Global Market Entry Strategies for UK Businesses

The given assignment is focused on exploring global market entry strategies for UK-based businesses. It includes an analysis of the company's target market, demographics, and competition from rivals using Porter's diamond model. The report also critiques the use of franchising as a potential international market entry strategy for further growth in global markets.

International Marketing

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Two recent drivers of globalization that can help impact the expansion of Amazon into the
UK market...................................................................................................................................1
2. Justify one specific target market that AmazonFresh should target in the UK.......................2
3. Describing global environment for Amazon...........................................................................2
4. Evaluate one Global / International Strategy and one International Market Entry strategy for
Amazon.......................................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
International marketing is done on international level and it is based upon the strategy
that is created in Home country of a company and further distributed to its other offices. The
report is based upon Amazon that is a multinational brand who usually innovate international
marketing strategies for various countries. Therefore, report will describe two recent drivers of
globalization which can help for the expansion of the Amazon and it specify one target market
that Amazon Fresh should target. Report will critically analyse the global environment of
Amazon with relevant statistics, its competitors and customer trends. The present study will
describe one international strategy and one international market entry strategy that Amazon may
use to grow.
MAIN BODY
1. Two recent drivers of globalization that can help impact the expansion of Amazon into the UK
market.
As Amazon wants to expand its business and raise its brand image at global level, but on
the other side, there are some drivers that also influence the business to grow which are as
mention below:
Technological change: It has been analyzed that technology shaped and set the
foundation for the modern globalization. Amazon is also well known company because of its
best innovative products and it always adopts all new technologies into the working area in order
to grow its business at further level of expansion to increase the productivity and profitability of
the organization (Drivers of globalization, 2018). Apart from this, the rapid and sustained
technological change has also reduced the cost of transmitting and communicating information.
In this modern era, the rapid growth of the Internet is the latest technological driver that also
created the global e-business and e- commerce. This lead to help Amazon to grow its business at
international level because by using online business, the chances of growth is also increased and
as a result, it will help to expand its business at global level.
Competitive drivers: As the global market increases, the global inter- firm competition
is also increases and thus, the companies are also introducing, upgrading and distribute the new
products faster to gain high competitive advantages (Loppacher, Cagliano & Spina, 2018). That
is why, Amazon also uses competitive pricing strategy in order to gain large group of mass. It
has been analyzed that strong solidarity among countries and high two way trades and FDI action
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also support this driver and the growth of global network as well. By developing new pricing
strategies and offering discount products with different offers, the chances of sustaining its brand
image in the market will be high. Thus, it helps to gain high competitive advantages and also
leads Amazon to grow its business at further level of success.
2. Justify one specific target market that Amazon Fresh should target in the UK
Targeting implies choosing the specific group that helps to increase the market share of a
business and for Amazon, the consumer target market is based upon the demographic, in which
the company target the people on the basis of age group, it offers different variety of clothes to
their customer of all ages. As the company is dealing online and it provide a variety of products
for every one like men, women and children of all age group (Malhotra, Sivakumar & Zhu,
2019). Apart from this, the company also adopt the recent change in the market and by analyzing
the needs of their customers, it provides the products accordingly.
Hence, the website of the company main aim is to attract wide audience who are
interested to do shopping online and the range of items for sale that Amazon also offers that they
wish to target customers of all ages such that from young to old. Thus, it shows that the company
tries to reach the people who have access to the Internet and can invest amount for shopping
from Amazon as well (Eldering, 2015).
3. Describing global environment for Amazon
In order to describe the global environment of the company, Porter Diamond model is
used that helps to understand the competitive position in global markets. There are different
factors that affect it which are as mentioned below:
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Firm strategy and structure or rivalry: It defines the company's structure are organized
in such a way that it helps to creates high competitive advantages in market. Moreover, the
domestic rivalry is an instrumental to international competitiveness which forces companies to
develop the unique and sustainable strength and capabilities. But on the other side, Amazon also
faces high competition in market and such that its rivals are eBay, Apple and iTunes etc. Because
of their own fierce domestic competition, they have become able to more easily compete tin
foreign market as well (Rugman & Cruz, 2019).
Factors condition: It refers to natural, capital and human resources available for the firm
to compete in the global market, in the same way, in UK, the quoted firm has good knowledge
resources and infrastructure and this also includes the factor like quality of research and natural
resources such as climate, minerals and for getting better competitive position.
Demand condition: As Amazon has large market which means that it faces more
challenges and it has been analyses that the presence of sophisticated demand condition from the
local customers also pushes the company to grow and innovate new products and to improve the
quality as well (Narula, 2019). In the same way, Amazon also keep try to innovate new products
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Illustration 1: Porter Diamond model
(Source: Porter Diamond model, 2018)

