International Strategic Management

ASSIGNMENT SUBBMITTED BY Priyank Mehta

Roll No: L0243KMKM1010

BA 5

SUBMITTED TO Terry Johnson

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Table of content Title Page No.

1. Why do business in India 2. Mode of entry 3. Problem faced by HMV in Indian 4. Marketing Mix 5. SMART Objectives 6. STP strategy 7. Conclusion and recommendation 8. Referencing

3 3 4 4 5 6 8 8

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Why do business in India

India is a developing economy and offers considerable opportunities for HMV to expand in its activities and profitability. Trade between Indian and rest of the world has increased significantly in past couple of years. India is a growing economy, with population of more than 1.2 billion people and has huge potential for HMV. There are great opportunities in a wide range of sector for HMV like in music, games, books and video. Indian business are managed in same way to those of in the England and English is the main business language used. The government of India wants more trade liberalisation and economic reforms and it is expected that the economy to India will be third largest in the world by 2030. According to World Bank Indian gross domestic product is worth 1729 billion dollars or 2.79 % of the world economy. Indian is expected 7.81 % growth in GDP in 2012. Historically, from 2000 until 2011, the average quarterly GDP growth was 7.5 %.

Mode of entry
Franchise HMV should go with franchise in India because it will help them to share a risk and cost, grow faster, generate greater profit, and have greater access to resources, access to new market and distribution network. HMV is an experience organisation which is doing business for more than 80 years as high street music retailer. This new venture will provide a platform for both HMV and the home country Franchisees to increase their presence in the market. This deal is also further evidence of the changing face of the Indian music retail industry as these are first one to explore it. As India is a developing country they dont have big music retailer and this is the opportunity for HMV to dominate the Indian market by showing its presence.

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Problem may faced by HMV in India Market

India is a developing country, so people in India still use pirate CDs and DVDs, as they are very cheap and easily available. The government is Indian doesnt take any serious action to stop piracy or to stop illegal downloading from internet. Majority of the population still spent very less on entertainment, living standard and buying power of people is still very low in India as compared to rest of the world. Communication gap and cultural difference can be one of the major problems faced by HMV from its Franchisees. Government regulations for Foreign Direct Investment and corruption in Government sector may be the biggest challenge to face by HMV. Understanding customer behaviour and loyalty of the customer is difficult job. Despite of all the above problems India is one of the most attractive retail destinations in the world.

Marketing Mix Product

HMV is in retail music, video games, video and books. With the available recourses and making proper utilization of it HMV should develop more product and services. They should emphasis and promote more on packaged music, visual and games. Games have good opportunity to play major role in their business in India. They should adapt to change in technology as it is the major factor in entertainment markets. In this technological environment they should try to launch more innovative and advanced product. For instance they should start selling 3 D games, as the demand of these games are growing and they will be the future.

Price
India is the new market for HMV so they need to come with some pricing strategy and try to keep the price low initially. This means they should offer low price than the existing music retailer, to encourage the new customers. Setting low price will attract the customers in India and will help them to capture market share. The sales target in India should be high because it is very populated country and people love to hear music, watch movies and play
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video games. Once they capture the market share they can increase their price gradually to increase the profit.

Place
HMV should have a centralized warehouse in which they can develop their product and distribute to various stores around the country. They can use Internet has their intermediary channel to distribute their products online. Franchisees will be the great help to them regarding distribution of their goods.

Promotion
A wide spread promotion plan should be taken too introduced HMV in India and capture the market. The best advertising company should be hired, who should take care of their market penetration strategy by TV adverting, sign boards, pamphlets etc. In future HMV should best Artist and Icon in their business from all over the world to inspire the customer about their product.

SMART Objectives
HMV should decide their smart goal and objectives before entering Indian market; it will help them to make clear strategy and helping them in getting the market share. They should decide the time, in what time they have to achieve these objectives. Aim and Objective should be: Specific - HMV main objective is to have long- term sustainable growth in future. They should capture the Indian market over a time. Measurable - To maintain good relation with franchisees and to improve their performance, this will help them to continue being transformed as international music retailer. Achievable The strategic objective in three year time or more, which should be achievable.

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Realistic- Capital structure should remain appropriate for the requirements of their plans and are they capable of obtaining their objectives. Time - To achieve their expectations from Indian market they should set a specific time, which should be realistic and achievable.

Segmentation, Targeting and Positioning Strategy (STP)

Segmentation Strategy HMV should follow the following segmentation growth strategies. Market Penetration HMV should use competitive price strategies, sales promotion and advertising to penetrate in Indian Market. HMV should do live shows and concert in order to get connected with the people.

Market Development Over a time HMV should expand their business in all the major cities in India.

Product development

HMV should introduce more advanced products and use the best of technological resources. They should more focus on games and blue ray disc, as they are the future.

Diversification HMV first came up with music retailer business and few years back they added games, books, gift item to their business, for various segment of people. This show that they are diversified and there is something for everyone in store from a child to grandfather.

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Targeting Strategy HMV should use the following approaches: Concentrated HMV access to e-books and good quality gift item, which are very rear in Indian market, can be unique selling point for HMV to increase their customer base.

Differentiated To attract customer from all age group HMV should move forward with latest technology and innovation. Games, technology and other related products which are growing in digital entertainment.

Undifferentiated DVD, Blue-ray and games will expect to have maximum sale in India. Thus marketing mix may be requiring for these item, for serving the whole market.

Positing Strategy After targeting its customer and segmenting the market, HMV should able to proceed to positioning their products and services in Indian Market.
HIGH PRICE GAME E-BOOK DVD,BLUE-RAY

+HIGH QUALITY

-LOW QUALITY

CD T-SHIRT POSTER

LOW PRICE

Positing map of HMV

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Conclusion and Recommendation

In this report the marketing plan has been recommended to ensure HMV, set up and grow their business in India. In this research, we have discussed about the STP strategy, SMART objectives, Marketing Mix and Mode of entry, of HMV for their further International expansion in India. SMART objectives tell us about, where HMV want to be and what they want to achieve. The STP strategy describes us about the marketing plan which tells HMV chosen market and positing its product in the market. Marketing Mix focus how HMV can widen the range of their products, set the prices, distribution channel, promote their product and services. After analyzing HMV and the Indian market I found that HMV has opportunity to become leading music retailer in India. My recommendation to HMV is: They should have SMART objective with short and long term strategy. They should maintain good relationship with their franchisees. Initially they should keep the price low to capture the market share. They should arrange events and live concert to attract customers and advertise their brand. Should be updated with the technology and be innovative. Should emphasise on Games market.

Referencing
Carl Mcdaniel, Jr.Roger Gates (1998). Marketing Research Essentials. 2nd ed. Ohio: West publishing company. P4-22, p66-96. Graham hooley, Nigel F. Piercy, Brigitte Nicoulaud (2008). Marketing strategy and competitive. 4th ed. England: Pearsons. p59-92,p205-270 Chadha, A.S. (2008), India Most Attractive Retail Destination in the World, The Economic Times, 19th March 2008 Douglas Bullis (1997). Selling to India's Consumer Market. USA: quorun books. P59-92, p205-270. http://www.eurobrandsindia.com/blog/2011/03/26/10-reasons-why-youshould-do-business-in-india/ http://blog.sudeepaudio.com/?cat=1 http://2009.hmvgroup.ry.com/busrev/ http://www.topnews.in/troubles-hmvs-suppliers-leads-trouble-company-2305757 http://ivythesis.typepad.com/term_paper_topics/2009/06/international-businessmanagement-and-strategyhmv.html

http://www.mairec.org/IJRFM/Feb2012/6.pdf
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