Analyzing Market Entry Strategies for Australian Products in Thailand

The paper delves into the intricacies of launching Tim Tam, a popular Australian biscuit brand, in Thailand's reserved market environment. By analyzing Hofstede’s cultural dimensions, it highlights how Thai consumers' conservative nature poses challenges for Western products. The assignment explores strategies like licensing and franchising to mitigate risks and tailor offerings to local tastes. It emphasizes the necessity of thorough market research and culturally adaptive marketing tactics for sustainable success in international business expansions.

Running head: MARKET CULTURAL ANALYSIS OF THAILAND
Cultural analysis of Thailand and market entry recommendations
Name of the student:
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MARKET CULTURAL ANALYSIS OF THAILAND
Executive summary:
Expansion is the main rule for survival in the corporate industry in the present age, for any of
the business industry providing either products or services; it has become crucial for them to
understand the global market demands and continue to change these services to optimally satisfy
the target market. However, international expansion has various challenges associated with it,
and hence without a thorough market cultural analysis and market entry plan, it can be very
difficult to establish a business overseas.

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Table of Contents
1. Introduction: 3
2. Market culture analysis of Australia and Thailand: 4
2.1. Hofstede analysis: 4
2.2. Market entry analysis for Tim tam in Thailand: 5
3. Market entry recommendations and conclusion: 6
References: 8

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1. Introduction:
International expansion has to be the most important and most effective business strategy to
keep the business afloat in this dynamic economy and along with that, the aspect of global
popularity helps in keeping the customers attentive and interested. It has to be understand that in
the present age of extreme competition and consumerism, there are too many options available to
the target market for any product and service (Verbeke 2013). Hence, in order to keep the
customers optimally satisfied and interested, it is crucial for the corporate services to entertain a
global popularity or position. On a more elaborative note, the international expansion has a
varied number of benefits; the first and foremost benefit can be the new market openings. It has
to be und4erstood in this context that after a considerable amount of time the domestic target
market becomes fairly saturated and for revenue enhancement there is a need for approaching
new target markets, which the international expansion can provide (Rugman, Verbeke and
Nguyen 2011).
Another very important benefit of the international expansion can be considered the risk
diversification; operating in multi-continent setting can effectively serve as the insulation for the
multiple economic breakdowns. The benefits of international expansion for any of the local
business company is the competitive parity, the most of the current corporate focus in the present
age is on the curbing the competition for almost every target market. And hence, entering the
foreign market has also become one of the necessary sets for the different corporate entities to
gain competitive edge or advantage (Forsgren and Johanson 2014). Although, apart from all the
mentioned advantages of international expansion, the most important benefit that the companies
can get from any overseas expansion is the geographic advantage that the business companies

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can get. It has to be understood in the context that many of the business corporations are tending
to expand into the Asian markets for the sole purpose of leveraging the local technological
expertise and addressing the steadily growing economy of the Asian markets (Falkner 2017).
Similarly the Australian popularity, the Tim Tam biscuits have entertained a successful business
in the Australian and American market, this report is attempting to focus on the issues and
challenges that this product can face if introduced in the market of Thailand. Along with that,
this report will also provide a set of market entry recommendations, which can be followed to
smoothen the issues that can rise in the Asian expansion for this product.
2. Market culture analysis of Australia and Thailand:
Tim tam is a very popular biscuit brand that has been a cult favourite among all generations
and age groups, and it can be mentioned in this context that the product has enjoyed a successful
business in the western market (Arnott's Australia 2018). Although, it has to be mentioned that
the western living and market culture differs significantly from the Asian market and a through
comparative cultural analysis is required before introducing the product.
2.1. Hofstede analysis:
It has to be mentioned that the hofstede analysis depends on 5 core dimensions of the market
culture, the very first variable under discretion is the power distance on which Australia ranks
fairly lower than Thailand based on the fact that societal inequalities are accepted. In addition, a
strict chain of command and protocol is frequently observed in the cultural settings of Thailand.
The individualism is the second factor where the Thailand scores very low at 20 when compared
to 90 of Australia, indicating that the collectivist nature of their society. The uncertainty
avoidance is the sector where both the countries rank closer to each other, although Thailand

