Research Proposal On Marketing Strategies of a Remote Control Car Manufacturer in International Market
Marketing Strategies of a Remote Car Manufacturer in International Market
Due to the influence of many macro-environmental factors such as the development in technologies, communications methods and transportations means, the world is current shrinking, which enable businesses and consumers in different parts of the globe to be connected (Parker, 2005). According to Pagell and Halperin (2000) the business environment of the current century is characterized as the era of emerging global economy or the time of the development of transnational corporations and the improvement of international marketplace. As a result, globalization of different companies is considered as one of the most important factors considered in the business environment and international trade (Kaynak, 1993).
Consequently, due to the growing competition in the local market, and due to the very promising global market, companies and organizations are taking advantages of overseas markets or international market in order to improve and enhance their connection to greater market. Globalization of organizations and companies has become the most popular strategy in the ever changing environment (Kaynak, 1993). However, there are different factors that must be considered upon taking advantage of globalization, because of the fact that globalization also offers different risks and threats that might cause failure for an organization.
2.0 Background to the Research Problem
R/C or Radio Controlled car is considered as one of the most popular toys for children as well as adult. This had become more popular because of the different local and international organizations that have implemented events and contests in R/C car races. Due to this, the number of manufacturers and sellers of this type of toy had increased for the past few years. Malaysia is also one of the well-known countries which venture into this industry. There are numbers of local Malaysian manufacturers who are producing and manufacturing parts and accessories for R/C. These companies enable to create their strong position in the local market, due to the quality of their products. However, growth and expansion is the next feasible step for these companies. With this, they are considering entering the international market – which will enable them to target massive and immeasurable market that can help in order to improve sales and profits. However, this will not be an easy task, because of the different macro- and micro-environmental factors that must be considered, which include the differences in political, social, economic and technological aspects.
3.0 Problem Definition
In order to ensure success in entering the international or global market, it is important to focus on intensive research and planning regarding the marketing strategy and market entry mode to be used in the international or global RC industry. With this, it is important to focus on the different internal and external factors related to the environment and the organization itself. It is important to focus on the differences between the culture and behavior of these Malaysian companies and its International competitors, particularly Tamiya, which is considered as the leader in the industry. These factors are important to be considered in order to come up with the different internationalization strategies to be implemented.
4.0 Overview of Literature
Ansoff Product-Market Growth Matrix
Overall, the main objective of these Malaysian companies is to expand or grow. With this, it is important to focus on tools which can help in order to analyze growth actions and strategies. The product/market matrix of Ansoff (1987) is a sound framework which is used in order to identify market growth opportunities. Figure 1 shows the x-axis which is the dimension of product, and the y-axis which shows the current and the new market (Basu, 2008).
Figure 1 Ansoff’s Matrix
With this, there are 4 ways a business can expand or evolve, which include: market penetration, product development, market development and diversification. Out of this 4, market development is the most appropriate growth strategy. In this growth model, the products are established and growth occurs by looking for new markets (Gessinger, 2009).
Market Penetration: Foreign Entry-Mode
The mode of entry in the foreign market is considered as vital aspect in internationalization (Jain, 2003). In general, there are four types of entry-mode which can be used by organizations planning for internationalization, which include: joint venture, wholly-owned, licensing and exporting.
- A wholly-owned subsidiary is a mode of entry where in the company owns 100% of the stock. This can be done by acquiring current company in the home country or the company can develop a totally new operation (Dess and Lumpkin, 2004).
- Under international licensing, the company grants rights to a foreign company to produce the products of a company or to use some knowledge and technology gained from patents, copyrights, brands and trademarks (John and Letto-Gillies, 1996).
- An international equity joint venture focus on formation of new entity that is owned jointly by two or more parent organizations to enter a new market where at least one of the parent organizations is non-resident (Lane and DiStefano, 2000).
- Exporting is also another entry mode which can be used. It is the process of marketing goods produced in one country into another. No direct manufacturing is required in an overseas country, but vital investments in marketing are needed. It can offer several advantages such as: manufacturing will be home-based, therefore it is less risky, at the same time, it can help to have the opportunity to learn about the foreign markets before investing, which can help in order to reduce possible risks in operating overseas (Agriculture and Consumer Protection, n.d.).
