What are some of the environmental factors that you will need to consider in marketing coffee in China?
Question by O4K1986: What are some of the environmental factors that you will need to consider in marketing coffee in China?
You are the marketing manager for a leading coffee chain. Your company has made the decision to expand internationally, specifically into China. What are some of the environmental factors that you will need to consider in marketing your coffee in China? Which of one of these factors would have the largest impact on the company’s marketing strategy? Why?
Best answer:
Answer by TopSavings.Net
Well, I would need to know the culture of China better. A major environmental factor I would believe to exist would be tea vs. coffee, a long standing cultural of the Chinese. If I understand correctly, green tea is highly consumed in China. I believe this would have a significant impact on breaking into the market.
It will be hard to convince an ancient tradition to change, but there can be a marketing ploy right there. An advertising campaign making tea look for the old and weak, and coffee for the new man of the modern era.
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Demand. China is used to drinking tea more than they are to drinking coffee, so expanding a coffee chain to include more tea drinks (chai and regularly prepared tea — vs. the common way when you order tea at a coffee shop in America and they hand you a tea bag and a cup of hot water, to have different brews of tea ready to roll.)
The environmental factor in this situation is culture.
Accommodating to the desires of tea while promoting the ‘benefits’ of coffee versus tea would help greatly.
Coffee would start serving more of a niche market, to start with, being more a Western beverage, but can be promoted among the middle class, including working professions. (Akin to going out for wine than going out for a beer.)
Environmental scanning usually refers just to the macro environment, but it can also include industry and competitor analysis, consumer analysis, product innovations, and the company’s internal environment. Macro environmental scanning involves analysing:
* The Economy
o GNP or GDP per capita
o economic growth
o unemployment rate
o inflation rate
o consumer and investor confidence
o inventory levels
o currency exchange rates
o merchandise trade balance
o financial and political health of trading partners
o balance of payments
o future trends
* Government
o political climate – amount of government activity
o political stability and risk
o government debt
o budget deficit or surplus
o corporate and personal tax rates
o payroll taxes
o import tariffs and quotas
o export restrictions
o restrictions on international financial flows
* Legal
o minimum wage laws
o environmental protection laws
o worker safety laws
o union laws
o copyright and patent laws
o anti- monopoly laws
o Sunday closing laws
o municipal licences
o laws that favour business investment
* Technology
o efficiency of infrastructure, including: roads, ports, airports, rolling stock, hospitals, education, healthcare, communication, etc.
o industrial productivity
o new manufacturing processes
o new products and services of competitors
o new products and services of supply chain partners
o any new technology that could impact the company
o cost and accessibility of electrical power
* Ecology
o ecological concerns that affect the firms production processes
o ecological concerns that affect customers’ buying habits
o ecological concerns that affect customers’ perception of the company or product
* Socio-Cultural
o demographic factors such as:
+ population size and distribution
+ age distribution
+ education levels
+ income levels
+ ethnic origins
+ religious affiliations
o attitudes towards:
+ materialism, capitalism, free enterprise
+ individualism, role of family, role of government, collectivism
+ role of church and religion
+ consumerism
+ environmentalism
+ importance of work, pride of accomplishment
o cultural structures including:
+ diet and nutrition
+ housing conditions
* Potential Suppliers
o Labour supply
+ quantity of labour available
+ quality of labour available
+ stability of labour supply
+ wage expectations
+ employee turn-over rate
+ strikes and labour relations
+ educational facilities
o Material suppliers
+ quality, quantity, price, and stability of material inputs
+ delivery delays
+ proximity of bulky or heavy material inputs
+ level of competition among suppliers
o Service Providers
+ quantity, quality, price, and stability of service facilitators
+ special requirements
* Stakeholders
o Lobbyists
o Shareholders
o Employees
o Partners
Scanning these macro environmental variables for threats and opportunities requires that each issue be rated on two dimensions. It must be rated on its potential impact on the company, and rated on its likeliness of occurrence. Multiplying the potential impact parameter by the likeliness of occurrence parameter gives us a good indication of its importance to the firm.