Market Entry Strategies for a New Product

This assignment focuses on analyzing various market entry strategies suitable for launching a new product. It requires students to evaluate different options based on factors such as the target market, competitive environment, and prevailing economic conditions in specific countries (Belgium, France, Netherlands). The analysis should also consider the impact of cultural differences and technological advancements on market entry decisions.

Market entry planning and
selection

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK A...........................................................................................................................................1
Market selection..........................................................................................................................1
The choice of criteria..................................................................................................................3
Critical evaluation of the selected countries...............................................................................4
TASK B...........................................................................................................................................5
Market entry and distribution strategy........................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

Illustration Index
Illustration 1: Tingz: product of Peppersmith .................................................................................5

INTRODUCTION
The process of defining a marketing entry strategy is highly beneficial for the company in
establishing their presence in the market and attracting their targeted customers (Chiu, 2015). It
is necessary that management of the company should identify all the factors responsible for
affecting the firm's business and their activities in attracting the attention of their customers. In
the report, the market entry strategy of Peppersmith company which is a confectionery business
of UK that is specialised in making 100% xylitol mints and chewing gums. These candies, mints
and gums products provide a source that freshen up the breath, reduces spots of plaque and help
the customer in avoiding cavities and fillings.
TASK A
Market selection
It is evident that the Peppersmith is likely to focus on increasing its market and their
boundaries in the international countries. For this, the company needs to assess the list of
countries which are fruitful for them in expanding their market. In that case, the marketing
management team of Peppersmith is responsible to contribute all the helpful information about
the countries and their market condition in order to determine the appropriateness of selecting the
particular market. It is also useful in addressing all the available resources in the particular
market. In this process, the company need to analyse various aspects that are beneficial in
determining the perfect market for establishing their business (Castaño Labajo and Xiao, 2015).
Considering the business of Peppersmith confectionery company that offers a wide range
of mint and chewing gum related products which is likely to expand their market in various
foreign countries. The company's targeted set of customers are the groups of kids and children
that are between the age of In that respect, the most beneficial countries for confectionery
1

industries are Holland, Germany, France and Belgium. The criteria of market selection is based
on different aspects and areas that are:
BASIS Holland Germany France Belgium
GDP rate 853.5 Billion
USD (2013)
46,268.64 USD
(2013)
42,503.30 USD
(2013)
521.4 Billion
USD (2013)
Population (Kids) 0-14 years:
16.9% (male
1,460,234/female
1,393,766)
0-14 years: 13%
(male
5,386,525/female
5,107,336)
0-14 years:
18.7% (male
6,337,877/female
6,053,185)
0-14 years:
15.6% (male
830,980/female
797,624)
Per capita income $43,300 (2012
est.)
$39,500 (2013
est.)
$35,700 (2013
est.)
$37,800 (2013
est.)
Competitors Cloetta, Perfetti
van melle benelux
b.v.,
Mondeléz
International Inc.,
Nestle, Barcel, Yildiz Holding,
Ferrara Candy
Co.,
Other than this, the company could also generate the helpful information by attaining
helpful information from the factors that produces high influences in the functioning and the
working of the business in the international market. The elements are divided on the basis of
some typical aspects that are: Political factors – The influences that creates by the relationship of political parties
between the countries the company is likely to expand its market. Thus, the company has
to consider the level of political relation of UK with all the other countries. In addition to
this, the management has to assess the stability condition of political party in the existing
country and the selected country. Their stability would help the company in accessing
the criteria of judging the impact of policies and regulation defined by them (Xu, Taute
and et.al., 2015). Economic factors – It is determined that the exchange rate, inflation rate and market
purchasing power are the main elements which affect the revenue and earning capacity
of the company. They directly links with the profitability conditions and level of earning
revenue for various sources.
2

