MKT 5235 - Global Marketing Plan: Costco's Market Entry Strategy

This report provides a detailed marketing strategy and plan for Costco's potential market entry into Dubai and Myanmar. It includes a country analysis focusing on political, economic, social, cultural, and legal factors to determine the optimal market for entry, recommending Dubai due to its strategic location and favorable economic conditions. The report also analyzes Costco's current global situation, including its product offerings, target customers, and key competitors like Walmart and Target. Promotional objectives are outlined, emphasizing awareness creation, attitude adjustment, purchase intent influence, trial purchase stimulation, and brand switching. The target market is identified as the middle and upper-middle class, with communication strategies focusing on advertising and word-of-mouth marketing in Dubai. Finally, the report details international promotion strategies, including advertising messages, direct marketing, public relations, and personal selling, with specific tactics for adapting to the Dubai market.

Running head: MARKETING STRATEGY AND PLAN
Marketing Strategy and Plan
Name of the Student:
Name of the University:
Author Note:

1MARKETING STRATEGY AND PLAN
Table of Contents
1. Country Analysis:........................................................................................................................2
2. Company Analysis:......................................................................................................................4
3. Promotional Objective:................................................................................................................4
4. Target Market..............................................................................................................................5
5. International Promotion:..............................................................................................................6
References:......................................................................................................................................8

2MARKETING STRATEGY AND PLAN
1. Country Analysis:
The selected countries include Dubai and Myanmar where Costco does not have a
business. The political, economic, social, cultural and legal indicators that helps in deciding the
best market for entry by the company is analyzed below:
Dubai:
Political: Dubai does not have political parties but indulges into active politics. The
country has flexible policies for both expatriate and the local population put forward by Dubai
government that helped the country to emerge as one of the global city across the world.
Economic: Dubai represents an open economy with no exchange controls and trade
barriers and is dependent on profits earned by the real estate projects. This has led to an increase
in the foreign trade at an average rate of 11 percent thereby showing that it is one of the popular
choices of most businesses for opening their head office and conduction of the annual meetings
and conference (El Mallakh, 2014).
Social and Cultural: The state has subsidized healthcare and education programs that
satisfies the needs of the people and helps in the maintenance of peace. The country is liberal and
open in the terms of the social factors. This implies there is no strict policy for covering the head
and the body of women and drinking of alcohol
Legal: In terms of the legal indicators, Dubai has certain great policies in the form of no
federal income or corporate tax (Mitchell, 2016). The country also does not have any sales tax or

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value added tax along with no restrictions on the foreign trade and the exchange controls.
Businesses only need to get a license.
Myanmar
Political: The country has an open democracy and economy and has civilian led
government. This in the long term can lead to an increase in the foreign direct investments,
ensure better lifestyle and lead to an increase in the income.
Economic: Although the country has a GDP growth of about 7.7 percent, it lacks
appropriate infrastructure that acts as drawback for the foreign direct investment (Beeson, 2014).
The country not only has a lower labor cost but it also lacks skilled labor. Myanmar is considered
the least developed countries.
Social and Cultural: There has been an increase in the income of the middle class and
they remain in a position of spending more. The people have a busy life in the urban areas and
people remain more influenced by the social media than the traditional media.
Legal: The country had outdated laws. The country also stood weaker in the real life
execution and operation procedure. In addition, the country also had a high corruption index and
ranks 171st amongst the 190 countries in determining the index related to the ease of doing
business (Crouch, 2014).
Based on the indicators mentioned Costco should first enter the Dubai market due to its
strategic location and easier access to close to 2.2 billion consumers. The country also has a

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central time zone that combines the business hours of the East and the West and acts as the most
suitable getaway for the imports and the exports of the region. As per the reports in the year
2011, the country had an increase in the trade revenue by 5.8 percent that determined its
economic performance (Al Faris & Soto, 2016).
2. Company Analysis:
Current Situation of the Company at the Global Level:
Products: Costco represents one of the top retail brands of United States having wider
range of the product offerings based on the customer needs. These includes, caskets, art,
clothing, computer software, books, furniture, wine, home appliances, home electronics, solar
panel, jewelry, pharmaceutical goods and perishable items like fresh fruits, dairy, flowers and
vegetables(costco.com, 2018). The products are packaged in bulk and are sold to the large
families or business.
Customers: Costco especially targets the middle class and the smaller businesses. The
retailer believes in the philosophy of providing the customers higher quality goods at most
competitive prices (costco.com, 2018). The performance of the company highly depends on
North American business. In recent times, the management of Costco took necessary steps for
attracting the younger customers to the stores.
Competitors: The primary competitors of Costco include Walmart Stores, Inc and Target
Corporation. The net income of Walmart is $15 billion that is quite higher than the income of
Costco. Walmart has a dividend yield of 3.1 percent that is higher than the yield of Costco and
Target. Walmart has a higher turnover rate that portrays that the retailer effectively maintains its

5MARKETING STRATEGY AND PLAN
current inventory and clears obsolete or outdated items (walmart.com, 2018). The dividend yield
of target also stands at 2.9 percent higher compared to Costco. Target has a lower turnover ratio
of inventory that put forward the fact that it has more dated inventory compared to Costco
(target.com, 2018).
3. Promotional Objective:
The communication objectives that Costco seeks to accomplish include (Naeem, Bilal &
Naz, 2013):
Creation of awareness: This is important when a company makes an entry into the
market since it enables in informing the people about the existence of the products or the
services. This includes broadcasting of print ads or commercials that not only depicts the
company image but leads to a constant repetition of the slogans, jingles and the brand name. The
sole objective of the company remains in becoming memorable and known.
Changing of Attitudes: The Company can resort to advertising for clearing
misconceptions developed in the market due to negative publicity of its services or products. It is
a vital communication objective for a company making an entry.
Influencing the Intent of Purchase: This communication objective is adopted for
motivating the customers in making a purchase. This is done through persuasive advertising that
emphasizes on the superior benefits of the products in relation to the competitors. In doing this, it
is however vital in striking a chord with the want and need that triggers the customers.

