International Marketing Plan For UK-Based Brand: Clarks Shoes

International Marketing Plan Outline

Global marketing is not only about trading goods across the nation, it includes promoting products and services across the globe; they could have foreign offices in other nations. With the help of technology and the increase in digitalization, even petit organizations are able to trade using the internet worldwide.

This report will discuss global marketing aspect with Clarks shoe store company case. Clarks is considered to be a successful shoemaker since 1825 by James Clark and Cyrus (clarks, 2018). The company tends to go internationally and until now, the company has expanded to various nations, more than thirty-five nations. The company’s major objective includes the latest design, innovation, and maximum selling of shoes each year (clarks, 2018). The new target market for the company is Brazil and the company wishes to expand business in this country. For this, the report will contain an international marketing plan. The external and internal analysis will be conducted for the company to enter into Brazil market.

The target market is Brazil, which is a country in South America. The country is popular for its Ipanema beaches, busy Copacabana, and raucous Carnival festival (Evans, 2018).

To study macro environmental factors of Brazil, For Clarks to expand in this nation, PEST analysis is as follows:

1. Political factors

The government of this nation is stable and proactive and there is no political instability is observed recently. Nevertheless, from the history of the nation, it has been observed that there could be a change in Brazil overnight, as political circumstances lead to head up to a good extent, especially in the election environment. Corruption is still a major problem in the nation. Therefore, it can be said that for Clarks, expansion in this nation is neither too good option, nor bad.

1. Economic factors

If growth potential is considered, it can be said that it is very high for Brazil. The foreign direct investment inflow is large, and the population is also very large of the nation. Moreover, the declining gap of poor and reach indicates the improving economy, which could be a positive point for Clarks to enter the market. In addition, the risk of devaluation of currency is also reduced by Central Bank, and inflation has also brought under control. Therefore, considering economic factors, it is advisable for Clarks to invest into the nation.

1. Social Factors

A major aspect of social factors is economic inequality, which is twenty percent of the residents of the nation is under the poverty line. Considering class distribution, there is a large amount of wealthy population and high segmentation of minimal income group. For Clarks, a positive aspect regarding this factor is that the nation is very much into fashion and modernization. The residents are very much interested in purchasing from well popular and reputed brand and expensive luxurious goods (Ho, 2014).

1. Technological factors

Evaluation of Macro and Microenvironmental Factors of Brazil

Technological infrastructure is weaker as compared to other developed nations like the US. Nevertheless, Brazil is rapidly enhancing in the IT sector and it is at 53^rd ranking all over the world. This is not a major issue for the company to invest in this country, as Clarks can bring technology through other nations for manufacturing of shoes and market in the nation (Pestleanalysis, 2018).

To analyze the internal environment of the company, SWOT analysis has been conducted for Clarks:

Strengths · High-quality shoes · Competitive prices · High brand awareness across nations · Controlled distribution market	Weakness  · Less profit margin due to competitive pricing · Competition with similar retailers · Narrow product range · Fashion forecasting trends difficulty
Opportunities  · Product diversification · Targeting new market/ nation · Product development · Global brand recognition	Threats · Price competitive sector · Various substitute good · Low switching cost (Boone, 2016)

For studying industry analysis of Clarks, the theory used is porter’s model. Five forces are as follows:

1. Competitive rivalry

Brazil holds the third position for leather manufacturing worldwide, which makes this industry a competitive environment. Some of the competitors of Clarks in Brazil are M Boots, Kadesh, and Sports shoes range from most recognized brands like Reebok, Adidas, and Nike. Moreover, it has been observed that in this industry, price competitiveness is very high. Due to large producers, the companies are competing for each other with lowering the prices (Porter, 2014).

1. The threat of new entrants

This factor is very relevant, as there is no major restriction in entering into this market. Due to which, the competition increased every day. This is a major threat to the company, as a new company with more innovative design can enter into the company with various intellectual proprietary rights can lead in this industry. Considering this factor, access to inputs is very easy, and access to the distribution would be limited due to various another brand, which is leading the industry for years.

1. Threat of substitutes

Substitute threat for Clarks is moderate because the switching cost is short. The major substitute for Clark’s shoes is normal sandals produced within the country. Moreover, nowadays, crocs are also a new trend to the market, which is a substitute for Clark’s shoe (Khoja, 2016).

1. Bargaining power of suppliers

This force is not a much concern for Clarks because switching suppliers is not a problem, without decreasing the respective quality product. Moreover, the threat of integrating forward is low due to entry barriers. Any supplier, which is liable to meet the standard quality, could be able to supply raw material to Clarks easily. The number of suppliers in Brazil is very high, which is another reason for bargaining power in hands of Clarks instead of suppliers (sutherland, 2014).  

