International Marketing Strategy Report: ALDI's India Expansion

This report delves into ALDI's international marketing strategy, specifically focusing on its potential entry into the Indian market. It begins by outlining the purpose and need for international marketing, highlighting ALDI's strengths and capabilities, and identifying the factors attracting the company to India. The report then addresses contemporary business issues, including cultural and marketing challenges such as net neutrality, GDPR compliance, trade barriers, and cybercrime. It explores various market entry methods like franchising, partnering up, direct exporting, and joint ventures, analyzing their suitability for ALDI. Furthermore, the report covers the STP model (Segmentation, Targeting, and Positioning) and marketing mix decisions relevant to the Indian market. Finally, it offers recommendations for a suitable market entry method and concludes with a summary of the key findings and implications for ALDI's international marketing strategy in India.

INTERNATIONAL
MARKETING
STRATEGY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Purpose and need of marketing internationally by entering into market of India and elements
that attracted the company to enter market of India..............................................................1
Strength and capabilities of ALDI.........................................................................................1
Contemporary Business Issues when entering into a new market including both cultural and
marketing issues. ...................................................................................................................2
Methods for entering into a new market.................................................................................5
Analysis to the problem of market entry Methods.................................................................5
Recommendations for suitable market entry method.............................................................6
STP Model – Segmentation, targetting and positioning of customers...................................7
Marketing mix decision making.............................................................................................8
Marketing mix elements which should be considered by ALDI while entering into market of
India......................................................................................................................................10
Ans-off Matrix......................................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
International marketing is a marketing application in which needs and wants of the
people residing across the boarders are being satisfied. It is a marketing activity which is
undertaken in more than one nation which is can be also recognised as global marketing(Gomes,
Sousa and Vendrell-Herrero, 2017). Global marketing is being taken place because of several
reasons like increased economies of scale, huge market share, elongated life of the products and
many more. Present report is based on ALDI which is a private company headquartered in
Germany that deals in food, beverage and households essentials. ALDI group currently have 35
independent regional branches with around 2500 of stores. Regional branches of the company
are operated as limited partnerships that haves a regional manager for each of the branch who
reports directly to head office. Company is involved in global market which covers several
countries that includes Denmark, France, Portugal, Poland and Spain. It also operates in Ireland,
Hungary, Great Britain, Switzerland, Italy, Austria, China and Slovenia. Present report includes
important issues which are being faced by a company while entering into market of India, which
comprises of cultural and marketing related issues. Further it has appropriate market entry
strategy suitable for an organisation to enter a new market.
Purpose and need of marketing internationally by entering into market of India and elements that
attracted the company to enter market of India
ALDI is a huge company with a good brand name in market that have numerous
strengths and capabilities which can help the company in entering into new market. ALDI has a
strong distribution network which make the company to offer its products to all the major
markets where it operates. Company also have a strong free cash flow which can help the group
to enter into a new market by making a investment to enter into global market. India is a country
where ALDI has not offered its products since yet, so the company have a opportunity to offer its
products in India and create a new customer base. India have a huge population which attracts
the company most as a huge customer base in the country can be created by the company.
Strength and capabilities of ALDI
ALDI have several strengths and capabilities which can help the company to market its
products internationally in the international market of India. Company haves a good brand name
which can allow the company to offer its products in the new market more easily as company
name is already being known by most of the population of the new country where the company
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wants to enter. ALDI has a strong distribution network which make the company to offer its
products to all the major markets where it operates. Company also have a strong free cash flow
which can help the group to enter into a new market by making a investment to enter into global
market.
Contemporary Business Issues when entering into a new market including both cultural and
marketing issues.
Every year is bringing new opportunities for the businesses at the same time it is coming
with new issues like changed perspectives, legislations and even innovation that are making
business difficult. It is the responsibility of the manger to be aware about the issues that can
effect the company's existence and functioning while entering into market of India (Hartsfield,
Johansen and Knight, 2017). ALDI is already in global markets of several countries and have a
good response from all the major countries. Company can move into a new market in order to
make new customers and offer products which are being produced by the company. This can
increase the market of ALDI with a new base on consumer for its products.
Marketing issues
Net Neutrality Ending
The motive behind developing net neutrality was to enable everyone with equal as well as
free access over the internet. Federal Communications Commission has revoked the previous
regulations given on net Net neutrality which is taking away the motive behind establishing it.
