A Guide for Developing an International Marketing Plan

Economic analysis report creation is Guideline 1 of the overall country note. This is the economic intelligence part of the whole country notebook. It is going to really help in deriving several critical inferences about the target market. Watch the next few videos discussing this Guideline - 1 of the course.

Now, friends, in this lesson, let us start with the first part of this guideline, which relates to the market economic analysis.

This is very important.

The data and the information sought in this particular economic analysis are more straightforward in nature compared to the type of information gathered in the cultural analysis, which is more general and subjective in nature.

In the case of economic analysis, it is more quantitative in nature.

Here, the focus is on things like the economic soundness of the country.

You will get a fairly good idea of the macroeconomic parameters, which will reveal the economic soundness — the current soundness or the future soundness.

For example, if you look at recent events happening in the Chinese market, you can find that the economic situation in China is facing challenges with respect to international debt.

This kind of information will give you an idea of what is expected in the near future or in the medium-term future in that particular market.

Similar information will be required to focus on the economic soundness of the target market.

Another focus of the country economic analysis is to identify the channels of distribution available in general, and more specifically, for your product, brand, and services.

That is how you are going to distribute your products and services in that particular market.

It is also important to gauge the landscape of media availability in that particular market.

What types of media are available?

What is the coverage?

What are the segments addressed by the media?

What are the costs and effectiveness of the different types of media in that particular market?

While the information is more general and quantitative, it can help in selecting the right media for the particular product or brand that your company wants to serve in that country.

What is included in this country's economic analysis involves broader categories of data in the guidelines.

The purpose, as I explained earlier, is to make this Country Note useful for years to come.

Not only for short-term objectives, but also for long-term objectives, although it will definitely help you in creating documents related to more short-term competitive marketing efforts.

The main and intentional purpose of including broad categories in this market economic analysis is to create information that will be useful in the long term as well.

Friends, let us try to see what type of information is required in the market economic analysis template.

The economic analysis template talks about the first information that is to be included. That is the introduction.

The introduction is very important because it helps you gain momentum about the market.

What is the direction of your information flow? How have you collected the data? How accurate is this data in your opinion? Any special learning you had while collecting this data?

Those kinds of things can be given in this introduction. You can also introduce a little bit of very general information about the economic soundness of that country, which is your first impression.

That kind of introduction will definitely be very useful for taking the plunge into the deeper data, which is going to be part of this particular country's economic analysis.

The data to be collected starts with the details and information with respect to the population.

Why population?

Because they are going to be your customers.

The information about the population includes the growth rate of the population, the percentage of live births, and easily available information such as birth rates.

These are all included in the information to be collected with respect to the population.

Then comes the population distribution.

The demographic landscape of the population includes different age groups — for example, what is the percentage of the young population and the distribution of the sex ratio?

The geographical distribution of the population in that particular country.

For example, in some countries like Japan, the population is more concentrated on the coastal parts, and in the hinterland, you find very mountainous regions with very little population.

The same is the case in Canada, where 90% of the population is concentrated within 100 km of the border with the US.

This kind of geographical distribution has to be included in this section.

Then a note about migration and migration trends.

What is the percentage of the population that is migrant? Is it increasing or decreasing?

What is the perception of the local people about migration?

For countries like New Zealand, Australia, and Canada, which are migrant countries, you will find this kind of note very useful.

A similar note for many other countries will also help you understand what is actually happening on this front and what the future trends are.

Then a note about the existence or non-existence of the features of ethnic groups present in that population, minority groups, and the treatment of minorities, any state laws or government laws with respect to minorities.

What is the situation?

What is the factual situation about the existence of such smaller groups in the population?

That has to be discussed in this section.

This, then, friends, is the focus of this economic analysis — collecting economic statistics, which is very important.

Things like GNP, GDP total, the growth rate of GDP, the per capita GDP rate, and a note with respect to family income.

I will try to help you by sharing some online tools that will assist you in collecting this kind of information when we take up, in the last section and last lesson of this course, the particular case study based on which we will collect this kind of data.

I will show you how to collect this data and what online resources are available to do that.

Then, the economic statistics with respect to wealth distribution in that particular target market are very useful.

This kind of information can be really helpful for years to come.

Things like the rich-poor gap, the income classes that exist in that market, and the proportions of different income classes.

The nature of the distribution of such classes compared with world trends.

That kind of comparison will give you some knowledge about the uniqueness of that particular country and its features, which will help you in creating the marketing mix, the marketing campaigns, and the ad programs.

On many fronts, this kind of information will be very helpful.

Then, in the economic statistics, another type of information to be included in the Country Note refers to the note on the different natural resources available in that market.

The mineral resources and any other local natural resources, like in countries such as Russia, which has a lot of natural gas.

However, while the existence of natural gas in Russia is there in quantitative terms, the cost of exploring and acquiring that gas is very high because such resources and reserves are located in very difficult terrain.

Therefore, the note about the existence of natural resources should also include whether it is easy to acquire, explore, and exploit those resources, or whether it is costly.

Because if it is costly, then even if they exist, they are not useful.

This kind of practical and useful information should be included in this note.

Then, economic statistics with respect to transportation.

Surface transportation, water transportation, and air transportation — all modes of transportation have to be dealt with.

To collect this economic statistic, note the types of transportation available, the main ones, how accessible they are to the population, and what their uses are.

Is the local population able to use it fully?

What is the extent of usage of such transportation? Is it affordable? Is it practical?

That type of information has to be collected.

Then, economic statistics with respect to communication in that target market.

Again, the types of communication, the availability of communication, and the general uses of communication.

What statistics are related, and how can they help us understand the features of communication available in that market, and why?

What is the situation? What are the reasons for that particular status of communication?

These details should also be part of this note. In small footnotes, this information can be put.

Then, economic statistics with respect to working conditions.

The practice of the number of working hours per week, which companies generally employ for their workers.

The availability of safety and security for female employees and minority groups of employees working in companies.

The type of labor laws that exist, whether they are favorable to industry or to workers.

Worker unionism.

