Digital Marketing Expansion: PESTEL & Entry Strategy - US Market

This report provides a comprehensive analysis of entering the US market for Blue Frontier Ltd, a UK-based digital agency. It includes a PESTEL analysis of the US market, examining political, economic, social, technological, legal, and environmental factors impacting digital marketing. The report explores three market entry modes: export, intermediate (licensing, franchising, joint ventures), and hierarchical, recommending intermediate entry as the most suitable for Blue Frontier. Furthermore, it discusses market segmentation, target market identification, and Porter's generic strategies to achieve a competitive advantage. The report concludes by highlighting the competitive threats Blue Frontier may face and suggesting strategies to mitigate them, such as protecting company data and adapting to technological advancements. Desklib provides students access to similar solved assignments and study resources.

INDIVIDUAL
MANAGEMENT REPORT

TABLE OF CONTENTS
EXECUTIVE SUMMARY.............................................................................................................3
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
PESTEL Analysis of digital marketing in US-............................................................................3
Three modes for entering into the market-..................................................................................5
Market segmentation and Targeting-...........................................................................................8
Porter’s generic strategy for AMS Company-...........................................................................10
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................12

EXECUTIVE SUMMARY
This report has discussed the PESTLE analysis of US for identifying the factors of the country
for expansion of the business. Along with this it will also include the concept of market
segmentation and target market of Blue Frontier company as well as the Porter's generic strategy
which can provide them the competitive advantages. This report has also discussed the entry
modes for the Blue Frontier company.
INTRODUCTION
Strategic marketing addressees the high level of considerations such as targeting market, services
to be offered to customers, setting the price and how these can be promoted. This strategic
marketing helps in achieving the organizational goals and objectives by using the marketing
principles as well as help in maintaining the competitive advantage. Blue Frontier Ltd company
is a leading UK digital agency offering professional web design, development, mobile app,
digital marketing and the IT services to its customers. This report will discuss the PESTEL
analysis of US and the product as well as the threats and opportunities that Blue Frontier Ltd. .
Can face in the country. This report will also include the three modes of market entry which will
be appropriate for Blue Frontier Ltd company. Along with this, it also involves concept of
market segmentation and the target market and porter's generic strategy for Blue Frontier Ltd.
company which can give them the competitive advantage.
MAIN BODY
PESTEL Analysis of digital marketing in US-
PESTEL analysis is a tool used to by the marketers for evaluating the macro environmental
factors that can affect the working of the organization or an industry (Matovic, 2020). It helps to
understand the aspects of the target market. It comprises six external factors that can affect the
performance of the organization.
Factors of this analysis are such as
1. Political- Political factors are those factors which can have impact on the performance of the
organizations. The particular target market can be affected by the stability of the political system.
The political factor can be such as tax policy, environmental regulations, trade restrictions as

well as trade reforms. Political situation of USA is better which will help Blue Frontier
Company for starting up of business. For example. Apple is the leading company in technology
sector which is based in USA (Rotz, and et.al., 2019). Digital marketing is very important
marketing services as day by day everything is getting online so to develop, digital marketing is
the best way to serve the customers as this most growing business in USA. Using latest and
advanced technology will help the company to compete and penetrate the technology in USA.
2. Economic Factors- Economic factors has a significant effect on the performance of the
business as they mostly affect the demand of the consumers. These factors can be like
employment wages, inflation rates, consumer confidence, and interest rates. Economy of USA
stable which will help Blue Frontier Company for start-up of the business. Blue Frontier
Company will also get affected by these factors (Bernhagen, Kollman and Patsiurko, 2022). The
interest rate when change it affects the customers (Auerbach, Gorodnichenko and Murphy,
2020). Digital marketing business will also be affected if there is any change in the economy of
USA.
3. Social factors- Social factors can influence the business decisions as well as their working in
the organisation. As the internet economy is increasing day by day because of which the role of
influencers is also increasing. The most significant social factors that can affect the digital
marketing business in USA can be the population growth, health consciousness, career attitudes
and many more (Kreuter, and et.al. 2021). These has more impact on AMS Solutions Company
as they have direct impact as it depends on understanding of the customers by the marketers.
4. Technological Factors- Technology is changing rapidly in the all over the world. To combat
with the changing environment, it is very important to adapt the technological changes. These
factors can be like engine efficiency, computer calculation and speed, automation, security for
cryptography, artificial intelligence etc (Drucker, 2018). The technology used in USA is highly
advanced which will help AMS Company to grow in this country. AMS Ltd. company when
enter into the market of USA it may have impact on the its business by the factors which are very
much advanced in USA so to use that level of technology in the businesses would help them to
survive in the market.
5. Legal factors- These are the factors when changed by the government may affect the
businesses. These factors which can affect the working in USA in Blue Fronteir Ltd Company
can be such as privacy law obligations, terms and conditions, consumer law and marketing,

