This document discusses factors affecting the marketing strategies of multinational organizations in Sri Lanka. It analyzes these factors using the PESTEL framework, which examines political, economic, social, technological, environmental, and legal influences. Socially, Sri Lanka's diverse ethnic and religious cultures present challenges for multinationals to understand local norms and values. Economically, Sri Lanka's lower income levels mean multinationals must tailor products to local budgets and purchasing power. Politically and legally, foreign investment policies and tax policies can help or hinder multinationals' local operations. Multinationals must adapt their standard international strategies based on these unique Sri Lankan conditions to effectively reach local consumers.

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“Factors Affecting Marketing Mix Strategies of
Multinational Organizations in Sri Lanka”
S.Suren
2015/EDM/26
Executive Diploma in Marketing
Faculty of Graduate Studies
University of Colombo
Sri Lanka

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Abstract…………………………………………………………………………………………iii
Chapter I: Introduction……………………………………………………………………..…4
Chapter II: Literature Review………………………………………………………………...6
Chapter III: Conclusion……………………………………………………………………….11
Reference………………………………………………………………………………………..12

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Abstract
In this report include factors affecting marketing mix strategies of multinational organizations in
Sri Lanka The main objective of the report is to find out what strategies included used to establish
strategies of multinational companies in the local market and what factors they face when perform
the above strategies are implemented at the local market.
Further, this assignment is to define strategies of multinational organizations in the international
market and how are injected into the market and flexibilities Sri Lanka, according to the effective
local factors.
Here the author has continued the secondary data to find marketing mix strategies multinational
organizations through websites and documents online, on the other hand the author tries to verify
the true picture of the factors influencing the local market in the application. These assignment
gives an idea of how to conduct multinational organizations marketing mix strategies local factors
threats effective brand of the mothers company and its values.

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Chapter I: Introduction
This chapter provides an understanding of factors affecting multinational organization in Sri
Lanka implement their international marketing mix strategies in the local market with the review
of the effective factors.
About an entire country like Sri Lanka has its own cultural attitudes and deferential standard type
of economic levels and income levels. Here implement strategies multinational organization
product, price, place and promotion for the local market, regardless of their status as parent
company and the social, legal and cultural
Sri Lanka is a third world country and multinational organization’s brands cannot launch high-
end luxury because the disposable income of Sri Lanka is very low. The technological side
compared to the world market, there is no progress in digital marketing, mobile advertising and
social media networks, etc. But in future Sri Lanka may achieve those things. There deferent
types of behavior and lifestyle markets respectful and deferential consumption should use
marketing strategies to each market
As a leading multinational companies in Sri Lanka has had some problems. When considering the
financial aspect as multinational organization only deals with international banks. Unfortunately,
they are not strong in Sri Lanka and local banks dominate the market. In the view of the tax policy
on imports of dairy products it is very high because the government of Sri Lanka has imposed
higher taxes to support local companies.Sri Lanka is a third world country and brands cannot
launch high-end luxury because the disposable income of Sri Lanka is very low.
The technological side compared to the world market, there is no progress in digital marketing,
mobile advertising and social media networks, etc. But it may in future.
Each multinational organization has specific strategies for working perfectly now. The strategy is
the management of a multinational organization that shows the way to achieve the goal. No
multinational organization can achieve its goal without specific strategies. Therefore, there are
different strategies to establish business in this competitive era. Strategic planning is one of them
and their effectiveness varies on the type of multinational organization and what is its mission,
vision and purpose. The success of the organization depends on its perfect strategic planning.
There is an initial and essential to survival and success in any business step. There is some
multicultural organization in the world that faces some of controllable and uncontrollable factors.
other names of these factors are internal and external factors. Before formulating strategic
planning, organizations should take into account internal and external factors. Internal factors are
like power management, equipment, materials, equipment, money and man that can be controlled
or managed by the organization. Moreover, external factors are uncontrollable. Now we move
from the era of globalization. Most global problems are influenced organizational strategy
formulations that are uncontrollable.
With that, highlight the strategic planning brief McDonald. McDonald is one of the most
successful companies in the world. McDonald strategic plan called "plan to win '. The concept of
this plan is not for McDonald is the largest chain of fast food, but to be the best fast food chain. In