What kind of unionism exists in that particular target market?

These statistics should be collected with respect to working conditions.

Also, economic statistics related to the main industries — the main industrial sectors and principal industries.

For example, the share of the major sectors in the overall GNP of that target market, and the ratio of companies owned by private owners versus those owned by the government, the private and public holding ratio.

And, of course, the economic statistics related to foreign investment.

What is the scope of foreign investment?

What are the opportunities?

Which sectors are most promising for foreign investment?

That kind of economic statistics has to be included in this part of the overall market economic analysis.

Then, friends, the other part of the economic statistics relates to the international trade statistics.

Things like: what are the major exports?

What are the values and trends?

What are the major imports?

What are the values and trends?

What is the balance of payments situation?

Does the country have surplus funds, surplus foreign exchange? What is the value of the surplus?

If it has a deficit, what is the value of the deficit, and what international debt does the country have?

What is the situation of that debt?

What is the value of the debt?

All this information has to be included.

And what are the recent trends — whether it is moving in a positive direction or getting worse?

Those kinds of trends have to be included in this particular trade statistics section.

And then, of course, the international trade statistics also relate to the exchange rate situation in that country.

What is the exchange rate regime in that target market? Is it a single or multiple exchange rate system?

What is the current rate?

What are the trends regarding the main currency?

What is happening on the exchange rate front for that particular currency?

These trends have to be included.

Then the economic statistics relating to trade restrictions, like trade embargoes, quota systems (if any), imposed by the local government with respect to imports, and any kind of import taxes.

What is the extent of those taxes? Are they prohibitive in nature, or are they encouraging in nature?

This information, in quantitative terms, has to be collected.

What are the tariff rates?

What are the policies with respect to import licensing or business licensing for doing international trade in that market?

What are the overall customs duties?

Any surcharges? Any countervailing duties? Any additional duties?

This information has to be collected with respect to trade restrictions, trade, and tariff barriers.

It would also be useful to include information about non-tariff barriers, such as embargoes, quotas, or any other type of non-tariff barrier.

This information must be included in this section.

Then the economic statistics with respect to non-cash foreign economic activities, which are not reflected as inflow or outflow of foreign exchange, for example, activities called countertrade.

What is the type of countertrade?

What are the different types of products offered under countertrade in that market?

Has any foreign aid been received in recent years?

What are the trends in foreign aid, if any?

Or is the country itself giving foreign aid to other markets?

It may not just be receiving; it may also be outflowing foreign aid.

That kind of information can be included in this part of the economic statistics.

And, of course, the economic statistics relating to the labor force.

What is the type of labor force in that market?

Is there a high level of unemployment among the labor force?

Does a Hire and Fire policy exist in the labor laws there?

What kind of labor exists?

Are they very active in their trade unionism?

What is their productivity?

And, of course, what is the size of the labor force?

The availability of the labor force is very important, and those statistics have to be included here.

Also, the economic statistics relate to the existence of inflation.

What is the type of inflation?

What is the level of inflation?

What are the trends?

That kind of information has to be included here in quantitative terms.

Then, the statistics with respect to science, technology, and mathematics availability, prevalence, status, and determinants.

What is the expenditure on research and development, for example, among the overall expenses of the government?

What is the current availability of technology?

What is the status?

And what is the type and level of technical skills available in that market?

This will be more useful for manufacturing companies that plan to produce their goods in that market.

Even otherwise, this information will be very useful for all types of international marketers.

Then, economic statistics with respect to the channels of distribution.

What is required here is the macro analysis.

The micro analysis will be left for short-term documents, which relate to a thorough market investigation for a particular product or brand.

That micro analysis can be done separately.

But what is required here is a macro analysis.

For example, what different channels of distribution are available — the retail channels, the wholesale channels, the agents, the importers.

That information has to be gathered in quantitative terms.

And also a note about which of those channels are more relevant for your company, your product, and your brand.

For example, information about retailers — the number of retailers, big retailers, size of outlets, general markups, retail markups, and the operational practices of retailers, whether they work on credit or cash.

What is the scale of operations of such retailers?

How significant is their presence in that market?

That kind of information and the overall role and importance of chain stores, department stores, and neighborhood shops.

For example, if you take Japan, despite being a very sophisticated and rich market, neighborhood shops play a greater role than chain stores or department stores.

Every market is unique.

That kind of information has to be gathered.

Then, information about wholesalers — their number, size, general markups, operational practices (credit, cash), and information about import-export agents, their roles, and their importance in that target market.

What commissions do they normally charge?

What is the network and status of warehousing available?

What are the possibilities for warehousing in that market?

And, of course, the market penetration in different segments or types of markets in that country.

For example, the rural part of the market or the urban part of the market.

What kind of market penetration is more common?

A small note about your product or service can also be included in this particular market penetration information.

Then, friends, at the end of the economic analysis of that target market, a very important area to collect economic statistics is about the media — all types of media available in that market, and specifically the media likely to be more useful for your products and services.

A small note can be included about that.

The availability of such media, the ease of access, and accessibility to that media.

What is the cost of the different types of media available? Which are more useful?

Is any local agency assistance available to identify the right media and to deal with media persons or media companies?

What is the coverage of different types of media in that target market, and, very importantly, what is the coverage of the population by different media?

How effective is it, and what features of the media can be important or deciding factors for your products and services?

That kind of information has to be included with respect to the economic statistics related to the media in that target market.

And then finally, a two-page executive summary of the entire economic analysis is required, not more than two pages.

Important points have to be highlighted in this executive summary.

Any special notes or special information to be retained and stored for years to come must be included here.

Efforts should be made to ensure the information is not more than two pages.

And, of course, the list of sources of information used to collect the data should be included, so that in the future, if any information has to be updated, those sources can be referred to.

Finally, appendices are to be added to this analysis, with notes that are very important for the specific quantitative information included in the analysis.

Those notes, if available, can be added to the appendices. They may not be of direct use now, but they may be useful in the future.

That is the idea of including such notes or even quantitative information.

