Sangram Mkt Research

8/12/2019 Sangram Mkt Research

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L G Electronics

1. INTRODUCTION

Background of the study

As a consequence of the globalization of business, world trade has grown faster than world

output. Foreign direct investment has surged, imports have penetrated more deeply into the

world of industrial nations and competitive pressure has in-creased from one industry after

another. To retaliate to this global pressure firms started expanding to foreign countries

(Ekeledo, 1998, Barlet & Ghoshal 1987, ODonnell 2000).

Chinas economic growth has increased rapidly over the last twenty years. In the globalization

section, China has become a major trading nation since Chinas ef-forts in opening up to the

outside world in 1979.

When foreign enterprises are coming and expanding their business in Chinese market, the local

enterprises are threaten by the international competitors in-vestments. Along with Chinese

economical and scientific technologies increas-ing, many Chinese enterprises in different

industries have set up their solid in-vestments into the foreign markets.

Since Chinas WTO entry, the Chinese household electrical appliances industry, as well as other

industries, is facing the reality of a globalizing world economy and multi-global challenges, such

as the environmental challenge, the competi-tive challenge , the collaborative challenge, the

organizational challenge, the worldwide learning challenge and the management challenge

(Bartlett & Ghol-shal, 2000)

This thesis is a marketing analysis of the Finnish household appliances market for Haier Group

a Chinese household appliances manufacturer. Since Haier has set up the European headquarter

in Italy 1996, the company has opened the western European market successfully. For the next

period of its business plan, the company is going to expand its market in Northern European

Countries. This aim of this thesis is to provide a realistic framework for Haier Group which con-

siders investing in Finland.


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Purpose of the study

The manager of Haier wished that the thesis would especially concentrate on the marketing

analysis of the competitive environment. Moreover, a more proper study of that would be in

order which the thesis included the general marketing plans some important aspects.

For this time, Haier would try to promote one of their products to be the first sample: Haier

washing machine.

In this report, it included the internal and the external environment analysis to evaluate Haier

groups different marketing activities and the Finnish business environment to define the

companys mission, and future plans in Finnish mar-ket, and also by using various study modelsand research methods to analysis the current Finnish household appliances market situation and

possible marketing 6 strategies.

The methods of research and information collection were based on desk research (collected by

internet, book resources) and field research (personal interview, telephone interview,

questionnaire etc.). The marketing strategy suggestions and the final conclusions were given to

Haier for helping its future Finland market-ing decision making plan.

The first part of the thesis was the theoretical framework for the marketing analysis. Each of

steps of strategic planning of marketing was explained. The next part of the thesis continued

with the practical marketing analysis for Haier Group. The final conclusions were the third part

and the biography and appendi-ces were following in Chapter four.

Research problems

To fulfill the objective of this study, the research was done by answering the main question: is

Finland a potential country for investment for Haier Group? The research should consequently

make the company be able to reach a conclu-sion on:How is the electrical household appliances market situation in Finland at pre-sent? Such as

market demand, market size, consumers buying behavior etc.

How is Haiers competence in the Finnish market?

Does Haier have any potential market in Finland?

How is the competitive situation in this market?


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How will the company meet the customer needs with better products than their competitors?

If the company is going to enter into the market, what kind of the marketing entry mode

should be used? And what kind of distribution channels can be con-sidered for Haier in Finland?

Research methodology

In this report, the research was implemented by using both qualitative and quan-titative research

methods and using theoretical ideas to analyze the practical case study.

The theoretical part contains information gathered from literature and text books dealing with

marketing planning, marketing environment and market research. In addition, the case studies

research is from the existing company information to the analysis of macro and micro

environment of the target market to evaluate the companys strengths, weakness, opportunitiesand threats.