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addition, many without planning organizations meet adequate strategic perishes even deal with the
corrupt bank. Strategic Plan for the stakeholders are the most essential part for operating
companies. Therefore, strategic managers or organizations must consider it very important to
provide information to interested parties of the organization in the period of free access to
information. We know that organizational information is a fundamental right of interested parties
and are main challenge of the strategic plan for existing products and new, and
there deferent types of behavior and lifestyle markets respectful and deferential consumption
should use marketing strategies to each market. For example Nescafe machine in general are
catering to the mass market, but in silence a growing trend towards quality coffee experience and
exposure to the demands of the youth of Western culture’s most experienced high-quality coffee
that power given by the coffee vending machine

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Chapter II: Literature Review
External factors that suffer are very important for the organization in many cases, it was revealed
that the success of the organization depends on its external factors. All external factors affecting
the company mentioned by customers, shareholders, government, culture, time and so on. We can
see some of the macro or external factors in this global society that is uncontrollable for all
multinational companies and other organizations. Business researchers gave a common name
called PESTEL.
MAJA ANALYSIS: According to Grant (1998), to identify key success factors and business
opportunities and threats. In world affairs, we can see some of the macro or external factors that
are uncontrollable for all multinational companies and other organizations. It is important to study
the environmental factors that affect the strategy of the company in the industrial plan. To do this,
the analysis tool PESTEL applies.
PESTLE is an acronym for Political, economic, social, technological, legal and environmental
factors, which are to assess the market for a strategic plan for organizational unit or business
Originally it conceived as an analysis of the business environment. PESTLE analysis is an analysis
of the external macroeconomic environment in which a company operates. These factors are often
beyond the control or influence of any business; but it is important to consider when developing
products, business planning or strategy becomes.
PESTEL
This is a type of analysis used in strategic management that takes into account political, economic,
social, technological, environmental and legal factors. PESTEL is a useful tool for understanding
market demand/decline, current business position and potential opportunities/obstacles. PESTEL
analyzes environmental factors at a company, national and global level.
Political
Before the creation of a wholly owned subsidiary, review and careful analysis of the political
stability of the host country it is important, since they vary from country to country. Sri Lanka has
been involved in a fierce civil war for over 30 years and in May 2009 have seen an end to this civil
war. Followed by the end of the civil war in January 2010, the parliamentary election that followed
was also won by the ruling party and the president was a clear sign of political stability. Many
developed countries and international donors such as the World Bank, the ADB and JICA pledged
substantial financial assistance for the rehabilitation of the provinces of North and east have been
seriously affected by the war. The new government has also invited international investors to
productive investment in Sri Lanka and promised interest in new investors. The decision of our
company is also the result of this initiative by the Government of Sri Lanka

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Sri Lanka also has an independent foreign policy and a member of the Commonwealth nations
since independence and UN membership. Favorable foreign policy of non-alignment in a host
country is very essential for a multinational company to establish business.
Sri Lanka has a well-established legal system and the judicial system, which was introduced by
the British before Sri Lanka won the status of full independence. The labor legislation of Sri Lanka
is known to be very strong to protect workers from unfair treatment by employers. However, there
is no legislation on minimum wages in Sri Lanka and this is one reason for the interest of foreign
investors in it as a favorable destination for multinational business operations.
Political and legal factors influencing the development of the organization or industry. These
factors determine the rules of competition, operating costs and the presence of several pressure
groups. The major political factor is the local rules on foreign ownership, cross-ownership and
concentration. In March 2006, the Board of Directors of McDonald has adopted a policy on
political contributions formalized our long-standing practice with respect to contributions to
political parties, candidates for office and political organizations. The policy recognizes that it
may be in the best interest of society to make political contributions. For these cases, the policy
aims to ensure that contributions are made in a manner consistent with the law and the
fundamental value of the company.
Economic
These factors are closely related to political, legal and cultural. Sri Lanka is a country where the
average wage levels to pay for the level of work low and medium is very low. One of the main
sources of foreign exchange earnings is labor income of the underclass of workers who provide
services in the Middle East. Due to the migration of certain categories of skilled workers abroad
there is a shortage of workers in these categories.
The economic factor is crucial to the organization or industry development importance.
McDonald hit the economic ladder. We know that the development of an organization depends
on their economic status and earned by maximizing benefits and minimizing costs. McDonald
seeks to achieve this objective. Nestle spends nearly 2.5 million francs a year in digital
marketing .Each market, they tend to use the digital platform, as the state of the social network,
global advertising, mobile advertising. However, availability, holding different market levels in
the market. Limiting their use of the digital platform
A key in the consumer market player, Unilever Sri Lanka has made good progress towards the
growth figures of two digits. But today the company has been under intense pressure from the
economic crisis that hit people with the rising cost of living has also hurt the consumer goods
industry. Unilever Sri Lanka Chairman Amal Cabraal Financial Times spoke of downward trends
observed in some segments and other regions most affected geographically while noting the
expected number of its likely to take in the next year. The collection of palm oil added to high
performance of the industry and the serious setbacks that have plagued the industry as highlighted
as a whole. Unilever had a large company present in this country for over 70 years. Back in the
1990s, the company knew that if we Unilever were in line with the growth of GDP or more, then
it would be good. In 2001, Unilever created a vision of the company to double its business in five

