Export Planning How to write an international marketing plan

Export Planning How to write an international marketing plan Chapter 2: External and Internal Analysis Internationalisation of the firm

Export Planning Learning objectives (learning tasks) Ch. 2 • At the end of the chapter you are able to: • 1. describe a company briefly in terms of its vision and mission, its business definition, • and its product lines and markets; • 2. explain how to set up an internal analysis by means of its organisation structure, the • 7S-model and its organisational capabilities; • 3. explain how to set up an external analysis by means of the DESTEP – and trend - analysis; • 4. put together a SWOT analysis and TOWS matrix with its strategic options.

Export Planning Vision and Mission Example from Kellogg‘s

Export Planning Environmental analysis and trend direction DESTEP - analysis Trend - analyis Conclusion …………… D E S T E P High Low High Low A. Identify the two most Important trends Impacting your business B. Put the two trends in a axis – overview and draw a conclusion

Export Planning DESTEP or PEST analysis The PEST analysis consists of five main steps:1. Understand a category's relevant trends- research the important variables of the organisation's strategy - determine the long term trends that apply to these variables- research the past behaviour of these variables- analyse the predictability of the trend lines and their fluctuations- assess the impact of these trends on the organisation 2. Understand trend interdependencies - analyse which trends are interrelated- determine which trends conflict by understanding movements in opposite directions3. Distill likely issues from the identified trends - validate the impact of trends on the organisation- distill the most critical trends that have the greatest impact given the organisation's objectives

Export Planning DESTEP or PEST analysis 4. Forecast the direction of issues- determine the fundamental drivers behind a critical trend- assess the behaviour of the critical trend- run a sensitivity test to assess impact (take -10% of your worst case scenario)5. derive implications for the organisation- assess the affect of critical environmental changes on the industry - assess affect of critical environmental changes on a firm's competitive position- assess the affect of critical environmental changes on a direct competitor's position- validate a firm's competitive position given the likely positions of its direct competitors'

Weaknesses Strengths • specialist marketing expertise • exclusive access to natural resources • patent • new, innovative product or service • location of your business • cost advantage through proprietary • know how • quality processes and procedures • strong brand or reputation • lack of marketing expertise • undifferentiated product or service • (i.e. in relation to your competitors) • location of your company • competitors have superior access to • distribution channels • poor quality of goods or services • damaged reputation Opportunities Threats • in new competitor in your own home • market • price war • competitor has a new, innovative • substitute product or service • new regulations • increased trade barriers • a potential new taxation on your • product or service • developing market (for example China, • internet) • mergers, joint ventures or strategic • alliances • moving into new attractive market • segments • a new international market • Loosening of regulations • removal of international trade barriers • a market that is led by a weak • competitor Internal – and External analysis SWOT - analysis Examples Internal External

Internal – and External analysiS Example SWOT – analysis of PepsiCo Strengths Weaknesses • Broad product line and outstanding reputation • Global market leader in snack foods and non-carbonated beverages (= power and knowledge) • Intelligent Logistics network and strong existing distribution channels • Inability to leapfrog Coca Cola as being the most famous beverage provider • Reliant upon line extensions • Reliant upon particular carbonated drinks Opportunities Threats • Growing population • Progress in technology  less costly production processes • Spread of liberalisation and democracy across countries • Increasing health awareness • Ongoing economic crisis • Difficulties regarding financing of major projects Source: R.Hüfler a.o., students HAN University

Internal – and External analysis TOWS – analysis: strategic options External Opportunities(O)1.2.3.4. External Threats (T)1.2.3.4. Internal Strengths(S)1.2.3.4. SO"Maxi-Maxi" StrategyStrategies that use strengths to maximize opportunities. ST"Maxi-Mini" StrategyStrategies that use strengths to minimize threats. Internal Weaknesses (W)1.2.3.4. WO"Mini-Maxi" StrategyStrategies that minimize weaknesses by taking advantage of opportunities. WT "Mini-Mini" StrategyStrategies that minimize weaknesses and avoid threats.

Export Planning Chapter review questions (10 min.) • What is an export policy plan? What are the three steps of the export policy plan? • Create a possible business definition for a brand label manufacturer selling cigarettes. • Explain the 7S Model of McKinsey. • What is a DESTEP – analysis?Why do you apply this analysis on the existing • Markets first, before looking at new, foreign markets? • What can you do with a SWOT - and TOWS – analysis? Explain and provide an example?

Export Planning How to write an international marketing plan