intellectual property, competition regulations. Laws made in USA are much systematic which
leads to systematic working of the Blue Fronmteir Company (Stephenson and et.al., 2020).
These are the key factors which have direct impact on the Blue Fromnteiree Company as they
have to work according to the rules and regulations.
6. Environmental Factors- These factors are mainly concerned with the surroundings which
can impact the businesses. This involves waste disposal laws, energy consumption regulations,
environmental protection laws etc. Blue Frontier Company can be affected by the weather which
is the most significant factor for the digital marketing organization. This company can be
affected by the weather because when there will be rainfall then this company may be affected as
it is the digital marketing company which works by the internet so it may happen as of bad
weather internet may fluctuate.
These can be issues and factors by which Blue Frontier Company can face while setting up
digital marketing business in USA (Fuentes and Mies, 2021). It will be very growing business
because of change in the technology. These factors are beneficial for this company as the
environment of USA is highly advanced which will help the organization in survival of this
business and there is high demand of the digital services in this country.
Three modes for entering into the market-
These entry modes will be suitable for this company because these modes are most considered
when entering into the new market and as this company is service provider so this will be
effective. Blue Frontier Company can enter into the market by using these three modes such as-
1. Export Modes or Externalise- By entering through this mode, the companies have low
cost, low risk and low control as well (Askerova, 2020). They provide the businesses the
quick entry into the market. This is the most cost- conscious entry of mode as it enables
the businesses to put off the major investments when the market is tested. These modes
rely on the relationship between the buying agents as well as in absence of the tariff
barriers. Blue Fronteir Company if enters through this mode then it will have the benefit
of entering quickly in the market of USA with low cost and low risk. These modes are
also classified into three types such as
 Indirect export- This is the export in which the manufacturing organization are
directly does not involve in the exporting activities (Wagner, 2021). The
domestic companies like export agent and any trading company carries out these

activities without these manufacturing businesses involvement in the foreign
sales.
 Direct Export- In this the manufacturing company is involved in the exporting
activities. This activities can be like physical delivery, pricing policies etc.
 Cooperative Export- This type of export includes the collaborative agreements
with other companies through their export functions performance.
2. Intermediate entry modes- In this entry mode, the production process of the product is
transferred to another country for taking advantage of low production costs of the foreign,
opportunity of customer closeness, avoiding the high transportation costs. This method is
usually done by contract manufacturing method. This entry mode is suitable for Blue
Frontier Company as they can enter through licensing method as they are engaged in
service providing company which can be done by this mode of entry. There are three
most important intermediate entry modes are-
 Licensing- In this, licensor gives the right to the licensee for working of the
business in the other countries (Haupt, 2019). There are two types of licensing
formats are standalone in which the contract is based and works on legal basis for
transferring the rights and it allows the licensor for enjoying the royalties and
other is licensing plus which means the contract has some relationship orientation
and focuses on clauses related to R&D.
 Franchising- In this type of entry mode, franchisor allows the right to franchisee
for using the brand against the payment of money (Rosado-Serrano and Paul,
2018). In this contract the relationship also created between the entrant, the
franchisor, the host country as well as the franchisee.
 Joint Ventures- It is the partnership between two or more firms or parties which
they come for work together. There are generally two types of joint ventures can
be created that is a joint venture in which a whole new entity is created and a joint
venture in which is based on contractual relationship.
3. Hierarchical entry modes- In this entry mode the businesses completely owns and
controls the mode of foreign entry. This is not much beneficial for Blue Frontier
Company as it is offering digital marketing services to the customers and not the
products. There are five main entry modes of such as-