by analyzing the needs of their customers, that helps to achieve more sustainable competitive
advantages as well.
Related and supporting industries: It has been critically evaluated that the success of
the market is also depend upon the presence of suppliers and related industries within a region.
In the context of Amazon, it has best suppliers that helps a business to grow well.
Government: It also plays an important role in order to encouraging the development of
an industries and companies at both home and abroad (Bakan & Doğan, 2018). Such that they
also finance and invest for the welfare or provide alternative environmental system that also
affect the production. The government can also help the development of the company in such a
way that it should be benefited the industries in some countries as well.
Chance: By conducting events and seminars the company in this stage, try to promote
their business. These events are also beyond the control of the government or some companies
through this, some company may gain competitive position while on the other side, some may be
lose.
Apart from this, there are some more key factors that also affect the international
marketing decision for the country such as:
Industry Statistics: The e-commerce industry falls into the category of an internet and
software service. Thus, there are two major segments of this industry such as business to
consumer and business to business, in which Amazon falls into Business to consumer category
as its main target is customers (Asmussen, Pedersen & Dhanaraj, 2019).
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Illustration 2: E-Commerce market share in UK
(Source: E-Commerce market share in UK, 2016)

From the above, it has been interpreted that in 2016, the rate of online shopping is raises
as compared to other years. And in recent years, the online business also tries to attract wide
range of customers in order to raise their sales.
Two major competitors: Amazon major competitors are eBay, media game changer
Netflix in media segments, and in electronic and general segments its competitors are Walmart,
Best Buy and Alibaba Group.
Few customer trends: in online business, the customers wants that they want to make e-
commerce shipping faster so that they will get their products at short period (Hodgetts, 2019).
Further, now customer wants to save their time and money and that is why they want that
everything is available in internet so that it will make their shopping easier, cheaper and more
convenient. Thus, by analyzing the need of their customer, Amazon keep providing the same
products.
Social and Cultural intervention: social factors may also help in international
marketing of Amazon such that as the customers mood is shift towards another brand if they find
low rates of products. Every people have their own perception and it also varies form the cultural
aspect as well. Thus at that time, the company should provide the best services and products by
analyzing the needs of their customers.
4. Evaluate one Global / International Strategy and one International Market Entry strategy for
Amazon
International Strategy: To produce the product and services at international strategy, it
is suggested to Amazon to use transnational strategy which is differ from the global approach in
which a company takes one product and then sell it into the market to promote it in the same way
across all channel of people, to establish its global presence at international market (Stonehouse,
Hamill & Purdie, 2019). Apart from this Transnational strategy is more personalized approach in
order to selling and marketing the goods and services with the target markets. Therefore, it has
been analyzed that this strategy relies on the coordination of the center, the operation unit and
local subsidiaries for an efficient and effective reach as well. Thus, it is recommended to the
Amazon to use this strategy as an international strategy for gaining high competitive advantages
and raise its brand image as well.
Market entry strategy: As Amazon tries to enter into new market, thus there are
different market entry strategy which can be used by the firm. And among all, Franchising is the
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best market entry strategy. This method is based on the marketing concept within which a
franchiser takes license of the know how of the procedure , intellectual property are uses of its
business model, brand and rights to sell. Thus there are many advantages of using this method as
a market entry mode such as if Amazon uses this method then the chances of risk is minimum.
