Strategic Marketing Report: Flipkart's UK Market Entry Strategy

This report analyzes Flipkart's strategic marketing approach for entering the UK market. It begins with an introduction to strategic marketing and then presents a PESTEL analysis to identify opportunities and threats in the UK market. The report then evaluates various market entry modes, recommending partnership as the most suitable option for Flipkart. Furthermore, it examines market segmentation and targeting strategies, critically assessing Flipkart's current approach. Finally, the report applies Porter's generic strategy to determine how Flipkart can gain a competitive advantage in the UK e-commerce market. The analysis emphasizes the importance of understanding the political, economic, social, technological, environmental, and legal factors, along with effective segmentation and targeting to succeed in the UK market.

STRATEGIC
MARKETING
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Table Of Contents
INTRODUCTION……………………………………………………………………………..3
Explain about the PESTEL analysis along with the opportunities and threats faced by the
client for a particular product or service and the country……………………………………...3
What are the modes of market-entry that is best for the client. Recommend about the one
market-entry mode which can be justifiable…………………………………………………5
Using the concept of segmentation and targeting evaluate about the potential target market of
the client in critical manner………………………………………………………………… .6
With the help of Porter’s generic strategy, explain about how the client can gain competitive
advantage ………………………………………………………………………..……………8
CONCLUSION………………………………………………………………………………9
REFERENCES………………………………………………………………………………10
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INTRODUCTION
Strategic marketing refers to that method through which an organisation can
differentiate itself from the competition by focusing on its strengths to provide better service
and value to its customers. The goal of strategic marketing is that to make the most of the
organisation’s positive differentiation over its competition through the consumer’s
perspective. Strategic marketing is somewhere different from other types of marketing. In this
report, the analysis has been done on the particular product which is going to launch in the
UK market. The PESTEL analysis has been done on it while identifying the opportunities and
threats for the product in that particular market. (Li, L. and Qian, G., 2018). Also the research
has been done on the modes of market-entry and the potential target market. The analysis has
been done on the porter’s generic strategy while gaining competitive advantage. The chosen
organisation is Flipkart. Flipkart is an Indian e-commerce company which is headquartered in
Bangalore, Karnataka, India and which is incorporated in Singapore as a private limited
company. The company has focused themselves initially on the online book sales before
expanding into other product categories. Flipkart is dominant in the category of apparel
segment which is supported by the acquisition of Myntra.
1. Explain about the PESTEL analysis along with the opportunities and threats faced by the
client for a particular product or service and the country
PESTEL analysis is a framework or tool which is used for analysing the macro
environmental factors that may have a profound impact on an organisation’s performance.
This tool is useful especially in that case when starting a new business or entering a new
foreign market. PESTEL is an acronym which stands for Political, Economic, Social,
Technological, Environmental and Legal factors. Political factors are those factors which
depicts that to what extent the government intervenes in the economy or a certain industry.
The government influences include government policy, political stability, corruption, foreign
trade policy, tax policy, labour law. (Karama, F. B. and Linge, K., 2019). These all factors
need to be taken into account while accessing the attractiveness of a potential market.
Economic factors are determinants of a certain economy’s performance. The economic
factors which include are economic growth, exchange rates, inflation rates, interest rates.
These factors may have a direct or indirect impact on the company, since it affects the
purchasing power of consumers. Social factors includes the dimension of the general
environment which represents the demographic characteristics, norms, customs and values of
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the population within which the organisation operates. When targeting certain customers then
these factors are important for marketers. Technological factors refers to the technology
incentives, the level of innovation, automation, research and development activity and the
amount of technological awareness that a market possess. Under the point of environmental
factor,if some climatic conditions have been changed then it affects the supp1y of the
products and items that has been ordered by the customers. (Chang, C. T. and Cheng, Z. H.,
2015). It impacts on the availability and stability of products supply. Under the legal factor,
it includes specific laws such as discrimination laws, antitrust laws, employment laws,
consumer protection laws, copyright and patent laws and health and safety laws. It is
important that company needs to know what is right and what is not right in terms of legal
matter for doing the business in a successful and ethical manner. Flipkart has its opportunity
in the UK by shipping or exporting their desi Indian products through online stores in the
UK. As the company can plan for some particular years so that it can achieve good results out
of it(Farris, P. W., 2016). The unique nature about the UK market is the management of the
company and a perfect illustration of the think global, act local. There are some reasons due
to which Flipkart will get success in UK market. First reason is that the Indian products
which will attract the customers because of their desi look, presentation and ethnicity in every
kind of their products. The second element is the consistent proposition which appeals to the
every age group of customers. There can be threats also related when entering into a new
foreign market. Every country has its different kind of policies. Then there will be threat that
government can implement the policy regarding the ban on some particular products and
items. The competition in the market is very high, the market is more attractive and intensity
of competition is high.
