Standardization and Adaptation of International Marketing

Question: Discuss about the Standardization and Adaptation of International Marketing. Answer: Introduction: Starbuck is an American Company that is founded in Seattle and currently it is considered as the premier marketer and retailer of the special coffee throughout the world. The company has around 182,000 employees with more 19,500 outlets throughout the world in 62 countries. Starbucks offers variety of products and their range of products comprises of high quality coffee of premium price, tea, and wide range of food items with other beverages. The company also provides wide variety of tea products with license and trade through their channel of distribution (Armstrong et al., 2014). The report is based on proposal of new market strategies in Singapore for Starbucks so that the company can expand its products throughout Singapore outlets. Starbucks possess macro-environment of macroeconomic nature, which can be attributed to the constant economic recession internationally that has lowered the purchase powers of the consumers (Ali Talwar, 2013). The following macro-environment would offer information regarding Starbucks macroeconomic conditions. Market Demographics: Starbucks will be focusing its marketing of products among the customers that are adult aged. This is because such age group does not have higher demands for coffee beans and coffee creamer but these products serve as the necessary means of purchase. Additionally it will also target the age group of students ranging from 18-24 years since they are the most likely consumers of the coffee creamers. Political: One of the most important concern of Starbucks is the sourcing of the new raw materials by attracting the politicians of the Asian countries like Singapore. The enables the company to remain reliant on the social and environment conditions and follow the strategy of sourcing in compliance with mutually agreed fair trade policies of the international firms and national government of Singapore (Ahmed, 2014). Economic: The important economic constraint is constant recession that has been impacting the profitability of the company. Starbucks faces the difficulties related to rising labour cost and operation in the market. Social: The social factor that affects Starbucks is the rising demand of the customers is Singapore is for the cheap price products (Kotler Armstrong, 2013). This becomes challenge for Starbucks. Starbucks can easily provide products at cheaper but then the company faces problem of lower product quality due to cheaper pricing of the products. This may be a challenge in expanding and acquiring new customer in Singapore, Technological: Starbucks is presently using the technological advancement by collaborating with Apple to provide discount coupons for customers (Armstrong et al., 2015). Starbucks might offer new method of payment through mobile application, which the company is testing and practicing in USA. Environmental: International advocacy, activist and customers present concern for Starbucks. Therefore, the company needs to be aware of such concerns in order to enjoy continuous success in Singapore. Legal: Starbucks should be make sure that is aware of the legal environment of Singapore where it intends to expands since it has to source the raw materials in the home markets (Lilien et al., 2013). Micro Environment Factors: Supplier: One of the vital inputs for Starbucks is the beans of coffee along with the high quality Arabic coffee in specific regions, which offers less cost in switching amid the substitutes (Ebert et al., 2014). Along with the size and scale, Starbucks has the power of seeking advantage of the suppliers and simultaneously maintaining fair trade in Singapore. This result in lower bargaining is supplier. Channel Member: The coffee industry of Singapore is moderately saturated with a structure of monopoly competition. The channel of the coffee industry in Singapore is already filled with potential channel members and it would be difficult for new firm to enter into the market. Competitor: There prevails a monopolistic rivalry in the industry and Starbucks has wider market share (Gupta, 2013). There are also different competitors in Singapore that creates regular pressure on the Starbucks. The company is therefore suggested to maintain a competitive strategy of product differentiation and service to result in medium extent of the intensity within the company. Customers: The coffee industry possess numerous customers and no single buyer can influence the demand for concession in price. Starbucks can offer differentiated coffee products under the varied base of customers that makes comparatively lower volume purchase and lowers the purchasing power of customers. Competitive Strategy: The competitive strategy for Starbucks for expanding in Singapore is providing new unique, innovative and upscale atmosphere that could differentiate the products from its competitor (Johnson et al., 2014). The company should establish a community hub for socializing its customers and entertaining them simultaneously. It is further recommended that Starbucks should also make their presence felt through social networking and other mediums. The