 Domestic-based sales representative- In this the sales representatives are of
domestic country and they travel abroad to carry out the sales activities. These
salesman maintains the relationship between the important clients in small
number.
 Resident sales representative- The actual sales activities are performed by
foreign market. The two functions carried out by the sales representative are
order taking and order making, communication of information about the products
to when the product is complex to understand.
 Sales subsidiary- This format is generally practiced by the initial foreign
presence, as they are responsible for the suitable management of prices and
distribution. This is related to both cost of operation as well as revenue model.
 Regional centres- Nowadays the organisations are more towards expansion in
different regions other than going in a single country. In regional centres it is very
important to ensure that companies are able to manage subsidiaries of foreign
because effective regional centre can provide the organisations the competitive
advantage.
As Blue Frontier Company is engaged in providing digital marketing services in UK, and they
want to expand their business in USA. By analysing the options of entry modes, they can enter
through intermediate entry mode, this will be the most beneficial mode of entry as they will only
have to need licence for working in that country as they do not have to export any of the products
from one country to another. This will provide benefits for this company as they can easily enter
the market, low cost and low risk associated with this mode of entry.
Threats for Blue Frontier Company-
Highly competitive
In the highly competitive environment of digital marketing and services it is very important for
BLUE FRONTIER LIMITED to keep all the data and information of company's policies safe
with proper management so that the competitors could not easily access the data of the company
and disrupt its digital information (Pappas and et.al., 2018). The use of new technologies by
other digital companies can also be highly competitive for the Blue Frontier Limited. To stand
out in the competition the company has adopted the use of software development services.
Hiring of best IT professionals could be one of the major challenge that the company could face

in smoothly operating the new technology tools. The solutions to above threats faced in the
competitive market by BLUE FRONTIER LIMITED are stared below.
Solutions for these threats-
1. Adopting strategy- As the competition is increasing day by day it has become very
difficult to survive in the market (ERSARI, G. and Naktiyok). Blue Fronteir must
adopt the suitable and appropriate strategy so that the competitive advantage can be
taken.
2. Innovation- This will help Blue Frontier company to compete in the market by
bringing innovative services while providing digital marketing services.
Market segmentation and Targeting-
This model approaches in segmenting the people and targetting on different basis like
age, area, demands in order to run the business successfully. It gives a brief plot of the
consumers needs and what changes are required to fulfil them. In this way resources can be used
more effectively and increases the value of the business in the market. Proper segmentation and
targetting gives correct information about demographic, geographic and psycho graphic factors
that are main elements of segmentation. Targeting helps to target the people on basis of
segmentation and required needs of the services and products by the consumers. This will further
helps in branding setting up the sales criteria for selected audience to increase the profit rates by
targeting and segmenting the business people along with the young generation who have become
tech-savvy in the modern world. The BLUE FRONTIER LIMITED helps in providing range of
digital services for its customers including social media marketing strategies for the business
groups, content writing and helps in building new relationships with other business groups.
Types of targeting
Contextual targeting
target audience on basis by placing ads according to the website so that rite message about the
service and the product is reached to the audience.
Demographic targeting
it includes targeting on the basis of web browser, links and different use of web pages searched
by the audience for any or service product and target audience according to their web search

history by targeting the youths and business class to grow the business of BLUE FRONTIER
LIMITED with the help of promotional tool by capturing more audience through social media
marketing. Along with this the company can also combine the SEO tool and content marketing
tool to increase the rank of the company's website by boosting the number of young generation
and business class people who are more interested in adapting the digital services for the
company to minimize the workload and help business gain new heights.
STP analysation for digital services of the Blue Fronteir company
The role of the STP in the market is to apply a planned strategic structure for any product
or services to evaluate the importance of services, selecting its target audience and doing
segmentation and positioning for developing efficient communication practice (Schlegelmilch,
2022). The STP analysation of digital services will help to understand its approach in relation to
the company.
Segmentation
the segmentation of the digital services will be done on the basis of various factors like
geographic, demographic, psycho graphic and behavioural change.
Demographic- It measures considers different factors like age, race, religion and income level of
the targeted segment.
The digital services of Blue Fronteir company the will be focused on providing services
with new technologies to the business men aged between 24-40 years in US who mainly requires
different ideas to advertise the products to make it more appealing to the buyers. These
businessmen have a high income level.
Psycho graphics- It defines the target market based on lifestyle preference and on the socio-
economic basis like educated people, skilled and uneducated people.
The business class in USA is highly educated, have a very busy schedule with high living
standards and in order to speed up the working efficiency and save time the Blue Fronteir
company will provide the best visual representation of products with routine advertisements and
also include content writing for the business people. The business men are more motivated in
increasing the profits for their company and the Blue Frontier company will surely help in
achieving the goal by providing the services on right time .
Geographic- this allows segmentation based on area, location and what are the needs of the
customers.

