Global Marketing Assignment: International Expansion Of T2 Tea In Hong Kong

Question

Task:
Global Marketing Assignment Task: Find an Australian company with potential for international expansion. An example could be a local wine maker, a bank, a university or a marketing consulting agent etc. Develop an international plan that helps this company identify a NEW emerging market and export its products/services into this market. This foreign market should totally new to this company. It means this company has not explored this market yet so far.

Answer

Executive Summary
The use of internal and external market environment will be done in this global marketing assignment with the use of the strategic measures to ensure the potentiality of the Hong Kong market for the growth of the T2 Tea. T2 Tea is effective in creating awareness about the health benefits with the development of brand awareness. The business has a very weak distribution channel making it difficult for the business for international business expansions. The situation is positive for the business execution. T2 Tea with the effective management measures of the Hong Kong government. The products will be proposed to the customers who like to experience exotic tea flavours and are encouraged to experience different products and then select the best for them. The business needs to adopt strategic marketing measures to attack the customers towards the new brand T2 Tea. Sole Proprietorship market entry mode will be used for the business expansion in Hong Kong. The company will be prospering at low pricing for the product to gain polarity in the market of Hong Kong. Social media influencers to promote the products online and thus ensure that awareness about the brands among the customers is created.

Introduction
The expansion of the business in the international market is the strategy used by the companies to increase their market share. The SME companies are willing to expand their business in promising markets so that they can elevate their annual returns. In this report, the SME business T2 Tea has been taken into consideration. The business is successfully operating in the local Australian market and is willing to expand its business in the promoting Hong Kong market. The business has 40 stores across Australia and had sales of around $57 million at the end of the year 2013. The business has already expanded its business in the countries like London and USA and thus will be using the market expanding measures to develop an understanding about the Hong Kong market. In this report, the use of internal and external market environment will be done with the use of the strategic measures to ensure the potentiality of the Hong Kong market for the growth of the T2 Tea and thus encourage the business to promote the products with the effective implication of theories and models.

1. Internal Assessment / Competency Analysis
Company’s existing and potential competitive advantages
The business of Melbourne has started in the year 1996 and has been effective in providing a unique taste as well as services. The business is providing branding and pleasant store experiences. The business has been effective in enhancing the sales of Tea throughout London. The effective knowledge about the markets and the consistent production of the Tea, which are innovative, has been the recent competitive advantage that the business has (Prezi.com, 2021). The brand is well known in the domestic market and thus is showing huge potential in the international markets as well. The execution of the tea that has exotic flavours has the ability to attack the attention of international customers as well. The mission statement of T2 Tea is effective, and the business is willing to introduce unique as well as exotic flavours throughout the world with the help of tea blenders (T2tea.com, 2021). The business is willing to give power to the customers to explore different cultures they're effective sensory such as sights, taste, and smell to develop the richness of their lives. It is effective in providing fresh products as well as high-end retail experiences to the customers. T2 Tea is effective in creating awareness about the health benefits with the development of brand awareness. The exclusive products experiences are enabling T2tea to develop better growth prospects for international customers as well. It has been evident that the products proposed by T2 Tea are excellent in developing the customer’s acquisition in the internal markets (T2tea.com, 2021). The exclusive flavour and the good quality products at reasonable process are the main competitive advantages that the business of T2 Tea is having in recent times.

SWOT analysis

Strength
The business of T2 Tea has a huge market hold in Australia. The business has been operating in an effective manner in the European market as well. It has been evident that the product quality and the variety in the flavour of the team is the key to success for the business (T2tea.com, 2021). The business, with its ability to produce a variety of Tea providing exotic experiences to the culture, is proposing the ability to fetch profitability in the new internal market as well.

Weakness
The limited understanding of the international market is restricting the business of T2 Tea to develop effective business in an unknown market. The market competition is huge. There is a local business in the new market that is affecting the business success. The customers are mostly willing to rely on the local business, and they are not willing to trust the internal business (T2tea.com, 2021). This is the major weakness for the business.

