International Marketing: Petronas' Expansion into the Indian Market

This report examines Petronas' potential entry into the Indian market, focusing on key international marketing considerations. It discusses the difficulties in conducting market research in emerging markets like India, including survey design issues, response bias, and data representation, and suggests mitigation strategies. The report highlights the importance of a Marketing Information System (MIS) for effective inbound/outbound logistics, sales management, and pricing decisions, emphasizing its role in enhancing transparency and competitive advantage. It also analyzes the factors influencing pricing decisions, such as competition, demand, cost, and branding, stressing the need for accurate cost calculation and efficient supply chain management. The objective is to provide a comprehensive overview of the strategic factors Petronas must address to successfully expand its business operations into India.

Running head: INTERNATIONAL MARKETING
International Marketing
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction................................................................................................................................2
Question 1..................................................................................................................................2
Question 2..................................................................................................................................3
Question 3..................................................................................................................................5
Question 4..................................................................................................................................6
Question 5..................................................................................................................................8
Conclusion..................................................................................................................................9
Reference List..........................................................................................................................10

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Introduction
Petronas is a company that deals with oil and gas and is located in Malaysia. The
company was established in the year 1974 and is owned entirely by the Government of the
country. The company is known to produce and deliver the energy resources in a way so that
it can help in meeting the needs and demands of the growing society. The company adopts
innovative techniques so that it can help them in harvesting the energy sources that are
located in harsh environments as well. The report will highlight their strategies that the
company will take so that they can enter in a country like India, which will help them in
expanding their business operation (Petronas.com.my 2018).
Question 1
It is very important for the international companies to research the markets before
they decide to enter an unknown market so that it can help the company in tapping the
potential resources that would help in earning better levels of profits. However, most of the
international companies face difficulties in conducting the market research efficiently due to
various factors. A country like India where there are many political influences may create a
negative impact when the market is being researched by the company so that it can allow
them in setting up their business (Czinkota and Ronkainen 2013).
The major difficulty that will be faced by the company in researching the market may
be due to the design of the survey in a poor manner. It may result in the collection of the
information in a wrongful manner through the qualitative or the quantitative data. If there are
mistakes in the design of the survey, it would result in collecting the data in a wrong manner,
which would result in the faulty interpretation by the company regarding the market that they
would want to enter. The collection of the data from a particular group of consumers will not
represent the entire population based on which the company may want to expand its
operations in India (Akaka, Vargo and Lusch 2013). This factor can be addressed by
structuring the design of the survey in a better manner so that it can result in gathering the
information in an efficient way. This will allow the company to understand the market in a
better manner.
Another difficulty that is faced while conducting the research of the market is that
there may be no responses regarding the survey that is being conducted among the target
population. There may be a possibility that the target population may not be interested in
responding to the process of survey, which may affect the quality of the research that takes

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place for the company. The respondents may not be willing to participate in the survey,
which may lead the organization to reach to a conclusion based on the research that has been
done taking in to consideration the views of less than the target population (Czinkota and
Ronkainen 2013). This can be avoided by the company by targeting the respondents in the
first place so that they are willing to take part in the survey that will be beneficial for the
organization. After this process, the company will be in a better position to frame the design
of the survey so that the responses can be collected in a suitable manner.
In a place like India, there can be biasness when the surveys are being conducted.
This can lead to the faulty representation of the data that is being used for researching the
market. This may also lead to the organization in developing their understanding regarding
the market where they want to operate in a positive manner. The surveys that may be
conducted through the online portals may use certain images that may appeal to people of
certain ethnical backgrounds and can offend the other groups as well. To mitigate this
situation, the company needs to conduct the survey that will be acceptable to all the people
who are belonging to different ethical backgrounds so that it can result in setting up the
organization in a better way. It will also allow the company to gather the information in a
better way so that the organization can set up its business operations in a proper way
(Paliwoda and Thomas 2013).
Question 2
The objective of Marketing Information System is that it helps in the creating and
maintaining decisions taken by the management within the business scenario. The process of
development begins by understanding the structure of the system along with the data bases
that needs to be present in the computer applications. It also helps in solving the problems by
setting up proper information systems within the organization (Buckley and Casson 2016).
The company will understand the needs of the customers in a better manner long with
the level of competition that they are facing from the rival groups. The information that will
be provided to the market managers will be in a better manner. The company will be able to
understand the demand and the supply of the products in a better manner along with the
alternatives that are present in the transportation facilities (Johanson and Mattsson 2015). It
will also help in increasing the transparency within the market space for the company so that
better strategies can be taken up for production and marketing facilities. This will help