Besides, the case study includes a series of surveys and personal interviews that a lot of

participant observation where the potential users in the target market knew the goal of my

research. The open questionnaire included various types of questions such as simple yes & no

answers, multiple choice and sliding scale which were designed for the potential users by

answering on internet and paper handing out. The personal interviews were deducted at public

places and compa-nies visits for the potential target group and staff from other relevant organiza-

tions. The market research included primary and secondary data. The primary data was collected

with qualitative methods by interviewing the potential users and retail-ers, especially the

competitors informationfrom retailers and other organiza-tions. The quantitative research was

conducted by survey research for under-standing the customer buying behaviors regarding the

Finnish household appli-ances.

All interviews and customer survey were conducted by in English. The secon-dary data sources

were from books, product brochures and internet with some relevant documents from Haier

Group, China.

Limitations of the research

A marketing analysis and the marketing research of a country is a big project by using more

personnel and resources to get information in details. Also the time consuming with personnel

cost probably is a big investment. For this report, al-though my capabilities are limited on


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searching all over the country, the results and collected data of the main Finnish cities by the

references of books and sur-vey implementation are still validity for the company.

There are also limitations in the surveys regarding the quality of the question-naire. Some

considerations such as whether the respondents understand the ques-tions completely, whether

the feedbacks of the respondents were correct and from their real point of view can be

reserved. However, we know that most of responses can be effective because reliable and honest

is a part of Finnish culture.

Furthermore, another limitation is that all data and information could be changed by years and

economical circumstances.

Reliability and validity of the study

It is not easy to define the reliability and validity in the qualitative research, be-cause thequalitative research is hard to replace the same research methods to get the same results. In the

case of this report, the personal interviews by using qualitative research method could not be

repeated until the records of interviews provided. For this time, although some useful

conversation was written down in a paper during the interview time by me, it was lack of the

interviewers original sound records.

However, the survey research can be repeated by the similar ways. The ques-tionnaires were

conducted by sending emails and papers to various potential consumers. The answers were

collected randomly after respondents finished the questionnaires. And each of respondents

answered individually without any pressures. All the results can present a social phenomenon

and the respondents point of view in a certain period which cannot be changed quickly.

Therefore, the results of the market research are generally reliable and valid in this report.


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Market research and consumer protection

A Food Standards Agency case study

The UK government set up the Food Standards Agency (FSA) in 2000 by Act of Parliament. It is

a non-ministerial government department. This means that it reports to the government but it is

run by a Board which acts on the public's behalf. This ensures it can act independently to protect

consumers. The public can have confidence that the decisions it takes about food safety are in

their best interest.

The FSA's role is to:

provide advice and information to the public and to the government on food safety, nutrition anddiet

protect the public through effective enforcement and monitoring support consumer choice through accurate and meaningful labelling of food.

The FSA's vision is 'Safe food and healthy eating for all'. The FSA seeks to achieve this vision

by:

putting the consumer first operating in an open and independent way carrying out actions that are based on science and the best available evidence.

The work of the FSA is important to everyone in society because we all have an interest in food

safety and healthy living. Food from restaurants, supermarkets, and school kitchens all needs to

meet certain standards.

The FSA works with a range of stakeholders. Stakeholders are groups and individuals that have

an interest in what the FSA does and the decisions it makes.

Different stakeholder groups have different concerns and issues. For example,

businesses need to be sure that they are meeting food requirements for consumers. The FSAlooks at all activities 'from farm to fork' to help them meet requirements at every step of the food

process.


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local government and law enforcement agencies need to be aware of what to do when problemsoccur, for example, shops selling out-of-date food. The FSA provides standards to enable food

inspectors or health and safety officials to take remedial action.

consumers want helpful information about food. The FSA carries out a range of work to makesure food is safe to eat and provides consumers with up-to-date information. This helps them to

make healthy choices about what they eat.

This case study focuses on how the FSA uses scientific and market research to provide

consumers with reliable up-to-date information, enabling them to make healthy choices about

food. It shows how market research helped to develop the 'traffic lights' system of labelling food

(also known as signposting). This gives consumers an easy way to understand the breakdown of

fats, salts, sugars and carbohydrates in food.

Market research is about finding out what customers and consumers think, want or need. For

example, market research helps businesses decide on what new products or services they will

offer.