When the company enters into the new market segments the company have to compete with
the market leaders. Threat can be in the terms of the higher tax rates which can squeeze out
the profit margins. Slow growth in the consistency of selling particular products to the
country. (Mu, J., 2015).These threats not only creates problem in establishing themselves in
the new market or UK market but also a test of patience for the company in terms of getting
support from the new country. While entering into the new market it is important to
understand the political scenario of the country. If there is any political issue is going on in
the country then there will be less chances of getting full success in terms of the satisfaction.
And also need to consider about the economic factor if the country is not performing good in
terms of financial area and the growth of the company.
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Entering into the new market when country is in good condition then people of the country
gives full support and response to the new online new initiative or product in the market.
2. What are the modes of market-entry that is best for the client. Recommend about the one
market-entry mode which can be justifiable
There are five most common modes of international market entry are exporting,
licensing, partnering, acquisition and Greenfield venturing. Through exporting their products
the country can make strong relations and a good trade relations with the country. Under the
Licensing mode of market-entry, licensing is a transfer-related market entry strategy. It
intellectual property for a defined period of time. Licensing has its three main pillars which
are named as protection, promotion and profit. Under the partnership market entry mode, for
entering into a foreign market is to partner with a local company in the target market. A
partner based in the foreign market can help in navigating the politics and customs of the
area, make connections with customers and find employees. Partnership include joint
ventures, licensing and joint distribution networks. Under acquisition market entry mode,
where a firm gains control of another firm by purchasing its stock, exchanging stock. Under
Greenfield venturing, it is a form of market entry strategy with establishment of a new wholly
owned subsidiary in a foreign country by constructing its facilities from start.
(Chetthamrongchai, P. and Jermsittiparsert, K., 2020).
Out of the three options, the best option is Partnership market entry mode. Partnership entry
mode is the best entry mode for the e-commerce business because it helps in navigating
through politics environment of the country and also guides in terms of doing not those
mistakes. (Hollebeek, L. D. and Andreassen, T. W., 2018). Partnership is the best way in
supporting the other partner in every aspect wherever the company faces problems at the
international level. Through partnership, it gives access to knowledge, competitive advantage,
it enhances the business credibility and image, it increases the customer base and long term
stability. Under the access to knowledge point, the company needs a wealth of knowledge
comes in bounty with strategic partnership agreements. Partnership increases the lease of
knowledge, expertise and resources available to make better products, services and reach a
greater audience. The right business partnership will enhance the ethos of the firm. When
firm that share the same goals and vision join forces, the influence and strength of each
organisation can grow dramatically. Through the functional strategic partnership agreement,
the business would grow its customer base. Under the long term stability, the goal of all
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businesses is to remain relevant for a longer period of time and reach its set corporate goals.
A great business partnership makes the better, lifts up the weaknesses and enhances the
strengths. Having business partners means that the partner is no longer in isolation.
Partnership gives the opportunity for innovation, expertise and funds. Through partnership,
when working towards a similar goal or target then the targets can easily achieved and
objectives of the company can be fulfilled in a strategic manner. Through partnership they get
benefit in terms of financial manner because in case of emergency if one partner does not
have the availability of money which is required instantly then their partner somewhere
support to the another partner for maintaining its stand in the market. The company will enjoy
lots of profits in this kind of market-entry mode. This kind of market entry mode can be
successful for achieving their goal.
3.Evaluate about the potential target market of the client in critical manner using the concepts
of market segmentation and targeting
The potential target market are not really defined in a proper manner by the Flipkart.
The company’s marketing targets everyone and does not have a selected audience. According
to market segment concept which refers to the aggregating prospective buyers into groups or
segments with common needs and who respond similarly to a marketing action. According to
target market, it is a process of selecting the target market from the entire market.
(Smilansky, S., 2017).Target market basically consists of group/groups of buyers to whom
the company wants to satisfy or for whom product is manufactured, price is set, promotion
efforts are made and distribution network is prepared. The company mostly target the adult
groups which can be considered under the biased category. By targeting in this manner, they
are ignoring the other age groups. (Ristevska-Jovanovska, S., 2017). Flipkart company has
not define that their desi touch in their every product is specifically for which age group. But
the originality is in terms of their product which attracts the customers but not in the large
number group. Flipkart to target middle-income segment with brand billion. So that those
category of customers can also enjoy the online delivery system of the Indian products.
