International Marketing Strategies for Greggs Bakery

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INTERNATIONAL MARKETING
GREGGS

Contents
INTRODUCTION...........................................................................................................................2
COMPANY OVERVIEW................................................................................................................2
LO1................................................................................................................................................3
UNDERSTANDING HOW MARKETING CONTRIBUTES TO BUSINESS STRATEGIES IN
AN INTERNATIONAL CONTEXT..............................................................................................3
INTERNATIONAL MARKETING BENEFITS AND REASONS FOR INTERNATIONAL
EXPANSION..............................................................................................................................3
DIFFERENCE BETWEEN LOCAL MARKETING AND INTERNATIONAL MARKETING.........4
MAJOR CHALLENGES FACED BY GREGGS BAKERY BUSINESS WHILE CONSIDERING
INTERNATIONAL MARKETING................................................................................................5
LO2................................................................................................................................................7
EVALUATION OF ENTRY TO A SELECTION OF INTERNATIONAL MARKETS AND
DEFINING THE KEY SUCCESS FACTORS.............................................................................7
STRATEGIES TO ENTER A NEW FOREIGN MARKET...........................................................8
MARKETING STRATEGIES FOR GREGGS BAKERY INTERNATIONAL EXPANSION.........9
LO3..............................................................................................................................................11
ELEMENTS OF A MARKETING PLAN WHICH CAN BE ADAPTED AND STANDARDIZES
ACROSS INTERNATIONAL MARKETS:.................................................................................11
MARKETING MIX IN INTERNATIONAL MARKETS...............................................................13
LO4..............................................................................................................................................15
INTERNATIONAL APPROACHES..........................................................................................15
WAYS TO ASSESS COMPETITORS......................................................................................17
CONCLUSION.............................................................................................................................20
REFERENCES............................................................................................................................21
1

INTRODUCTION
International marketing is the application of marketing concepts and principle to satisfy
the needs of people residing across the national borders. In international marketing the
marketing is done on the global level. The process of international marketing is
challenging on the other hand international marketing also provide a lot of opportunity
for business expansion. The foreign laws, cost calculation and pricing policy, payment
methods, the political risk associated with the country, cultural and religious are some of
the issues associated with international marketing. While there are many challenges
associated with international business there are many advantages of international
marketing like increased business profits, the chance of becoming a global brand,
international expansion will also provide the chance of product expansion. The report
also discusses the main differences between local marketing and international
marketing.
COMPANY OVERVIEW
Greggs Baker is a café and retail bakery. The Bakery has always provided a variety of
choice for the customers. The menu consists of wide variety of products. The Gregg’s
Bakery has always kept its customers happy. With more than 100 stores in the London
city alone Greggs Bakery has made a special place in the heart of the city residents.
Currently, Gregg's Bakery operates in almost all the city of United Kingdom. With more
than 2000 loyal staff the bakery is able to provide the best customer experience. With
great success in the UK, the bakery plans to expand globally. Currently, the business is
facing many problems as the bakery business has saturated in UK market, global
expansion is the need of the hour (GUK, 2019). With the advancement in technology,
communication, transportation, and financial flows the world has become smaller and
smaller. Due to international trade, local businesses can expand internationally and
increase their business very easily.
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LO1
UNDERSTANDING HOW MARKETING CONTRIBUTES TO BUSINESS STRATEGIES
IN AN INTERNATIONAL CONTEXT
INTERNATIONAL MARKETING
For the global expansion of Greggs business understanding of international marketing is
very important. International Marketing is the process of performing business activities
like planning, pricing, promotion of company products and services in a country other
than the business is located (BJ, 2019). There are many factors which have made
international trade possible some of them are
1. The growth of international Trade Organization like the World Trade Organization and
free trade areas for e.g. NAFTA and the European Union.
2. More countries have joined free trade agreement especially Latin America, Asia, and
Eastern Europe.
3. The internet and communication technology have made international trade possible.
4. With the growth in the economy around the world, now people from growing countries
can afford the products and services which were only available to developed countries.
INTERNATIONAL MARKETING BENEFITS AND REASONS FOR INTERNATIONAL
EXPANSION
1. The national Bakery business has become saturated and the national market is
becoming too intense.