Based on these 4 entry mode and the current operations and procedures involved in R/C industry. It can be said that exporting is the most applicable entry mode, because it can help in order to lessen and prevent the different risks and threats that are related in entering new market, particularly in an industry, where in international company like Tamiya is already taking majority of market share.
5.0 Research Methodology
Currently, there is not enough or sufficient research and literature about the subject or topic of the study. As a result, this paper will be exploratory in nature. Generally, exploratory studies are undertaken in order to have a better understanding of the nature of the problem. Thus, it enables the researcher to determine the best design, data collection methods, research approaches and selection of respondents for the future study. This study will use both qualitative and quantitative data; therefore, both numerical and descriptive data will be used. With this, it can help in order to take advantage of both the benefits of the two methods or data, at the same time, prevent disadvantages and risk related on implementing only one of those method.
5.1 Research Design
Case study will be used in the study. Case study is based on in-depth analysis and investigation of a single individual, group or event (Yin, 2009). Regarding this, two cases of Malaysian R/C companies will be used, which include RC Dreamz (http://www.rcdreamz.com.my/) and Niko (http://www.rcdreamz.com.my/). These two companies are considered as two of the most well-known and largest player in the R/C industry in Malaysia, thus, the two companies have already captured the local market. In addition, due to the help of the Internet and other new technologies, the companies also enable to establish its name in other countries.
5.2 Data Collection
Survey questionnaire and interview will be conducted to the marketing department and staffs of the two companies. The survey questionnaire will include questions and statements which ask the respondents regarding the different aspects and factors related to internationalization. In order to analyze the result easily, Likert scale will be used. On the other hand, open-ended questions will be used in the interview process, which will help in order to gather more direct and detailed information from the respondents.
6.0 Analysis and Interpretation
Numerical data gathered will be analyzed and presented using SPSS – statistic software. Percentage and mean will be presented. Document analysis will also be implemented in order to analyze the result of the interview. The result of the interview will be analyzed and interpreted based on the different theories in related literature, with this, it will be helpful in order to present the different theoretical aspects based on the actual experience of the respondents.
The time to be spent for the study, and the lack of knowledge of the researcher regarding the topic affected the choice of methodology to be used in this research. As a result, it can affect the analysis, findings and results of the study. Because this study is mainly exploratory, it will not investigate the subject or problem in in-depth manner. Therefore, future study must be implemented to support and enhance the result of this study.
Generally, this study will explore and analyze the different factors related on planning and implementation of marketing strategies and market-entry in order to successfully launch the products and services of the company in the international or global R/C industry and market.
Agriculture and Consumer Protection. Chapter 7: market entry strategies. Retrieved on 22nd October 2010, from FAO Corporate Documentary Repository.
Basu, R. (2008). Implementing six sigma and lean: a practical guide to tools and techniques. Butterworth-Heinemann.
Dess, G., Lumpkin, T and Taylor, M. (2004). Strategic management: creating competitive advantages. McGraw Hill Professional.
Gessinger, G. H. (2009). Material and innovative product development: Using common sense. Butterworth-Heinemann.
Jain, S. (2003). Handbook of research in international marketing. Edward Elgar Publishing.
John, R., Letto-Gillies, G, Cox, H. and Grimwade, N. (1996). Global business strategy: an introduction. Cengage Learning EMEA.
Kaynak, E. (1993). The global business: Four key marketing strategies. Haworth Press.
Lane, H., DiStefano, J. and Maxnevski, M. (2000). International management behavior: text, readings and cases. Blackwell Publishing.
Parker, B. (2005). Introduction to globalization and business: relationships and responsibilities. SAGE.
Pagell, A. and Halperin, M. (2000). International business information: how to find it, how to use it. Lessons Professional Publishing.
Yin, R. K. (2009). Case study research: Design and methods. 4th edn. California: SAGE Publications.