International Market Entry Strategy Analysis - Case Study, Micro-brewery Entering a South American Market

Topics: Spanish-language newspapers, El Nacional, Argentina Pages: 76 (6878 words) Published: December 3, 2013
International Marketing Analysis and Strategy: Portfolio/Essay

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Essay Question: Write a 2500 word essay/report advising Consortia Drinks about which two markets to enter in South America (South America here refers to those countries south of Panama, extending to Patagonia).

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1.0
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Introduction

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1.1
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Methodology

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2.0
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Key Statistics and Indicators

I have been tasked with advising Consortia Drinks, a UK based micro-brewery, as to which two international markets they should consider entering in South America. The product to be marketed and sold, ‘England’s Best’, is a collection of beers with high individual sales volumes, proving to be ‘hugely successful in the domestic market’. Retailing at around £5, the multi-packs are bought predominantly by ‘social segments’ where they are consumed at parties and in front of the television during sporting occasions. My recommendation to Consortia Drinks will serve as a preliminary investigation to be further researched and investigated before deciding on an eventual decision.

In my approach to suggesting what I believe to be the two most suitable markets for further investigation, I will be working with a ‘funnel’ approach, firstly looking at a wide range of countries in South America and their key economic, political, social, technological, environmental and legal indicators. From this, I plan to systematically withdraw countries that show signs of obvious instability and/or weakness. After narrowing down the initial broad collection of countries, I will begin to took more critically at other indicators such as lifestyle trends, the competitive environment, and culture, whilst all the time eliminating countries that are comparatively weaker. Finally, as the process becomes more selective, I will perform a top-level risk analysis of the remaining markets; assess the cultural compatibility between the markets and the UK, and finally, any miscellaneous market entry considerations that could act as a potential hindrance or potential advantage. To arrive at my conclusions, I will be relying predominantly on secondary data research available through the internet, but also certain academic theories such as PESTEL Analysis and Hofstede’s Cultural Analysis Model.

When first comparing the 14 sovereign states, non-sovereign states and integral territories of states outside of South America (French Guiana), It was important to look at a small number of general key statistics and indicators to ensure a comprehensive and quantitative analysis that could be applied across the board. This was not necessarily to decipher whether any markets should be eliminated, but more to gather an understanding of the general marketing environment - and one that was easily comparable in quantitative measures. Fig.1 in the list of appendices shows a table displaying these key statistics and indicators. The first immediate issue that becomes apparent from the initial data collection is that certain markets in South America contain such a relatively small population size that a) the amount of data available to collect is limited, and b) the opportunity cost of selecting any of these markets is substantial. It is therefore my opinion that The Falkland Islands (UK), French Guiana (France), Guyana and Suriname should be withdrawn from consideration at the early stage.

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When looking at the other categories, it becomes clear that some markets display some less than desirable metrics. For example, Venezuela’s level of hyper-inflation must count against it as marketing a product in an environment of high price instability may make “incomes and profits for producers unpredictable and may inhibit investment spending because suppliers are concerned about their expected profits”. (G. Riely., 2013. Costs and Effects of Inflation). However, I believe at this stage, it would be too soon to reject Venezuela as a potential market as the analysis is only at the top level, and more research...

References: Hofstede, G (2005). Cultures and Organisations. Software of the Mind. New York: McGrawHill.
Euromonitor. 2013. Euromonitor International - Research Sources. [ONLINE] Available at: https://www.portal.euromonitor.com/Portal/
Pages/ResearchSources/ResearchSources.aspx
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