key to competitive strategy for Starbucks is introducing coffee creamer that can provide new experience to the customers. The company can introduce coffee creamers based on the seasonal preference together with the traditional year round flavours to the customers in Singapore. Marketing Objective: The marketing strategy of Singapore is to make the wide range of coffee products available to the customers including the new Coffee Creamer. To accomplish such strategy, Starbucks will be promoting the affordability along with the convenience take home facilities for its customers in Singapore (Volberda et al. 2013). In continuance to the growing relationship with the targeted corporation, the company would be offering product that is exclusively made for the shoppers. The new coffee creamer would be available in Starbucks stores of Singapore. Financial Objectives: The financial objectives of Starbucks is to gain the market share of 15% in the coffee creamer products inside the first year of operation in Singapore. The company is intended to increase the corporate net income by 3% from the introduction of the new coffee creamer in the Singapore market and increase the company share by $30 million in the span of one year (Baker, 2014). Social Objective: The social objective of Starbucks is to increase the customer service by creating a better working relationship with the customers through Customer relationship management. The company social objective is to create and maintain a working relationship with the targeted corporation. The Starbucks Corporation is planning to continue honouring its working relationship with the customers by offering products of better quality. Marketing Segmentation, Targeting, and Positioning: Segmentation: Unlike any other company, Starbucks is making the use of the market segmentation as one of the key marketing strategy that makes the use of the demographic segment. Starbucks fall under the category of market segmentation is because the company fall under the target market of ethnicity and generation. Large parts of the customers in Singapore is college goers and possess higher income with high social life. Therefore, Starbucks is looking forward to target the group of customers that are generally professionals and prefer enjoying higher lifestyle (Frynas Mellahi, 2015). The customers in Singapore are generally the consumers of gourmet coffee and this would make Starbucks a prestige for their company by introducing coffee creamers with new added flavours. Starbucks would be aiming for behavioural segmentation and such segmentation would offer company with the vital understanding in the areas of customers, tastes and preferences along with uses, attitudes or response to wards the products. Targeting: To target its customers, the target market strategy of Starbucks would be of undifferentiated marketing of its coffee products. By introducing undifferentiated marketing strategy in Singapore Starbucks will be able to ignore the difference in segments and would be able to target the entire market with one offer. Such strategy would help in focusing the common needs of the customers. Positioning: The competitive edge of Starbucks will help in positioning the brand awareness and consumer loyalty in Singapore (Stead Stead, 2013). Although there are some different coffee creamer and other brands of products but the company is positively looking forward to position its products through undifferentiated marketing strategy to attract more potential customers. In order to understand the marketing situation of Singapore marketing research has been conducted to better understand the taste and preference of customers. Because of the market segmentation, Starbucks has introduced wide range of coffee products including the coffee creamers. This was done by understanding the purchasing patterns of the Singapore coffee consumers and changing demands of the consumers needs. The coffee industry suffered a big slowdown in 2009 by 6.6% because of the economic crisis (Tapp Spotswood, 2013). However, the industry gained pace with the low annual rate of 0.9% from 2010 to 2016 and the present industry revenue stands, around $29 billion The research has been conducted keeping in mind the increasing consumer base in Singapore that is mainly driven by the improving economy. Major Discover and Findings: The major discover and findings in the marketing of the coffee products is the focus balance between the consumer base that primarily comprised of the collage age, post-graduation and young family. One of the effective way that helped in the marketing of coffee product and its pricing is that large portions of the coffee consumers were the high-end consumers that prefer brand (Festa et al., 2016). As a result, such group of coffee consumers almost made up 60% of the survey, which consisted 18-32 years old coffee consumers. In Singapore 54% of the population are beyond the age of 18 years and consume coffee averagely on daily basis with total drinking population 30 billion dollars on this beverage annually. As per the statistics, there is a large market potential in Singapore for coffee products especially in the service and marketing. Therefore, Starbucks and several other competing