Do you need this or any other assignment done for you from scratch?
We have qualified writers to help you.
We assure you a quality paper that is 100% free from plagiarism and AI.
You can choose either format of your choice ( Apa, Mla, Havard, Chicago, or any other)
NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.
NB: All your data is kept safe from the public.
Introduction
International marketing refers to a method of promotion designed to capture global markets and exploit commercial prospects in other nations. Promotion strategy adopted by an organization depends on the features of the countries targeted by the company. International marketing entails all processes of promotion that include performance of market research, development of a campaign strategy, determination of the target group and analysis of sales results.
A significant facet of international marketing is the effects of differences in cultures, languages and other environmental conditions on a company’s products (The Times 100, 2012). These conditions affect how products appeal to different people in diverse regions.
Promotion environment consists of factors external to an organization. These external factors affect promotion strategies that organizations use. Organizations cannot control these factors.
However, companies can influence some of the factors to their advantage. Some of the external factors that have influence on companies’ promotion strategies include population, economic features and political processes (The Times 100, 2012). On the other hand, there exist factors that companies can control to improve their competitive advantages. These include technological prowess and competitive conditions among others. Globalization has forced companies to compete internationally.
Marketers have to ensure that they understand factors that affect the competitiveness of their companies in different countries. Therefore, they must scan the markets that they operate in and develop effective promotion strategies. This paper compares the effects of environmental factors on marketing strategies used by Vodafone in India and Kenya.
Company Background
Vodafone is a leading international brand worldwide. It is positioned as the eleventh largest telecommunications organization in the world and second in the European region. The company has its headquarters in the United Kingdom and operates in numerous countries (Celtnet Telecommunications Companies, 2012).
The company operates in different countries via its subsidiaries. In India, the company operated under the brands Vodafone India and Hutchison Essar. Currently, it operates as Vodafone Essar in India. Through the subsidiary, the company controls the telecommunications market in India. In Kenya, it operates under Safaricom as its subsidiary. Safaricom is the leading telecommunications company in Kenya (Krause, 2008).
It provides pre and post-paid services and sells different handsets. It offers high quality mobile services in Kenya. Moreover, it is a creative and successful advertiser and marketer (Celtnet Telecommunications Companies, 2012). The company has also created employment opportunities for Kenyans. It provides Kenyans with business opportunities through its mobile money transfer services.
Social Environment
Social environment in India and Kenya affects the promotion strategies that Vodafone uses. Social environment comprise conditions linked to groups of people in the society. It includes factors such as the population, behavior patterns, beliefs and practices.
A change in the social environment determines the marketing strategies that a company uses (Vitullo-Martin, 1997). A social environmental change has the potential to increase or reduce the size of a market. Notably, a change in the social environment directs consumers’ behavior and preferences.
Demographic environment is the magnitude, distribution and increase of segments of individuals with diverse characteristics. International marketers normally consider the behavior patterns of countries. They consider the age groups, poverty levels, cultures and household organizations. India has an extremely large population (Vitullo-Martin, 1997). Vodafone serves approximately 35 million people in India currently.
The total population of India is approximately 1.2 billion people (Kumar, 2010). This creates growth opportunities for the company. The marketing strategies that it uses in the country aim at increasing the customer base since there exists untapped market. It is predicted that the country’s population will increase to 2.6 billion by 2050. This further creates opportunity to increase business activities in India. The company uses aggressive advertisements and provides more value added services to capture untapped market.
However, in Kenya, the company uses a different promotion strategy. Kenya has a total population of about 40 million people. Safaricom has a customer base of about 5 million people. The company faces stiff competition from other service providers like Telcom Kenya and Airtel.
However, it is the leading telecommunications company in Kenya. The marketing strategies of the company in Kenya aim assisting the organization to maintain leadership in the market due to the low population and stiff competition. It engages in aggressive advertisements and price wars. Additionally, it offers value added services to different segments of the market.
The other demographic feature that Vodafone considers in the two countries is poverty. The two countries have high poverty levels. Many people in India and Kenya cannot afford some of the services that Vodafone offers.
However, India’s large population presents opportunities for growth despite the existence of high poverty levels. Vodafone provides low-cost handsets in India. Through the provision of low-cost handsets, the company increases its sales through massive distribution (Wang & Kishore, 2010). In contrast, the company targets towns and cities with its products in Kenya.
Poverty is highly widespread in the rural areas than in urban areas. Hence, the company targets people in urban centers who can afford different varieties of products. The products are highly differentiated to enable people of different poverty levels access the services that the company provides. Finally, the company markets itself through corporate social responsibilities in the two countries.
