King Su Technologies (KST) India Market Entry Strategy Analysis Report

This report provides a comprehensive analysis of King Su Technologies' (KST) international marketing strategy, focusing on its potential entry into the Indian market. It begins with an executive summary and introduction, followed by an in-depth environmental analysis, including SWOT and PESTLE analyses to assess the political, economic, social, technological, legal, and environmental factors influencing KST's market entry. The report then delves into a competitive analysis, utilizing Porter's Five Forces to evaluate the competitive landscape and identify potential threats and opportunities. Furthermore, the report explores various market entry strategies and recommends the most appropriate approach for KST. The analysis also considers the policies of the Indian government relevant to businesses. The report concludes with recommendations for KST's successful entry into the Indian market.

INTERNATIONAL
MARKETING

EXECUTIVE SUMMARY
The business activities which expands the companies to flow their goods and services to
the people in two more two countries is known as International Marketing. King Su
Technologies (KST) is a Hong Kong based smart phone manufacturing company. This
organization want to enter in the international market and they decided to start with India. This
report covers the various analysis including Environmental analysis, Competitive analysis,etc.
The various strengths and the areas of improvement are mentioned in it. In this report, different
market entry strategies are discussed and also suggest the appropriate strategy for the company.
It also includes the policies of Indian government related to the businesses.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
ENVIRONMENTAL ANALYSIS.............................................................................................1
COMPETITIVE ANALYSIS.....................................................................................................4
COMPETITION..........................................................................................................................7
...................................................................................................................................................7
MARKET ENTRY STRATEGIES.............................................................................................7
CONCLUSION AND RECCOMENDATION:..............................................................................8
REFERENCES..............................................................................................................................10

Illustration Index
Illustration 1: Market share of Indian smart phones........................................................................7