firms have seized the opportunity to innovate the market of Singapore based on the primary data. The marketing mix of Starbucks is focused on placing higher emphasis on the channels since the company is already established brand. Using this channel the company is anticipated to attain growth in the new markets of Singapore. Product Mix: The product mix of Starbucks will be focussing on the endless possibilities of introducing new products in the home of the Singapore market (Akgn et al., 2014). The company would be selling the experience and prestige with its brand name and package in the coffee creamer. Promotion Mix: The promotion strategy of Starbucks would be getting the word out to the right consumers. The focus of the company would be to assure that consumer appreciate the Starbucks products and must know how to locate the product. Place: If the consumers would like to purchase the products of Starbucks, they would be able to purchase at selected locations. The company has selected two main outlets for distribution namely its target stores and Starbucks retail outlets in Singapore (Hill et al., 2014). The quality and value of the Starbucks products are represented through such channel. Price: Starbucks would price its products by using the differentiated strategy to attract consumers. A cappuccino would cost around $2.50, a hot chocolate would cost approximately $2.35, and this would not make the consumer to spend more on coffee products. Detailed Strategy for one element of the marketing Mix: The detailed strategy of the marketing mix would help the company in understanding the central activity undertaken by the Starbucks for its marketing plan in Singapore targeted market. Price is considered as the main issue for the Starbucks coffee products. Captive pricing was used by Starbucks, which would always propose an extra spending for the consumers. The company faced much criticism due to its higher pricing of coffee products (Peppard Ward, 2016). With the adoption of the differentiating product, pricing strategy would help in enhancing the marketing mix of the company as this would enhance the promotions and would increase the sales of Starbucks in targeted market of Singapore. The industry of coffee products is increasing and bearing this in mind a marketing plan in Singapore has been planned that would seek to expand in the targeted market. Below stated are the control plan for the company. Starbucks would begin in the summer of 2018 by continuing to strengthen then working relationship with the Targeted Corporation. Currently the company has several mini Starbucks caf inside the targeted superstore location (Eden Ackermann, 2013). This forms an exciting opportunity for the company to expand its new coffee creamer products by advertising its new line of products. This would comprise of several collaborative advertisements with the targeted corporations. Metrics: The chairperson of Starbucks is in-charge of everything that occurs in the company. The company would measure the marketing, operations, finance creation and human resource as the metrics to assess the performance of its wide range products in targeted market of Singapore (Wheelen Hunger, 2017). The Starbucks products along with the coffee creamer would stand out in the targeted market because of the organic ingredients. A possible challenge that the company is anticipated to fac is the similar flavour for coffee creamer and organic ingredient at lower price. As a contingency the company would trademark its Coffee Creamer from other brands as an attempt to distinguish its flavour from the rival firms (Rothaermel, 2015). Consumers seeking exotic flavours would be turned off since the products of the Starbucks would be a trademark product. In spite of the fact that the company is entering late in the market but Starbucks established brands would offer consumer with quality products. Reflective Statement: To begin with the feedback gained from the formative group presentation helped in gaining an understanding of the marketing plan. The marketing plan provided me with the opportunity of preparing the research report based on the marketing plan of Starbucks. I was able to learn about the several macro environmental and micro environmental factors that are involved in the promotion of the product. The dynamics involved in preparation of the report enabled me t undertake an extensive amount of research in the areas of economics, technology, legal and environmental factors that are involved in the marketing of the products. I was able to understand the factors that enables a company to remain dependent on the communal and environment circumstances and follow the approach of obtaining in compliance with commonly agreed fair trade policies in a nation. With the help of these factors, I gained an insight that helped in understanding of the economic constraint that effects the profitability o f the company. Moving towards the collection of data, an important assertion I would like to bring forward is that the data collection was the challenging aspect of this marketing plan. The reason behind these challenging aspects was the collection of the reliable data formed an imperative element. The proposal of the marketing was