International Marketing: Modes of Entry and Strategies for Pizza Hut

Running head: INTERNATIONAL MARKETING
INTERNATIONAL MARKETING
Name of the Student
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Author Notes

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Executive Summary
The aim of the report is to find the various market modes of entry that is there in the
international marketing segment of the firms. In addition, the companies that are associated
with each of the entry of the firms are also taken into practise. The analysis also takes into
consideration the growth of Pizza Hut into the province of India along with its major
competition Dominos as well as the market strategies followed by each of the company. The
recommendation for the entry of the country into the province of Nigeria after their
unsuccessful venture is also assessed in the report and the valid problems and
recommendations in each of the section. Overall, the report is an analysis of the international
market plan in relation to Pizza Hut under the franchise mode of entry.

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Table of Contents
Part 1..........................................................................................................................................3
1. Introduction........................................................................................................................3
2. Hierarchical market entry modes for entering international market..................................3
3. International companies implementing each of the type of entry strategies......................5
4. Advantages and disadvantages of each of the strategy......................................................7
Part 2........................................................................................................................................11
1. About the company - Pizza Hut.......................................................................................11
2. Evaluation of success or failure of the franchise of Pizza Hut........................................11
3. SWOT analysis of Pizza Hut after entering into India.....................................................13
4. PESTLE analysis of India as a potential market for Pizza Hut Franchise.......................14
5. Direct Competitor Analysis – Dominos and the intensity of competition.......................15
6. Critical evaluation of marketing plan of Pizza Hut..........................................................17
7. Digital marketing and E-business activities.....................................................................18
Part 3........................................................................................................................................22
1. Recommendation for the future international market for Pizza Hut................................22
2. Ways and reasons for Pizza Hut to enter Nigeria by franchise means.............................23
3. Global citizenship and cultural consideration in Nigeria.................................................23
4. Political technological and economic risk with the market entry of Pizza Hut...............24
Conclusion............................................................................................................................25
Reference..............................................................................................................................26

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Part 1
1. Introduction
In a world of globalisation, there are a number of companies, both new and existent
which are interested to venture into the international market and make a mark for themselves
in the world of business. De Villa, Rajwani and Lawton (2015) states that the companies as
well as the industries make sure to enter the market by the means of a number of entry modes
that do make sure to cover every aspects of the entering into the international market to make
a niche for themselves in the overall business arena. The various types of market entry modes
help the company to have base in the various international markets in which the company is
interested to operate. The following report is an analysis of the different marketing modes
that are required for a company to enter the international market in a hierarchical order. In
addition, the various companies that have implemented each of the type of the strategies for
the entry in the international market have been addressed along with the required advantages
and disadvantages of each of the strategy or the entry of the marketing modes. The following
paragraphs highlight the summary of the overall analysis in the report in a precise manner.
2. Hierarchical market entry modes for entering international market
The market entry mode is defined as the way or the strategical methods by which the
goods and services of a particular market enters or aims to enter into a new market which has
been targeted and aimed to be achieved. Laufs and Schwens (2014) states that in the modern
age there is a specific need of entering into a new market other than the proposed niche
market to increase their sales and improve brand awareness and even the stability of the
business in the new market. The market entry of a specific company is however is to be
operated by keeping in mind the competitor analysis as well as the increase customer base for
the companies. There are a number of ways in which the companies can establish their modes
of entry into the foreign market which are as follows –

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1. Direct Exports – Direct Exports is defined as the basic form of exporting in which the
direct holding of a company is to be done and the economies of scale are being capitalised in
the matters of production from the home country to some other foreign countries in order to
get better business and work (Maekelburger, Schwens and Kabst 2012, pp.458-476). This
form of exports is best for the business that concerns with small amounts of goods without
any form of intermediaries. There are a various types of direct exports namely the sales
representative and importing distributors.
2. Indirect Exports – Indirect export is defined as the process of export in which the process
of transaction is done intermediaries and in which the exporter has no control over the
products. This kind of business is done for the companies which has large business scale.
3. Licensing – Licensing is defined as the type of market entry modes in which the licensing
agreement is done by the foreign companies in order to manufacture as well as market a
product which is either exclusive or nonexclusive in the matter. There is limited rights and
resources for the manufacturing of the product in the span of time (Park et al. 2012).
4. Franchising – The whole matter of franchising is defined as the system or a way in which
the company is independent and also pays fees or royalty bonus to the mother concern for
allowing them to make sure that their production is not being hampered in any sense (Ang,
Benischke and Doh 2015, p 1536-1553). The concept of franchising is for a longer period of
time compared to licensing process as it adheres to the intellectual property rights of the
company including lower political and cost risk.
5. Turnkey Projects – The project is defined as the form in which the clients pay the liable
contractors to design and construct and train the facilities and personnel’s in the required span
of time. In this way the technology and other forms of products are exported to the rivals for
the advantage of the company.

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6. Subsidiaries – Ang, Benischke and Doh (2015) states that the subsidiary is the daughter
company or a sister company for a large concern. There are generally two types of
subsidiaries in the marketing strategy namely the Greenfield Investment as well as acquisition
in the method. The risk of acquisition is lower than the Greenfield investment and so the
whole relation to subsidiary is there for the span of time.
7. Join Venture – Joint venture is defined as the alliance of two companies in order to get the
best of the company and the strategies that are there in the company’s marketing ways. The
joint venture is the form of mixing with the companies to make sure that both the companies
have ample access to making profit for the span of time.
8. Strategic Alliance – Winter et al. (2012) states that the Strategic alliance is defined as the
various types of agreements on the corporate level in between the different form of firms and
which have participated in the span of time for the equality in the level of participation for the
research of the project.
3. International companies implementing each of the type of entry strategies
There are a number of companies that implement each of the style of strategy to make
sure that each of the company has each of the strategy to expand their business in the
concerned sector and also to be made sure that the whole business has got the required
amount of business in the new market. Following are the different modes of entry level and
the companies that followed this entry level to enter the new markets –
 Direct Export – Australian energy drink company Red Bull entered the Australian
market using this technique of direct export in which the home country being Holland
as its manufacturing company. Hoy, Stanworth and Purdy (2017) states that the direct
export for the product is being done to make sure that all the necessary marketing
strategies of the firms. The direct export of the company is to make sure that the