Before carrying out market research, it is important to define the aims and objectives of the

research, that is, what does the consumer or organisation want to find out and why. These

questions guide the market research process and lead to solutions. By analysing the results of

market research, a business can improve its products or service in line with what consumers

want.

One of the FSA's main aims is to identify what customers want, need or expect to see on food

labelling. FSA's objective is to help consumers make informed choices about which foods they

buy, for instance, if they had a nut allergy or were on a low calorie diet.

One of the starting recommendations was that front-of-pack labelling should have a user-friendly

approach. Customers wanted labelling to provide information about the nutritional content of

foods 'at a glance'.

Aims and objectives


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To meet the aims and objectives the FSA devised a market research campaign with a series of

questions. These included:

What sort of information would you like to see on packaging? How could the information be set out for ease of communication?

During 2004/5, FSA carried out an extensive programme of research over four separate studies

with consumers, health charities and other stakeholders. These studies considered:

the advantages of the various front-of-pack labelling formats compared against a benchmark of'no signposting'

what products the signposts would be useful for how consumers would use the signposting to help buying decisions consumers' preferences for the format of the label.

Outcomes of research

The outcomes of this programme of research helped to develop the 'Traffic Light' front of pack

labelling scheme. Many companies, like Sainsburys, ASDA, Waitrose, Budgens, Londis,

McCain Foods, Marks & Spencer and the Co-Operative Society now use the Traffic Light

label on their products.

Each year the FSA also carries out face-to-face interviews with consumers to produce its

Consumer Attitudes to Food survey. This research method means that people get a chance to sayexactly what they think. The research aims to:

track people's attitudes to and awareness of food issues improve the public's knowledge and understanding of those areas for which the FSA is

responsible

help the FSA develop effective communications.Over 3,500 people gave their views for the 2007 survey. The 2007 survey showed that:

many people had an increasing awareness of the '5-a-day' fruit and vegetables message about 30% more consumers were aware that they should eat five portions of fruit and vegetables

a day compared with 2000

increasing numbers of consumers are worried about the amount of fat, salt and sugar in foodbecause they understood how these may damage their health


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a growing number of consumers said that they looked at nutritional information on the labels tocheck the fat and salt content.

However, the survey showed that there is still room for improvement. It showed that whilst 40%

of people snacked on fresh fruit in between meals, almost 35% snacked on biscuits or cakes and

a further 20% on crisps or savoury snacks.

Primary and secondary research

Market research can be either primary or secondary. Primary research is new research, carried

out to answer specific issues or questions. It can involve questionnaires, surveys or interviews

with individuals or small groups.

Secondary research makes use of information previously researched for other purposes andpublicly available. This is also known as 'desk research'. Secondary research includes published

research reports in a library, surveys or the Internet. It can also include scientific reports

produced by medical councils, universities or government, for example, the Royal College of

Physicians, the British Heart Foundation and the Department of Health.The FSA also uses

reports produced by research organisations such as MINTEL. These give the results of large

scale surveys, which companies commission to learn more about what consumers think of their

products. FSA does not make decisions or rely solely on research by third parties, unless its own

research supports the findings.

Collecting information

There are different ways of obtaining and analysing information:

Questionnaires provide answers to standard questions. These can be carried out by mail, online or face-to-face and can cover a large number of people.

Interviews are usually one-to-one and focus on a list of questions. Focus groups enable a number of people to discuss ideas or topics together and provide a range of views.

Organisations often undertake secondary research first to find out what already is known about

the subject. It is cheaper than setting up primary research.

As an example, the FSA ran a major television, newspaper and other advertising campaign to

raise public awareness of its 'Traffic Lights' campaign. The campaign consisted of three 10-


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second TV adverts, a poster on a bus side, a six-sheet poster, a press advertisement and an

advertorial in the Sun.

The first campaign took place between mid-January and mid-March 2007. A further 10-second

TV advertisement was launched on the 5th March. The FSA undertook some primary research

interviews to find out if how effective the campaign had been in making people more aware.