1. Bargaining power of buyers

Since the competition is high in the industry and switching cost of buyers are not as such. Therefore, the ball goes into the court of buyers, and the power of bargain in their hands. Moreover, buyer power depends on brand identity, which is a plus point for Clarks, as it is a recognizable brand. Nevertheless, there are various substitutes available like normal other sandals, dancing shoes, and sports shoes of popular brands like Nike. Moreover, the product range is narrow of Clarks, which makes the customer completely in a position to bargain.  This is the reason for Clarks to offer competitive prices in most of the nations (Dobbs, 2014).  

SWOT Analysis

For entering into the Brazilian market, the mode of entry recommended to Clarks is:

• Franchising

According to this entry mode, the owner of the company, or product and services opted to sell their products across the nation through dealers affiliated. This is the best method or marketing concept to be adopted by a company that wishes to expand the business, without taking marketing pressure in another nation or market. The franchising sector of Brazil is growing since the last few years, the majority of companies that are opting this mode are from the food industry. For Clarks, this mode is recommended because, with this, the company can trade their products of same quality and similar design, and in case any changes as per the local culture of the country are to be made, then it can be done by the franchise. Out of 183 countries, Brazil “Ease of doing business index” ranked at 126 by the World Bank. Moreover, there are no such legal issues, regarding franchising process in Brazil. According to statics, the risk of failure of a company with franchise business is fifteen percent, when compared to a non-franchised company that is eighty percent (forbes, 2018).

The only con for this mode is that the control is not properly in the hands of the company. Moreover, the training and quality control is to be maintained by the company. The legal formalities are also long for franchising (Schewen, 2018).

• Direct exports  

Another mode, which is recommended to the company, is direct exporting. Direct exporting includes the entry to a nation through selling goods and services directly by the supplier to the end users. This could be done either without any intermediaries, or with intermediaries like distributors, sales representative, or foreign retailers. According to this mode, the requirement for market research increased in order to locate a market for selling the goods and provides services, creating a relation to customers, the international distribution system is established, and collection of payments is to do. Direct exporting depends on marketing ability, company’s size, and exporting experience of the company, target market conditions (Hennart, 2015).

According to this mode of entry, Clarks can manufacture shoes in the home country or most feasible country and can directly sell to Brazil with the help of distributors, who will be held responsible for selling, building customer relationships, and collection of payment. This method is suitable for Clarks because there is no such restriction in entering into the Brazil market through direct exporting. This mode of entry is advantageous because the intermediaries are minimized through this mode, due to which profit is maximized. The employees can also be of the seller from sale call to retailers at end market. Moreover, the control is more in case of direct exporting by the company and can gain more protection for property rights for foreign markets. The only negative aspect of this mode of entry is a cost that the company occurs for the creation of a completely new department that is exporting department. In addition, the human resourced cost can also be high, and with more control, the responsibility increases for the company regarding the marketing of good into a new foreign market (sharma & Johanson, 2015).

Porter’s Five Force Model

The most recommended suitable marketing strategy for Clarks shoes are

1. Growth strategy

This marketing strategy major objective is the growth of the company as a whole. The growth could be either expansion in the product line or product diversification. That is targeting existing market with new products or targeting a new market with the existing product line. Since the company is targeting new international market that is Brazil, the growth strategy can be achieved by either offering the existing product ranges or the company can introduce a new product to offer this new market. Since the culture of all the nations is different, the company can introduce the customization. According to this, the designs that are more adaptable in Brazil can be introduced and offered to the customers. This strategy also includes increasing profit, which can be done through the right decision of mode of entry, targeting right segment of customer, most suitable distribution system, and enhancing customer awareness in order to reduce the cost to the company.

For an increase in sales of the company, the marketing includes conveying correct message to the customers, to create a positive perception to the customer’s while using various promotional tools (Feng & Chari, 2018).

1. Pricing strategy

While observing the trading of the company in various nations are price penetration strategy. Which is recommended to be followed for Brazil trading as well. Since the competition is very high in this industry and price is the major aspect for customer shift from one brand to another. It is recommended to keep competitive prices in this nation as well, in order to attract new customers. Price plays an important role in marketing, as the customers initial two expectation from any barn is quality and worthy pricing. Clarks have premium quality products, which must be offered to the customer at a relatively low price.

Through this strategy, Clarks can enter the competitive market of footwear with other existing brands in Brazil. It is difficult to influence the customer to leave a brand and switch to another, the best reason could be the price.

