Purbeck Market Entry

Purbeck - Market Confirmation and Market Entry Page 1
Global Marketing Management
Course Name : BA (HONS)
Module Name : Global Marketing Management
Module Code: MG603
Assignment No. : CW002
Report on : Market Confirmation and Market Entry
Submitted by : Sajedul Islam Chy
ID No. – 21414464
Submitted to : Sandhya S Thirunagari
Submission Date : 29th
May 2014

Executive Summary
Global spreading out is the establishment to be a multinational organisation. Before entering
into a specific foreign territory, identifying the perfect market entry strategy participates a
significant character towards achieving organisations success. As an understanding of
previously submitted report on “Globalization Value and Market assessment”, France and
Germany were finally selected to expand Purbeck’s business. At the moment as senior
management team’s decision this report is prepared to identify and confirmation of an
international market and suitable market entry strategy for Purbeck ice-cream company.
Market Entry Segmentation has done within three major cities as an average image of both
France and Germany.
This report encloses a deep segmentation including demographic, geographic, psychological
and behavioural factors and targeting a specific market between France and Germany and
positioning product. Moreover a discussion on three types of market entry strategy that
included a overview of their advantages and disadvantages.
Later than comparing through advantages and disadvantages of 3 market entry strategies
Franchising in foreign country is recommended for Purbeck. Moreover few next steps are
recommended for the management of Purbeck.

Table of Contents
Executive Summary ...................................................................................................................... 2
Segmentation and Targeting .........................................................................................................4
Positioning...................................................................................................................................6
Market-Entry Strategy .................................................................................................................. 6
Franchising............................................................................................................................... 6
Licensing..................................................................................................................................7
Joint Ventures .......................................................................................................................... 8
Market-Entry Choice..................................................................................................................... 8
Next steps and reflection .............................................................................................................. 9
Bibliography ................................................................................................................................ 9

Segmentationand Targeting
The market segmentation is one of the core essentials of up to date marketing and a method
of isolating the market interested in a number of groups otherwise segments based on the
factors for instance demographic, geographic, psychological and behavioural. By doing as a
result the marketers will have a superior understanding of their targeted audience and in that
way makes their marketing more effective (Gunter & Furnham, 1992)
As requirement of targeting segmentation has done comparing of 3 most populated cities in
both France and Germany.
Demographic Segmentation
The demographic segmentation separates customers into segments stands on demographic
values such as family size, family life cycle, age, gender, education, religion, income,
occupation, race, generation, social class and ethnic group (Armstrong & Kotler, 2012).
Paris Marseille Lyon
Population 2,243,833 850,726 484,344
GDP Per Capita (USD) 41,141 35,207 25,000
GDP (USD Billion) 26.09 58.9 62.00
Unemployment Rate (%) 10.5 14-40 12
Fig : Demographic segmentation of France 2010
Source : Paris, Marseille, Lyon official website
Range of years Percentage Male Female
0-14 18.7 % 6,314,779 6,029,258
15-24 11.9% 4,017,893 3,840,268
25-54 38.9% 12,877,039 12,764,229
55-64 12.6% 4,020,974 4,287,381
65 and above 17.9% 5,029,801 6,769,989
Fig : Age range of France 2010
Source : CIA fact book
Berlin Hamburg Munich
Population 3,415,091 1,751,775 1,388,308
GDP Per Capita (USD) 32,000 35,000 38,000
GDP (USD Billion) 133 123 94
Unemployment Rate (%) 12.7 12 5.6
Fig : Demographic segmentation Germany of 2010
Source : Berlin, Hamburg, Munich Official website

Range of years Percentage Male Female
0-14 13.1% 5,435,658 5,155,065
15-24 10.8% 4,457,412 4,267,366
25-54 42% 17,268,604 16,786,146
55-64 13.3% 5,354,690 5,469,884
65 and over 20.9% 7,360,711 9,591,729
Fig : Age range of France 2010
Source : CIA fact book
Geographic Segmentation
Marketers can segment according to geographic criteria—nations, states, regions, countries,
languages, cities, neighbourhoods, or postal codes. The geo-cluster approach combines
demographic data with geographic data to create a more accurate or specific profile (Kotler &
Keller, Marketing management, 2009).
Paris Marseille Lyon
Size of city 105 km 240.62 km 47.95 km
Population density (/sq mi) 55,000 9,200 26,000
Fig : Geographic segmentation of France 2010
Source : Paris, Marseille, Lyon official website
Berlin Hamburg Munich
Size of city (km) 891.85 755 311
Population density (/sq mi) 9,900 6,000 12,000
Fig : Geographic segmentation of Germany 2010
Source : Berlin, Hamburg, Munich official website
Psychographic Segmentation
Though the conventional geographical and demographical basis (sex, age, income etc.)
present the marketer with ease of access to consumer segments, the psychological
segmentation provides further information about these and increase the understanding of the
behaviour of present and possible object markets (Gunter & Furnham, 1992). In both France
and Germany people are more concern about their lifestyle and day to activities. Moreover
they try to value their capital though they are happy to pay more money for valuable food.
Behaviouralsegmentation