Opportunities
Brand awareness is huge. The effective idea about the international markets and the use of the proper business executing strategies has the ability to develop a better idea to enhance the prosperity of the business in the international market. The expansion in a competing market like London has been productive in creating excellent market expansion experiences for the company (Prezi.com, 2021). T2 Tea has been effective in creating a stronger notion to ensure benefit to the business and thus encourage the company to develop sales rate.

Threats
The products produced by T2 Tea are easily imitable. The Tea that is the main product of the company is easily substituted. International marketing has a leading tea business that is effective in developing tough competitiveness to the local business like T2 Tea (Prezi.com, 2021). However, the inefficient logistics has been effective in the international expansion of the business and therefore acting as a threat to the business.

Key driving forces behind this company’s international expansion

• Growth in the market share: The expansion of the business in the international market is determined to be effective in elevation in the market share. Rietveld and Schilling (2021) mentioned that a business with an international presence has a wider market share. It is effective in developing the fact that the business with the internal business expansion measures has the opportunities to develop market hold and thus ensure that the productivity of the business is enhanced in an effective manner.
• Economic integration: The expansion of the business in the potential international market is contributing to elevating the business profitability. The developed and the developing countries benefit the business the most (Nosratabadi et al., 2019). It has been evident that the annual growth rate, along with the annual revenue generation, is enhanced business the business on financial grounds. The economic integration of the business is positively impacted by the execution of the internal expansion in the potential country, thus acting as the full factor for the business.
• Increase in the customer base: The business is able to serve wide customers and thus develop brand awareness. The effective measures are allowing the business to build a better customer base and gain loyally among international customers as well.

The above-mentioned factors are encouraging the business of T2 Tea to expand its business in the international market. The market of Hong Kong is considered for the expansion of T2 Tea. The evaluation of the Hong Kong market to inspect the market and ensure that the market is appropriate for the business of T2 Tea and thus has the potential to develop better growth prospects.

2. Market Analysis/business situation assessment
First level

Second level
PESTLE analysis

STP
Segmenting
Geographical: T2 Tea, in the context of expanding its business in Hong Kong, will be focusing on the people residing within the geographical territory of Hong Kong. The use niche marketing measures will be taken to ensure that effective strategies are taken to target the customers and keep them satisfied at the same time.

Demographic: Both males and females belonging to the age group 15 to 65 years are attacked for the sales of T2 Tea (T2tea.com, 2021). Moreover, the company is focused on ensuring that the products are reasonable so that it can attack the people belonging to the lower and middle-income group people.

Behavioural: The customers loving to have Tea are the focused group for the business T2 Tea in the market of Hong Kong (T2tea.com, 2021). It has been evident that the taking of interested customers is helpful for the business to execute the strategies measures that are helpful in influencing the customers buying behaviour.

Psychological: The products will be proposed to the customers who like to experience exotic tea flavours and are encouraged to experience different products and then select the best for them.

Targeting
The company will be targeting customers, both male and female, who belong to the age group of 15 to 65 years (T2tea.com, 2021). The products are effective in attracting customers of different cultures. Targeting customers having an interest in consuming Tea has been effective in ensuring profit to the business in the new market as well.

Positioning

Figure 1: Positioning map

The strategic measures of T2 Tea to position its high product quality and Low price are having the ability to attract customers belong to the lower and middle-income group. Tea is consumers by both rich and poor, so the effective measures of positing the product in low price strategies are effective in fetching better success rate to T 2 Tea in the market of Hong Kong.

Porter’s five forces

3. Entry Strategy Appraisal
Entry mode theories- Dunning’s eclectic framework

Internalization theory
As per Morrish and Earl (2020), the theory of internationalization is effective in evaluating the State aspects as well as the change aspects in a coherent manner.