Moreover, from the existing market, it was observed that customer only purchase goods when they are on a discounted price. Therefore, one of the recommended pricing strategies is discounting strategy. Through discounting, the customers can be attracted and that will purchase more and more good. Such promotional tools are best to increase the sale of the company. This has been witnessed through sales trend from American business; it was observed that the sales increased to a large at the time of discount. Customer’s persistent and aggressive attitude has been observed in pricing; therefore, the company needs to enter with a lower price or discount coupons at first five purchases (Jaworski, 2018).

Suitability of Market Entry Recommendations

For offering products and service in Brazil, the recommended marketing mix includes

1. Product

• The products of the brand include its existing product line that is the footwear collection for women, men, and kids
• The major focus is on the premium quality product to be offered by the company, for which the brand is popular
• The company can also offer handbags along with footwear in Brazil market
• Boots are the major product when it comes to both men’s and women style
• To bifurcate the product line, the shoes are classified under casual styles, flats, heels, and boots with different variety like biker boots, ankle boots, healed boot, walking boots. Moreover, the bifurcation can also include walking, wedding, work, and winter shoes for both men and women(Bach, 2017)
• The quality is a major concern for the brand, and this must be continued while offering goods to Brazil(Festa & Cuomo, 2016).

1. Price

• As mentioned before, from previous experience of the company, it was observed that people like to make a purchase from the brand when there is a discount on the products
• The discounting strategies are recommended to the bran for Brazil as well
• The price competition exists in this industry, which leads the brand to keep their prices worthy and attractive for the customers
• Price penetration strategy would be most suitable for the company to follow(Lau, et al., 2015)

1. Place

• This includes the distribution strategy of the company, which need to be attractive in order to reduce the cost to the company and increase the profits.
• The area to be targeted can be the location, where the population visits the most. This could be shopping complex, malls, or popular area that is known for high-end brands
• This depends on the mode of entry of the company, in case the mode is direct exporting, the distribution system plays an important role due to the manufacturing of goods in other nation and selling of goods in Brazil through distributors
• In today’s world, where everything is online, including shopping. The best way to reach out to customers is through the internet. The company has an international website, where any product can be delivered to the customer of a particular nation. At that website, Brazil can be included to trade and ship goods to the country

1. Promotion

The major promotional tactics recommended for the company are

• Brand awareness through advertisement, this includes a printed advertisement that is through newspaper, printed hoardings, and pamphlets
• Audio video advertisement also plays an important role while influencing new customers. This could include television commercial, that could include either the common advertisement that was made for other nations as well or there could be a specialized advertisement that is made with the popular personalities of the nation
• Coupons, vouchers, and membership cards are other promotional methods to accelerate the sale of the company. This includes the initial purchase offer, according to which the customer is eligible to discount for the initial five purchase from the official store; this is to influence the customer to visit the store. Moreover, membership card could be the way to enhance relationships with customers.
• Promotional tools are very useful in an increase of sales and customer awareness and perception regarding the brand (Ang & Rusli, 2018)

Conclusion: 

The report discussed the marketing management, for which discussion over the company was taken into account. James Clark and Cyrus initiated Clarks shoe store, in 1825. The company trade in any nations, as it is an international brand. In order to grow the company wishes to extend its business into the new market and target new country that is Brazil. For this, the micro and macro environmental factors of Brazil were discussed, which includes PEST analysis for the study of macro environmental factors of Brazil. While studying this, it was observed that political stability was not there, and corruption is another issue observed. Moreover, according to the economic factor, the economy growing opportunity is very high, due to which investing in the country seems to be a plus point. Considering social and technological factors, the people are very much engaged in the purchase of expensive products related to fashion.

For the study of industrial analysis Porters five-force model was considered, according to which competition is generally at the peak in such fashion industry, moreover, the bargaining power is in hands of buyers and not in hands of supplier since the switching cost is not much. The most suitable mode of entry to Brazil market was recommended, to be either direct marketing or franchising. I addition, the marketing strategy that is recommended for Clarks, which is most suitable to be adopted in Brazil market are a growth strategy and pricing strategy. The marketing mix of the company that it will offer to the customers in Brazil is classified under product, price, place, and promotion. The products offered are standardized for all the nations that are boots and casual shoes for men, women, and kids. The price offered is a competitive price, and the promotional tools included advertisement, discounting schemes and vouchers. In addition, the place factor of marketing mix includes the distribution strategy of the company, and the location recommended was malls, shopping complex, which are most visited places of the nation.

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