The marketing director argues that the company’s marketing strategy should be to develop new products aimed specifically for the Chinese market rather than traditional ‘British’ products. Do you agree that this is right? Justify your decision (18 marks) Marketing strategy is the goal of increasing sales and achieving a sustainable competitive advantage. The new marketing director of Brainwash, the traditional British pottery company, proposes to change the company’s strategy from market development to diversification, entailing a large risk.The reason behind the proposed change is that a ‘large department store’ in China has asked for new exclusive range of products to sell. The potential benefits are huge but is it necessary for an already successful business to take such a risk? One method of assessing the potential risks and rewards of a particular marketing strategy is to use Insofar Matrix. This identifies 4 major strategies including market penetration, market development, market penetration and diversification.In the case of Brainwash, diversification is the new strategy Ewing considered.
The company’s marketing director argues the company should be developing new products for a new market, the large Chinese department store. The store has shown an interest in placing a large order, giving the company huge potential being entered into such a complex market. Moreover, it guarantees Brainwash future orders as well as growth. As the large Chinese department store expands, so will the sale of their products as it’s reaching more areas.From this it can be said although risky, the potential he Chinese department store offers is huge for Brainwash.
However is the Marketing Director correct in his decision? Brainwash current marketing strategy is market development giving the company success of 3% market share. From this factor alone, if the company is already gaining success in Britain, then why push it into the riskier Chinese market? By remaining in the K, Brainwash have a range of products that are well known and established.Brand recognition is a major factor in purchases, meeting Brainwash have not established in China yet. The risk that brings is not worth it when the company is still achieving in the KICK. Moreover, another factor the Marketing Director has clearly not considered is the fact only 6% of Brainwash senior managers are non-UK citizens. Therefore the company does not really have any idea what the Chinese market is like without undertaking costly and time consuming research.It can be said along with the risk and the costly research Brainwash would have to undertake is not worth it when the company has already achieved 3% market share in the I-J. In conclusion, the Marketing Directors decision to take the company and move it into the large risky Chinese market is wrong.