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years. Unilever Sri Lanka has achieved this vision and no activity has doubled in 5 years, but 4. In
late 2006, we have doubled our vision. The main raw material for palm oil has increased by 50%
compared to last year. This is compounded by a devaluation of the rupee and removal from the
government. All this is not transmitted to consumers. But the costs of soap and margarine will
increase, which started last month. As a global multinational, obviously, we have strong points of
attachment to our global network unit. Unilever continue to build on the ability of the skills of our
people.95% of the products we sell in this country are manufactured in Sri Lanka and will continue
to do so provided that local policies are conducive. Unilever employs some 20 million consumers
and our first goal is to serve our customers. But if economic policies are not encouraging so we
have to handle it in the best way possible. Sunlight, Lux and Lifebuoy remain in tune with today,
especially with the younger generation. We invest in our people, manufacturing and brands are the
most important and also more and more with our connections with people. These are the
perceptions that we are after. It is only the success of the business in a responsible way that we
move up. According to a profitable and competitive growth it is what Unilever see and Unilever
will continue to provide brands. MCG volumes are on an upward trend, but real down so far with
the support of 14 %. So people are buying less. The urban sector is growing at 17%, while the rural
sector is growing by 13 % in the five main categories of milk powder, biscuits, malted milk, skin
cleansing and washing with soap contributes to 50 % consumption market value. Unilever can see
a decrease in the purchase of a call option or nonessential extras.
Sri Lanka has also been able to stabilize the internal value of the rupee to maintain its inflation
CPI value in single digits since the end of civil war, meaning that the local price levels would be
low, which is for the benefit of our operations in Sri Lanka and those thing highly affected on
multinational organizations in Sri Lanka.
Social
Cultural forces are another major concern affecting multinational organizations in Sri Lanaka.
National culture is a unique attribute of any country, including all shared social forces that
influence the norms, values , beliefs and behavior of people in this country. Culture is not tangible,
pervasive and difficult to understand and learn. Get people from different ethnic, religious and
tribal origins can be difficult and this is a challenge for multinational organizations in Sri Lanaka
The demand trends are determined by the following main factors: demographic changes, attitudes
and beliefs and fashion cycles. Demographic changes create different niche markets; while the
fashion cycle with the necessary training to create market growth attitudes. McDonald has a
corporate responsibility committee acts in an advisory capacity management Company policy and
strategies that affect McDonald 's role as a socially responsible organization, and issues related to
security of security products, opportunities for employees and training , diversity, the environment
and initiatives in sustainable supply chain . Although the consumer behavior factors were also
several local competitors in the market going. Here in Sri Lanka as an example “Maggi " was Baby
Food segment. But suddenly Prima passes through the "Prima “Koththu Me ' address the youth
market. Now Nestlé should take into account not only the children but also the youth segment
segment. Therefore Nestle room ' Maggi Devilled ' to enter the part the youth segment, where
Prima dominated. Manly Sri Lanka most competitors Nestle Lanka used to make quick decisions
and rest products according to market demand , but Nestle Lanka as a multinational organization