ALDI is not a small firm but a large enterprise that cannot run its functions without the access
over net. According to new regulations companies will have to pay the price, content and speed
for the technology and consumer demand as dictated by the Internet Service Providers. ALDI
might not be able to get the access of net as per its targeted budget. So the managers will be
required to look for other possible alternatives that can be used for attracting and communicating
with customers(Wu, 2016).
Legal issues
GDPR
General Data Protection Regulation got approval from European Union. Companies
including ALDI are required to comply with these regulations within a time frame of two
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years(House and Street, 2016). The companies are required to protect the personal data collected
from the customers as the various customers are facing privacy issues as their personal data are
being misused. So the ALDI when entering the new market that is India may not get the trust of
the people. The compliance with GDPR will increase the budgets of the company as different
companies are having their privacy compliance procedures. The company will have to follow the
compliance procedures as long as it deals in the activity of buying and selling products and
services.
Trade Barriers
Every single individual is aware about the new trade tariffs which are brought by the
government (Baker and Saren, 2016). ALDI being a American company cannot remain
unaffected by the these tariffs and the trade barriers. The imposition of new trade barriers and the
tariff rates will make the prices of the products go high. The company will not be able to import
products from outside at cheaper rates from their well established suppliers. With the increased
prices the company might not be able get the desired revenues as the people will not shift over
products which are available at cheaper rates having the same quality.
Technological issues
Cybercrime
When firm enters into India, it might face issues related to technologies such as cyber
crime can get increase when foreign consumers pay online. In such condition brand value of firm
can get minimised to great extent. Another international issue faced by the companies who are
planning to extend their roots in foreign countries is the cyber security. The companies are facing
cyber attacks all over nowadays. So the plan of a ALDI might be hacked by the hackers and the
companies secret operational information may be used by the hackers for their benefits or may
be leaked out to the competitors(Gillespie, 2015). So, ALDI should undertake this aspect while
entering into market of India.
Cultural issues
In order to enter into global market, ALDI has to consider some cultural issues as the
consumer products can affect be affected by India culture so the consumer goods must be
prepared in such a manner that it meets needs, values and beliefs. There are several cultural
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issues which can be faced by ALDI consist of material culture, languages, cultural preferences,
religion, education, social organisations and ethics and values.
Material culture consist of the technological goods which are being used by majority of
population, personal transport and the availability of several resources such as natural gas,
telephone, internet and wireless communication, ALDI should consider these factors while
entering into global market(Kienzler and Kowalkowski, 2017). Another cultural issue which can
be faced by ALDI is different cultural preferences of the consumers. Different global markets
have different preferences for the products, food quality levels and for brands, the meanings of
colours, shapes and iconic features can also have a different cultural significance. These factors
are to be determined by ALDI that are the products made by the company are suitable for the
international market.
Language is the major cultural issue while entering into global market as the languages
spoken and used in the target country may have an impact on marketing, the collection of
information through surveys and interviews, brand name, advertising and conducting of business
relationships(Morgan, Feng and Whitler, 2018). While entering ALDI in the market of India they
should consider that languages might vary between different regions of the country and it can
also have involvement of more than one language, so the marketing should be done likewise by
considering this issue.
Education is also one of a cultural factor which can impact the business of ALDI in
global market as the typical level of completed eduction in a particular region may indicate the
quality of the status of consumers and potential work force. ALDI should also consider religion
as a cultural factor which can effect several aspects of life that includes the role of women in the
society and the rules they have to follow about consumption of foods and beverages, holiday
activities and clothing habits as it may differ in India. So, the company should consider all the
things before entering into global market.
Ethics and values have a major impact on global marketing specially when the business is
being conducted in another nation as different nations have their different ethics and values
which are always depended on status, religion, region and ethnicity. ALDI should also consider
human rights conduct of the potential market. Social organisation too have cultural effects while
entering into global marketing, the prevalence of special interest group, the composition of
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family groups and attitude towards them with racial diversity and recreational lifestyles are all
the important aspects to be considered when a country is being investigated as a potential export
market(Kotler and et.al., 2015). These all cultural aspects are to be considered by ALDI in order
to enter into a global market that is India, as failure of this can result in loss of investment in the
international market.