Cultural Environment
Cultural environment is the second social factor that marketers consider in international promotion (Vitullo-Martin, 1997). Cultural environment comprise conditions connected to how individuals live and act. It includes values and beliefs, traditions and attitudes. International marketers must establish significant features and movements in different countries that their organizations have business operations.
Cultural differences affect the nature of products that different groups in a society desire (Vitullo-Martin, 1997). Cultural environment in India and Kenya has influenced the marketing strategies that Vodafone employs in the two countries. India operates under the caste system of classification. Individuals in India are grouped into social classes. The caste system is rigid and encourages poverty. It has also resulted into cultural rigidity.
India can be categorized as a collectivist society. The low flexibility of culture in India results into resistance to economic growth. This affects the ability of Vodafone to increase market share and sales volume. The marketing practices that the company uses in India also try not to conflict with beliefs of different social classes in the country. Hence, the company’s promotion adverts, like Zoozoo, appeal to Indians.
Conversely, Kenya’s culture is flexible, and Kenyans adopt new ideas rapidly. Kenya can be categorized as an individualist society. The flexibility of Kenya’s culture matches with the speed of economic and technological growth. This boosts the rate of economic growth and attracts different international companies (Vitullo-Martin, 1997).
The flexibility of culture in Kenya has enabled Vodafone to develop effective marketing strategies. The company has used elements of Kenyan culture to develop marketing campaigns. In fact, the name Safaricom is derived from Kenya’s national language. Safaricom is derived from the word safari, which is Swahili.
Cultural diversity in the two countries has made Vodafone develop marketing adverts that use native languages. These adverts appeal to the citizens of the two countries. However, in development of the adverts, the company ensures that it does not offend customers. Hence, it has to understand the cultural beliefs and practices in Kenya and India (Brand Directory, 2011).
Economic and Competitive Environment
Economic environment comprise conditions connected to production of products and services and income levels (Vitullo-Martin, 1997). The economy relates to incomes, expenses and costs of business operations.
Demographic and cultural environments influence the volume and requirements of markets. Conversely, economic environment influences the ability of markets to purchase goods and services (Vitullo-Martin, 1997). Hence, high population growth rate does not necessarily translate into excellent market opportunities for businesses.
Markets must have adequate purchasing power for consumers’ needs to be satisfied. Economic conditions in a country affect the marketing strategies that companies use (Vitullo-Martin, 1997). Additionally, economic conditions in a country affect marketing strategies that companies use in other nations. For example, changes in production costs in the can affect the prices of telecommunication services in India. This then affects the marketing strategies that companies in India use.
India’s gross domestic product grew at a rate of approximately 7.1% in 2007 and 2008. However, unemployment level is high in the country. Many people cannot afford expensive services. Vodafone recognized this fact and decided to develop marketing strategies that target the poor. The company decided to distribute mobile phone handsets that cost $25 due to high unemployment and poverty levels.
The poor and the unemployed people in India can afford these low-cost handsets. The marketing strategies that Vodafone use in India rely on the high population (Wang & Kishore, 2010). Even though the purchasing power of Indians is low, the high population presents Vodafone with approximately 250 million consumers in the middle class bracket. Kenya also has high unemployment and poverty levels.
This affects the purchasing power of Kenyans. Vodafone employs product differentiation as its marketing strategy in Kenya. It also segments the Kenyan market through the provision of products that target different groups (Anderson, 2008). Hence, it sells products like the iPhone to rich people and Kabambe to relatively poor people. Kabambe is specially designed specifically for the Kenyan market.
Competition is the other economic factor that marketers consider in development of promotion strategies. Marketers must develop competitive strategies that can enable their organizations acquire large market share (Vitullo-Martin, 1997). Vodafone faces local and international competitors in India and Kenya.
Additionally, it is the leading telecommunications company in the two countries. The company uses almost similar promotion strategies to maintain leadership in the two markets. The company targets new and old customers. In addition, it continually introduces improved versions of old products in India and Kenya. The company also engages in price wars in India and Kenya (Wang & Kishore, 2010).
However, price wars are intense in Kenya due to the limited market. Furthermore, Vodafone achieves command in telecommunications market in India and Kenya through the establishment of niche markets (Anderson, 2008). In Kenya, it targets corporate organizations as a niche market. It then offers custom-made services to these organizations. Finally, the company creates market entry barriers through its promotion strategies in Kenya and India.
Technological Environment
Factors related to inventions and innovations that have an impact on development or improvement of products and services compose technological environment. Marketers must take technological viewpoint when they design promotion strategies and products (Vitullo-Martin, 1997).
Improvements in technology affect the ways through which Vodafone markets its products in India and Kenya. The company uses media in the two countries to market its products and services. In addition, it uses social sites in the internet to promote its activities in the two countries.