Customer’s approach towards use of, or response to a product are related to Behavioural
segmentation. Many marketers consider that the behavioural inconsistent for example
occasions, benefits, buyer-readiness stage, user status, usage rate, loyalty status and attitude
are the most excellent preliminary points for assembling market segments and thus these
inconsistent will be described further in the subsequent (Kotler & Keller, Marketing
management, 2009). People of both France and Germany are food lover. Even France
cuisine’s are most popular around the world rather then German. In those country ice cream
is a part of their every meal.
After having result of all the segmentation above, Germany and specificly Berlin is most
favourable for Purbeck to entry.
Positioning
After finishing market segmentation, market selection process has to be completed due to
setting up the products in a specific position of market. What companies need to do first is to
propose and establish a specific image of their manufactured goods offerings in a individual
place of their customer’s mindset this act is positioning (Kotler & Keller, Marketing
management, 2009).The purpose of positioning is to illuminate the brands fundamental
nature to its targeted consumer’s minds, explain how the goods will present exclusive
resolutions for their requirements, and eventually make them to feel comfortable when
choosing the products (Kotler & Keller, Marketing management, 2009). To position Purbeck
as a premium ice cream, Purbeck has to focus on some issues. Due to segmented on family
and gourmet, Purbeck has to concentrate on dietary value of ice cream. Flavor of ice-cream is
key factor which attracts the customers (Purbeck, 2014). The price of each flavor of ice
cream needs to remain same, which will be helpful for customers to decide the flavors rather
then focusing on price
Market-Entry Strategy
Market entry strategy is the planned method of presenting goods or services in the direction
of a latest targeted market and distributing them there. A range of market entry ways are
available for Purbeck to enter an overseas country, as example- Exporting, Wholly owned
subsidiary, Franchising, Licensing, Joint Venture and many more. From the history of ice-
cream companies who are operating their business around the world, the three main strategies
of entering to an international market with their advantages and disadvantages are described
below-
Franchising
Franchising is the implement of trading the accurate to use of a firm’s promising business
form. In actual fact, and in conditions of distribution, the franchisor is a provider who allows

an operator, or a franchisee, to exercise the supplier's trademark and allocate the provider's
goods. As a result the provider receives a part of income from operator. The work of the
franchisee is to distribute goods or services supplied by the franchisor using the trademark of
the franchisor (Pasco, 2007).
Advantages of Franchising:
 Company can capitalize with minimum investment
 Political risks are very limited
 Due to directly tied of profits are to their efforts, franchisees are frequently very much
inspired
 Local franchisees are familiar with local customer demands, and over all marketplace
 Franchisees have better understanding of necessary laws rather then foreign firms
Disadvantages of Franchising:
 Franchisees aren’t entirely self-governing.
 Franchisees are mandatory to run their business according to the measures and
boundaries
 Restricted products or services which could be offered, Geographic territory, pricing
could arise most serious difficulty to appropriate a franchisee
 Franchisees has to be suspicious to balance control and support supplied by franchisor
among their own capacity to manage their provision
Licensing
Licensing means giving permission to someone else to produce product of provide service as
per instruction of the licensor. In case of licensing, a license may be issued by the licensor to
the licensee as an agreement between these two parties (Kotler & Sheth, Legends in
marketing, 2012). Advantage and disadvantages of licensing are below-
Advantages of licensing:
 The licensor gets instant and guaranteed revenue from the licensee by issuing a
license (Johansson, 2011).
 A clever way to begin manufacturing with a minimum risk in a foreign territory
 Speed up the entry into a new market in front of the competitors
 Licensee is bounded to licensor for production and operation
Disadvantage of licensing:
 Possibility of losing expected returns from marketing and manufacturing
 Live controlling the quality of product will become a problem

