Once you have chosen the company, write a one-two page analysis of what the company could have done differently to be successful in the specific market.
Groupon Company in Chinese Online Market.
International markets operate differently in several countries. When Groupon Company heads ventured into the Chinese business market, they failed to understand this concept. They thought operations in the global market were similar. Chinese market environment was a group-buying environment, something the company managers did not consider when entering the Chinese market. There were many players in the market, and vendors were the principal spokesmen when negotiating with business people involved in the group-buying activities. After the agreement, they left their partners with 10 percent profit other than the usual 50 percent profit. Besides, Groupon used a mass email marketing strategy. This was a wrong approach since Chine people rarely read that type of email.
For a successful business venture into the Chinese market, Groupon could have carried out intensive market research before engaging in any partnership. Through market research, adequate information is gathered that might be analyzed to give evidence on how markets operate in China (Gupta, Gupta, & Gupta, 2019). Consequently, the market research process was essential for the identification of an appropriate marketing strategy that could have been used.
Another Groupon Company’s failure was misaligned management structure. The company’s management structure demonstrated limited ability to tapping local talent for them to succeed in the Chinese market. Groupon management team comprised of almost all foreign members. The situation was, however, different from the remote area. Foreign managers directed their operations in this market. The managers had limited understanding of the domestic requirements of the Chinese market. They controlled the Chinese employees using the Western-style, a type of leadership that demotivated employees.
There existed a well-established culture of how the companies, together with employees, were being managed in China (Mozur, 2016). The management team could have incorporated domestic members who understood the Chinese corporate culture. The local members were to provide appropriate information during the identification and study of this culture. Studying the Chinese corporate culture would have helped Groupon company to incorporate the best essential elements, like adapting the best leadership style to be used slightly than the Western-style.
The partnership was one of the critical market entry strategies that Groupon used, although it did not work well for them. They made a wise decision in partnering with Tencent. However, the company failed when it misused the numerous advantages that came as a result of the partnership with Tencent. They did not rely on Tencent’s domestic expertise; rather, they chose to employ experts to carry out the activities all over the country.
Groupon should have formed a robust legal relationship with Tencent Company. They should have made business agreements as co-owners. For instance, an agreement on how to employ workers should have been made for successful market entry by the company. For example, they should have made an agreement on sharing employment chances, just as both companies agreed to share profit and risks. Employment of Tencent experts could have brought in new skills and knowledge on how to carry out the business operations in the market. Thus, enhancing a broad understanding of what kind of products and services are required in the market.
In conclusion, the Chinese market being an international market, requires an intensive market research process for successful market entry. Groupon Company should ensure that enough information is gathered and analyzed for healthy business competition. In addition, Groupon Company should wisely select and use the most relevant market entry strategies, if not all, of them for successful entry survival in the Chinese market.
References
Gupta, D. K., Gupta, B. M., & Gupta, R. 3. (2019). Global library marketing research. Library Management, 40(3/4), 251-261. Retrieved May 14, 2020, from https://search.proquest.com/docview/2187969915?accountid=151051
Mozur, P. (2016, december 4). Silicon Valley’s Culture, Not Its Companies, Dominates in China. (New York Times Company) Retrieved may 14, 2020, from New York Times (Online); New York: https://search.proquest.com/docview/1845546590?accountid=151051
Warren, J. K., & Mark, C. ,. (2015). Global Marketing (8 ed.). New York, United States: Pearson Education Limited. Retrieved may 14, 2020