INTRODUCTION
Business activities which is used to create plan, promote, price and also expand company
to more than one country for providing goods and services to consumers for some profit come
under International marketing. It is a company's approach with global outlook, pursuing its
profit properly in the world, with a systematic and planned basis.
King Su Technologies (KST) is an electronic manufacturer company in Hong Kong
which is famous for inexpensive mobile phones. Cited organization designs their products in
Hong Kong and they have manufacturing plants in Malaysia and China. The mobiles of KST
have some limited capabilities, but they have features like WiFi and 4G. This company is 1 or 2
generation behind from other leading companies of mobile like Samsung and Apple. KST's
mobile phones come under an average price range i.e. from HK$ 500 to HK$ 1000. Their target
customers are poor and middle class people. They do not target rich people as their customers.
Now, company wants to launch their mobile phones in India since India is a developing country
with a large population and 80% - 90% of population is middle class or below than that.
Therefore, India is the most suitable nation for the cited firm to enter into international market.
MAIN BODY
ENVIRONMENTAL ANALYSIS
Environmental Analysis is the method of identifying all internal as well as external
factors which affect the performance of an organization (Pike and et.al., 2010). Basically,
environmental analysis is divided into two parts which are as follows:
1. SWOT Analysis.
2. PESTLE Analysis
SWOT ANALYSIS
The systematic planning procedure to analyse Strengths, Weaknesses, Opportunities and
Threats is known as SWOT analysis.
Underneath is the SWOT analysis to launch new mobile brand in India:
STRENGTHS:
 These mobiles supports various regional languages of India and thus, it is easy to use for
customers who are not able to understand English properly.
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 KST provides many functions in their mobile phones at comparatively lower price than
other companies. For example, 12 MP camera, latest version of Android, AMOLDED
screen, etc.
 The handsets are user friendly, therefore, they are easy to use or operate and so, anyone
can access them easily.
 The cabinets of phone are made of fibre for easy replacement if there is any damage at a
low cost (Turnbull and Valla, 2013).
 Most of the mobiles of cited company are dual or triple SIM which is helpful for the
customers who used to carry more than one mobile. As the handset works on Android operating system, therefore, customers can get a wide
range of applications from play store.
WEAKNESSES:
 Services provided by company after the sale of a product is not good as compared to
other leading companies like Nokia, Samsung, etc.
 They do not have big brand name and reputation, therefore, customers would not trust the
new brand easily.
 They are not able to target rich people as do not manufacture premium handsets. Companies like Samsung, Nokia and Apple are already leading in India. Therefore, it is
hard to enter in the Indian market.
OPPORTUNITIES:
 India has large population and around 80% - 90% of people are of middle class or below.
Therefore, it is easy to attract them with lower prices of mobile phones (Fetscherin,
2010).
 Company mainly focuses on Dual SIM phones and nowadays, customers prefer to buy
Dual SIM mobiles rather than single SIM.
 It is easy to attract Indian customers with the help of effective advertisement.
 As per the new government policies made by new PM Mr. Narendra Modi, it is easy to
establish the business in India. Now the criteria to enter in Indian market is simple and not so complexed, since the
government also helps the companies to expand their business.
THREATS:
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 All the other companies like HTC, Samsung, LG, Nokia, etc. also offer handsets at lower
prices for middle class customers.
 There are also new low range price competitors like Micromax, Lava, Karbonn, Lemon,
etc.
 Most of the Indian customers have started avoiding Chinese brands (Turnbull, 2013).
 Government of India encourages their citizens to purchase the products of Indian
companies to increase the economic growth of nation.
PESTLE ANALYSIS
Strategic tool which is used to understand the business position, operation's direction,
market decline or growth and potential is known as PESTLE analysis.
Underneath is the PESTLE analysis of India for entrance of new mobile brand:
POLITICAL FACTORS:
Government resources like Science and Technological policies, Economic policies, etc.
are very important for an organization. KST requires the support from public sectors to operate
efficiently, fast structural change, economy based on latest knowledge and technology, etc. In
broader sense, S&T and industrial policy include all the components through which public
welfare and operating business environment are shaped by the public sector. For the national
information society and growth of economy both the policies are important which are used by
parliament as well as government.
ECONOMICAL FACTORS:
Global and national economic factors affect all businesses of different categories
(Hultman, Katsikeas and Robson, 2011). Economic environment of market is dictated by the
behaviour of suppliers, stakeholders, customers, etc. The current economy of India is not so high
because of demonetisation, but this is only a short term impact on Indian economy in the near
future the long term economy of country will improve. Therefore, this will give a better support
to company in the coming years.
SOCIAL FACTORS:
Social factors depend upon the components within the society like friends, neighbour,
family and media. This factors affects our interests, attitudes and opinion about a particular
products. In India, attitude of people towards mobile phones is changing. They take mobiles as
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the sign of standard. Also, the government is focusing on digitization of India , therefore large
numbers of people are purchasing new smartphones. There is a massive growth in the demand
of smart phones which is very much beneficial for KST.
TECHNOLOGICAL FACTORS:
The cost cutting process and development of the product is influences by by technology.
India have 3G as well as 4G technology which is used to facilitates many of technical projects
(Chandler and Graham, 2010). The country also promotes the IT sectors, upgrades their software
and various innovative technologies, since India is one of the strongest competitor in the IT
sector around the globe.
LEGAL FACTORS:
India is focusing on more Eco friendly products which do not harm the environment and
also focuses on the economic development of the country. Therefore in recent some years, there
are many legal changes occurs in the country. Some of the legal changes are increase in
minimum wages, discrimination of disability and recycling, which affects many of the businesses
directly.
ENVIRONMENTAL FACTORS:
Urbanization and industrialization is highly affecting the environment of India. Since the
wastage to industries produces air pollution, water pollution, etc. which highly affects the health
of the human beings as well as animals (Riefler, Diamantopoulos and Siguaw, 2012). As a result,
new rules and regulations are introduced for noise control, disposal control and wastage control.
COMPETITIVE ANALYSIS
Determining the weaknesses and the strengths related to our product by identifying and
evaluating the strategies of the competitors is known as Competitive Analysis. In porter's five
model there are total 5 forces, out of which two are vertical competition and three are horizontal
competition.
PORTER'S FIVE FORCES:
The framework which analyses the strategies of business development and the level of
competition inside the company is known as poster's five forces.
Underneath are the poster's five forces analysis of India:
INTERNAL RIVALRY - high:
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Number of organizations which are competing for same product in the same market is
refers to Internal Rivalry (Dinnie and et.al., 2010). Businesses are encouraged to the competitive
reduction of prices and to spend lot of money on advertisement or promotion. Also, new
innovative products are introduced if there is high rivalry in an industry. This activities reduces
the profits and increases the costs of the products.
There are various types of retailers present in India such as domestic organized, domestic
unorganized, foreign retailers, etc. which creates more diversity in the competition. In organized
sector foreign and domestic retailers are competing on large scale. Profit can be increased
through differentiation of products by generating minimum rivalry in market. By adding branded
products in their offers, many small retailer are trying to comes under organized format.
THREAT OF NEW ENTRANTS – low :
India is a developing country with very large population, therefore more and more
foreign companies are trying to enter in the Indian mobile market (Cadogan, 2010). But the
threat is low because it requires very high capital costs, R&D costs and manufacturing costs to
compete in the Indian market. There are many barrier or hurdles for new competitors like patent.
Customers trusts the already existing brands in the market like Nokia, Samsung, Apple, etc. If a
new competitor comes in Indian market, then it will be very difficult to build the trust towards
their brand.
Technology is becoming more and more advance day by day, therefore it is hard to
develop this new technologies for the new competitors. In mobile industry, the already existing
companies are fighting for more and more market share. In phone industry there are always
threats of new competitors as well as from new products by existing company.
THREATS OF SUBSTITUTE – moderate:
Threats of Substitute is a moderate threat for the survival of of successful companies
(Kotabe and Helsen, 2010). Basically there are two main functions of smart phone i.e. to
distribute and access the information instantly and second is to connected with peoples through
communication. In present, there are many substitutes of mobile phones are present in the market
like e-mail, social, networking, internet, etc.
During the low economic conditions, dumb phones are treated as the substitute of the
smart phones as they are cheap and only used for calling purpose. Smart phones are only used for
the calling purpose but also they are used for all options for various purposes. Therefore, the real
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substitute of a smart phone is the smart phone with more features who belongs to same or
different brand.
BARGAINING POWER OF CUSTOMERS – high :
In India, bargaining power of customers are very high. This power of customers is
increased due to the very small differences in products and increase in choices (Parsons,
Takahashi and Hargrave, 2013). Customers can do bargaining more effectively as they all the
information which is required. People can easily switch their brand as there are lots of choices or
options in front of them. Indian customers waits for the launching of newer model because after
it's launch the price of older model will reduce and then they buy that product at lower cost. India
is a highly price sensitive market, so the customers will always wait for the best deals in the
market.
Buyer have great power of bargaining, as they have lots of choices and alternatives
present in the market. An generally, Indians are investigate each and every thing about the
product before purchasing it. Therefore, the companies should make mobiles with all decent
features at best price to sell their mobile phone in market.
BARGAINING POWER OF SUPPLIERS – moderate:
The market of inputs are also known as bargaining power of suppliers (Diamantopoulos,
Schlegelmilch and Palihawadana, 2011). Their are various potential factors which affects the
bargaining power of suppliers which are as follows:
1. Presence of alternate inputs
2. Ratio of concentration of supplier to the concentration of firm
3. Switching costs of suppliers as compared to the switching cost of firm
4. Degree of input differentiation
5. Employee Union
6. Impact on differentiation and cost by inputs.
7. Competition of suppliers
The existence of very low supplier as well as the number of customers influence the
power of bargaining of suppliers. For retailers, the suppliers are those companies who provides
them the finished product which is ready to sell (Douglas and Craig, 2011). Some of the bigger
brands open their own outlets or showrooms which act as a threat for the local retailers.
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COMPETITION
According to the latest report of the IDC- a market research firm, Samsung shares 25.1%
of the market of Indian smartphone. On second position, Micromax stands with the share of
12.9% of total market. Lenovo is one third position with 7.7% of market share, where Intex and
Reliance Jio stands on fourth and fifth position with 7.1% and 6.8% of market share respectively
(Indian Smart phone market, 2016).
MARKET ENTRY STRATEGIES
The systematic procedure of providing services or goods to a specific market and
distributes them in that market is known as Market entry strategy (Samiee and Leonidou, 2011).
There are various types of marketing strategies, some of the strategies are as follows:
 Licensing
 Franchising
 Joint Venture
 Exporting
 Manufacturing Contract
 Mergers
 Counter Trade
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Illustration 1: Market share of Indian smart phones
(Source: Indian Smart phone market, 2016)