 A licensee can achieve more profit then licensor, as a result licensee can become
competitor
 Possibility about bargaining of contribution in favour of licensee. For example-
Technological support, training of human resources, equipment support etc.
Joint Ventures
Simple Joint ventures is an enterprise where two or more entrepreneur are involved to share
ownership towards having direct over property rights and function. Joint ventures correspond
to a huge strategy for organizations to enter overseas markets by participating and making
partner with related corresponding persons in a multitude country with the expectations of
making up a relationship that profit both parties from a skill and technological transfer
perspective while providing each with the benefits the economies of scale bring with this
partnership by straight away doubling-up supply chain systems and consumer bases and
reducing their production costs. Advantage and disadvantages of Joint Ventures are below-
Advantages of Joint Ventures
 Easy to expand right of entry to local market expertise
 Sharing profit and loss results reducing risks and costs
 Local partner is expert about buying behaviour and first choice of buyers and
suppliers
 Joint investor means joint financial strength
 Able to use all possible required resources including manpower and technology
Disadvantages of Joint Ventures
 Inequity in the case of capability, investment or other assets supplied by the involved
partners
 Partners from different cultures and management approaches result in reduced co-
operation and integration
 In the early hours enough required leadership and support aren’t visible on partners
 Partners hold Less interest to any further investment essential
Market-Entry Choice
After demonstrating advantages and disadvantages of all those 3 market entry strategies,
Franchising is more suitable then others. Franchising is the most useful market entry strategy

that many successful organizations use to deal with international marketing. It provides the
business organization an access to the international marketing without much
engagement (Sahoo, 2012). Here are some reasons to choose Franchising-
 Franchisees makes a start-up payment to become a part of business and then they has
to continue a portion of their revenue
 Franchisees are well expert about their local customer demands
 By purchasing a franchise, franchisees are making a decision to attach with their
preferred business for the long period.
 Service commitment of franchisees to the customers, will reflect the loyalty of
franchisees to the franchisor’s brand.
 Franchisor has to train franchisees one time to run their business for long period
 Franchisor doesn’t need to worry about advertisement, promotion and some other
issues in foreign location. It is the apprehension of franchisees.
Next steps and reflection
If the senior management of Purbeck ice cream agrees the recommended market entry
strategy into Germany’s market few of necessary steps should to take whose are following-
1. The management must reassess suggested strategies advantages and disadvantages
2. The management should recognize the experiences and history of franchisee
3. Purbeck has to keep an eye on quality and standard of their ice cream in host market
as parent market
4. Purbeck should train the franchisee about all details of product and historic image of
company
Bibliography

1. Armstrong,G.,& Kotler,P.(2012). Marketing:An Introduction (11thed.).N.J.:Prentice
Hall.
2. Berlin.de. (n.d.). Facts and figures. Retrieved May 22, 2014, from Berlin.de:
http://www.berlin.de/berlin-im-ueberblick/zahlenfakten/index.en.html
3. Gunter, B., & Furnham, A. (1992). Consumer profiles: An introduction to
psychographics. London: Routledge.
4. Johansson, J. (2011). Global Marketing: Foreign Entry, Local Marketing and
Global Management (5th ed.). McGraw-Hill.
5. Kotler, P., & Keller, K. L. (2009). Marketing management (13 ed.). Prentice Hall.
6. Kotler, P., & Sheth, M. (2012). Legends in marketing. New Delhi: SAGE
Publications.
7. Pasco, C. (2007). Marketing International (7th ed.). France: Dunod.
8. Purbeck. (2014, 05 22). Retrieved 05 22, 2014, from Company history:
http://www.purbeckicecream.co.uk/index.php/company/company-history/
9. Sahoo, U. (2012). Clinical research in Asia. New York: Woodhead publisher.
10. CIA (2013) World Fact Book - France, Available
at:https://www.cia.gov/library/publications/the-world-
factbook/geos/fr.html (Accessed: 22nd May 2014).
11. CIA (2013) World Fact Book - Germany, Available
at:https://www.cia.gov/library/publications/the-world-
factbook/geos/gm.html (Accessed: 22nd May 2014).
12. Berlin Official (2014) , Available at: http://www.berlin.de/en/ (Accessed: 22nd
May 2014).
13. Hamburg Official (2014) , Available at: http://www.hamburg.de/ (Accessed: 22nd
May 2014).
14. Munich Official (2014) , Available at: http://www.muenchen.de/ (Accessed: 22nd
May 2014).
15. Paris Official (2014) , Available at: http://www.paris.fr/ (Accessed: 22nd May
2014).
16. Lyon Official (2014) , Available
at: http://www.lyon.fr/page/accueil.html (Accessed: 22nd May 2014).
17. Marseille Official (2014) , Available
at:http://www.marseille.fr/sitevdm/jsp/site/Portal.jsp?page_id=687 (Accessed:
22nd May 2014).

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