2. Due to intense competition in the local market sales and profit has declined.
3. The international market will provide a new opportunity for the bakery to expand its
products and services in new countries.
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4. Easy access to internet and technology all over the world has made it possible for
local businesses to move into the international market.
5. Greggs Bakery has done well in the national market and has the potential to become
an international brand (MS, 2019).
DIFFERENCE BETWEEN LOCAL MARKETING AND INTERNATIONAL
MARKETING
Greggs Bakery has performed very well at the local market. The products are very
famous among local residents. But to do business in other countries international
marketing is to be considered. Local Marketing and International Marketing are
compared below (ENM, 2015).
LOCAL MARKETING INTERNATIONAL MARKETING
Local Marketing is the process of selling a
product in the local market.
International Marketing is the process of
selling a product to consumers in different
countries.
In the local market the business has to
deal with local competition and economic
issues.
International marketing can be more
challenging as the business has to deal
with international competition.
There is no language barrier in local
marketing.
International marketing can come with a lot
of hurdles, language is one of the major
issues in international marketing.
Local marketing involves a lesser risk. International Marketing involves higher
risk.
Products are decided according to local
demand.
New products are required to enter the
international market.
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MAJOR CHALLENGES FACED BY GREGGS BAKERY BUSINESS WHILE
CONSIDERING INTERNATIONAL MARKETING
1. Foreign Laws and Regulations
While entering an international market understanding the local laws of the target country
is very important. Employment and labour laws differ from country to country therefore
complete and comprehensive knowledge about tax laws, trading laws, employment and
labour laws are required to enter any international market.
2. Cost calculation and global pricing strategy
Pricing of products in international markets is also a challenge. All the factors like
currency exchange rates are to be considered. The pricing should be competitive and
must ensure profits in the international market. The cost of production and shipping,
labour, marketing and distribution and profit margin must be considered while
calculating the product pricing.
3. Universal Payment methods
Payment methods that are commonly available in the local market may not be available
in the international market. Determining the payment methods and economic laws of the
target country are important factors while going international.
4. Communication difficulties and cultural differences
Communication across cultures can be very challenging. Cross-cultural communication
skills are required for effective communications with local people of the target
international market. Religious and cultural traditions are also considered while
evaluating the communication problems in the international market (HIBS,2019).
5. Political risks
Political uncertainty and instability is a major risk in international business. Before
considering expansion into the international market assessment of the economic and
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political landscape is critical. Unstable policies and corrupt practices can be huge
problems in emerging markets. Any change in government can bring change in policy,
regulations, and interest rates that can be damaging to foreign business.
6. Supply chain complexity
While sourcing products and service in overseas market managing the supply chain can
be very challenging. When the supply chain become complex there are chances of
working with illegal and unethical suppliers. As a Bakery business, sourcing of raw
products is very challenging in the international market.
7. Environmental issues
Recent international proposals like the UN’s Sustainable Development Goals have put
environmental issues at the forefront of international business development. Awareness
of country-specific environmental policy and regulations are also important factors while
entering any international markets (Terpstra et al., 2012).
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LO2
EVALUATION OF ENTRY TO A SELECTION OF INTERNATIONAL MARKETS AND
DEFINING THE KEY SUCCESS FACTORS
The Greggs Bakery decision of selling products in other countries can be very
rewarding as international marketing efforts can introduce the company to huge
markets, increase in sales and profits, brand recognition, reducing the risk of only
operating in one market. Some of the important questions need to be answered before
considering international expansion is,
1. Which country to enter?
The food business has become very popular in Asian countries. Greggs Bakery
products have very good potential for performing well in these countries. The food
business in countries like India has grown very fast, there are many international
companies like currently doing their business in India and other Asian countries.
2. When to enter?
The entry to the international market comes with many risks, but proper planning can
make the process easier and can be profitable for the business. The decision about
when to enter a particular country depends on the current economic, political and
cultural situation of the country. If there is political turmoil in the country then doing
business in a foreign land can be very difficult. So correct assessment of these factors
is important while considering international marketing.
3. The scale of entry.
The proper evaluation of the local market (local to a foreign land) and the potential it
holds for business expansion is an important factor. Proper planning like the customer
base, product demand, and scope of increase in profits should be included in the
international marketing plan (WS, 2019).