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Stimulation for Trial Purchase: This communication objective includes making
product samples or free trials available so that customers are persuaded in making a purchase.
The focus remains in taking the risk away and in getting the customers in experiencing the brand.
Driving a Switch in Brands: This communication objective drives the consumers
towards making a switch to the products of Costco instead of the buying the products of the
competing brands.
4. Target Market
Foreign Target Market: Costco targets the middle class and the upper middle class
sector of the new market. In recent times, the consumers in Dubai were cost conscious that had
led to a rapid change in the purchase behavior (Bayat, 2013). The consumers however remained
loyal to the preferred brands but bought them in lesser quantity. This helps in the consumers in
believing that they were capable enough in reducing spending across all the types of retail that
included the discounted stores, convenience stores and the hypermarket. Therefore, if the
retailers like Costco invest in the analytics for decision-making then they can significantly
outperform the peers.
Effective Communication with the Customers in the Target Market: Although Dubai
is one of the digitally connected nations but the consumers follows a reserved approach towards
the digital marketing. Close to eighty-four percent of the consumers makes the purchases at the
stores that also plays a key role in the creation of product awareness (Petersen, Kushwaha &
Kumar, 2015). This is because seventy seven percent of the consumers learn about the products
at the store outlet. Therefore, advertising and word of mouth are the effective communication
means which Costco can undertake with consumers in target market.

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5. International Promotion:
1. Advertising message: Advertising refers to the audio and visual form of the marketing
communication employing a non-personal, openly sponsored message for selling or promoting
the products (Moriarty et al., 2014). For instance, “Costco brings you all kinds of products under
one roof”.
Media Strategy and tactics: The media strategy refers to finding the right path for
transferring or delivering the message to targeted customers. This can be done via a television,
radio or hoarding. The tactics adopted might be in the form of jingle, slogan or a simple message.
Costco needs to adapt to these changes for making an entry into the foreign market.
2. Direct Marketing Message: Direct marketing refers to the means of connecting to the
customers in their own world through innovative ideas.
Media Strategy and Tactics:
The strategy adopted includes text messaging via the cell phones, websites, and
distribution of catalog, outdoor advertising and magazine and newspaper advertisements. For
capturing Dubai market Costco needs to adapt to these changes.
3. Public Relations/Publicity: This tool ensures involving other people for speaking on
behalf of Costco. In other words, Public Relations do not result in immediate effect but helps in
brand building over the long term (Cutlip, 2013).
Strategy and Tactics
It is important in determining the messages that Costco wants the professional to portray
to the target market. The medium for disseminating the message might include press release,

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direct communication with the press and the consumers. Costco needs to adopt these means for
making a mark in new market.
4. Personal Selling: This refers to the tool where a business tries to sell its products
through face-to-face communications with customers (Shannahan et al., 2013). Here the sellers
usually promotes product through product knowledge, appearance and attitude.
Sales Strategy and Tactics:
The strategy involved by the sales people is to convince the consumers in purchasing the
products. Here, the sales man needs to make use of a personalized approach tailored for meeting
the customer’s needs along with a demonstration of the benefits. To adopt the tool Costco need
to implement these changes to its domestic strategy for communication.

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References:
Al Faris, A., & Soto, R. (Eds.). (2016). The Economy of Dubai. Oxford University Press.
Bayat, A. (2013). Life as politics: How ordinary people change the Middle East. Stanford
University Press.
Beeson, M. (2014). Regionalism and globalization in East Asia: politics, security and economic
development. Macmillan International Higher Education.
costco.com (2018). [online] Available at: https://www.costco.com/ [Accessed 10 Jul. 2018].
costco.com (2018). [online] Available at: https://www.costco.com/membership-information.html
[Accessed 10 Jul. 2018].
Crouch, M. (2014). Rediscovering Law In Myanmar: A Review of Scholarship on the Legal
System of Myanmar. Pac. Rim L. & Pol'y J., 23, 543.
Cutlip, S. M. (2013). The unseen power: Public relations: A history. Routledge.
El Mallakh, R. (2014). The Economic Development of the United Arab Emirates (RLE Economy
of Middle East). Routledge.
Mitchell, K. (2016). Dubai, UAE. In Architecture and Globalisation in the Persian Gulf
Region (pp. 205-230). Routledge.
Moriarty, S., Mitchell, N. D., Wells, W. D., Crawford, R., Brennan, L., & Spence-Stone, R.
(2014). Advertising: Principles and practice. Pearson Australia.

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Naeem, B., Bilal, M., & Naz, U. (2013). Integrated marketing communication: a review
paper. Interdisciplinary journal of contemporary research in business, 5(5), 124-133.
Petersen, J. A., Kushwaha, T., & Kumar, V. (2015). Marketing communication strategies and
consumer financial decision making: The role of national culture. Journal of
Marketing, 79(1), 44-63.
Shannahan, R. J., Bush, A. J., Moncrief, W. C., & Shannahan, K. L. (2013). Making sense of the
customer’s role in the personal selling process: a theory of organizing and sensemaking
perspective. Journal of Personal Selling & Sales Management, 33(3), 261-275.
target.com (2018). [online] Available at: https://www.target.com/ [Accessed 10 Jul. 2018].
walmart.com (2018). [online] Available at: https://www.walmart.com/ [Accessed 10 Jul. 2018].