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Petronas in improving their efficiency with respect to cost that will result in a higher income
as well.
It will also allow the company in understanding and handling the relationship between
the customers by providing them with proper answers regarding the operation that is taking
place within the company along with the decisions that are taken within the company (Stair
and Reynolds 2013).
The company can apply it for inbound and outbound logistics and distribution, as it
will help them in distributing the products efficiently. The systematic use of the management
information system will allow the company in distributing their products throughout India so
that the potential customers can be understood by the company. A country like India where
there are traffic congestion will be an advantage for the company, as they will be able to take
the fastest route in delivering the products in a better manner (Perlmutter 2017).
The use of the software will also be beneficial for the company, as it will help in
managing the sales according to the data that has been analysed through the software. The
number of units that will be sold by the company can be recorded in a proper way so that it
can be easy for the company to calculate the amount at the end of the year before publishing
their annual report (Grubel 2014).
It will also be helpful for the company, as the decisions of pricing can be taken in a
better way. The use of information system will allow the company in getting a better
information of the dynamics that are present in the market so that the price can be set
accordingly. This would be beneficial, as the price can be set up in an accurate manner so that
the customers will be attracted towards the products of the company. It will also allow the
company to gain a competitive advantage in the market, as the minimum price provided by
the company cannot be matched by the rival firms operating in the Indian market (Stair and
Reynolds 2013).
The company will also be able to develop the products and the services that they are
offering in the market in a better manner. The company needs to understand the choices and
the preferences of the consumers so that the products can be developed. This will result in
increasing the sale of the company in a better manner. It will allow the company to take in to
consideration of the view point of the customers so that they can provide the products that are
being demanded by them. This will enable the company in increasing their level of profits to
a great extent (Buckley and Casson 2016).

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Systems analysis
Market
research
Better
transportation Transparent strategy
formation
CRM
Sales
managementMarketing
plan
Pricing
decisions
Supply chain
The company will be in a better position to use the marketing plans in a strategical
manner, as the use of the marketing mix tools can be done properly. This will allow the
company in setting the price properly and the right products can be provided to the
customers. The use of the management information system will result in increasing the
efficiency of the company in the Indian market so that it can provide a competitive advantage
to the company (Perlmutter 2017).
System Analysis
(Source: Created by Author)
Question 3
The decisions of pricing needs to be taken appropriately by the company, as it
depends on many factors. These factors have to be considered by the company so that it can
help in increasing the attractiveness of the company in the market. One of the factors that
influence the price of the company is the level of competition that is present in the market.
The price of the competitive products needs to be taken in to account by the company so that
it can set its price accordingly (Armstrong et al. 2015). This will result in setting up the prices
in a competitive manner so that the customers can be attracted towards the products that are
being offered by the company. It will also help the company in understanding the price that is
being demanded by the competitors so that Petronas can gain an advantage over them.

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The company also needs to understand the demand that is present in the market so
that the price can be set correctly for the goods. The demand that is present in the market
needs to be analysed through the supply and demand chain that is present so that adequate
supply can be provided in the market (Bharati and Chaudhury 2015). This will allow the
company to maintain an equilibrium of the demand and supply appropriately within the
market. The stability in the price in the Indian market by the company will help in increasing
the attractiveness of the company among the customers (Jappelli and Padula 2013). This
would also lead to an increase in the profit margin for the company.
The strategy that is taken by the company will play an influential role in developing
the brand of the company as well. The objectives based on which the company operates needs
to be followed suitably so that the price can be set accordingly. This will help the company in
gaining the trust of the customers so that the products can be sold in the market. The proper
pricing of the products will help the consumers in understanding the utility of the products, as
the price will help in determining it (Mintz and Currim 2013).
Another strategy that needs to be taken in to consideration by the company is the
factor of cost that is incurred in selling the product. The supply logistics that are present in
the company has to be efficient so that it can transport the products in a better manner within
the Indian market (Dakin et al. 2015). The efficient use of the transportation facilities will
result in providing the products to the customers so that their demands can be met easily. This
will result in promoting the products of the company as well. The cost of goods sold needs to
be calculated accurately so that it can increase the efficiency of the company in the market.
This will also result in improving the image of the brand within the Indian market so that the
customers can be attracted towards the company (Graham, Harvey and Puri 2015). The
pricing of the products also need to be set accordingly so that it will help in increasing the
attractive of the company within the market as well.
Question 4
According to Moriarty et al. (2014), the company needs to take in to consideration the
integrated marketing communication technique so that it can enable them in reaching to a
large number of customers regarding the products and the services that will be offered in
India. The company will have to spread the information about its products to the customers
by taking the help of the official website. This will allow the company to announce its arrival
in the country so that the customers can gain a better knowledge about it. The website will