The best strategy option for KST mobile company to enter in the Indian market is
Exporting. The marketing of products or goods in a country which are produced in some other
country is called Exporting. It can further be divided into two parts i.e. Direct Exporting and
Indirect Exporting. In the foreign market, it is one of the most well established and traditional
method (Magnusson, Westjohn and Zdravkovic, 2011). Only marketing investments are
required, since manufacturing is not required in overseas.
Their are many advantages of Exporting type market entry strategy, which are as
follows:
 It is less risky as compared to other strategies, since it has home based manufacturing
process.
 Before making investments in mortar and bricks, it provide an opportunity to learn the
market of overseas.
 Reduction in the potential risks which are produced by overseas operation.
 It reduces lots of expenses such as purchasing of land, building of manufacturing plants,
extra labour costs, etc.
CONCLUSION AND RECCOMENDATION:
Above report concludes that the KST can enter into international market through India as
their first country. Since India a developing country with a large population and 80% - 90% of
population is middle class or below than that. This major part of population can become the
target audience of the company. There are some weaknesses that the company is not able to
provide the great after sale service of the mobile. It is one of the major factor that a customer
keeps in mind while purchasing any product. To increase there sells in India they have to spend a
lot of money for the advertisement and brand promotion. The modified government policies to
establish new business in India are more easier as compared to previous policies. Nowadays,
Indians are avoiding the Chinese products and focuses on buying Indian manufactured products
to increase the economic condition of the country. Indian is among the top IT sectors in the
world, which is one of the reason that why foreign countries are attracting towards this country.
India supports 3G and 4G technologies which are beneficial for smart phone industry. Also,
BSNL and Nokia are together working for the more advanced technology i.e. 5G in India. There
are various new rules and regulations which are introduced for noise control, disposal control
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