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, they have to spend more time at the show the new product on the market if deficiencies identified
in the market faster than others . Because they have long procedures with the parent company or
regional units.in this section, for a better understanding of the culture and the Chinese adaptation,
both KFC and McDonald cultural adaptation approaches will be introduced by presenting
examples of adaptation measures in the Chinese market. The section consists of several parts that
have been designed on the basis of Becker definition of culture "Culture is everything that people
do , think and do as members of society"(Becker , 2005) , taking into account three components
of culture : ( 1) material objects ; ( 2) the ideas, values, attitudes and
Beliefs; and (3) specified or expected behavior.
Culture is one of the main factors is to mix marketing strategies when it comes to the international
market. Dutch Professor Geert Hostede Management defines culture as " software of the mind"
and Edwed Hall , which is an anthropologist and a business consultant described as "People that
continue banging your head against an invisible neighborhood " .as there are other definitions of
culture as James Day Hodgon , former US ambassador to Japan describing culture as a " Bosquet
" and more traditional definition of culture is the sum of the values, rituals , symbols, beliefs and
thought processes that are learned shared by a group of people , and transmitted from generation
to generation. (Marketing International, 2008) In this example, a product has been modified to
cope with the food habits and taste of the Indians. Pizza Hut and Domino now serving Tandoori,
Chettinad Paneer and decorations that are absolutely new menu for the multinationals, but
culturally accepted. Noodles are accepted in many countries as a dinner meal .But with Tamil
people, it did not work because Tamil people prefer itili, dosa, chappathi arms, so their dinner
menu. And they came up with a new strategy that is not Maggi noodles for dinner, there is a snack
that can be hungry between meals. And they were very successful with this new strategy according
to their culture. But not only that, came with curry flavor, the flavor of the tomato in India.
Fast food chains like KFC and McDonald multinationals are more concerned about price when
they promote their products in Sri Lanka. Because the majority of Sri Lanka are more concerned
about the price and quality, because of what they publish the prices of all its products. And the
prices are revised to adjust the Sri Lanka market and promote consistency with the price of food
meal ordinary Sri Lanka
A very good example is when the launch of Big Mc in India for McDonald, were initially
unsuccessful. Because 40 percent of Indians are vegetarians and treat the cow as a god. Most do
not eat beef and then identified the problem that came with the Maharaja of burgers which is filled
with lamb and vegetarian meals to satisfy vegetarian Mac Donald discovered satisfaction of the
customer and provide these veggie burgers are cooked in the area the separate kitchen. Using a
separate Toping and Masala sauce as mc and Malmi they were developed by McDonald.
Some companies see culture as a barrier of religion during penetration in the international market.
However, large multinational giants like Microsoft, Intel, Coca Cola, McDonalds, Nike, adidas
etc. they are competitive on the world market and have achieved their goals beyond the limits of
the consumption needs. It is very important not to be detrimental to the image and not confuse the
customer.