Any tables, figures, or graphs can also be included in this last section of the Country Economic Analysis — the appendix.

Hello friends.

Welcome back.

In the last episodes, we talked about the country's economic analysis.

Country economic analysis is very quantitative in nature and is comparatively more straightforward.

You have data, and you can interpret data.

There is a very clear impact of that data on the market.

But there is another aspect of understanding the target market, and that is the cultural features of the market.

Country cultural analysis is more subjective in nature.

It is still very important, although it is not very straightforward.

The aspects related to culture may have a different type of impact on the target market.

The response of the people can be different even with similar cultural features.

For example, two countries having the same religion may behave differently in response to the teachings of that religion or the philosophy of that religion.

It is very much possible that two different countries with the same religion would behave differently.

Consumer behaviour may be different.

What is the meaning of this?

The meaning is that consumer behaviour, societal beliefs, and value systems are the result of many factors.

Not just one factor.

You cannot say, for example, that a particular religion would have the same impact.

This means that cultural analysis needs to be taken care of in a very subjective and different manner. The features recorded in the country cultural analysis should be supported by the actual impact they have on the market.

Those differences have to be clearly mentioned.

Very careful treatment is required when we are talking about country cultural analysis.

Friends, in the country cultural analysis, what are we looking for?

We are looking for the information that actually helps in making market planning decisions and market decisions.

Our idea is that it has to be just according to the information that is available about the cultures, regarding what kind of market planning decisions would be taken.

The second idea is to get the information that can help us in understanding the business customs, because there are certain customary things. For example, the retail markups or the type of promotions that have to be carried out in a particular market will very much depend on several cultural aspects, also.

Similarly, the other cultural features of the market may have a direct or indirect impact on several aspects of the international marketing plan, which we aim to create out of this exercise.

Let me tell you that all these cultural aspects and features have to be recorded very carefully and with a lot of judgment and experience, which are required for recording this information.

People with very good experience in cross-cultural management should be involved in such cultural analysis.

What I was trying to tell you is that the information collected in this analysis should be supported by aspects such as how it affects the differences in the market, the unique features of the market, the consumer behavior, and the cultural differences, which have a direct impact on the marketing decisions.

And of course, the differences in market behavior and consumer preferences also, because these are going to affect our product adaptation, brand adaptation, and modifications that may be required.

Like in the country economic analysis, in cultural analysis guidelines, we also start with the introduction part.

What we are trying to do here is to start with the profile of the company.

Why the profile of the company?

Because it will tell us what things in the cultural milieu of the market have to be focused on.

It would depend on the profile of the company.

For example, what are the products the company is manufacturing?

What are the vision and mission of the company?

What is the focus of the company?

What are the financial goals of the company?

That will definitely help us in understanding the things which we have to record, the type of information which we have to record in the country's cultural analysis.

Similarly, very important herein is the profile and brief details of the products that are to be marketed in that particular market or exported to that market.

Again, the requirement of the product will also help us in understanding what questions have to be addressed in the country's cultural analysis.

And then, of course, the profile of the target market, target country, because that will give us a starting point for addressing the cultural questions we seek in this particular cultural analysis.

After the introduction, we focus on the country's relevant history.

Relevant history means the aspects of the history that may have an impact on the current cultural status and the possibility of the success of the product or the brand, or the context in which we are trying to work in that particular market. That relevant history will play an important role.

When, later on in this course, we take up one case study, an example of preparing this kind of cultural analysis, you will have a better idea of what we mean by the relevant history of the target market.

A very useful aspect, before we go into the hardcore cultural aspects of the target market, is to write down the geographical profile of the market. Because geography plays a very, very important role in understanding the culture of a country.

Things like the location, the climate, and the topography of the country have to be written down.

A small, brief note has to be given here about this information.

Some part of it may be quantitative, but this is going to be helpful.

It is a good idea to also write the impact of the geographical profile, the location, climate, and topography on the possible impact on the current cultural status of the market in this section.

Then, friends, we further go into the country's cultural analysis by understanding and focusing on the social institutions.

That is very, very important because many things a marketer requires to understand about consumer behavior come from the immediate environment of the consumers, which includes the structure of the family.

What kinds of families are commonly found in that target market?

You will find those kinds of differences among countries. And of course, the family dynamics, where the prevalent roles of the parents may be important.

What kind of impact does the family have on the thought process of the parents, what role parents play, and the practices related to marriages, courtship, and the prevalence of living relationships, for example?

Those kinds of family dynamics are very, very important.

They will give you an idea of the sophistication of the thought process of the people of that country.

And then, of course, the female and male roles—whether they are changing, static, or showing certain trends, such as women working in senior roles, in politics, or in higher corporate positions in companies—and what their ratios are.

Those kinds of trends are very, very important because they give a lot of insights into the cultural aspects of that market.

Another very important area of understanding and focusing on the social institutions of our target market is to understand the situation of education.

What kind of education exists, because it has a very significant influence on the cultural status of that particular market.

For example, things like the role of education in society, whether it is primary education, secondary education, or higher education.

We have to record the comparative quality of the education.

For example, the primary or secondary education level, when compared with world quality levels and the level of development, and what the trend is—whether the education scenario in the country is improving, getting worse, or facing certain challenges.

These kinds of things have to be recorded when we are talking about the role of education in society.

And of course, in education, we have to record the literacy rate of the target market or the target region within the market.

That information has to be recorded because it has a direct impact on the cultural status of that particular target market.

In the social institutions, we also need to focus on the political system, the structure of the political system in that country.

The political structure, political parties, the stability or instability of the political governments—all that information has to be recorded.

If there are any special taxes, which are not very common worldwide, in most democracies, but exist in that country, they need special attention when carrying out business.

Those kinds of things and the role of the local government—how much role the local government has in the day-to-day life of the people, and especially in business—are important for carrying out business.

This kind of information is required.

The impact of government policies on the social structure of the country will also help in this particular part.

Another aspect of social institutions focuses on understanding the legal system prevalent in that particular country.

For example, things like what is the organization of the judiciary, what is the code of legal conduct—common code, socialist, or Islamic, for example.