Methods for entering into a new market
There are several methods through which ALDI can enter into market of India which
includes franchising, partnering up, direct exporting and joint venture. Franchising is a process of
market entry in which existing name of the company is being used in the new market with the
help of a local business that helps in understanding the market much easily. Partnering up is a
process in which a company can enter into a new market by partnering with a local business
which can help the business in understanding the market much easily with the help of a local
involvement. Direct exporting can be take place by the company as it does not involve much
intermediaries that significantly increases the profit margin of the company but it involves risk of
lack of local involvement. Joint venture is a process in which two brands come together and join
their forces to achieve a strategic and tactical edge in the market.
Analysis to the problem of market entry Methods
There were several issues which were discussed above which includes cultural and
marketing issues being faced by the ALDI in order to enter into market of India. Marketing
issues which can effect the workings of the business in international marketing includes net
neutrality ending, compliance with GDPR, trade barriers and cyber crime. Net Neutrality ending
was a major factor which effected the entry into global market which can be overcome by ALDI
easily as it is already a large organisation with huge involvement in internet marketing which can
help it to bring this to global market and use this technology their also for preventing this issue.
GDPR is the general data protection regulation which is being formed to protect the data of the
consumers, so ALDI has to undertake such factors that it doesn't effect to GDPR by involving
the traditional techniques of marketing and consumers should be pitched in that manner that it
does not effect the general data protection compliance. Trade barriers are to be considered by
ALDI in order to enter into global market as in India has formed some tariffs which are to be
considered for offering the products in new markets of India for preventing any unlawful event.
Another issue in marketing globally faced by ALDI is cybercrime which can be prevented easily
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by the company, by undertaking such securities for its websites and data information that outside
sources cannot hack their data and information. This is to be done on a serious note by the
company as the operational information which might be hacked can be used by competitors in
the market.
Cultural issues in which ALDI can face problem includes cultural preferences, material
culture, languages, ethics and values, education, religion and social organisations. For
overcoming the issue of material culture ALDI has not to make much efforts as it is already a
huge organisation dealing in the goods which are updated technologically so this factor should
not effect much to the company butIndiamay have more involvement of technology so company
should consider that the technology being used byIndiais not too much upgraded from ALDI.
Cultural preferences may be different in India so the products must be designed in such a manner
by the company that it meets all the expectations to the consumers targeted in India and these
factors are to be considered that the products which are manufactured by ALDI are suitable as
per the consumer preference in India. Another cultural issue and the most vital issue which can
be faced by ALDI is language, as India may use different languages in different regions which
can directly impact the marketing strategies in the global market, those languages are to be opted
for marketing which are familiar to the local public and targeted consumers in the global market.
Recommendations for suitable market entry method.
ALDI can adopt the method of joint venture in order to enter into a global market. Joint
venture is a process in which two brands come together and join their forces to achieve a
strategic and tactical edge in the market(Bıçakcıoğlu, Theoharakis and Tanyeri, 2019). ALDI can
consider joint venture for the purpose to enter into India in order to offer its products in the
international platform by pursuing the specific task with joint venture. Company can initiate this
with the help of an agreement between the parties and the profit and loss in this method is pre
decided by both the companies, and involving a joint venture doesn't effect an individual
business of the participants involved.
Joint venture is somewhere different from the partnerships but it has some common
features(Boso, Debrah and Amankwah-Amoah, 2018). The major purpose of joint venture is to
form for a single or multiple projects which are pre decided and then it can be continued with the
agreement of both the partners or it can be dissolved if both the partners disagree to continue the
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venture. Joint ventures help in getting better exposure in the global market, it allows to merge the
resources with the partner for better productivity, it will also help ALDI to work for bigger
clients with combining expertise and saving money.
There are several reasons for choosing joint venture as market entry strategy for entering
into global market for ALDI which includes profit at low cost, flexible nature, start-up push,
shared costs, benefits, expenses and risks, and learning ground. Joint venture can make profits at
low cost as it involves resources and machinery of partnered venture which will help in
increasing the productivity of both the ventures and will decrease the cost of production that will
low the cost(Rowley, 2016). Joint venture is a method in which both the ventures are flexible in
nature as each of the participant has the freedom to continue with the existing business which an
individual is handling as they only have the right to interfere in the participated project of joint
venture, this will allow ALDI to continue working with their existing businesses. Joint venture
play a vital role in early stage for entering into global market of India as with a well known
brand can provide a good customer base as well as market credential and recognition.
Joint venture shares the risks and expenses involved in the business which can help ALDI
in investing the money in the global market and having a support of another partner in case of
any loss and risk occurred in the business. This will also help ALDI in learning the ground
knowledge of the global market and gain some experience in the market so that the company can
operate independently in future by obtaining experience and ground knowledge for the
same(Katsikeas and et.al., 2016).
