Analyse the choice of India on the basis of various selection criteria (preliminary + fine grained screening). To what extent was it a good idea to enter the Indian market?
In order to figure out whether a market entry is advisable for a company one could analyze different macro environmental factors which the company will have to face after it has entered the market. A PEST-analysis can be a useful business tool to get an clear overview of the market of entry, to see which factors influence the company in which way.
India is generally referred to be the world’s most populous democracy. Plus, the political situation in India seems to be quite stable since the 1950’s. People in India have all the common rights, what is contrary to some other Asian countries that restrict the freedom of expression, for example. Settling in India seems to be a good opportunity for Apple, as there is no sign for political instability. Economic
The economy of the republic of India is the tenth-largest in the world by nominal GDP and the third largest by purchasing power parity. Due to the fact that India is a BRIC country, the economy is expected to zoom upwards. Furthermore, India claims the ninth-biggest Gross National Product (2011) worldwide. The economy is a good example for a newly industrialized country. Thus the service economy makes 55% of the GDP, 28% the industry and 17% the agriculture. A notable fact is that India’s growth engine is -unlike in China - not the industrial sector but the service economy. This is based on the high demand of Indian back office services. A big disadvantage is the high controlling of foreign direct investments, joint ventures and duty payments. The FDI only concentrate on a few areas in India and they make only 2% of the GDP. India currently counts a population of 1.2 Billion and based on experience the population increases annually by 1.4%, which is an average growth of 15 Million people per year. In 2005 45,3% of India’s population was under the age of 20. Focusing on the Human Development Index (HDI), the country is listed on 135. position – a medium score. The potential market opportunity in combination with the matching marketing strategy of Apple, which consists of targeting adolescent and business people, makes India an interesting country for market entry. Social
Due to India’s history the country has deep roots to Great Britain and therefore India acknowledged the English language as an official language, among 21 further languages. This fact is important, as it enables Apple to be easily understood when it comes to its campaigns, advertisements and the brand image. India has huge problems when it comes to its society. The caste system, the conservative view of the women, the bad life conditions in the periphery and the bad education in the agriculture regions are just a few problems Apple faces in India. 44% of the people in India have less than 1 dollar a day for disposal. Thus the disadvantages lead to a low human development index. Technological
India has a highly underdeveloped infrastructure. The main transportation way is the road. This is based on the fact, that India does not have a lot of big airports, common shipping possibilities nor a modern rail network. This proves to be very problematic, as the average time for a container transport from Bombay to Delhi (distance 400km) with the truck takes one week. Due to the fact that 90% of the Indian Highways are not compatible for big Trucks, this high delivery time cannot be reduced. Analytics claim, that the bad infrastructure costs 1,8% of the economic growth every year. Although the facts mentioned above a clear disadvantage for Apple, India can convince with a very important aspect: The demand for telecommunication technologies is huge. 2011, nearly 900 million Indians have got a mobile phone which underlines the huge potential for Apple. Fine grained screening
Step two of the screening process takes the...
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