Or it can be something else.

That has to be recorded.

The participation of the legal actors or the legal system of that particular target market in international conventions, for example, things like international patents, international trademarks, or the legal systems suggested by organizations like the World Trade Organization and others.

That information has to be recorded.

And then, friends, in the social institutions, it is very, very important to focus on the type of social organizations.

This means things like group behavior, the different social classes that exist in that particular target market, the nature and types of clubs and similar community organizations, and the existence of races, ethnicity, and subcultures.

When we take up this example at the end of this course, using a case study, and try to create these guidelines for the country note on that particular situation, you will have a better idea of what we mean when we are talking about social organizations, group behavior, social classes, clubs, and other organizations, race, ethnicity, and subcultures.

For the time being, you can just note down this kind of information if you like.

You also have this complete template available in the resource section of this particular episode.

You can download the document with respect to the cultural analysis guideline as well as the economic analysis guideline.

All these templates are available for download, and you can easily access them from the resource section.

Special focus is also required when talking about social institutions to understand the typical business customs and practices.

You can also include in this the typical management styles that are prevalent in that particular market.

They definitely help in day-to-day operations for organizations in carrying out business activities.

In the cultural analysis, our special focus is required to understand the religious aspect of society and the aesthetics.

When we talk about religion and other belief systems that are prevalent in the target market, we are talking about whether they are orthodox, what the doctrines and structures of the religion are, and their relationship with the people.

The list of prominent religions.

If there exist multiple religions—or if at all religions exist—the group sizes of the main religions should be noted.

What are the group sizes?

Maybe some ratios can be given, so a note is required to understand the relative sizes of the different prominent and principal religions in that particular target market.

If there exists a possible influence of any cult, it should be recorded, as certain countries are influenced by specific cults.

And when we talk about aesthetics, we are referring to aspects that are observable.

You have to consider this through observations of things like the visual arts, music, performing arts, folklore, and local symbols.

This is a very tricky aspect of recording.

You actually have to focus on the unique features of the visual arts, music, and other arts and aesthetics of the society, because recording all the common and typical types of art is not possible.

For example, if we take India.

India is a country of great cultural diversity.

You will find the visual art changes every 500 km.

It is a very, very vast country.

Every state has its own visual art, its own music, and its own performing arts.

There may be some commonalities, but there are a lot of differences.

It is not possible to record the whole of the visual art scenario in India, which is very, very large, or the music, folklore, and local symbols—it is very, very difficult.

What is important is to focus on the relevant aspects, the differences, and the unique things that are required.

Or you can also focus on the target regions.

If you have a limited target region in a very large market, you can focus on those regions to understand the aesthetics and record the data.

Then, friends, another aspect of the cultural analysis in the target market is to understand and focus on the living conditions, which include things like diet and nutrition.

We are talking about the typical meals, the consumption of meat or non-meat products, malnutrition if it exists, and the ratio, types, and nature of the local and imported foods consumed in that market.

If you can include certain data regarding this information, it will be helpful.

Other aspects of the living conditions include things related to housing.

What types of housing are common in that particular target market, and what is the ratio of owned properties or rented properties? Are they more one-family dwellings or joint family dwellings?

What types of housing conditions exist in that particular market?

That gives an idea of the cultural aspects of that market. And the common clothing.

Do they have a national dress?

If it exists, you can include a picture and put it in the appendices. For a common work dress, you can include a picture and put it in the appendices, along with any other aspects related to clothing.

For example, the color and type of commonly worn marriage dresses by the groom and the bride.

These are very important pieces of information and may be relevant to certain companies, but may not be relevant to others. But at this stage, it is better to write all this information because it is very, very difficult to judge whether certain information is useful to the company or not.

It is always better to include these basic things in the report, which can be useful if not now, then maybe later.

Other things in the living conditions include recreation, sports, and other leisure activities.

We are talking about the types available and which are the more in-demand portions of the income span.

For example, if you take Singapore.

Culturally, Singaporeans are rich, but they spend a lot of money on recreation, sports, and leisure activities.

You will find that there exist many recreation clubs in Singapore, the membership of which is very high.

If you do some research online, you will also find that the memberships are very costly in Singapore because there is a lot of demand.

This kind of information can be really useful.

Then things like social security, which includes unemployment support, if any, in that particular country, health care support, and the cost.

For example, you can take Canada, where very good support systems exist with respect to social security in the form of unemployment support, health support, and also support for senior citizens.

In countries like Canada and Australia, you have these kinds of social security.

Many countries have them, but some have gone one step ahead of others in providing social security.

These things have to be recorded.

Friends, the last important thing to be focused on in the living conditions is the language, which is the commonly spoken and written language in that particular target market.

What is the official language?

And if multiple languages exist. For example, India has more than 200 languages. Every 100 km, the dialect and many times even the whole script changes.

India is very unique in this case.

And of course, the dialects. For example, even in Europe, if you talk about Germany.

Dialects differ in Germany itself.

We talk about Austrian German or Swiss German, and people have different dialects for the same language.

It is possible. In India, we have different dialects for the main languages, including Hindi, Bengali, and Bihari. You will find that different dialects exist in India.

Finally, friends, after having recorded all this information, what is important is to create a two-page executive summary.

That is a very, very important part, especially in the guidelines for cultural analysis.

Why?

Because in the cultural analysis, as I mentioned, whatever you record may have a different impact on cultural features, societal behavior, and consumer behavior.

The same facts in two countries may have a different impact.

Those unique and important things that require special attention have to be mentioned in the executive summary.

A glance is required.

But that should be very concise and to the point.

As I mentioned, you have to choose the right points, bullet points, or information in the executive summary that is useful and unique, and note the impact it has—or may have—on societal behavior, consumer behavior, or aspects of culture likely to influence international marketing decisions and planning.

Hello, friends.

Welcome back.

Friends, in this course, we have been talking about the economic analysis, the cultural analysis, and the guidelines given. The idea of these guidelines, friends, is to help you understand the basic information required for creating a robust international marketing plan. That is our aim.