entirely vital for the company that has been selected by me and given the variation of the coffee industry consumers it was hard to obtain the correct data. I undertook extensive research through internet, several government websites and statics published from the marketing of the coffee products from this industry. I undertook an extensive research in the areas of coffee market of Singapore and found that there were several high-end customers. The major discover and findings that I was able to discover was in the marketing of the coffee products is the focus balance between the consumer base that primarily comprised of the collage age, post-graduation and young family. The collection of data was though a hard part in preparing the report however, I gained an insight into one of the effective way that helped me in understanding the marketing of coffee product and its pricing is that large portions of the coffee consumers were the high-end consumers that prefer brand. Through the help of the several websites, I was able to gain insight that a group of coffee consumers almost made up 60% of the survey, which consisted 18-32 years old coffee consumers. As an alternative to the list of methods that could have been used in the development of the report is thought the help of direct interview with the certain age group of customers that are regular coffee consumers. Additionally, I also used interviews, focus group interviews, and survey questionnaires as an alternative means of collecting the data so that I could proceed with the preparation of the report. I also used the reports published by the food and beverage industry as the means of gaining an insight into the consumer habits relating to the coffee products. Additional research were performed in the areas of Starbucks retail outlets by suing the websites of the company. The primary data collected helped in understanding that in Singapore 54% of the populace are outside the age of 18 years and drink coffee commonly on daily basis with total consumption population $30 billion dollars on this liquid refreshment annually. As a result the data gained from the statistics helped me in understanding that the as per the statistics, there is a large market potential in Singapore for coffee products especially in the service and marketing. In future, I would like to undertake direct mailing to the potential customers of the coffee consumers to understand their pattern of consumption. Considering on the ethical requirement in the areas of data collection, the data has been collected by duly complying with the ethical requirements. All the facts, materials that has been collected by me is from the reliable source and does not contain any vague data. The collected of data has been the vital part in the preparation of the marketing plan and I ensure that authenticity of the data should be maintained. The primary interview, surveys, questionnaire offers valuable insight into the marketing conditions of the coffee products is Singapore and offers detailed description of the prevailing scenarios among the taste and preference of the consumers. Considering the storage of data, the data was stored by me in my computer drive which was protected from any kind of manipulation. The data was used primarily as the means of carrying out the extensive research so that the group members involved in the preparation of the report have better understanding of the prevailing conditions in the market. Additionally, I also used the SPSS tool for coding the questionnaire in the SPSS model. Primary Data Collection: The following questionnaire is designed to access the marketing plan of Starbucks Singapore. Section 1: Demographic Profile First Name Last Name Department Section 2: Factors which have a bearing on the marketing plan. Who is your potential Customer? College Goers Businessmen Employed Unemployed Do you plan to Advertise your product in TV/ Local Newspapers? Yes No Maybe Do you plan to promote the chain through Social Media? Yes No Maybe Is the Market Plan based on potential of the market? Yes No Maybe Is there an objective target of the volume of Sales? Yes No Maybe Do you have a contingency Plan in case of Targets not being met? Yes No Maybe Which of the following factors affect the business prospect the most? Economic Legal Technological Socio-Cultural Intra-Company Conclusion: The marketing plan can be contributed by stating that Starbucks must continue to expand their range of products in Singapore as the market provide the company with wide range of opportunity for expanding its product. The expansion policies could be adopted by following the technological trends as the target population of the company has greater probable consumer base. Overall, the brand of Starbucks could gain more success in Singapore by adopting the above-proposed strategy in the next year and this will result in constant increase in profits for the company. Reference List: Ahmed, M. (2014). Principles of Marketing. Akgn, A. E., Keskin, H., Ayar, H. (2014). Standardization and adaptation of international marketing mix activities: A case study.Procedia-Social and Behavioral Sciences,150, 609-618. Ali, H., Talwar, V. (2013). 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