International marketing thesis-international marketing.
Abstract: Procter & Gamble is one of the largest and most valuable consumer goods companies in the world. Its business is distributed in about 80 countries, producing 300 brands and marketing them to 160 countries. China market of P&G is its second largest market, so the marketing strategy of P&G in China market is the focus of this paper. In order to make P&G adapt to the changes and sustainable development of China's local market, this paper first analyzes the implementation strategies of P&G based on the marketing process theory, then analyzes the successes and shortcomings that are worth learning, and finally gives some suggestions that can help P&G to successfully market in China.
Keywords: P&G China market analysis marketing strategy
First, the marketing analysis
(A) the choice of the international market
Before international marketing, the choice of international market needs to be preliminarily screened by external and macro-oriented driving factors, and carefully screened by Boston model measurement. Before entering the China market, P&G had large-scale business and experience all over the world, and investigated Beijing and Shanghai in China as target markets. When China just opened its market policy, P&G made a marketing plan to sell shampoo instead of washing products, thus opening the door to China. P&G will choose the development of international market according to the population distribution, geographical distribution and industrial structure distribution of annual income, which can increase market share and product recognition and meet the needs of different consumers, but it will disperse the company's resources and increase the company's additional management and production costs. Therefore, it is suggested that P&G should do in-depth value research before choosing whether to enter new markets, and more importantly, consolidate and stabilize emerging markets. [ 1]
(B) the choice of market entry mode
Reasonable market entry strategy can not only realize cost economy, but also take into account the resources, risks and non-profit expectations that the company may face. Generally speaking, the choice of entry mode includes internal resource factors, external market and transaction risk factors, the characteristics of various modes and transaction behavior. When P&G entered the China market, it cooperated with Hutchison Whampoa. Its purpose is that, as a foreign-funded enterprise, it will be limited by the local open policy and consumer demand, and cooperation with local partners can share risks and ensure that foreign-funded companies can gain a foothold in the local area. For the current market share of P&G in China, it is suggested that the model of wholly foreign-owned enterprises can be adopted to continue to expand, because maintaining the cooperative relationship will bring about the inconsistency of the development goals of the two institutions and affect their respective business strategies; Unable to balance income amicably; Mutual confidentiality of core technologies and other risks; WFOE can help P&G, which has a mature business network, increase profit income, save cooperation costs and strengthen the control of its subsidiaries.
(3) product decision-making
Product internationalization decisions usually need to consider service support, product attributes and core product advantages. When consumers hesitate to choose, products and services can greatly increase their competitiveness. P&G pays attention to service quality and has set up a global business service team consisting of 7,000 people to help P&G make great efforts in global sales and product decision-making. The overall product attributes of P&G, including core products, are characterized by high quality and high value. And integrate innovation and environmental protection elements to cater to consumers in different markets. However, it ignores the advantages of product localization. Once, Rejoice Chinese herbal shampoo was all the rage in China market, because it was not only cheap, but also catered to the preferences of China people. However, because the competition is not as good as other more localized brands, the sales volume of Chinese herbal shampoo is gradually decreasing. In addition, the development trend of men's cosmetics market in China is promising. It is suggested that P&G can seize and develop this market, and at the same time try more localization elements in the China market with a large market share, which is believed to be fruitful.
(4) Pricing decision and operation
Product price positioning will refer to organizational goals and market positioning, international monetary policy, product value, competitiveness and customer purchasing power. Before 2009, P&G paid attention to product quality and appropriately raised product prices. When the financial crisis swept the world, P&G implemented a "good" low-cost strategy to stabilize and continue to expand its market share. In view of the high inflation in China market, P&G increased the prices of low-profit products such as detergents and soaps by115%. As the operating cost of China market is forced to increase, it has to reduce its price to maintain its net profit. P&G's flexible pricing strategy meets diversified market demands. China market is the second largest market of P&G, but huge consumers will still take a fancy to P&G's high quality and low price. Therefore, the low-price strategy is still the dominant strategy, but the promotion of high-priced brands cannot be ignored, and at the same time, scientific research should be developed to save costs.
