Cross-Cultural Consumer Behaviour – Market Entry Strategy Analysis

Scenario

To prepare for your poster, you will need to address the following tasks:

In the first instance, you will need to select a brand from a product or service sector of your choice (For instance, Food/Beverage, Clothing/Footwear, Skin Care/Cosmetics, Restaurants, Leisure/Entertainment, etc.). Your choice could range from a small independent organisation currently targeting a small niche market to a global brand targeting multiple markets, nationally and/or internationally.

The brand should be briefly introduced.

Required Tasks:

Task 1 [Learning Outcome 1]:

Select ONE market where the brand does not currently operate. This market must be culturally different from the brand’s home market. Discuss the basis on which this market is classified as culturally different.

Task 2 [Learning Outcome 1]:

Considering any cultural differences, discuss in depth the relevant individual, psychological AND sociological factors that may influence the chosen market’s decision-making process when purchasing your brand’s products.

Task 3 [Learning Outcome 2]: Given the preceding findings and assuming the brand wishes to enter this market, recommend the key marketing decisions that would be suitable for the market.

Experts Answer on Above Question on Market Entry Strategy Analysis

Culturally different market

The market selected for analysis is Vietnam which is significantly different from the market of the United States in terms of cultural values. The Vietnam market follows collectivist culture whereas America follows individualistic culture. In addition to this, the Vietnam market has a strong influence of family and social groups on purchasing decisions, and customers are highly price sensitive in Vietnam. The coffee culture in Vietnam is highly oriented towards local traditional Vietnamese coffee and the lifestyle of consumers and their consumption habits is significantly different. It is therefore important for Starbucks to make significant adaptations to its offerings and should not completely rely on the US model.

Factors influencing consumer decision making process

The important factors are individual factors which includes the income level as the Vietnamese consumers are highly price conscious compared to a US customer, and the lifestyle pattern shows that the young urban professionals views starbucks as a modern lifestyle brand. This indicates that Starbucks needs to reconsider its premium pricing strategy for its products in order to do well in the Vietnam market. In addition to individual factors, there are psychological factors that also affect the consumer decision making process, as the consumers perceive starbucks as an international and premium brand which creates a status value and aspirational appeal. Along with this, consumers expect social experiences, comfortable study spaces and premium product quality from using Starbucks. This increases the store visits beyond coffee consumption. Another major factor affecting consumer behaviour is sociological factors, as reference groups have a significant influence on the selection of Cafe choices. Positive reviews and influences marketing contribute significantly in driving customer visits. The influence of family members is also significant on the purchasing decisions, and this implies that Starbucks would require family friendly products and promotions.

Marketing recommendations

With respect to the product strategy, it is important for Starbucks to introduce local flavours and ingredients in the Vietnam market, and provide lighter food options that are strongly accepted by consumers. For pricing strategy, Starbucks can consider the introduction of value bundles and loyalty rewards whereas the promotions can be carried out through TikTok, facebook and Instagram. With respect to the place strategy, Starbucks should consider focusing on major cities first like Ho Chi Minh City and Hanoi. The employees should be adequately trained to offer local customer service and have a good understanding of cultural values in the Vietnam market.

This model answer is reviewed by Pamela Lim, a business management expert from Nanyang Polytechnic.
Disclaimer: This answer is a model for study and reference purposes only. Please do not submit it as your own work.

Want a Full Worked Out Answer with References?

The analysis of the market entry strategy of Starbucks in Vietnam revealed significant findings with respect to products, pricing, place, promotion and customer experiences strategies that it needs to consider in achieving success in the target market. If you need a similar kind of international expansion strategy analysis, get in touch with the international management experts in Singapore. If you need analysis with assignments on any other management topics or subjects, you can consider using our assignment help Singapore services for best writing assistance, or you can also access the international business assignment examples written by our experts.

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