The Blue Fronteir company will provide its digital services in more business operating
areas in US where the electricity and Wi-Fi networks are strong so that all the required services
are fulfilled and will not operate in remote areas (Mora, Vila-Lopez and Küster-Boluda, 2021).
This will ensure in providing an efficient service to the business people.
Behavioural
The company will deal with all the queries of different business organizations via e-mail
and also share new ideas by planning and regulating new to minimize the file work of the
businessmen and converting it into document form on Word documents.
Benefit segmentation
To ensure that the data and information of any project of the businessmen is not leaked to
other organisations the Blue Fronteir company provides very strong and encrypted security to all
the data that is stored in the system and no one can have easy access to this information ( Yoga,
Korry and Yulianti, 2019). The company will also provide the benefit of creating websites on
different projects provided by businessmen.
Loyalty segmentation
By providing the environment of tight security on protection of data and files of
individual businessman by the company and take a responsibility to be accountable for any
information leak and this will ensure in maintaining good relationships with different
businessmen.
Targeting
The main target of the Blue Frontier company will be the business class of US
who are in need of expanding their business by attracting more customers (Nafisa, Lalu and
Salma, 2021). By the digital services the company will help to manage the files of different
projects, making communication easy via messages, e-mail exchange and making it easy sign-
up. The company will also target on using innovative representation of products on different sites
to expand the business. The company will cover the major portion in providing the digital
services to businessman US.
Positioning
Functional Positioning
In order to ensure that the company provides the best digital services to the targeted business it
will provide well researched material required by businessman on various topics. It will create

videos and write content with social media posts in order to increase the growth of the business.
Feedback reviews from different business man will be taken in order discuss drawbacks of the
company. The company will also conduct free webinars to discuss and share knowledge on the
new digital services that are being implemented in the business world. Pay per – click process
will be used by the company in digital services in order to lead the business growth. The SEO
tool will be used in the digital service to make the business more popular by increasing its rank
in search list. By keeping the competitors in mind the BLUE FRONTIER LIMITED has adopted
the use system development tool to compete with the competitors in the using the latest
marketing trends by providing the best digital services through system update technology.
Porter’s generic strategy for Blue Frontier Company-
The porter five analysis will help in measuring the growth of the company in digital services for
continuously analysing the external and internal forces that affects the growth rate of the Blue
Frontier Company (RILEY, 2020).
1. Cost Leadership- This strategy when used by organisations earns high level of returns as
well as competitive advantage by offering products and services in the market at the
lower prices. The cost leader companies owns high market share and enjoys more
advantages in manufacturing and purchasing.
2. Differentiation Strategy- Differentiation means making products and services more
unique and attractive from the competitors. For successful differentiation strategy
companies must go for good research, innovation and development. They must deliver
high level of quality products to the customers.
3. The Focus Strategy- Companies using this strategy focuses on the specific niche
markets and evaluates the changes in the market as well as the needs and wants of the
customers. These companies generally produces low cost products of the market this
helps them to earn trust and loyalty towards the brand. Cost focus and differentiation
strategy adds something more to serve the customers to the target market.
Blue Frontier Company can go for adopting search engine optimization in cost focus and cost
differentiation together comes under The Focus porters strategy as it will help them to serve their
target market customers effectively which will fulfil the needs and wants of them. Different cost
differentiation can be done by setting the prices of different segments customers. Providing the

customers with low cost and extra service will help this company in creating trust and loyalty
among them. Blue Frontier company has high competition in USA market so it is very important
for them to focus on quality with low cost and extra services for attracting the customers in the
market as well as surviving in the competitive market and it will help the company in building
strong loyalty and trust among the customers. It will also help Blue Frontier company in
expertising or advancing the digital services these all overall will provide the company to stay
ahead in the highly competitive market of USA.
CONCLUSION
From the above report it can be concluded that there are different analysation to be done
like Pestle which determines the economical, social, legal, technological, political and
environmental factors which have direct influence on the business in determining its market
value. Various market entry modes like joint ventures, direct investment are helpful in sharing
profits and also helpful in overcoming the new risks in the market. Further the STP analysation
helps in segmentation on basis demographic, geographical and psycho graphic factors to target
the consumer. It's main target is on the needs of the customs and what are there demands
regarding any service so that changes are made accordingly. Porter five analysation keeps a track
of various new competitors in the market and threat due to new entrants. This help to
acknowledge the nature of the competitors, what strategies they are adopting in order to maintain
good market value and what are the possible threats a new marketer by adopting different modes
to enter the business.