Market Commitment: The business will be entering the Hong Kong markets with the help of a sole proprietorship. No partnership or alliance is made with the existing business. The company is well aware of the markets condition and the business environment that is prevailing in Hong Kong, and thus the use of the internal business expansion strategies are adopted by the business so that the company can remain itself in the tough competing business conditions.

Market knowledge: The inspecting of the condition of the external and internal market is productive in fetching evidence about the customer's behaviour towards the tea products. The interest of the customers towards the products proposed by the business has been highlighted, and thus measures are taken (Jocevski et al. 2019). It is to ensure that the well-planned business strategies are adopted, and the company is able to increase the profit prospect in the new markets of Hong Kong.

Commitment decisions: The business needs to develop a proper network of suppliers. The business is in need of developing contacts with the local distributors so that the prospect can reach the stores easily (Boojihawon et al., 2021). It is a must to ensure that the company is able to develop a better engagement with the stakeholders so that they can keep the customers satisfied in an effective manner.

Current activities: The business is effective with the production of quality products. The use of organic ingredients is done so that the health of the customers is not subjected to any kind of risk. It has been thus evident that the use of technological advantages is allowing the business to propose the best quality products to the customers even in the host countries. Tallman et al. (2018) mentioned that the business needs to be well energy of the business environment and the needs of the customers in the new markets. Therefore T2 Tea is effective in developing strategies notion in building customers engagement by proposing the tea flavours which are as per the preferences of the people residing in Hong Kong.

Market entry mode

4. International Marketing strategies
Yaghoubian et al. (2018) mentioned that the 7 Ps of the marketing mix is considered to be effective in developing better measures in developing the strategies to market the product in the international business environment. The effective measures adopted by T2 Tea in the markets of Hong Kong are mentioned as follows:

Product
The exotic ingredients are used to make the different flavors of the Tea. The health concern of the people is taken into consideration. Natural raw material is used to produce high-quality products. The different flavour of the Tea is inspirited by different culture and therefore ensure that the product proposed by T2 Tea has the ability to keep its customers satisfied.

Pricing
The pricing of the products plays an effective role in developing buy intentions among the customers. Lipsitz et al. (2017) mentioned the reasonable pricing of the products are needed for developing for the business to gain the attention of a wider population range. In the context of T2 Tea, the business is fissuring on the customers belonging to the lower and middle-income group. It is thus evident that the company will be prospering at low pricing for the product to gain polarity in the market of Hong Kong.

Promotion
The use of digital marketing has been in trend in recent times (Yurchuk, 2020). The business of T2 Tea will be using social media influencers to pamphlets the products online and thus ensure that awareness about the brands among the customers is created. The use of hoarding and pamphlets will also be done so that the business is able to attract customers using offline marketing measures.

Placement/distribution
The local distribution will be used to develop strong and integrated contracts. This will allow the business to develop its efficiency in logistics. Transparent agreements with the distributors and suppliers will help the business to thrive in the tough market condition in Hong Kong.

People
The employees of T2 Tea are the reason for the business success. In the context of its Hong Kong expansion, the business will be targeting employing local employees. This will be effective in developing better employment opportunities for skilled employees and thus ensure that the business is able to execute services without any hurdle (Fan and Harzing, 2021).

Processes
The use of a flat business structure will be used for fact decision making. Moreover, the effective implication of AI technologies in serving the customers with quality products will be done (T2tea.com, 2021).

Physical evidence
The brand name and the trade markets of T2 Tea are effective physical evidence for the brand. It helps the company to gain prosperity in the new market condition as well (T2tea.com, 2021).

5. Summary and conclusion
It can be stated that the business of T2 Tea has huge growth opportunities in the market of Hong kong. The use of the sole proprietorship is effective in developing competitive measures. The local business is the tough rival for the T2 Tea, and therefore the use of effective marketing measures like using influencers are productive in developing attracting forces for the business in the new market.

Reference List
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