Quantitative and qualitative research

Quantitive research

Quantitative research presents information numerically, for example, by use of

percentages. All respondents in interviews or questionnaires answer the same questions

to ensure consistency.

For example, the following question was used before and after the advertising campaign:

'How often, if at all, do you use information on salt, fat, sugar or saturated fat on the FRONT of

the pack when it is available when choosing which food product to buy?

01: Never/Not seen 02: Rarely 03: Occasionally 04: Usually 05: Always 06: Do not purchase

food'

The results of this question for the period before and after the advertising campaign were

shown as a chart to make it easy to understand.

Qualitative research

Qualitative research finds out opinions through open-ended questions. The FSA used

primary qualitative research when designing the traffic light scheme. It talked to small groups of

medical professionals, consumers and government advisers.


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It also used secondary research taken from scientific studies by bodies like Diabetes UK. This

helped the FSA to gather all relevant information to ensure that the scheme would fulfil

requirements.

By using both quantitative and qualitative research, the FSA was able to maximise the range of

data available for effective analysis. For example, it commissioned a survey of 2,000 adults

using Computer Assisted Personal Interviewing (CAPI). This plays the TV adverts and shows

posters and press adverts to respondents.

Each interviewer had a random quota of people. The interview group had a mix of gender, age

and working status to ensure a representative sample. A sample is a small part of something

intended as representative of the whole group. For example, it would be impossible to survey the

whole country. By using a carefully selected sample, the FSA analyses and makes judgements

about what the overall trends are. By analysing sample data, the FSA can draw conclusions about

what the results would be for the larger group.

Analysis and use of market research

The market research showed that increasing numbers of consumers are aware of the work of the

FSA, the importance of a healthy diet and how the traffic light system guides their purchasing.

This system makes it easy for consumers to make healthier food choices quickly and easily.

Healthy eating is all about getting the overall balance right. Consumers should look for

products with green, amber or red coloured labels on the front of the pack. For example, when

deciding between two pizzas, the colours guide the consumer on which has lower fat or salt,

helping them decide which one to buy. It also helps the retailers by showing that they are taking

a responsible approach in providing nutritional information for consumers.

The front of pack traffic light colouring delivers three main benefits:

It makes it easier for consumers to eat more healthily. It encourages consumers to look for and demand healthier food.


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It provide businesses with an incentive to provide healthier food. There is a pay-off to cutting back on fat,saturated fat, salt and sugar in products as consumers will increasingly prefer these.

The traffic light system has been adopted by a range of major UK retailers. Waitrose,for

example, describes how the scheme works with its products: 'The easy-to-follow front of pack

format allows customers to see the nutritional content of products at a glance. A majority of

Waitrose customers use the information to help them make healthier choices. Traffic Lights

appear on a range of Waitrose products including ready meals, sandwiches, pizzas, vegetable

accompaniments and beefburgers.'

The Agency's traffic light approach is fully supported by key medical institutions and well

respected organisations, such as British Medical Association, The National Consumer Council,

WHICH? Magazine and the British Heart Foundation.

Having the support of these influential groups means that consumers recognise that the research

is valid and that they can trust the information. Developing this approach was based on both

consumer research and scientific-based secondary research. This is research carried out under

scientific conditions such as laboratory testing.

Conclusion

The FSA carries out market research with consumers, producers and retailers to identify

ways to educate the public about diet and food issues.

The FSA uses science-based evidence about healthy eating and food to protect consumers and

public health. It also uses existing market research about food consumption produced by

organisations such as MINTEL as well as conducting its own research.

The FSA's traffic light colour-coded system, developed after research, gives consumers a useful

tool to help with healthy food choices. Evaluation after the advertising campaign shows that the

proportion of people now referring to the nutritional information on the front and back of

packaging has increased from 72% to 75%.


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The FSA conducts regular research to evaluate how consumers are using the traffic light system.

This helps it to assess the value of this approach and to make ongoing improvements.

Sangram Mkt Research

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