STP Model – Segmentation, targetting and positioning of customers
Segmentation of customers must be done in such a manner by ALDI that it covers all the
consumers who can be show interest to the products of the company. Demographic segmentation
can be done by the company through variables that includes age, gender, education, family size
and income.
Target customers for ALDI in the new global market of India can be the age group of 16
to 30. Most of the millennials are to be targeted by the company as they are the one who are
interested most in the products which are offered by the company. Another segment which
should be targeted by the company is women ageing from 18 to 40, as they are the one who are
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always interested in shopping of households and food products, so the marketing of ALDI should
be done in such a manner that it approaches maximum number of target customers.
Positioning of products must be in such a manner that it meets the needs and wants of the
consumers by providing and offering the products to maximum number of people. High class
people must be targeted by the company in order to achieve more customer base as premium
products are being offered by ALDI which mostly focuses on high class people.
Marketing mix decision making
Marketing mix refers to the operational part of a marketing plan. It have 7Ps which
includes product, price, place, promotion, people, process and physical evidence (THE
MARKETING MIX, 2019). These decisions in marketing mix can be used for preventing the
impacts of cultural and marketing issues.
7 P's Description
Product It is the thing for which the consumer pays for satisfying their needs.
It can be a service too(Rowley, 2016). ALDI should consider this
element of marketing mix for overcoming the issue of material
culture and culture preference by manufacturing the product in such a
manner that it involves all the factors which are being expected by
the consumers of the market of India. As the preferences of the
customers are different in the global market, so company should do
such modifications in its products that it meets all the expectations of
the new customer base.
Place It refers to the area where the product is being offered to the
consumers. It should be in the reach of consumers easily so that the
consumers can be approached easily and in maximum number. Net
Neutrality Ending can be overcome by ALDI through place mix by
offering its products online in the market, with this maximum
number of customers can be approached and customers can also
easily approach for the products which are being offered by the
company, by this element net neutrality ending can be overcome by
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ALDI.
Price The cost for which the product is been brought by the customers is
known as the price. There are various pricing strategy for different
organisations like price skimming, penetration pricing strategy etc.
(Wu, 2016). Trade barriers can be overcome with this element of
marketing mix by applying penetration pricing strategy in which
products are offered in cheap rate as compared to competitors in the
market. Company can offer its products in a cheaper rate than other
competitors in the market of India and can obtain a huge customer
base in the market further it can adjust the price as per the tariffs
when the customer base is being created.
Promotion The process in which customers are being attracted to purchase the
products of the company, which includes promotion of products and
services(Gillespie, 2015). There are various tools used for promotion
of products which includes advertising, sales promotion, personal
selling and public relation. For overcoming the issue of GDPR,
promotion is the element which can be used by ALDI, marketing of
products should be done in such a manner that it does not involve
GDPR and the way through which it can be done is use of social
media which is trending the most in the recent period of time.
Another issue which can be overcome by promotion mix is language,
it is the main issue which is to be considered while promoting the
product as promotion is to be done is such a manner that the people
who all are being approached and offered the products of ALDI are
comfortable with the language which is being used for promoting the
product.
People The human resource involved in the company from sales staff to the
managing director of the company can be known as people in
marketing mix(Kotler and et.al., 2015). By bringing the right people
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at the right place at the right time it can increase the productivity of
the organisation. Cybercrime is the issue which can be overcome by
this element of marketing mix by employing a person who is being
responsible for all the cyber security of the company by ensuring all
the data and information of the organisation is safe and cannot reach
to anyone else other than organisations authorities.
Processes It is the process through which the product and service is being
delivered to the customer. This can be undertaken for overcoming the
issue of different ethics and values of different countries by
providing products to customers in such a manner that it does not
create any issue to ethics and values of the global market.
Physical Evidence The products and services for which customers are paying have some
physical element even if it is a intangible service then too it have
something to attract the customers that element is known as physical
evidence(House and Street, 2016). With this ALDI can over come
the issue of religion and social organisation by providing such
physical elements that does not violates terms of any social
organisation or any religion which will help the organisation to
increase its productivity through increasing the customer base.
Marketing mix elements which should be considered by ALDI while entering into market of
India
P's Description
Product India is a country where several cultures are
being followed by the different populations of
different religions, so the company should
undertake such factors in the production of
products which do not create any religious
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