International Marketing Management: Prada

This report examines the impact of globalization on Prada's international expansion. It analyzes the effects of globalization, including providing quality products at competitive prices, creating employment opportunities, leveraging advanced technology, and navigating increased competition and investment levels. The report also conducts a PESTLE analysis, evaluating political, economic, social, technological, and environmental factors influencing Prada's international business. Finally, it discusses Prada's competitive advantages, such as unique designs, product customization, prioritizing quality over price, utilizing advanced technology, fostering strong customer relationships, and employing effective promotional activities. The report concludes that a thorough understanding of globalization and environmental factors, coupled with a strong competitive strategy, is crucial for successful international business expansion.

INTERNATIONAL
MARKETING MANAGEMENT

INTRODUCTION
In today's business environment, it is hard to remain competitive by just relying upon the
domestic market. Thus, in order to beat such arising conflicts, international marketing plays a
dominant role. International marketing is proven to be a bit complex as compared to the
procedures of domestic marketing. It consists of both private and governmental trading
negotiations among the parties of two or more countries and therefore has a major role of
globalization. This global competition equally affects both large and small firms (Joshi, 2009).
The present report depicts the effect of globalization on the international business of PRADA,
by effectively analyzing its major environmental factors. PRADA is a renowned fashion
industry of Italy, started by two Prada brothers in 1913. Since then, it is carrying a clear
observation of the world and it's changing trend. Such curiosity towards the society and it's
reforming culture, PRADA is now successfully leading in the markets of apparel and
accessories.
1. Affect of Globalization on the international expansion of PRADA
International expansion is referred to as a broad range of business activities taking place
across the national borders of a company. It is a composite and challenging process which
requires handling all economical, political and social or cultural activities outside one's own
nation. Hence, globalization plays a crucial role in internationally evolving the business. It is a
recent term that has four main aspects of concern, which concludes- trade transactions,
movements of capital investment, migrating people and transmitting knowledge. Globalization
has a rising effect since 1970's, but in the last 20 years, this term is attracting most of the
businesses to approach the international market. Before forming the decisions of international
marketing strategy, business managers are liable to consider the globalized business
environment in managing the required operations (Andriopoulos and Slater, 2013). Therefore,
globalization is a leading concept for positioning the business in international market. PRADA
is currently running over 250 boutiques worldwide. Over the time and in these 103 years, it has
made a huge expansion of its business. This expansion has a great occurrence of globalization
which consists of a dual effect, in the following ways- Quality product in cheap price- It is among-st the advantages of globalization in which,
after considering the increasing competition, the market provides a wide range of
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standard products in low price. PRADA also utilizes the same strategy of using low
priced raw materials to form an effective product. It together helps in reducing the
production cost of the company. Employment opportunities- Expanding business in a completely unfamiliar region
requires sustaining little information about that particular area. It mainly involves
knowing their taste, culture and language. Due to this, the stated company needs to hire a
person customary to these requirements. This gives rise to the employment opportunities
of that division. Advance Technology- Advancement in technology helps the company to make clear and
proper communication among the worldwide business sources. It becomes easy for the
stated firm to conduct a smooth circulation of information. Rise in competition and investment levels- However, the term globalization consists of
certain disadvantages, as well. International expansion of business requires entering into
the foreign capital along with an updated technology. This involves varied levels of
investment and the company requires spending huge funds. It is also due to an increasing
competition, where the stated firm has to effectively beat its existing competitors of that
region.
 Meeting customer's expectation- Being a leading fashion industry in the world, it is big
challenge for PRADA to easily adopt the outside trend and culture. Business expansion
in other country requires adapting the custom of their residents and thus the company
needs to design cloths, as per the choice of those inhabitants.
2. Environmental factors affecting the business expansion of PRADA
Expanding business at an international level is a challenging task and thus needs to
consider major environmental factors that could easily affect the organization. These are certain
external or macro environmental factors, which mainly determines the consumer attribute,
technological element, economical and governmental influence, etc. It involves a study of
PESTLE analysis, that concludes the five major factors-
1. Political and legal factors- These factors are highly associated with certain
governmental rules and regulations of the country. These are certain factors according to
which an organization needs to decide its operational work. It is the one of the biggest
concerns of the firm where PRADA strictly needs to adhere by the various governmental
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laws. It also includes various employment and labor laws, featuring the workers rights,
etc.
2. Economical factor- A clothing industry has both positive and negative impact of the
economic factors of a country. For example, people have more income at the boom time
lead the retailers like PRADA to increase their sales. It also helps the manufacturers to
produce good quality products by using high priced raw materials, which automatically
increases the cost of that product. Also, the people are tended to buy more number of
cloths, as compared to the usually days (Loura, 2014). Contradictory to that, recessions
have an opposite effect, when people purchases less number of goods that comparatively
lowers the sale of retailers. At the time of recession, people often chooses to buy low
cost product. Therefore, the manufacturers too produces less amount of quality goods to
lowers the price of that product.
3. Social factor- Clothing sector is highly affected by the social factors of a country. It
clearly states the latest consumer demand. It includes considering the present culture and
lifestyle of the residents. PRADA maintains a high level of customer satisfaction by
determining the exact need of the consumers. It requires making a prior investigation of
the vogue. Building a demographic segmentation is another best method to clearly