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Technological
Technological factors affect how industry players compete. The introduction of better technology
solutions enables companies to reduce operating costs, increase production capacity and quality.
McDonald has brought a change in the technological system radically in their business room crew
boardroom. Until use in machine computer tabulation. Introduced electronic business and a lot
more customer service system so that energy conservation to minimize fuel, recycling and so on.
Samsung can be considered as being among the world’s leading innovative companies. This means
that the company is at an advantage as far as harnessing the power of technology and driving
innovation for sustainable business advantage is concerned. This has translated into an obsessive
mission by the company to be ahead of the technological and innovation curve and a vision to
dominate its rivals and competitors as far being the first to reach the market with its latest products
is concerned. however, as we shall discuss later, this has also resulted in the company cutting
corners with its imitation of the legendary Apple’s product design and this has brought legal and
regulatory scrutiny and troubles for the company. There is a lesson here for other technology driven
companies from Samsung’s experiences and it is that no matter how fast you are to reach the
consumer in this age of Big Bang Disruption, doing the basics right is still the key to success.
Legal
Legal deliveries in many aspects of the activities of the organization. McDonald is well aware of
the legal issues in business. Such as laws against discrimination, health and safety, regulation of
monopolies and restrictive practices, laws governing labor relations, including strikes and pickets,
employment and dismissal law and the statue of the Sri Lanaka and the common law and the rules
of the Community have to keep in sight. At this time of global credit crisis, external factors are the
main meaningful experience for all multinational organizations to do business and survive in the
competitive business area. As mentioned in the technological section, Samsung has faced heavy
sanctions for alleged imitation of the iPad and the iPhone from Apple, which has led the company
to take a beating, as well as public perceptions and consumer acceptance of its It refers strategies.
It remains to be seen how the company will escape the legal maze that is in the market due to
various persecution developed
Environmental
The most important thing is to analyze the potential environmental organization. Environmental
factors may change the "look out" of the organization. Environmental factors play an important
role in the success of the business, because it affects manufacturing capacity input. McDonald and
KFC are trying to create the sound environment in every restaurant for customers and employees.
You are looking for ways to improve their environmental performance. Efficiency and innovation
are natural byproducts of thinking "green". After all, when energy is conserved, reduce waste and
minimize the resources used by our suppliers use less and spend less. Therefore, it is always ready

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to make its sound environmental factors to all kinds of people. Covered three areas as energy
conservation - Finding new ways to improve energy efficiency in its restaurants to help save money
and reduce its environmental impact on sustainable packaging and waste management - Regular
explore ways to reduce the environmental impact of packaging and packaging waste remediation
activities consumption green building design develop their strict building regulations to include
new opportunities for environmental efficiency and modernization in the design and construction
of restaurants.
In Sri Lanka with the rise of the ethical consumer want your brand to the source and make the
products in a socially and environmentally responsible manner, Samsung should be aware of the
need for their products to meet consumer ethical chic. This means making sure that does not
compromise on conditions or wages paid to their work that goes into making the end product work.
Chapter V: Conclusion
Multinational organization in Sri Lanka decide on the marketing mix they need to give their
attention to factors such as economic strength , the level of technology, the structure of political
,legal forces and the forces of culture.
In a dynamic environment, what kind of economy surrounding the company had to quickly change
their lifestyle and Multinational organization wants to respond to these changes, according to the
results of the search results most customers want to increase awareness of the company and the
product of the company. All competitors in the industry use strategies to meet the customer better
than others Multinational organization should then change their communication strategy of
intensive communication strategy in the only method of communication. Due to a higher gear with
all multinational organization and improve customer loyalty. Today, it quickly moves cooperate
world there is a tendency of consumers usually go for branded products .Because is primarily a
multinational organization. Furthermore, when multinational organization examination are some
strategies ' to constantly keep its current image. Although they have strategies that should have to
do more things to do from multinational organization situation better than the aspect.
The economy is changing so fast that they cannot follow a single strategy for complete business
periods. However, it is difficult to implement effective strategic change. The multinational
organization must change and evolve in the light of the opportunities and threats of the
completive market. Multinational organization strategic plan is very active to keep up with the
changing PESTEL of the Sri Lankan

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References
Hofstede, Geert (2003) “Culture’s Consequences, Comparing Values, Behaviours, Institutions,
and Organisations Across Nations”, Sage
PublicationsWordpress,(February 2011) .Cross Cultural Marketing. Today’s[Online]. Available
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November 2015.
Karl,H .(2014) Strategy in the global Environment. Reference for business [Online] Available at
http://www.referenceforbusiness.com/management/Str-Ti/Strategy-in-the-Global-
Environment.html Accessed on 21th November 2015.
Udeshi Amarasinghe (2009) “UNSTOPPABLE SRI LANKA” businesstoday [online] Available
at http://www.businesstoday.lk/cover_page.php?article=1947 Accessed on 21th November
Unsilver (2015) Unilever Sri Lanka Growth [online] Available at
https://www.unilever.com.lk/news/press-releases/2007/unilever-sri-lanka-growth.htmlAccessed
on 21th November 2015
Nestle,(2013).Corporate Governance. Nestle [Online]. Available at.
http://www.nestle.com/investors/corporate-governance Accessed on 18th November 2015.