 Social factors – These are the factors that is termed as the most impacting elements for
the food and confectionery industries. It defines the preference and choice of the
customers towards the products offered by the companies related with that sector. In that
case, the company should identify the criteria of choice and preference towards the
confectionery products offered by the company.
 Technological factors – The impact of technology deals with the changes in technical
aspects, manufacturing techniques and packaging ways. Thus, the recent approach of
changing the production method and packaging process over the years has encouraged
the market of Peppersmith (Lee, 2013). This was started with the adoption of introducing
new machines for making mint candies and preparing gums that enables the users with a
last long impact which stays for a long time. The recent moves section also include the
method of using the filing patents and pathogen testing systems for reducing the impact
of heat and insects.
The choice of criteria
It has been ascertained that an organisation has to assess each and every aspect of the
market before expanding their business in any other country. As the process of expanding the
market requires high level of financial resources, effective set of human resources and origin of
natural resources for producing, marketing and distributing the range of products in the specified
market. In that respect, the confectionery company named Peppersmith needs to address all the
factors and information about the local market of the countries where the company is proposing
to expand their business (Stevens and Dykes, 2013). It would be highly beneficial for the
company and their management in order to select the perfect market and attain better results
from implementing their business in the specified countries. For this, the following areas and
their contribution are determined on various aspects and that are: GDP rate – It is termed the rate of development and capacity of the population to spend
money. They are helpful for the company in ascertaining the buying capacity and
potentiality of the overall community. The criteria of development specify their nature of
adoption and acceptance to new company or product in their local market. Population of Kids – The company's main aim is target the group of children and kids
between the age of 2-14 years, thus, it is necessary for them to assess the number of
3

customers available in the market. By using this criteria, the company can easily
determine the level of demand and required supply in the particular market. Per capita income – This method would help the company in determining the level of
income generation of the overall population. It is necessary that the management should
adopt the perfect pricing strategy that is suitable and related with the buying capacity of
customers. In that respect, it assists the company is defining the appropriate price for each
of their offered product for every particular market (Sikimic, Frattini and Chiesa, 2013). Competitors – The activity of expanding the market to a new country also include the
process of addressing and evaluating the level of competitors and their competition. As
the organisation offering similar products in same targeted market is attracting the
aforementioned group of kids. Thus, the company needs to define the level of
competition they are going to face if they planned to target the particular market.
 Pest factors – The activity of assessing the factors and their influences are advantageous
for the firm in order to mark the impact of taxes and revenues, preferences and buying
behaviour of the customers, capacity of importing the goods, etc. It is recommended that
the company should assess the economic condition of the countries and accordingly
define their marketing and distributing techniques as per the potentiality of the market
(Yen, 2015).
Critical evaluation of the selected countries
It has been critically evaluated that all the countries are appropriate for the business and
the market of Peppersmith company in expanding their market and attaining high level of profits.
In that case, the analysis of each and every stated aspects are highly necessary and beneficial for
the company in assessing the information about the market and the requirement of the resources
for marking their presence. For this, it has to attract the customers and their minds towards the
range of products offered by the company and these criteria are extremely helpful in determining
the market entry strategy (Hsieh and Vermeulen, 2013).
Considering the information gained from the overall criteria specifies the following
ranking and structuring of the selecting countries.
RANK COUNTRY REASON
1st Holland High level of GDP and per capita income, in addition with low level of
4

competition (Netherlands, 2015)
2nd Belgium GDP and per capita income is strong, with better population of kids
(Belgium GDP, 2015).
3rd France Rising level of kids population which is higher than rest of the countries.
The competition is also high which enables them to switch the customers
(France, 2015).
4th Germany Per capita income is high which empowers the potentiality of the
customers to buy the products (Raff, Ryan and Stähler, 2012).
TASK B
Market entry and distribution strategy
The main the activity that defines the organisation's strategy of entering the market is the
positioning and distribution strategies. It defines the best way of marketing and distributing the
product in the present market and to the targeted customers. Both of the strategies are planned
and aimed to target the customer group which are likely to and frequent in buying the products
offered by the company (Kim, Min and Chaiy, 2015). In that case, the marketing team of the
company is liable to identify the best form of positioning and marketing the products which
highly attracts the attention of the customers and motivates them to buy the products. Concerning
the market and the targets of the Peppersmith industries, they should adopt the following
options for entering and distributing their Tingz product in the asterisked market.
5

 BRICKS strategies – The type of marketing and distributing the products offered by the
company via developing a physical store in various areas of the countries. This will
enable the company in marking impact on the customers that are unknown about the
organisation and their products like Tingz offered to them. The physical presence in the
market encourages the customers and increases the company's loyalty among the
customers as the Peppersmith is quite new to the countries and their local communities. It
is one of the best method to directly link the customers with the company's brand
(Ochola, 2015). The physical distribution technique supports the business in building up
as a brand and developing their reputation in the new markets of various countries. For
getting better results the company should identify the best areas for launching their stores
and shops which are directly dealing with the customers that are targeted by the
company. Like shops near primary schools, play schools, gardens, parks, malls, etc.
 CLICKS strategies – The method of distributing the product by the way of online
marketing and shopping of the products. It is one of the most trending strategy adopted
6
Illustration 1: Tingz: product of Peppersmith
(Source:)