determine the targeted area. It effectively concludes the age, gender and income of a
person. However, the stated firm is specialized in the arena of women apparel. But it
designs cloths for almost all age groups that are available in different styles and sizes.
They together creates pocket friendly products and follows the recent fashion trend in
accessorizing products to satisfy all kind of customers.
4. Technological factor- Fashion industry is however less effected by the changing
technical factors, but sometime it is related to the availability of the resources, which
directly effects the production of goods and its demand. For example, PRADA is dealing
in leather material and the scarcity in its raw material may force the company to use
another substitute product. This lead the retailers to increase the price of that particular
product, to effectively meet their own production cost. Moreover, the firm also needs to
make use of the latest technology for maintaining a faster customer approach. It includes
the introduction of new inventories for paying bills, etc.
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5. Environmental factors- These are the factors which considers few Eco friendly steps to
manufacture product. It is mainly concerned towards protecting the environment.
PRADA is building a negative impact by making use of animal skin to form its leather
materials. It is causing an environmental breakdown of natural resources (Paliwoda,
2013). However, leather is a raw material and large number of toxic materials are being
used to give it a tanned look. Therefore, it directly harms the existing people where the
toxicity of leather material is slowly killing human beings. In order to avoid such
circumstances, the stated firm can make an effective utilization of few alternative
products like organic cotton, etc.
3. Competitive advantage of PRADA
To effectively beat the arising business competition, it is essential to build a perfect
marketing strategy. PRADA is a well established fashion house which deals in luxury brand
outfits and accessories for both men and women. The major competitors of PRADA include the
companies like Louis Vuitton, Hermes and Gucci. However, PRADA is an equally gives a tough
competition to all of them. It is truly focused to satisfy the customers from all possible means. It
too manufactures high quality product, which are rationally extravagant to its customers. Instead
of competing majorly on the price, it is aimed towards maintaining quality of the products and
giving a remarkable shopping experience to its customers. Therefore, PRADA is well known for
its quality products with unique designs (Lages, Abrantes and Lages, 2008). Few more
characteristics of PRADA which are the proven advantages to beat the continuous change in
international fashion industry, gives it a unique recognition. It includes some potent marketing
strategies of the firm to beat its competitors, which is mentioned below- Selling unique designs- PRADA is tremendously known for creating uniquely designed
product. It believes in trying something new at every phase and thus carries a creative
vision of building products by using the most innovative designing approach. It is
famous for its classic and elegant designer cloths which maintains the latest trend of
style. Customization of product- The stated firm provides a great option of ordering a
customized product. It truly gives an immense pleasure to its customer, when they can
order manufacturing a product of their own choice. To form an exact product which
matches the customer's demand, PRADA even focuses on the tiny details. It not only
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resembles the specified look, but also gives the same touch that makes the customer to
feel valuable among all. Quality over the price- PRADA offers a wide range of quality products, which
potentially stands by the price of the product. They believe in producing high quality
product and offers it to the customers within a reasonable price ratio. It is the biggest
challenge to its competitors who primarily believes in attaining the production cost of
their company, as compared to PRADA who has the least focus on competing by price. Using the latest technology- PRADA effectively utilizes the advance technological
approach of creating products (Javalgi, Joseph, and LaRosa, 2009). It includes the
robotic machines that quickly allow the manufactures to build a product at an efficient
rate with less amount of time. It also shows a consonant result. Customer relationship- Rather than just selling goods and earning profits, PRADA
believes in maintaining an effective relationship with its customers. They work hard to
earn the trust of their customers which proves to be the biggest income for them. They
hire specialized employees who are experts in the field of customer service. The workers
are trained to ensure an intense level of customer satisfaction by understanding their
superior taste.
 Promotional activities- The stated firm also has the best advertising procedures which
provide more business opportunities to them. It includes making promotion of their
products by the latest means of social media, television and magazines, etc. They also
consider attracting more number of customers by utilizing varied promotional offers
consisting of various discount coupons to all the visitors, etc. It increases the chances of
revisit by a customer or sometimes the customer also prefers to convey the offer to
others.
CONCLUSION
The above report provides an insight view of the key points to be recollected at the time
of intentionally expanding a business. It clearly mentions the varied features of globalization
which has an effective role in the international marketing of PRADA.
This report is divided into three aspects, in which the first part states the global
positioning of a market. In this modern era, Globalization is the key point for successfully
running an international business. It brings various challenges along with the newer
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opportunities to access the benefits of the international technologies and labor forces, etc. It
brings an increased level of strategic thinking which works the best in evolving a business.
The second part defines the pestle analysis of PRADA, which is another strategic tool for
analyzing the major environmental factors which affect the business, especially at an
international level. It is very essential for the firm that it should carry out a thorough analysis of
the environment where it is planning for expanding its operation. Through this way, corporation
can achieve success in the competitive business environment and can also perform improvement
in the area of sales and profits.
The third part showcases the critical discussion among competitive advantages of
PRADA. It defines various benefits of the stated firm compared to its competitors. It helps in
forming an effective marketing strategy to effectively beat the competitive business
environment.
Among all the assessed competitive advantages, the customized way used by the firm in order to
produce products for its buyers seems as the major USP of PRADA. This helps the firm to
remain competitive in the market and also assists in raising the sales and profits of the cited
organization.
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