The third important guideline after economic analysis and cultural analysis is the market audit and competitive market analysis.

I will tell you the objectives, the purpose of this third guideline, why it is required, and how it is going to help us in finally creating a preliminary international marketing plan. That is our aim.

You will soon realize, when we take up the example case study and create an international marketing plan, a preliminary international marketing plan, how all these things that I am talking about in these three guidelines are going to help you in creating a very practical preliminary international marketing plan.

Friends, in this market audit and competitive market analysis, the differentiating feature of this third guideline is that it is the most product- and brand-specific information.

The kind of information we are looking for is not general in nature. It is very much focused on the product the company is going to sell, or the products the company is going to sell, and the brand or brands the company is going to use for selling the products in the market.

That is specific information.

The objective of this third guideline is to determine the competitive market conditions: how competitive the market is, how much seriousness is required in terms of everything—marketing decisions, pricing, promotion, sales, retailing strategies, different ad programs, whatever marketing decisions are to be taken.

The segmenting, targeting, and positioning of the product in the market is to determine that level of competitiveness, the nature of competitiveness, what kind of market it is, the position of rivals, the conduct of rivals, and the level of rivalry that exists in the market.

All this information is to be determined and, very importantly, to determine the market potential of the products and services you are going to offer under a particular brand.

This gauging of the market potential is very important at the initial stages because that is where you start, and that is where you take off for your preliminary international marketing plan.

Friends, it is also very important to know all the strengths and weaknesses of your own product, as well as the competitive market efforts you are going to take up.

All the efforts you plan, how strong they are or how weak they can be—what are the challenges, what are the opportunities?

That analysis at this stage is very important.

Again, it is not general in nature. It is very much focused on the product or products and the brand or brands you are going to use.

The aim is also to know how much adaptation is required in the marketing mix because adaptation definitely costs money, and adaptation costs are upfront.

It is very important to know whether the strategies used in other markets, whether the products and the brands already used in the home market or in other markets have been successful, can be replicated, or to what extent they can be replicated to get the benefit of economies of scale.

And if it is not possible, then how much adaptation and modification is required in all the components of the product, as well as the whole marketing mix?

Friends, the aim is also to develop the final action plan. When I say “final,” I mean that ultimately we have to make a comprehensive investigation, we have to prepare a comprehensive plan, but here our aim is a final action plan in the sense of a preliminary international marketing plan.

Why preliminary? Because at this stage, we do not have very specific information. We have not actually done the comprehensive market and product investigation.

Friends, another very important area is to look into the possibilities of the information in the third guideline we are trying to gather—whether it can give ideas about the type of questions that need to be addressed in a more comprehensive market research investigation of that particular market, region, or target at a later stage.

Because you cannot go straight away for the comprehensive investigation.

You need to understand initially and in advance what the main questions are that are going to be addressed.

This third guideline will help you.

The aim of this third guideline will be that.

In the next few videos, Dr. Jain discusses in detail, step by step, how to develop a market audit and competitive market analysis report with the help of guidelines 1 & 2.

Hello, friends.

Welcome back.

Friends, in this course, we have been talking about the economic analysis, the cultural analysis, and the guidelines given. The idea of these guidelines, friends, is to help you understand the basic information required for creating a robust international marketing plan. That is our aim.

The third important guideline after economic analysis and cultural analysis is the market audit and competitive market analysis.

I will tell you the objectives and the purpose of this third guideline, why it is required, and how it is going to help us in finally creating a preliminary international marketing plan. That is our aim.

You will soon realize, when we take up the example case study and create an international marketing plan, a preliminary international marketing plan, how all these things I am talking about in these three guidelines are going to help you in creating a very practical preliminary international marketing plan.

Friends, in this market audit and competitive market analysis, the differentiating feature of this third guideline is that it is the most product- and brand-specific information.

The kind of information we are looking for is not general in nature. It is very much focused on the product the company is going to sell, or the products the company is going to sell, and the brand or brands the company is going to use for selling the products in the market.

That is specific information.

The objective of this third guideline is to determine the competitive market conditions: how competitive the market is, how much seriousness is required in terms of everything—marketing decisions, pricing, promotion, sales, retailing strategies, different ad programs, and whatever marketing decisions are to be taken.

The segmenting, targeting, and positioning of the product in the market is to determine the level of competitiveness, the nature of competitiveness, what kind of market it is, the position of rivals, the conduct of rivals, and the level of rivalry that exists in the market.

All this information is to be determined and, very importantly, to determine the market potential of the products and services you are going to offer under a particular brand.

This gauging of the market potential is very important at the initial stages because that is where you start, and that is where you take off for your preliminary international marketing plan.

Friends, it is very important to know all the strengths and weaknesses of your own product, as well as the competitive market efforts you are going to take up.

All the efforts you plan—how strong they are, or how weak they can be? What are the challenges? What are the opportunities? That analysis at this stage is very important.

Again, it is not general in nature. It is very much focused on the product or products and the brand or brands you are going to use.

The aim is also to know how much adaptation is required in the marketing mix because adaptation definitely costs money, and adaptation costs are upfront.

It is very important to know whether the strategies used in other markets, whether the products and the brands already used in the home market or in other markets have been successful, can be replicated, or to what extent they can be replicated to get the benefit of economies of scale.

And if it is not possible, then how much adaptation and modification is required in all the components of the product, as well as the whole marketing mix?

Friends, the aim is also to develop the final action plan. When I say final, I mean that ultimately we have to make a comprehensive investigation, we have to prepare a comprehensive plan, but here our aim is a final action plan in the sense of a preliminary international marketing plan.

Why preliminary? Because at this stage, we do not have very specific information. We have not actually done the comprehensive market, market potential, and product investigation.

Friends, another very important area is to look into the possibilities of the information in the third guideline we are trying to gather—whether it can give ideas about the type of questions that need to be addressed in a more comprehensive market research investigation of that particular market, region, or target at a later stage.

Because you cannot go straight away for the comprehensive investigation.