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ranks slightly higher indicating the fact that the country has higher tendency to avoid uncertainty.
In case of long- term orientation, both of the countries rant fairly low which indicates that both
countries have a more normative approach than pragmatic. Lastly, in terms of indulgence,
Thailand scores much lower than Australia, which indicates that Australia is an indulgent
country much more acquainted with impulsive changes. Hence, it can be deduced from the
analysis that the Australian culture is much more westernized, impulsive and risk taking rather
than the Thailand culture which is more reserved conventional and orthodox with an innate
resistance to uncertainty, change and impulse (Hofstede Insights 2018).
(Figure Source: https://www.hofstede-insights.com/country-comparison/australia,thailand)
2.2. Market entry analysis for Tim tam in Thailand:
From the hofstede analysis, it can be clearly stated that the business culture of Thailand is
much more conservative than the open- minded broader market culture of Australia and hence
any product marketed with Australian market on mind will not prosper well in the Thai market.
From the scores that the country has received on the variables like uncertainty avoidance and
indulgence, it can be mentioned that the introduction of any new product will receive a

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significant resistance from the Thai market in the initial stages. Now thinking from the business
perspective it can be mentioned that the importance of the international expansions are to make
use of the local talent and hence the vast cultural differences and language difference will work
as significant challenges for this western based product to be launched in Thailand
(Chittithaworn et al., 2011).
3. Market entry recommendations and conclusion:
It can be stated that the Thai culture is not very inclined towards the bakery goods, and the
modern interest is limited to the breads and cakes mostly. According to the recent statistics, only
5% of the bakery business in Thailand can be contributed to the cookies and biscuits sector
(Chongsermsirisakul and Iamurai 2017). Hence, the market demands for biscuits are already low
and in order to establish a secure business in the Thai market the Tim tam will have to persuasive
and innovative marketing principles and strategies.
As market entry recommendation, a few market entry modes can be suggested like licensing
and franchising. In case of licensing, the biscuit company will have the opportunity to wither
exclusively or non-exclusively manufacture and market the product in the foreign firm. It will
give the company a chance to incorporate the local taste into the manufacturing and attract the
local customers more efficiently. In case of franchising, the company will have a direct benefit to
partner with a home brand and launch their product in the market to test out the response before
they can branch out on their own (Grünig and Morschett 2012). This market entry suggestion has
minimal financial risk and can be the best option to test out the market before investing a large
among onto this resistant and conservative market. Although, on a concluding note, it has to be

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mentioned that a thorough market cultural and consumer demand analysis is required as an
essential step.
References:
Arnott's Australia. (2018). Tim Tam | Arnott's Australia. [online] Available at:
https://www.arnotts.com.au/products/tim-tam/ [Accessed 21 Jan. 2018].
Chittithaworn, C., Islam, M.A., Keawchana, T. and Yusuf, D.H.M., 2011. Factors affecting
business success of small & medium enterprises (SMEs) in Thailand. Asian Social Science, 7(5),
p.180.
Chongsermsirisakul, P. and Iamurai, S., 2017. Reconstructing retail management in wholesale
business in order to survive in online Era-Case study of Bakery business in Thailand.(Bk@
Eco). The Business & Management Review, 9(1), p.75.
Falkner, R., 2017. Business power and conflict in international environmental politics. Springer.
Forsgren, M. and Johanson, J., 2014. Managing networks in international business. Routledge.
Grünig, R. and Morschett, D., 2012. Evaluating market entry modes. In Developing International
Strategies (pp. 123-148). Springer, Berlin, Heidelberg.
Hofstede Insights. (2018). Country Comparison - Hofstede Insights. [online] Available at:
https://www.hofstede-insights.com/country-comparison/australia,thailand/ [Accessed 21 Jan.
2018].
Rugman, A.M., Verbeke, A. and Nguyen, Q.T., 2011. Fifty years of international business theory
and beyond. Management International Review, 51(6), pp.755-786.
Verbeke, A., 2013. International business strategy. Cambridge University Press.

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