Choosing a Product
The chosen product for the consumer market in South Africa is smartphones, which have a high demand in this consumer market based on the technological advancements experienced in different parts of the world. The selection of this product focuses on two aspects that would help towards defining success for the company involved in the export process. Firstly, the selection of product focused on the growing consumer markets for smartphones within the South African consumer market with the majority of these products coming in from Asian countries (Parker, 2014). Consequently, this means that providing consumers with quality smartphones would help towards shifting their loyalties from the Asian countries towards products manufactured within European countries. Secondly, the levels of advancements in technology have also helped in the selection of this product based on the demand that the product would have within this market.
Over the last few years, the demand for access to technology in developing countries has increased immensely, which has created that provision for companies to take advantage of the consumer market (as highlighted in figure 1). That is an aspect to consider in the exportation of smartphones into the South African market, as it presents higher levels of viability based on overall expectations from individual consumers in the market. The company ought to take advantage of the rising demand for this particular product in the consumer market in South Africa towards ensuring that it is able to position itself towards gaining a market share. That would also require having to come up with an effective market entry strategy into this particular market that would match the business environment.
Figure 1: Smart Phone Uptake in African Market
Source: http://www.bdlive.co.za/africa/africanbusiness/2014/11/07/nine-graphs-that-give-you-new-insight-into-africas-thriving-mobile-landscape
Choosing Market
The African country selected for the chosen product, highlighted in the previous section is South Africa, which has the highest levels of consumption for smart phones in Africa. South Africa has embraced changes and advancements in technology towards ensuring that most of its people maintain a technologically savvy platform that would enhance their demand for technological devices. According to a survey conducted by Google in 2014 within several African countries, South Africa, Kenya, and Tanzania had the highest ratings in terms of embrace for technology. Consequently, this means that South Africa would work as a favorable market for this particular product, which would guarantee success achievement in the company’s need to establish itself as part of the African market.
Another key aspect that makes South Africa the best consumer market that the company must focus on as part of its strategic capacity is the urban population in the country, which is higher when compared to other countries in the continent. Approximately 28.9% of the total population in South Africa lives within urban settings thereby creating a higher consumer platform for technological devices. The company ought to consider this aspect in defining the viability of any given market, as this would help towards creating that avenue for success achievement. The company may also experience ease in creating different marketing campaigns focused on this particular population based on the increased platforms for marketing and advertisement.
Gathering Intel
Gathering intelligence refers to a process where one seeks to collect information that would be of value towards creating leverage or an added advantage, which would define ultimate success for the company or organization involved. Before embarking on entry into a new product market, it is important for the company involved to concentrate on gathering information about the new consumer market as a way of ensuring success in the entry process. Companies must ensure that the information gathered is accurate, based on the evaluation of the consumer market. In this case, the company involved in the delivery of smartphones into the South African market must undertake several steps towards ensuring that it acquires adequate information towards improving possibilities for performance. Consequently, this highlights the need for having to review some of the key steps that the company may undertake as part of its information collection process as part of improved performance.
In this case, the company may decide to use reports from international organizations operating within the South African market, who conduct market reviews on a regular basis as part of their business structures. Some of the organizations involved in funding projects within South Africa have the ability to provide accurate intelligence on the business environment in the continent. One of the key organizations to consider is the International Monetary Fund (IMF), which is involved in funding some of the projects undertaken within South Africa. Through the reports from this organization, the company would gain a better understanding of the performance structure for different countries, as well as, basic information on investment capacities for these markets. Largely, this would help in highlighting some of the key challenges that the company ought to expect while focusing on its entry into the new market.
The company may also decide to use consulting companies with the capacity to conduct market surveys as part of information collection in the new market structure. The company may decide to engage services of consulting firms operating within South Africa to collect more information on the performance expectations of the business environment in South Africa. The information gathered from the market surveys would provide the company with leverage for performance as part of its key strategy towards improving possibilities of success. The company ought to consider its position as part of its investment capacities, which would help towards creating that avenue allowing for effective decision-making on the basic elements to consider as part of its entry into the South African business environment.