The reason that company needs to choose the different approaches to build market
segmentation is due to its enormous scale. Although the company has used so many
approaches to target and segment the market. But on the initial level it does not make proper
plan to target the audience in a structured pattern. Targeting and segmenting are the different
patterns to attract the customers towards the company. The company has to indulge
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themselves in such a manner that they can understand the current market situation and also
about the customers area of preference. Customers not only the well wisher for the company
but also supports the company in such a manner that it gives the opportunity to the company
to grow themselves. Its really important to target and segment the market because without
doing that company can’t handle such a huge market. ( Lacey, and et.al., 2015).
Potential target market can only perform better in that case when it has to be segmented with
proper planning and purpose. Without doing target to the customers it is impossible to sell
their products and also without analysing the preferences of the customers then it can be the
failure for the company when it enters into the new market. Although the company has
segmented through different approaches but it can’t be successful from the perspective of
long term approach. Because country’s situation and future can be changed with over a
period of time and by other influences also.
4.With the help of Porter’s generic strategy, explain about how the client can gain
competitive advantage
There are majorly three strategies of Porter which includes cost leadership,
differentiation and focus. He then further divided the focus into two categories which
includes cost focus and differentiation focus. The cost leadership strategy can be achieved by
following two main ways. The first way is through increasing profits by reducing costs, while
charging industry average prices. (Ismail, A. R., 2017). The second way is that increasing
market share by charging lower prices while still making a reasonable profit on each sale.
The cost leadership strategy is basically to be leader in terms of cost in the industry or
market. Differentiation strategy is that to make the products and services different and more
attractive than the other competitors. To make the differentiation strategy successful,
organisations need to do good research, development and innovation. Organisation need to
deliver high quality goods or services and effective sales and marketing so that the market
understands the benefits offered by the differentiated offerings. Under the focus strategy, the
key to making a success of a generic focus strategy is to ensure that something is added as a
result of serving only that market niche. The company can get competitive advantage through
by using one of the Porter’s generic strategy that is named as cost leadership. The company
can earn profits through by adopting cost leadership approach so that the company can gain
competitive advantage. The company can reduce the cost of raw materials by manufacturing
in their own country. This strategy can be useful for the client for fulfilling the purpose of
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competitive advantage. Market share can be increased by making changes in the segment and
target markets. Flipkart can gain advantage over here because it has many options of reducing
their cost in terms of their raw materials, online deliveries and in many other ways. These
strategies not only helps in competitive advantage but also support in understanding how the
company can work in a strategic manner. For becoming a leader in the cost strategy it is very
difficult task to do so because lots of planning and steps need to be taken so that the purpose
can be implemented in a positive manner. ( Babachenko, L. V., 2017). By making different
kinds of products and items the company has made itself into a diversified manner. By having
options for lots of products it can confuse the consumers regarding their choices and
preferences. So its important that they should focus on particular product so that it can attract
large level of market share and increasing number of profits. When particular product gets
popular then the company can grow and make its name through its brand value. Brand value
helps in making the company popular. Focus strategy is also one of the good strategy because
through this parameter company can identify that where they needs to do work and where
they are lacking. Focus can change the face of the company and it can reach to that level
where they want to reach. Overall for gaining the competitive advantage, the best strategy is
cost leadership because it’s the easier way to achieve their objective. ( Elarte, A., 2019).
Rather than focus and differentiation strategy, cost leadership is the best way to achieve
competitive advantage in the organisation. Porter’s generic strategy is the best strategies to
understand the company’s objective and target because it involves all those parameters which
are required on the initial level. These strategies are helpful and supportive for every kind of
organisation.
CONCLUSION
Strategic marketing plays a very important role in this competitive environment. This
kind of marketing makes itself different from other competitors. Under this competitive
world, its really important that every organisation focuses on its macro-environmental
factors. The company also needs to take care about the opportunities and threats in terms of
their future so that they can strategise themselves accordingly in a structured manner. If the
organisation made proper plans then for their further growth they can easily enter into the
new market and also be confident in entering in the international market. ( Doneria, K. and
Vinodani, S., 2017).For trying into the new markets it is important to take particular steps for
the segmentation and target markets. Only through this manner, the company can achieve
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their objectives and also their targets. For gaining on a larger scale and for the competitive
advantage it is really important that the companies should focus on particular strategies so
that the company can become leader in the market and can also attract the big market share
through different kinds of products and services. All this can be possible through the focus of
the company so that they can understand what really they want to achieve in the practical
manner.
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