Comparative Analysis of Hyundai Motors Marketing in Haiti Economy

This report provides a comprehensive analysis of Hyundai Motors' marketing framework within the Haitian economy, comparing it with the company's strategies in South Korea. It delves into the challenges and opportunities presented by Haiti's underdeveloped market, considering factors such as political instability, economic conditions, and social dynamics. The report utilizes frameworks like PESTLE and Porter's Five Forces to assess the external and internal environments, identifying the bargaining power of buyers and suppliers, industry rivalry, and the threat of substitutes. It examines Hyundai's current marketing strategies, including its distribution channels, customer sales promotions, and target market segmentation. Furthermore, the report offers recommendations for Hyundai Motors to improve its market approach in Haiti, including pricing strategies and promotional activities, providing valuable insights for students studying marketing and international business on the Desklib platform.

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MARKETING FRAMEWORK OF
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1MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
Introduction
The paper studies the marketing framework of Hyundai Motors in Haiti economy
through comparative analysis with its home market in South Korea. It examines the
marketing strategies followed by the company to operate in both countries –South Korea
being a developed market while Haiti being an underdeveloped market. The contrast of two
different markets are taken to bring clarity and portray the difference of culture, consumer
behavior along with the marketing mix. Haiti is chosen as the selected country to show how
business can also flourish in a poor market. The paper discusses how Haiti’s business
environment can pose threats as well as opportunities for Hyundai Motors and also
recommendations are suggested to improve the market.
Brief Analysis of Hyundai Motors
Hyundai Motors is the largest car manufacturing leader in automobile industry
globally. With headquarter in Seoul, South Korea, it is now one of the top 100 valuable car
brands and the official sponsor of the FIFA World Cup for 17 years. With business divisions
in Kia and Genesis, the overall company’s net revenue on 2018 is 1.64 trillion. The brand
philosophy of the company is strong commitment of the humans of the society in terms of
comfortable and fast-paced mobility with quality time [2]. This multinational conglomerate is
the third largest car manufacturer after Toyota and Volkswagen operating with widespread
business over Asia, South and Central America. It presently has nine profit generation car
models across product line segments – Eon, Grandi10, Elitei20, Activei20, Xcent, Verna,
Elantra, Creta and Tucson [15]

2MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
Current Marketing Strategies of Hyundai Motors
It has a four-tier distribution channel with manufacturers, dealers, retailers and
customers. Hyundai in its customer sales promotion strategy use mainly free accessories,
fewer rates of interest, exchange offers with a certain percentage of discount to attract
consumers to their retail showrooms. The target market of Hyundai consists of the middle
class and elite class level of consumers with high price models for conspicuous consumption
while the lighter models are for average class level. Hyundai gains a competitive advantage
through differentiation by investing about 10% of its market revenue in research and
development for bringing technological innovation [9]. The innovative designs of the
vehicles based on a sensual sportiness principle through creative marketing strategies,
Hyundai increased its guarantee period, mileage coverage and inserted new modulations of
eco-friendly features on the cars [15].
Challenges Encountered by Hyundai Motors in Haiti
The main opportunities lying for Hyundai Motors in Haiti are:
• The government of Haiti has increased its revenue collection, but 20% of its
annual budget comes from foreign aid [3].
• In 2003, Haiti reportedly had a higher ratio with people per registered vehicles
among other countries in the Western Hemisphere. With a population of around 10 million,
Haiti offers a significant market entry for exporters in automobiles [11].
Specific international programs like CBTPA and HOPE II have been extended by
the Haiti Economic Lift Program (HELP) Act, 2010 till 2020. The Trade Preferences
Extension Act, 2015 extended trade benefits until 2025 [12].

3MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
The PESTLE is used to study the external environment of Hyundai Motors in
both Haiti and South Korea.
• Political – In Haiti, few people pay taxes according to the World Bank. It is
estimated that remittances to Haiti at approximate $3 billion on 2018 constituting 31% of its
GDP running on foreign aids [3]. While in South Korea, people pay taxes and follow the
strict regulations of the country’s laws. It is GDP has fallen for three consecutive years due to
trade issues with the U.S.
• Economic- Haiti being an underdeveloped economy involves widespread
political instability in poverty and natural disasters with an increased flow of migrants [4].
South Korea is a developing economy with less poverty and natural disasters, but with a high
pollution index and with focus on eco-friendly production of automobile models [8].
• Social- In Haiti, the elite class enjoy a luxurious lifestyle and are capable of
purchasing the cars only while the rural people are simplistic in the countryside using
livestock or trucks and motorcycles as transport [6]. In South Korea, both the rural and urban
sectors enjoy a medium class of luxury. The elite class prefer sporty, trendy cars and are
always after a fashion. The rural sectors prefer low luxury through purchase within budget.
• Technological- Due to insufficient wired infrastructure and wireless antennas,
Internet service providers face on trying to extend their reach [12]. South Korea relies on high
technology with full network coverage and people using the internet. All types of high-tech
solutions are installed in cars.
• Legal- There are less safe driving laws for drivers and pollution is not taken
into consideration. The legal procedures in terms of driving and fuel efficiency are highly
controlled.

4MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
Porter’s five forces are used to scan the internal as well as the external economic
environment.
• Bargaining power of buyers – In Haiti, the bargaining power of consumers
from the elite class is less, as the automobile market is short of sport and trendy cars. While
the South Korean consumers will tend to bargain high for their purchase due to various high-
quality car brands operating in the market.
• Bargaining power of suppliers- In Haiti, the suppliers are quite less due to
shortage of skilled labour and with also fewer distribution centres and the import policy of
the country for automobiles reducing their negotiation power [12]. Due to lots of retail
showrooms, the bargaining power of suppliers is high with dealer promotion incentives.
• Industry Rivalry-In Haiti, the competitors are mainly Toyota and Nissan, so
the rivalry in the automobile market is very less. However, in South Korea, there are many
big players in the market Toyota, Volkswagen, Ford, Nissan and Honda. The industry rivalry
is intense in terms of product models.
• The threat of new entrants- In Haiti, the automobile industry is mainly
captured by Japan with huge imported car models of Toyota. The cars are mainly left-handed
vehicles. Along with the massive capture of Japan market, there are also lots of regulations
for suppliers to apply and continue dealership there. In South Korea, as the market is
perfectly competitive, other brands can capture the market.
• The threat of substitutes- In Haiti, there are lots of other transportation modes
like motorcycle, buses, trucks, tap-tap and livestock like a bull, donkey used for
transportation of resources and people in the hilly areas. In South Korea, there are not many
substitutes except the motorbikes.

5MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
The environmental impact as studied from both Pestle and Porter’s five forces
show that Hyundai Motors has better opportunities in Haiti in terms of less bargaining power
of buyers and suppliers along with new entrants in the market for competition. However, the
threat of substitutes is more in Haiti than in South Korea, due to which the differentiation
strategy of Hyundai Motors needs to be adopted at a grander scale. The industry rivalry is
also less as compared to South Korea. The market economy of South Korea has a moderate
level of bargaining power of suppliers due to the existence of many competitor brands and
the threat of new entrants due to developed market demand forces. However, the external
environment of Haiti in terms of political, technological and economic perspective is less
favourable as compared to the highly favourable external environment of South Korea with a
high standard of living [4]. The societal environment is favourable in both countries as the
company targets the elite class only. Nevertheless, the legal environment is less favourable in
South Korea as compared to Haiti, as there are many legal regulations and policies in terms
of pollution than Haiti which is devoid of such laws in the automobile industry.
Assessing Options in Haiti’s market
In Haiti, the company choose the urban segment with cities like Port-au-Prince,
Carrefour with two per cent of the population. From the demographic segment, only the
literate men above thirty years are chosen with high polished lifestyle [6]. However, the
South Korea segment is divided based on an important consumer segment who like trendy
automobiles on the high urban areas like mainly Seoul and Busan with affluent consumers.
While South Korea targets both the upper class as well as the middle class of the country
from millennial to high income-earning consumers. Hyundai motors position it is cars based
on appearance and fuel efficiency attributes for competitive positioning strategy in South
Korea [14]. In Haiti, the positioning is based in terms of price and benefits to grab the small
elite market using value-based pricing strategy.

6MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
The company provides value in terms of its logistics operations and high-quality
model designs in South Korea. Hyundai Motors has introduced new product developments
with fuel-efficient cars running on hydrogen and electricity and eco-friendly operations in
industry for maintaining ISO standards. In Haiti, the company provides excellent dealership
opportunities with employment for skilled as well as unskilled labour in automobile
warehouse operations. As the showrooms are limited, the car models are distributed based on
consumer needs.
The promotion used in South Korea is mainly through national television
broadband channels along with regional and state magazines. With banners and billboards in
outdoor advertising, Hyundai Motors engage in international sports events, roadshows and
trade fairs too [8]. However, in Haiti, the main tools for promotion are through newspapers,
radio and television. After the earthquake destroying telecommunication networks, billboards
are mainly used in Haiti roads. Hyundai Motors invest a lot in the promotion of new products
at South Korea as compared to Haiti due to targeting of a small closed group.
The distribution is of the four-tier channel with the manufacturer to dealer to
retailer to finally consumers in general. Their many dealers involved as the middleman for
transfer of vehicles to retail showrooms of Hyundai in various regions of South Korea. Each
retail showroom has their product positioning strategies which often lead to malfunction of
activities in the supply chain. However, in Haiti, there are less retail showrooms due to which
dealers are less concentrated in the supply chain with fewer costs involved in distribution.
The suppliers need new legal registrations due to which the distribution channel takes more
time than of South Korea.
The culture of Haiti urban consumers involves social system leadership which
remain in the hands of the elite class who enslave the rural black class. The majority of all

7MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
Haitians are very religious [5]. They place great importance on men as the head of the family
in urban areas. They prefer comfort and mainly visit shopping malls and lead a luxurious life
as compared to countryside people who live a minimalistic life [6]. The family values hold
great importance in the Haiti communities.
The approaches taken by Hyundai Motors in terms of context is examined to be
not as useful as the marketing strategies in terms of promotion and value proposition. The
promotion lack in reaching widely to the group and the value provided to consumers is less
than South Korea. Though Haiti is an underdeveloped economy, yet the market development
strategy through exportation licensing and direct investment is not valid. The investment
done in positioning to promotion and distribution of after-sales service is not so much than
South Korea.
Recommendations
The recommendations are provided as per priority to the Hyundai Motors on how
to operate in Haiti:
Recommendation 1 - Hyundai Motors mainly follow geographical pricing as per
the political and legal regulations of the countries it is operating. As Haiti is an
underdeveloped country with two per cent of the population having upper-class consumers
targeted, the skimming price strategy followed by penetration strategy can be used [7]. The
high price as an indicator of quality at first to the elite class will be balanced by sales increase
at a particular stage with little low prices to favour the environmental conditions like a
recession.
Recommendation 2 - New distribution channels can be opened up like two-tier or
three-tier channels to distribute the automobiles as the dealer regulations are quite strict in
Haiti. The direct purchases from dealers operating in Haiti, increasing the employment ratio

8MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
of that country prove more effective and with better service eliminating any further
malfunctions in the channel. Dealers must be given high incentives for better delivery to
unique elite customers.
Recommendation 3 – Hyundai Motors should invest more in promotion of its
vehicles through social advertising. Due to lack of awareness and less use of safety rules with
high accident ratios, the advertisement should aim for a better driving culture to educate
consumers at a mass scale. It will help in increased consumer reach at an emotional level
creating a competitive advantage.
The recommendations are suggested as per the figures and tables analyzed from
above discussion.
Figure : GDP level of Haiti
Source: Tradingeconomics.com | World Bank

9MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
Environmental Factors Level of Impact
Haiti South Korea
Political
Economical
Social
Technological
Legal
Negative impact Positive impact
Table 1: The level of impact of environmental forces on both Haiti and South Africa
Source: Created by author
Forces Level of Impact
Haiti South Korea
Bargaining power of suppliers
Bargaining power of the buyer
Industry Rivalry
Threat of substitutes
The threat of new entrants
Low Impact Moderate Impact High Impact
Table 2: The level of impact of porter’s five forces on both Haiti and South Africa
Source: Created by author
The recommendations imply that market penetration strategy is suggested to the
small proportion of upper-class consumer segment of the urban section of Haiti which is not
much affected by the poverty and unemployment scenario of the country [7]. Through market
penetration, a high price skimming combined with penetration strategy and new channels of

10MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
distribution with a proper advertising message is required to nurture the existing market in
Haiti [10]. The company cannot extend its market segment to the majority of the population
which reside in the rural countryside, but the existing market can be developed with more
product design models exclusively for elite clients with a mission of earning better revenue
growth from this geographical division. Hyundai Motors will not be able to generate high
profits from Haiti as it is an underdeveloped country, but it can improve its existing
automobile market through improvements in the areas recommended as there is high demand
in this untapped sector except by Toyota and Nissan operating as significant players in Haiti.
Conclusion
In conclusion, Haiti with poor economic conditions provide an open economy for
Hyundai Motors with less competition from big market players and small targeted segment of
elite class only. The market required new effective strategies in pricing, distribution channels
and investment in promotion for better revenue growth. Haiti as compared to Hyundai’s high
flourishing market situations in South Korea do not possess much opportunities for brand
product line extension due to threats in political, technological and economic environment.
However, the less bargaining power of buyers and suppliers create an advantage to continue
market operations in Haiti as long as the foreign aids flow in the country from US market.

11MARKETING FRAMEWORK OF HYUNDAI MOTOR IN HAITI ECONOMY
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