You need to understand initially and in advance what the main questions are that are going to be addressed.

This third guideline will help you.

The aim of this third guideline will be that.

Friends, the basic components, the basic structure of the third guideline I am talking about is the introduction part.

Like in the earlier two guidelines on economic analysis and cultural analysis, in the market audit, an introduction is also required. Something about your product, something about your company. A little bit of the profile is relevant to understanding the competitive market position and the target market audit. That kind of introduction, or some first impression of the market, if you have that, can be included in the introduction.

We will talk more about it.

The second structure is about the product. The focus in this part of the guideline would be on the product, products, services, or even the brand. Something about the brand and the market will be in the next section of this guideline.

We need to talk reasonably well about the market. We have to gather information that is important to us and that is likely to need a lot of attention from the marketer. That information has to be gathered about the market.

Another section is on the competitors. What kind of rivalry exists? What kind of competition exists? What is the competitive situation of the market, the level of rivalry, the level of competition, and the nature of the competition? These are the things we are going to discuss.

Finally, a two-page executive summary in this third guideline is also required, just like we had in the first guideline on economic analysis and the second guideline on cultural analysis. Here also, we have to prepare a two-page executive summary of the important points, the source of information, and the appendices. Any information in graph form or image form should be included here.

One by one, we will discuss these components of the market audit guideline, and we will have a fairly good idea of what we are trying to accomplish in this third guideline.

When we talk of the section that relates to the product and we are writing about the product, what we need to do is evaluate the unique features of the product.

Our product has the features that are already there, which are relevant and which may not actually be relevant. The features that might be relevant in other markets may not be relevant in this market. These kinds of things can be easily judged.

The evaluation of the unique features of the product should be done from the perspective of the target market. It may have many features, but they may not suit the target market.

For example, one very good example is the acquisition of the J-phone Company of Japan by Vodafone in 2000 for almost $20 billion. A lot of money was spent by Vodafone to acquire the J-phone company, but the company’s failure after the acquisition had many reasons. One of the main reasons was that Vodafone could not identify the unique features of the product they were going to offer, and that was the handset.

J-Phone was the first company in the world to introduce the phone camera in the handset, but Vodafone could not actually provide similar unique features. They failed to identify that Japanese customers were looking for new features for the first time in the world—features that were useful to them—and that was what they had been expecting from Vodafone. But Vodafone failed.

The result was a disaster, losing a great amount of money, almost $20 billion. The company had to be sold to another organization from Japan itself, SoftBank.

The evaluation requires understanding the unique features in terms of relative advantages or disadvantages, relative compatibility or non-compatibility, complexity or non-complexity, trialability or non-trialability, and observability or non-observability. These unique features have to be identified and jotted down. Not many big details are required, but important points must be included.

In this section, our focus will also be on the major product problems or acceptance issues in that target market. If you have done any previous evaluation, or somebody talked about challenges and problems in previous meetings, or from previous investigations, or if you have data from the experiences of other companies that introduced similar products in the market, that information must be noted.

For example, again referring to Vodafone acquiring J-phone in Japan: if they had taken note of J-phone’s market efforts, they would have easily identified that the main reason for J-phone’s success—being the third-largest telecom company in Japan—was the introduction of the phone camera in the handset for the first time in the world. That was very revealing of the taste and acceptance of Japanese customers. But Vodafone failed there.

It is very important to note the unique features, the problems associated with them, the challenges, and the opportunities from earlier experiences and the history of similar products—or even your own product, if it might have reached the market through middlemen or third parties. If you have some prior evaluations or experiences, you should definitely note this kind of information.

I will demonstrate to you later in this course, with an example, how this is done.

Then, friends, the section that relates to the information to be gathered is specific to the market, the target market.

We have to actually describe the market or the target regions if there are some specific regions in that target market.

We have to describe the geographical regions. In today's world, we also have the digital world, and we have some digital segments. If you can take care of that, if it is very much relevant to your products and services, you can do that also.

But in general, we are talking about the description of the regions based on the geographical locations.

Geographical regions may also be the whole country. Modes of transportation, for example, are available. What are the options that are available in those particular target regions or in the whole of the country, if it is a small country? Then what kind of communication infrastructure is available, and what decisions have to be taken with regard to promotions or advertising?

What kind of communication can we expect that is easily accessible and affordable? This kind of information has to be gathered.

And very, very importantly, the consumer behavior, consumer habits.

Things like the common and observable product use, the features that are likely to be accepted by the market, revered by the market, or preferred by the market. That kind of information has to be gathered.

And very importantly, the shopping habits of the customers of that particular region or the country, whatever the case may be.

When we take this example, you will understand better what I am talking about.

And then about the distribution. How are you going to distribute in that market, and what is the distributability and the ease of distribution in that particular market?

What are the smooth points? What are the rough points in the market as far as distribution is concerned?

How are you going to distribute?

Who will be your channel members? Both retail and wholesalers, or middlemen, or whatever may be the case?

The distribution network, which is very common in that particular market, has to be described.

We are here talking about the description.

And then the description of the advertising and promotion. Because if we are going for the pull strategy instead of the push strategy in that market in a given time frame, definitely our focus would be on the advertising and promotion.

And even if it is a push strategy, some kind of promotional campaign has to be done.

Whether they are effective, what kind of promotions would be effective, and what are the common advertising media available in that market?

What are the customary or preferred promotional tools in that particular market?

For example, things like whether the preference is for discounts, or it is done by coupons, or by distributing free samples, or free demo products.

We have to find out this kind of information.

And then information with respect to the prices.

In that particular market, we have to describe what the customary markups are, what the practices are for retail markups, wholesale markups, or the middleman's commissions.

Depending on the push and pull strategy, what kind of pricing may be required and will be suitable for your products and services.

And further, when we are talking about the market, we also have to write down the market size, which means estimated industry sales, the overall sales of that particular item for the planning year.

You have some near-future plans, planning for one year, two years, or maybe three years.

What are the trends? The past? What are the future trends of the estimated industry sales?