(v) Allocation decision
The distribution cost of general products accounts for 15%-40% of retail price. Therefore, how to choose low-cost and high-efficiency distribution channels is very important. P&G's distribution channels in China can be divided into two types: primary channels and tertiary channels. In China, the distribution of primary channels can cover first-and second-tier cities in China, and there is cooperation with Wal-Mart's CPFR (coordination, planning, forecasting and replenishment), while the tertiary channels will go deep into third-tier cities, towns and villages, with few applications and imperfect. The distribution structure of P&G is to store as many goods as possible in the store. This structure is called intensive distribution, and its purpose is to meet the needs of consumers to find P&G goods in front of the shelves anytime and anywhere. This requires P&G to cooperate effectively with a large number of wholesalers and retailers. P&G has improved the compact toilet paper to achieve the purpose of environmental protection, cost saving and convenient transportation, and ensuring the efficient operation of the supply chain is also a part of serving consumers. In view of the intensive distribution mode in China market, underdeveloped areas such as rural areas will prefer products with low prices and guaranteed brands, so it is very potential to develop dealers and distributors in this respect; For the more developed regions and cities in China, P&G can make more use of the very valuable online distribution market. E-commerce platforms, such as Alibaba, Taobao and JD.COM, are the most concerned e-commerce platforms with the largest sales recently. According to the consumption patterns of major cities in China, online sales are much larger than physical stores, and online distribution can also save various taxes and fees for operating physical stores and facilitate transactions.
(6) Communication and decision-making (promotion strategy)
Communication refers to the purchase behavior between enterprises and consumers through advertisements, public relations activities, promotions, discounts, etc. In the China market, Procter & Gamble mainly uses advertising as a publicity method. The company spends more than 500 million yuan on hair care products advertising every year, of which TV advertising will cost more than 60% of the budget, far exceeding the budget of print advertising. The purpose of Procter & Gamble's advertising expenses is to promote new products, improve brand awareness, publicize corporate culture and prove the business ability of enterprises. Procter & Gamble's regular promotion and discount communication method is the most effective way to stimulate consumers' purchasing demand in a short time and solve the continuous decline of product sales for a period of time. In the China market, public relations activities are mainly to donate money to social funds to enhance the positive social image of the company. In addition, it is suggested that P&G can also make use of China local media such as Youku and cooperate with international events such as the Olympic Games to promote corporate culture and products, which will get twice the result with half the effort. For example, a product of Procter & Gamble sponsored the environmental protection research project of Beijing Youth Project. Such sponsorship publicity can not only highlight the product status, but also enhance the good image of enterprises concerned about the growth of young people and environmental protection.
Second, suggestions
P&G China's marketing suggestions at each stage have been discussed above. At the same time, it is necessary to clarify some overall key suggestions. First of all, P&G's international marketing scope is too wide-it has 300 brands and 180 marketing countries. Therefore, it is worth paying attention to how each brand should weigh the cost and profit before marketing. Secondly, P&G has invested too much in advertisements, and these advertisements tend to focus on the promotion of a single product, so the budget is not reasonable enough. Therefore, it is suggested to promote different products or series of products in an advertisement, which may have better publicity effect and reasonable cost. Finally, enterprises should strengthen the supervision of product life cycle, manage product growth and regional market through Boston growth matrix analysis, and timely eliminate outdated products and replace new fashion products is the key to market development.
Three. conclusion
In short, P&G can adopt appropriate strategies to enter international target markets and expand diversified markets. At the same time, it will take into account the four major elements of the market, product characteristics, flexible price strategy, centralized and intensive distribution system and the support of a large number of communication methods. This paper not only discusses some problems existing in P&G marketing, but also puts forward corresponding opinions and methods, which can solve the problems in time. In short, as far as the theoretical knowledge of marketing is concerned, P&G is a good case of applying the theories of marketing, brand management and market expansion.
References:
Malcolm macdonald. Marketing plan. UK: Oxford, 2007. ISBN 978-0-7506-8386-9.
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