the proper chocolate company can establish its wholly owned subsidiary in the Bulgarian market after conducting the pestle analysis and market environment audit. It has been evaluated that the country preferred to live a healthy lifestyle, and it is in demand the chocolate products.
The organic and vegan-based ingredient made chocolate hazelnut spread will attract the target audience of the foreign market and develop a strong brand image.
Moreover, it is also justified that based on the business environment audit of the foreign market, an international marketing plan has been developed which focuses on offering the superior quality product with competitive pricing.
In addition, the promotional efforts will be used to attract the customers to the company and make them aware of its offerings and their specifications. In order to make the offerings accessible to the public of the nation online and offline, both selling will be done.
Conclusion
Thus from the comprehensive study, it can be concluded that expansion and going Global for the small and medium enterprises has become essential to compete with the large corporations. Businesses are now not confined to the borders and have the capability to expand into the international economies.
Moreover, the report reveals various aspects that a company must consider while planning to expand its activities in the international market. It includes conducting an audit of the external business environment and assessing the company’s internal capabilities and resources, which will be further used in the host economy.
After completing a proper business environment audit, a specific and detailed international marketing plan can be drafted to ensure smooth functioning of the business practices and activities in the Global market. In addition, it contains some vital Global challenges which the company will face in expanding its activities.
References
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