For example, if we talk about the mobile handset sales in India, the whole market is very, very big, and there is a wide variety of handsets of different prices, different price segments, and different levels of prices for handsets.

The overall industry sales are very, very big.

Here, it would be important, depending on your products and services.

If there exist multiple price levels and the product range—the entry range, the middle range, or the luxury range—or, depending on what you are going to offer, which range you are going to offer, you can have the breakup of the industry sales according to that and your company's sales target.

What does the company expect in the planning area in the initial years? What kind of sales are they expecting?

It requires some kind of judgment, and the market will tell you a little bit for the newcomers, or, depending on the type of strategy you have used for the market entry, what kind of sales target you can expect.

Suppose you have acquired an existing company, so you already have the sales data of that particular country.

You already have some statistics.

You can use these statistics and extrapolate them for your merged company.

It depends on what kind of entry you have made. It is absolutely on a case-by-case basis.

This third guideline, as I have been telling you, is very specific to your product.

It is very specific to your services, your brand.

And in this section, we also have to describe and write a note on the level of government’s role and the intervention of the government.

For example, what are the government agencies that may be supportive, helpful to you, or may sometimes pose challenges for certain regulations?

And what are the different regulations you must follow, if there are any?

This kind of information has to be gathered in this particular section, which talks about the market.

And then, friends, in this guideline, the third very important area is to talk about and describe the competitors.

We are trying to understand.

We should note down all the competitors' products, the brand, features, and the packaging details.

And you should have the samples ready with you from the market, purchased from the market.

What is being done? And what are the prices?

What is the pricing strategy?

What are the price points that have been generated by the competitors?

If there are any price points in different categories of the product, and depending on which category you are entering, you have positioned your product.

This kind of information has to be gathered.

And also, what are the competitors' promotional strategies, the tools, and the methods that they are using, the advertising methods and the media that they are using, and how effective it is.

If you can find out some information about it. And also the competitors' distribution channels.

How do they distribute?

Who are the channel members in their distribution chain?

What is the supply chain that they use, the front end as well as the back end?

All this information has to be collected about the competitor.

And then finally, you have to write down an executive summary, a two-page summary.

Like in the earlier two guidelines, the points should be very, very important, which require special attention and relevance.

And some of the information given in this guideline, if something has a major impact on the plans of the company, the product, or the advertising options.

Whatever different types of marketing mix decisions are required, and something that requires special attention should be included in this two-page summary, but it should be relevant to this guideline only.

And then the summary should also talk about the problems and opportunities that are there, and which would require special treatment when taking marketing decisions, or the marketing mix. Place this two-page executive summary at the front of the report.

Why?

Because this executive summary is very important since it is the most product- and brand-specific information.

And then finally, in this report, you should also write down the list of sources of information.

These are going to be very, very useful in the coming years.

At a later stage, for the new entrants in the team, the new people who will come, they need to update the information.

Somebody has to update.

If the list of sources is given there, it will become very easy to update the information that requires attention.

Every specific year of planning, you need to be updated, or a certain frequency has to be used for updating the information in the report.

Add any supplementary material you may have in the form of some images, graphs, or tables, which are useful for this report, in the appendices.

If there is something very, very important that should come in the main body, that should not be put in the appendices; it should be put in the main report.

Hi there!

I hope you are doing well and making great progress in this course.

I wanted to take this small moment to congratulate you on your remarkable progress in this course.

Your dedication and commitment to learning have truly impressed me.

I have been following you and your journey closely, and I must say, I'm delighted with the efforts you are putting in.

This course is part of the VJ Export Mastery Courses Series, a collection of 25 different courses targeting the area of export management, designed to equip you with the knowledge and skills needed to excel in the field of export and international trade.

On my part, I am committed to helping you expand your learning journey by providing access to more similar courses in the series, but at the same time, on your part, I have a small request as well.

Your feedback is incredibly valuable in refining this course and ensuring it remains world-class, and it is refined to its best.

I kindly ask you to leave a rating for the course along with your honest feedback, if you have not yet done so. Your input will help me continue to improve and tailor the course to meet your needs and those of future learners.

Thank you once again for your dedication and enthusiasm.

Keep up with the fantastic work that you are doing, and remember, I am here to support you every step of the way.

Together, let's continue on the journey of learning and growth.

Now we have sufficient details in the 3 guidelines already discussed. Now, guideline 4 is able to specify how to create the initial marketing plan and what information is required for the 4th guideline report.

Friends, now we know about these three guidelines, the idea of which was to help us in the creation of the preliminary marketing plan.

That was the aim of this whole exercise.

And you would appreciate that this kind of country notebook, country note, is going to be useful for the company for many, many years until the company is there in the market, until the product is being sold.

You will find that very meticulous work has to be done in this particular country note, which is the main focus of this course.

Right now, I am telling you all the step-by-step things that are required to be part of this whole country note. Later on, at the end of this course, I will be taking up the example and the case study, and I will demonstrate to you by actually presenting to you all these three guidelines for a particular case study for a particular situation example.

And we will also prepare a preliminary marketing plan.

You will get an idea of how it looks.

The basis of this preliminary marketing plan comes from the three guidelines that we have discussed.

And the main aim of this plan is based on the information that we have gathered—how to deal with the problems and exploit the opportunities that we have.

By now, we have very good basic information.

Base information.

Data.

All this information is there in quantitative form or in descriptive form.

We have information about the cultural aspects, the economic aspects, and the competitive market analysis we have done.

We have a fairly good idea about the strengths and weaknesses, problems and opportunities, and that is what has to be dealt with.

The objective, in most cases—though not true for all companies because different types of organizations may have different objectives—is, for the majority of commercial organizations, to maximize sales and profit. The preliminary marketing plan will take care of that. The preliminary marketing plan action plan, which is prepared based on these three guidelines, forms the basis for this and is discussed based on judgment.

That is where experience and long association with the market can help.

That is the difference between the judgment by one person and that by another.

Here, financials are also discussed.

For example, what would be the rough budget for marketing and all those things?

I will explain to you what different financials are discussed.

