2. Global integration has significant impacts for firms such as Starbucks that have built a strong brand based on a consistent product, no matter where the operation is. Global marketing integration demands that the marketing component of the company should also be integrated, and consistent. One of the major implications is with regards to product. Starbucks sought to expand into Asian markets, but their core product of coffee has very low penetration in tea-drinking countries like Japan and China. This major cultural difference could have been a significant impediment. However, Starbucks overcame this by shifting the focus of their marketing towards the other key product - the Starbucks experience. In Asia's densely-packed cities, the need for a "third" place, somewhere to socialize besides work and home, was strong. This was the means for Starbucks to win customers. Those customers have slowly become weaned on coffee, via the syrupy dessert-like coffee drinks on the menu.
Thus, the product did not change but the promotion saw a slight shift when Starbucks entered Asia. In order for this to occur, Starbucks needed to make some adjustments to its logistics systems. In North America, the inputs could be acquired and distributed from a central point of command. Asia's markets are too distant for this to be feasible, so new suppliers had to be found. Maintaining consistency - a Starbucks hallmark - would be more difficult.
Place and price, however, remained consistent. Place has long been a key component of the Starbucks business model. Finding the right location was considered essential. Starbucks has continued to emphasize this part of its marketing program when expanding overseas.
Therefore, the Starbucks strategy with regards to place was relatively easy to integrate on a global scale. Price did not represent a significant challenge. Starbucks price positioning is at the high end, and the Asian markets that they entered have ample high end consumers. A contributing factor to Starbucks' price...
Figure 1. Demographic composition of the United States (2003 estimate). Source: Based on tabular data in World Factbook, 2007 (no separate listing is maintained for Hispanics). From a strictly percentage perspective, it would seem that Asian-Americans do not represent much of a threat at all to mainstream American society, but these mere numbers do not tell the whole story of course. For one thing, Asian-Americans are one of the most diverse and
shares (which can only be purchased by foreign investors in foreign currencies (Cao 2000). In addition, Chinese law classifies shares by reference to the status of the shareholders: state shares, legal person shares, and individual shares. State shares are purchased with state assets by governmental departments and usually constitute fifty percent or more of all issued shares, which means that the state is a majority shareholder in most instances.
The process would then need to continue so that the changes that can be seen in the environment can also affect the changes in entry strategies. Environmental factors, economic factors, political/legal factors, social/cultural factors and also technological factors should all be considered. The legal factors that need to be addressed include issues in employee law, monopolies and mergers legislation, environmental protection laws, and wider issues such as foreign trade regulations.
Unionization is almost unheard of. China's economy has been built with over 200 million laborers that have moved from the countryside to the booming coastal cities. China is reducing the public payroll, which means the country is faced with the challenge of finding employment for millions of workers. This means that employers have the buying power. The result is that working conditions are often poor. There have been some
Movement All good things must come to an end, and at no time is this fact truer than in China in 1911, when the Xinhai Revolution resulted in the fall of the Qing Dynasty. This led to a period of unrest, as the world's powers engaged in World War I. Even though China had participated in the war on the side of the Allies, China was betrayed during the negotiations
All of the above represents the first part of strategic planning. You must know where you are now before you can determine where you should be going. The next step is to analyze the alternatives. It is important to remember that the current list of alternatives is not the sum total of options available. The company should be as creative as possible in the alternative-generating process. The external analysis should
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