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There are many strategies to enter a new foreign market. Some major strategies are
discussed below.
STRATEGIES TO ENTER A NEW FOREIGN MARKET
1. Brand Franchising
Brand Franchising is one of the very popular methods for food business to expand in
global markets. Franchising a business involves the selling of intellectual property rights
to a franchise. The franchisee must follow the rules and regulations like the use of
specific components while producing a product. Some of the challenges faced by the
franchising model are that there can be comprising with the product quality.
2. Direct Exporting
Exporting is the process of selling goods and services in another country. Direct
Exporting offers one of the best methods of entering the international market. By direct
exporting businesses can save cost as they do not have to invest in production facilities
in other countries. The rise in transportation cost can result in an increase in exporting
cost. Direct exporting considered as one of the easiest ways to enter international
markets. Greggs Bakery can use direct exporting of raw products to other countries
(ICS, 2013).
3. Licensing
Licensing involves the use of the company's property like the trademarks, production
process and patents. The licensee has to pay for acquiring the rights to use the
property. Licensing requires less investment cost and can be very profitable as all the
business activities are done by the licensee.
4. Joint venture
When two companies join together and establish a jointly owned business this type of
business is called a joint venture. One of the businesses will be local to the foreign
country. Both companies will jointly control the business operation. The local company
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(local to a foreign land) comes with regional or local knowledge which can be very
beneficial in international operations. There are some issues involved with joint ventures
like the problems of deciding who will invest and how the profits will be shared.
5. Foreign Direct Investment
Foreign Direct investment is a business method in which direct investment is made in
the foreign market. The investment is done on acquiring production facilities,
technology, staff. Foreign direct investment can be achieved by either acquiring an
existing company or establishing a joint venture with another company.
6. Buying a company
Buying a company is one of the easiest methods to enter any international market.
Buying a company gives the advantage of claiming the market share in another country.
A business will be treated as a local business in regard to licensing and other local rules
and regulations. Any restrictions by the government can be easily bypassed. Buying a
company in a foreign country can be very expensive. The new company will come with
a different set of working process which may not suit the parent company (Musso and
Francioni, 2014).
MARKETING STRATEGIES FOR GREGGS BAKERY INTERNATIONAL EXPANSION
There are many strategies to enter foreign markets; the best method which is suitable
for Greggs Bakery to enter the international market will be the franchise model. The
franchise model has many advantages over other strategies discusses above. Some of
the advantages of the franchise business model are (NBI,2019).
 Franchising a business can be a cost-effective way to grow the business in
international markets.
 Each franchisee finances their own business; therefore there is less investment
in a franchise business.
 Franchise model gives the chance of brand development in a foreign country.
 A franchise business can be established faster than other forms of ownership.
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 Franchises business has more control.
 The initial investment is lower for starting a franchise business in other countries.
 The franchise model provides more control over the usage of brand and
operation
 Risk of business failure is lower in the franchise business.
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LO3
This section of the task will explain what the elements of the marketing mix and how
they can be adapted and standardized across international markets. The second
section of the task discusses the key arguments in Favour and against the international
business and the third section contains the importance of the marketing mix and its
implication in the international market.
ELEMENTS OF A MARKETING PLAN WHICH CAN BE ADAPTED AND
STANDARDIZES ACROSS INTERNATIONAL MARKETS:
1. Market Research- An effective marketing team should do a market survey in
which the company is about to enter. Here Greggs should appoint a new
marketing team or outsource the research to a well-established research firm
which can help us to get insights of the new market and formulate an action plan
based on probable reactions of the market (INC, 2018).
2. Target market- Company should select a target market with high potential and
availability of target customers. Countries like China, Japan, and India where
business labour population is increasing rapidly can offer nice prospects for the
company (INC, 2018).
3. Positioning- Positioning refers to the creation of a place for the brand in the
market. Greggs has been very successful in building a positive brand image in
the UK and now it has to establish itself in Asia where the perception of people
towards a European brand is very positive. With the help of some positive
strategy and PR campaigns, Greggs can position our self in the Asian market
(INC, 2018).
4. Competition Analysis- Asian markets are known for high competition because
of their huge potential and availability of many brands. Change in the
demography of the continent has attracted many European and American Brands
like McDonald, Subway, etc., Therefore a thorough analysis of the competition
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