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also provide the information regarding the operations of the company, as it will help in
increasing the customer base. Carroll (2015) was of the opinion that in a country like India
where a majority of the population are uneducated, it will a problem for the company in using
the official websites, as the customers would not be able to understand the products and the
services that are being offered by them. The official websites are seen by mostly a less
percentage of the people, which may not be able to provide the boost to the company that it
wants when it starts its operations in India. The advantage of using this technology is that it
will be able to attract the customers through the design that will be used in the website. The
designing of the website in a strategical manner will help the company in achieving its
marketing goals and objectives as well.
In the words of Christensen and Cornelissen (2013) another complexity that the
company may face while taking up the IMC strategy within the country it will enter is that
the challenge that it will get from the management and the resources that are available in the
country. The company needs to form a new management within India so that the marketing
operations can be done by them. The resources that are available in the country is very
limited, as there are other petroleum companies that are operating in the country from a long
time. These resources are being used up by them, which will make it challenging for the new
company to locate the resources. After the resources have been located, the company may not
be able to use it up in an appropriate manner due to the complexities that are attached with
the resources.
Colleoni (2013) stated that another challenge that will be faced by the company is the
unification of the technology that needs to be done so that the process of communication can
be effective in nature. The technology that will be used by the company will help in tying the
data together so that the segmentation and targeting of the audience can be done properly by
the company. Ahmed and Rafiq (2013) were of the opinion that the unification of the
technology is a major problem in India, as the service providers are not up to the expectation
of the company. Since the company operates mostly in Malaysia, where the technological
advancements are better than India. India has a vast number of vendors who are providing
many choices to the company to use the technology, which may affect the business of the
company. This is due to the fact that there is a high level of competition in the market, which
may affect the communication power of the company.

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Quirke (2017) stated that the international issues are also present, which may affect
the communication strategy of the company. The right words needs to be selected by the
company so that it does not hurt the sentiments of the country that has been targeted as entry.
Since India is a democratic country, the message needs to be delivered properly so that the
customers can be made aware of the products and the services that are being offered by the
company. The company needs to contact with the local agencies so that they can provide a
better information regarding the messages that needs to be sent to the customers. This may
help the company in overcoming its challenges that it may face in the host country.
Question 5
According to del Mar Benavides-Espinosa and Ribeiro-Soriano (2014), the company
can opt for a joint venture in India so that it can help them in carrying out its operations in a
proper manner. The joint venture will be successful in nature if the company can be able to
get hold of strong partners, which will enable them to have a better knowledge regarding the
market through the skills that are available to the partners. This will help the company in
gaining a competitive advantage in the market as well. The deal with the partners have to be
done in a manner, which does not make them feel cheated. Golman (2013) stated that the
fairness in the deal will enable them to contribute towards better operation of the company in
India. The agreements need to be done in writing so that the company can have proof
regarding the partnership deals that they had undergone. This will help the company in
defending their position in the Indian market if the partners are found to be using any
unscrupulous technique within the operation.
Morais (2013) stated that the company maintains a strong goodwill in the Malaysian
market, which has to be maintained in the Indian market as well so that the business
operation can flourish. This has to be done by identifying the potential partners with whom
the company can go in to a joint venture. The goodwill of the company needs to be
maintained so that it can enable them in attracting more number of customers towards the
company. The basic idea of going in to a joint venture is that the company will be profitable
and may last long in the Indian market.
Beamish (2013) was of the opinion that the company can have other benefits from
going in to a joint venture, as it will help the organization in saving money and decrease the
risks that are present in the market. This is due to the fact that the resources that are available
in the market along with the capital to set up the business will be done on a shared manner.

9INTERNATIONAL MARKETING
This will also provide proper opportunities to the smaller companies to tie up with the firm so
that they can development of the company can be proper and provide better products in the
market as well. The use of the local businesses by the company will enable them in
increasing the sale in the Indian market by providing them access to a wider range in the
market. As stated by Killing (2013) it will also enable Petronas in understanding the
resources that are present in the market so that the development of the company in the market
can be done in a ueful manner. The local companies will also have a better knowledge of the
trends that are being followed in the market regarding the petroleum products and services,
which will enable the parent company in gaining knowledge in a better manner.
Yan and Luo (2016) were of the opinion that another major opportunity for the
company in undergoing joint venture activity is that it will allow the company in
understanding the tradition and culture that is present in the Indian market. The cultural
values need to be taken in to consideration by the company so that they can advertise the
company efficienlty, which will enable them in communicating properly. The help that will
be provided by the local companies will ensure that more number of customers are attracted
towards the company so that the level of profit can be increased as well. The resources that
are present within the company will not be required to a full extent, as the local resources will
also be used up for starting the operation in the market.
Conclusion
Thus it can be concluded that Petronas will have a favourable condition when they
will enter the Indian market, as they have identified the opportunities that are present in the
market. This will enable the company in setting up its operations efficiently so that the
company can increase its rate of profit as well. It will also be able to gain a competitive
advantage in the market over the rival firms by undergoing joint venture partnerships, as the
local companies will have a better knowledge of the needs and demands of the potential
customers. The difficulties and complexities that may be faced by the company in researching
the target market needs to be overcome so that it can enable the company in understanding
the opportunities that are present in the market. The use of marketing information system will
enable the company in getting a better insight regarding the market so that the products and
the services can be launched in a proper manner that will help in attracting more number of
customers. The price of the products have to be set accordingly so that the customers will be
able to switch over and increase the rate f the profit for the company as well.

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