Nowadays, companies are upping their competitive index in order to keep up with the globalization trend sweeping the international business landscape. A company cannot hope to survive only by opening subsidiaries in its own country. So, these companies are forced to open subsidiaries in other countries; however, this necessitates some previous studies to ascertain if it would be simple or hard to establish operations in a certain country. The cultural, demographic, geographic or economical differences can often be reasons for the failure in the implementation of a company on a market.
This document deals with French company Caroll's intention to enter the Chinese market. This middle market is very difficult owing to the country's cultural disparities from the Western nations. Initially, we will present an overview of the company and followed by that of the Chinese market. Finally, we will present our marketing plan for its implementation.
Founded in 1963 by Raphael Levy and Joseph Bigio, the company was originally named Les tricots Caroll. It gained immense popularity with its knitwear products and premium Shetland wool and has amassed over 1,000 retailers. In the 80s, it started to evolve with the addition ofa Prêt à porter collection, and opened its first stores in France. In 1984, it opened its first branches.
In 1988, Caroll International registered itself on the stock market and the Group Vivarte took over the knitwear retail chain.
In 1994, Caroll defined a new position on the market by creating the special brand Caroll Paris. The company mainly targeted the modern women, who were well aware of their needs and not hesitant to voice them either. In couple of years, Caroll International reinvigorated its image and developed its market shares. In 1997, it began its development in other countries in Europe and all over the world. Currently, it has 310 stores worldwide, in Spain, Portugal, Switzerland, Lebanon and Japan.
In the past forty years, Caroll has gradually established itself as one of the most important successes in the Prêt à porter (ready-to-wear) sector in France. Today, Caroll is appreciated for the quality of its products, its style and its know-how.
[...] - Price: Caroll must adapt its prices to the Chinese market because the income is lower there. Also, the company wants to enter the middle- market, so it must present a price in relation to the income of the potential Chinese customers. It must also correspond to the price of the competitors, not too high but not too low. Caroll must stay a high entry level fashion house. It must demonstrate that it has good quality products. - Place: Caroll must be implemented in the major big cities of China, as these are the places where we can find the most of the potential customers. [...]
[...] II) Overview of the Chinese market China is an emerging market witnessing an incredible growth, from 6 to per year, for the past five years. It is the second country behind the US with the most significant GDP 11.6 trillion) and has the largest population in the world with around 1.3 billion inhabitants. Moreover, with opening of its markets to liberal reforms in 1978, and its entry in the socialist economy, the Chinese market seems to be the new Dorado” for foreigner investors. [...]
[...] It has to be adapted to the Chinese way of living. - Physical evidence: It is an essential element and part of the identity of the brand. It must retain the look of the stores in France, be well- recognized and have the French style. The company should reduce the size of the clothing in accordance with the relatively diminished stature of the Chinese. The 3 Vs: - Valued customers: Chinese women aged between 30 and 55 years, from middle-class, living in a big city. [...]
[...] China is emerging as an attractive market today for companies over the world, so it is important to cement the company's presence now. Carol cannot afford to mull over its options, rather it has to jump onto the bandwagon before other competitors set up base in China. Now, we will make the marketing plan for the implementation of Caroll International in China. III) Marketing plan The Boston box: Relative Market Share Market High Low Growth rate High Stars with: Question Marks with: Jeans, trousers T shirts, blouses, dresses Low Cash cows with: Dogs with: Pullovers, coats Accessories, shoes The BCG Matrix evaluates the different products of an organization according to their market share and their growth prospects. [...]
[...] Ansoff matrix: Products Existing New Markets Existin g Market penetration Product development New Market development Diversification Market penetration strategy: Caroll must gain new customers by its entry on the Chinese market. It has to lure away the existing customers from its main competitors. Product development strategy: Caroll will have to adapt its collection to the Chinese style and also the measures of the Chinese women. It can also make new products, more specific to the Chinese taste. Finally, we must see the different quality levels. [...]
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