This paper is to analyze the barriers of entering Chinese pharmaceuticals market and based on that an export strategy is developed for Ego Skin Cream. In this paper, we compare Chinese pharmaceuticals market and Indian pharmaceuticals market for choosing a promising market. Although Chinese market has more advantages than Indian, culture barriers and complex legal system in China are two major factors can’t be ignored. In this case, market entry strategy is the main decision which should be developed to overcome the culture and legal barriers. Following market entry strategy, STP in China is analyzed. Accordingly, marketing mix is also suggested to change to adapt to Chinese market. In the end, the overall recommendation is provided. Brand and Company Overview
Ego Skin Cream is the moisturizing cream product that provides the professional treatment for the dry skin, particularly useful on the face, lips, hands, elbows and heels. It also can be used as a daily facial moisturizer and is suitable for any skin type. The manufacturer is Ego Pharmaceuticals who own other well-known brands such as QV and Sun Sense. Ego Pharmaceuticals is an Australian-owned pharmaceutical company providing the skincare products for more than 50 years. Ego Pharmaceuticals presents itself as the specialist in the treatment and prevention of skin diseases and the maintenance of healthy skin. Although two skincare brands QV and Sun Sense have achieved outstanding performance in sales, Ego Skin Cream as a treatment product brand is still out of people’s mind. The causes can be found in many ways. First, most Australian are very conscious of skin care. Moisturizing cosmetics are generally daily used so that serious dry skin is not a common disease in Australia. In addition, countless well-known brand skincare cosmetics can be found in every pharmacy throughout Australia which is another reason for the bad performance of Ego Skin Cream. In this case, multinational marketing can be an effective strategy for increasing the sales volume.
Nowadays, a rapidly growing number of companies have set out to develop multinational business. Generally, there are four drivers for the international marketing: following market needs, improving technology, reducing cost as well as increasing information technology (Fletcher and Brown, 2008). Under the circumstances that limited native market and fierce competition, exporting Ego Skin Cream to a prospective market out of Australia is a breakthrough point in improving sale performance.
Target market analysis
In the international marketing planning process, selecting marketing is the first step and is of great importance. Different criteria are developed for market evaluation. We conduct five stage approaches to analyze the target countries: 1. Domestic issues; 2. Macro environmental issues; 3. Competitive environments; 4. Response to marketing activities; 5. Firms objectives.
Taken first two issues into consideration, China and India are ideal countries for exporting. Both are huge countries in population. According to the statistics from World Development Indicator (2008), China has over 1.3 billion people, representing 20% of the world’s population, followed by India (1.1 billion). Huge population indicates the adequate market demand such as pharmaceuticals industry. In terms of Economy, both are developing countries, experiencing rapid economic growth recent years. China was regarded as the fastest growing Countries in economy (Dornbusch, 1997) and after successive years of growth, China has already emerged as the second largest economy in the world, measured by gross domestic product at purchasing power parity (Dahlman and Aubert, 2001). In recent years, both China and India has witnessed significant progress in pharmaceutical products. China’s output of pharmaceutical product rose from RMB 6.4 million in 1978 to RMB 104 billion in 1994, growing averagely 18 per cent annually (Nomura,...