Further, the products and services will have already an established market share and Amazon
also uses the recognized brand name as well (Franchising, 2018). Apart from this, there is no
prior experience required for a business and it has been realized that using Franchising as a
market entry method will help Amazon to provide financing in easy manner and also get
benefited from communicating and sharing ideas with and receiving the support from the
franchisee in the network as well.
From the above, it has been critically evaluated that Amazon should use international
market entry strategy because it helps to minimize the chances of risk while on the other side, in
international strategy of Transnational strategy not possible, as it is based upon the single
product promotion. While choosing Franchising as a market entry mode will help a business to
compete with its rivals in well and effective manner (Lovelock, 2015). Amazon's product and
services will already have an established market share so that there will be no need for market
testing.
On the other side, it has been critically evaluated that if the company opted transnational
strategy as an International strategy, then it has a biggest disadvantages in which the company
does not have the full understanding of the markets in which the company is trying to operate.
Another disadvantages of using this strategy is such that there Is a risk that company may lose
control over the operation of a business that further happening in other countries as a decision
making is not centralized. Therefore, it is suggested to the company to use Franchising as market
entry mode in order to grow the business at further level of success.
CONCLUSION
By summing up above report, it has been concluded that international marketing plays an
effective role in Amazon. From the report, it has been concluded that the company wants to grow
its business and thus technological change and competitive driver of globalization affect the
business in positive way and also helps it to grow as well. Further, it has been concluded that in
UK, the company's specific target market is based upon demographics of all age group people. In
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addition to this, report concluded the global environment by using Porter diamond model in
which the company faces tough competition from its rivals. Lastly, report critically concluded
that using Franchising as a International Market Entry Strategy will help to grow further in
global markets.
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REFERENCES
Books and Journals
Asmussen, C. G., Pedersen, T., & Dhanaraj, C. (2019). Host-country environment and subsidiary
competence: Extending the diamond network model. Journal of International Business
Studies.40(1). 42-57.Lovelock, C. H. (2015)
Bakan, I., & Doğan, İ. F. (2018). Competitiveness of the industries based on the Porter’s
diamond model: An empirical study. International Journal of Research and Reviews in Applied
Sciences.11(3). 441-455.
Eldering, C. (2015). U.S. Patent Application No. 10/229,783.
Hodgetts, R. M. (2019). Porter's diamond framework in a Mexican context. Management
International Review.33(2). 41.
Loppacher, J. S., Cagliano, R., & Spina, G. (2018). Key drivers of buyer-supplier relationships in
global sourcing strategies. International Journal of Procurement Management.4(2). 156-180.
Lovelock, C. H. (2015). Developing marketing strategies for transnational service
operations. Journal of services marketing. 13(4/5). 278-295.
Malhotra, S., Sivakumar, K., & Zhu, P. (2019). Distance factors and target market selection: the
moderating effect of market potential. International Marketing Review.26(6). 651-673.
Narula, R. (2019). Technology, international business and Porter's" diamond": Synthesizing a
dynamic competitive development model. Management International Review. 33. 85-85.
Rugman, A. M., & Cruz, J. R. (2019). The" double diamond" model of international
competitiveness: The Canadian experience. Management international review.33(2). 17.
Stonehouse, G., Hamill, J., & Purdie, T. (2019). Global and transnational business: Strategy and
management. John Wiley & Sons.
Online
Franchising. 2018. [Online]. Avaialble through:
<https://www.nibusinessinfo.co.uk/content/advantages-and-disadvantages-franchising>.
Drivers of globalization. 2018. [Online]. Avaialble through:
<https://www.tutor2u.net/business/reference/factors-that-have-contributed-to-
globalisation>.
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