Many people in Kenya and India use social sites like Facebook and Twitter. Competition also makes the company improve constantly the technology that it uses in the two countries (UK essays, 2011). Hence, it has introduced other services like cloud computing to market itself. However, the two countries depend on technological supplies from other markets. Therefore, the use of technological advancements in the two countries in promotion depends on the pace of development in other countries.
Political Environment
The political environment comprises factors connected to governments’ activities and regulations that affect promotion strategies. Political environment is connected to both the social and economic environments. Social and economic factors like poverty and unemployment guide legislations designed to control companies’ promotion activities (Vitullo-Martin, 1997).
Government agencies implement laws formulated to control marketing activities that firms practice. Such legislations have affected marketing strategies that Vodafone uses in India and Kenya. In India, Telecom Regulatory Authority of India controls activities of telecommunications companies (Wang & Kishore, 2010).
In Kenya, the Communications Commission of Kenya controls business activities in telecommunications industry. Vodafone’s subsidiary in Kenya was once forced to avoid the creation of market entry barriers by the regulatory authority. The regulatory authorities in the two countries prohibit Vodafone from the use of deceptive promotion strategies.
Political stability and systems also affects the marketing strategies that companies use (Vitullo-Martin, 1997). India and Kenya operate under democratic political systems. Elections are held after every five years in the two countries (Wang & Kishore, 2010). However, sometimes, elections are held frequently in India. This affects business operations. Kenya experienced political instability in 2008, and this affected the operation of Vodafone’s subsidiary.
Institutional Environment
The institutional environment comprises companies concerned with the promotion of products and services of other organizations. These companies are promotion agencies, research firms, retailers and wholesalers. Vodafone uses some organizations to improve its position in Indian and Kenyan markets. These organizations assist Vodafone to increase the visibility of its products and services in the two markets. Vodafone Essar uses Ogilvy and Mather to develop adverts. Ogilvy and Mather is a South African advertisement and public relations firm.
The firm assisted Vodafone to develop the Zoozoo advert that has become popular in India. Over 30,000 people on Facebook in India like the Vodafone’s advert. In Kenya, the company uses several retailers to distribute its products (Brand Directory, 2011). The use of retailers has made the firm popular in the Kenyan market since the retailers are over a million in the country. The company also brands retailers’ premises to increase its visibility.
Through its M-Pesa product, the company has managed to popularize all the other products and services that it offers (Krause, 2008). It provides individuals with opportunities to own businesses through agency. The company expects retailers to promote and sell other products that the company offers. M-Pesa is a mobile money transfer service that the company developed and is currently used worldwide (Krause, 2008).
Conclusions
International marketing involves promotion of a company’s products and services globally. Political, economic, social, cultural and technological environments of different countries influence international marketing. Marketers must consider these factors when their organizations enter new markets.
They must also consider these factors when they develop promotion strategies that aim to enable their organizations maintain leadership in foreign markets. This paper compared the influence of social, cultural, economic, technological and political factors on promotion activities of Vodafone in India and Kenya.
Vodafone is a leading telecommunications company in the world. It is also the leading telecommunications company in the two countries. India is a fast developing third world country and has significant influence in the world economy. It has a high population and offers business opportunities for international organizations. Conversely, Kenya is a small and stable African country. It controls business activities in East and Central Africa.
High population has made Vodafone target poor people in India and Kenya. It also uses product and price differentiation in the two countries. Cultural and social factors like poverty have also influenced promotion strategies that the firm uses in the two countries. The company uses high technology and agencies in management of promotion activities in the two countries.
Regulatory authorities in the two countries also influence the promotion activities of Vodafone in India and Kenya. The use of advertisement and public relation agents is also a promotion strategy that the company uses in the two countries.
References
Anderson, J. (2008). Vodafone’s drive for differentiation in rural India. Global Telecoms Business. Web.
Brand Directory. (2011). Vodafone. Web.
Celtnet Telecommunications Companies. (2012). History of Vodafone. Web.
Krause, R. (2008). Vodafone targets emerging markets, Investor’s Business Daily. Web.
Kumar, A. (2010). Half of India’s population lives below the poverty line. Web.
The Times 100. (2012). Business Case Studies: International Marketing. Web.
Vitullo-Martin, J. (1997). The Global Marketing Environment. Web.
Wang, C. & Kishore, A. (2010). Comparative research on the marketing strategies of telecommunication industry in China and India. Web.
Do you need this or any other assignment done for you from scratch?
We have qualified writers to help you.
We assure you a quality paper that is 100% free from plagiarism and AI.
You can choose either format of your choice ( Apa, Mla, Havard, Chicago, or any other)
NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.
NB: All your data is kept safe from the public.