SWOT Analysis
It is important for the company to undertake an in-depth analysis of the South African consumer market for smart phones with the focus being towards evaluating the possibilities of success in this particular market. The analysis will involve evaluating the strengths, weaknesses, opportunities, and threats that the company would encounter in the South African market based on its delivery of consumer products.
Strengths
One of the key strengths that the company must capitalize is the huge demand for technological devices especially smart phones with the ability to access the Internet without any notable challenges. Within the last few years, technological advancements have created an avenue for more people to embrace the need for having to use some of the technological products available. Consequently, this has driven the levels of consumer demand for smart phones upwards, which is an aspect of consideration for this particular case. Another key strength to consider is the viable marketing platforms for the consumer market in South Africa based on the high level of urban population.
Weaknesses
The main weakness that the company may encounter is lack of an adequate number of distribution agencies in this particular country that would handle the high population in the country. That would create a platform where the company would have to invest more on matters associated with distribution, which may have a major impact on the overall profitability levels for the consumer market.
Opportunities
One key opportunity that the company ought to leverage as part of its capacity to maintain success is the huge demand for products with the ability to take pictures and videos, access the internet, as well as, maintain class among consumers. The company would take advantage of the opportunity within this market towards ensuring that it achieves its expected goal with regard to enhances success margins regardless of it being new in the consumer market.
Threats
The main threat that the company may encounter within the South African market relates to increasing number of companies investing within this market as part of their strategy of growth and expansion. The South African consumer market has experienced a significant increase in the levels of demand for technological products including smart phones among others. The demand has created viable platforms allowing more companies to move into this particular market as part of their strategy to meet the rising demand. That is a threat that the company may encounter in its endeavor towards delivery of quality products and services to its consumers.
TARIC Number for Product
TARIC number refers to an exportation code used in the identification of products moved from one consumer market to another, which is filled out during the declaration of products as part of exportation requirements for different markets. The TARIC number for this product is 8517120090, which refers to the product code before export into the destination country towards ensuring that the products are designated as originating from European countries. One aspect to consider in the exportation process relates to the idea that different countries in the African continent tend to have varying laws and policies governing the importation processes for foreign companies. The TARIC number highlighted above focuses on the category of telephones operating on a wireless cellular network, which creates that platform for evaluation of smartphones.
How the Product will sell
The company will adopt two notable measures that will help in the delivery of the products to consumers within the South African market for the local consumers. Firstly, the company will focus on usage of agents as part of its distribution strategy focused on reaching the local consumer market. The company will undertake recruitment and evaluation of specific agents within different locations in the consumer market as part of its capacity to maintain success within this market. Secondly, the company will also use international fairs, which would be specialized towards meeting the consumer demands for technologically savvy consumers. Through these fairs, the company would be in a position to market its products not only to its customers but also to both local and international investors. The best mode of product delivery to its customers would be usage of international fairs, which would provide the company with a better platform for product delivery.
Exclusion Criteria
Another key aspect of consideration relates to exclusion criteria, which would help towards evaluating some of the key aspects that would help in the exclusion of specific consumer markets. In this case, the company intends to operate within South Africa but may intend to exclude specific countries in its entry strategy based on several aspects like market maturity, commerce barriers, and country brand.
Market Maturity
Market maturity refers to the consideration of whether the business environment in specific consumer markets is favorable towards maintaining overall performance capacities for a given company. Through market maturity, the company would evaluate each of the countries to ensure that it highlights the specific countries that present the highest risks for the business. These risks may arise from political instabilities in the countries, which may create a provision for increased insecurity, as well as, lack of a competitive market due to reduced uptake of the products offered (Parker, 2014). In addition, market maturity will also provide the company with a basic understanding of the prospective markets that the company may focus on, in its future growth and development strategies.
Commerce Barriers
Alternatively, commerce barriers may also create a challenge for the company in operating within specific consumer markets thereby highlighting the need to consider the same as part of exclusion criteria. In some cases, governments tend to implement policies that create an unfavorable environment for businesses to operate especially when dealing with international companies. From that perspective, it would be essential to consider some of these barriers in defining the best markets to operate, which would help towards defining overall success structures for the business involved.
References
Parker, H. (2014). Business in Africa: Next frontier for technological companies intending to invest in Africa. Journal of Business Management, 15(6), 159-201.