by the companies which is planning to expand their market. It enables the company a
source of offering a wide range of products like Tingz, without any physical appearance.
In that case, it is the most convenient method for entering the new market and distributing
the products to potential buyers (Osipov, Volinsky and Grishin, 2014). However, it is
termed as a costlier process as this kind of distribution generally raises the operating and
marketing expenses for the company which eventually rises the price of Tingz. Along
with this, it has been determined that using this method would generate more expenditure
over the product.
It is evidenced that the appropriate approach and option for marketing and distributing
the Tingz product range is Bricks method. The justification for choosing this strategy is that the
targeted customers for Peppersmith company is mostly the kids between the age of 2-14 years.
The customers need to be addressed by the physical stores or confectionery shops rather than
online dealing as most of them are unable to perform (Hu, Lee and Zhou, 2014). Along with this,
it is evaluated that this method enhances the level of customer valuation and satisfaction, hence,
considering that case, the company should adopt the approaches of BRICK strategies to expand
their market in the specified countries.
CONCLUSION
The report has concluded about the importance and structuring of strategies to enter a
new market in context of foreign companies. The process of defining the action plan is highly
necessary, thus has to be performed perfectly by attaining appropriate resources and information.
It also specified about the strategies for marketing, distributing and positioning the company in
the new market.
7

REFERENCES
Books and journals
Castaño Labajo, V. and Xiao, J., 2015. Market Entry, Strategy and Business Development in
Mobile Health (mHealth) Industry.
Chiu, P. S., 2015. The Research of International Market Entry Strategy in Taiwan SME--The
Case Study of the Wintec Co.
Hsieh, K. Y. and Vermeulen, F., 2013. The structure of competition: How competition between
one’s rivals influences imitative market entry.Organization Science. 25(1). pp.299-319.
Hu, J., Lee, L. and Zhou, Z.Y., 2014. Market Entry and Resource Acquisition Strategies for
Social Enterprises. Entrepreneurship in Asia: Social Enterprise, Network and Grassroots
Case Studies. 1. pp.1.
Kim, N., Min, S. and Chaiy, S., 2015. Why Do Firms Enter a New Product Market? A Two‐
Dimensional Framework for Market Entry Motivation and Behavior. Journal of Product
Innovation Management. 32(2). pp.263-278.
Lee, A. M., 2013. Examining the market entry strategies of a university's international
expansion into a developing country. University of Southern California.
Ochola, S. A., 2015. Foreign market entry strategies adopted by paint manufacturers in
Kenya (Doctoral dissertation, University of Nairobi).
Osipov, I. V., Volinsky, A. A. and Grishin, V. V., 2014. Gamification, virality and retention in
educational online platform. Measurable indicators and market entry strategy. arXiv preprint
arXiv:1412.5401.
Raff, H., Ryan, M. and Stähler, F., 2012. Firm Productivity and the Foreign‐Market Entry
Decision. Journal of Economics & Management Strategy. 21(3). pp.849-871.
Sikimic, U., Frattini, F. and Chiesa, V., 2013. Management of technology licensing as a foreign
market entry mode: The case of lea-ding Italian pharmaceutical and biotech com-
panies. Letter from the Editor. 10(1). p.3.
Stevens, C. E. and Dykes, B. J., 2013. The home country cultural determinants of firms' foreign
market entry timing strategies. Long Range Planning. 46(4). pp.387-410.
Xu, H., Taute and et.al., 2015. Examining Causal Relationships among International
Experience, Perceived Environmental Uncertainty, Market Entry Mode, and International
8

Performance. International Marketing in the Fast Changing World (Advances in
International Marketing, Volume 26) Emerald Group Publishing Limited. 26. pp.135-156.
Yen, M. Y., 2015. A study of international market entry strategy for the foreign labor agency in
Japan–a case of Y firm.
Online
Belgium GDP. 2015. [Online].Available
through:<http://www.indexmundi.com/belgium/gdp_per_capita_%28ppp%29.html>.
[Accessed on 13th May 2016].
France. 2015. [Online]. Available through:<http://www.indexmundi.com/france>.[Accessed on
13th May 2016].
Netherlands. 2015. [Online].Available
through:<http://www.indexmundi.com/netherlands/demographics_profile.html>.[Accessed on
13th May 2016].
9