Friends.

The basic components of the marketing plan are the marketing objectives.

What are the marketing objectives?

Based on the three guidelines and the templates we discussed, we will have some idea of the actual marketing objectives and what we want to achieve from the different marketing programs.

It also includes the SWOT analysis.

This strengths, weaknesses, opportunities, and threats analysis is focused on the product or the products, the brand that you want to offer in that particular market.

As I had explained to you, this particular plan is very much product- and brand-specific.

That is what has to be done.

It also includes the level of product adaptation, which initially has to be judged, and how much adaptation is required, and how many modifications are required.

All these will form part of the marketing plan.

Then the promotion strategy, the initial promotion strategy.

How do you want to go about it?

Definitely, when you implement the strategy, you will get some idea, some feedback you can use to further fine-tune the promotion strategy, and the promotion strategy may be changed when you go for the comprehensive market investigation.

Then, a little bit of an idea about the distribution strategy that you are going to use. How are you going to distribute your products?

That initial plan has to be mentioned.

Again, the price estimation.

What would be the landed price in the market?

What will be the retail markups, wholesale markups, middlemen commissions, and all those things?

And what would be the market price? And what would be the terms of sales?

We’ll explain this in a little more detail in later slides.

Terms of payment. And of course, the financials, the marketing budget, and other financials.

Also, this plan will include resource planning.

What kind of resources are required?

What infrastructure is required?

What kind of manpower is required?

What skills are required?

All those resource planning elements will be part of the marketing plan—preliminary marketing plan.

Finally, this particular plan will also have a two-page executive summary, a source of information, and appendices.

This is the structure of the initial marketing plan we want to create based on those three guidelines I mentioned.

If we talk in more detail about the marketing objectives, we will be describing the target market.

If there are some geographical regions or target market regions, those have to be mentioned.

And the segments—what kind of segments are we going to target?

Then, in the next few planning years, what will be the sales forecast that has to be discussed?

What would be the profit?

Expected profit.

Any estimation that has to be done.

And what would be the market penetration, initial market penetration, and coverage, and how are you going to cover it?

These will be the main marketing objectives.

These will be the areas of inclusion in the marketing objectives.

In the SWOT analysis, the strengths of the product, the brand, the company, and the weaknesses—based on the new knowledge received, earlier experiences, or input from new team members—should be listed.

They may identify some weaknesses, opportunities, and threats.

That kind of SWOT analysis is very, very important and must be done in this initial plan.

It is, again, as I mentioned to you, product- or brand-specific.

As I also mentioned, product adaptation and modifications will be part of this plan, about the core product, what will be the core component of the product, and if any modifications are required.

For example, if it is a food product, if any local regulations or local preferences are there in the food taste or any ingredient in the food, some changes are required—adaptation according to the market.

That would form the adaptation and modification of the core product.

Then, the packaging component of the product.

Any adaptation or modification required, or the other components, including after-sales services, shall be provided.

These will form part of the preliminary marketing plan.

The promotion strategy, which has to be included in this initial marketing plan, would focus on advertising, including the advertising objectives.

What would be the media mix for the advertising, what would be the message of the advertising, and what would be the expected costs?

Cost estimation of the advertising budgets and the sales promotion.

What would be the objectives of the sales promotion—whether it will be coupon-based, use some other method, or include premiums?

Any kind of promotional costs that are involved have to be estimated.

All these will form part of this particular component of the initial marketing plan.

Then, is there any need for personal selling?

Any component of personal selling required in your product and brand case?

That has to be included.

And if there are any other promotional issues, they will be part of the promotion strategy in the initial marketing plan.

Then the distribution methods, distribution strategy, and the complete cycle from the back end to the front end, from the country of origin to the country of destination, to the market, to the marketing channels.

The whole distribution strategy has to be covered in this plan.

We are talking about the port of loading.

We are talking about the port of discharge.

This will be part of the distribution cycle.

Things like what would be the mode of transportation—whether it will be by sea, by air, or by any other means.

That planning has to be done.

What would be the type of export packing required for your product?

That information has to be noted down in this particular section of the initial international marketing plan.

Then, the export documentation and procedures requirements are specific to your product.

Any special requirement from the importing country or the target country has to be mentioned here.

The planning for the insurance, for mitigating the transportation risk, and the modalities of the clearing and forwarding agent, if it is to be included. Who will be the agent?

What kind of work will be outsourced to the C&F agent?

All this information has to be part of this section of the initial international marketing plan.

Then what will be the channels of distribution in the target market?

Once the goods have been landed in the target market, how are they going to be distributed?

It may be through retailers, wholesalers, some kind of middlemen, or Export-Import agents.

The requirement of warehousing.

What kind of warehousing network is required for this purpose?

All these things will be part of the distribution strategy you create in your initial marketing plan.

Then, the information has to be noted down with respect to the cost of the shipment.

The expected cost estimation has to be done, including the transportation cost, the handling cost, the insurance cost, the customs duties and charges, and taxes.

Port charges, port authority charges, any equipment handling charges, import taxes or GST, and the provision for the channel members.

The channel partners’ markups and discounts, expected gross margins, and the final retail price points.

If it has to match local customary price points for your product in the market for the targeted segment, those have to be part of the initial international marketing plan.

Then the details about what the terms of sales would be, including the terms of delivery.

What would be the choice of Incoterms 2010 or 2020—FOB sale or CIF sale?

What kind of terms of sale have to be included? If it is being exported to the target market, with the importer of record being the company established by the exporter itself, those things have to be mentioned here.

If any stock and sales have to be done, that can also be included.

Any other terms and conditions to be included in the terms of sales—in the case of middlemen commissions, Export-Import agents’ terms and conditions, or any other kind of third-party distribution—must be part of this distribution strategy.

What will be the terms of sales with the third party?

Those can be included here.

Then the main terms of payment, which basically talk about the transfer of money from the target market to the origin country.

It may be cash in advance, open accounts, consignment sales, sight drafts, time drafts, or letters of credit/documentary credit.

What would be the mode?

What would be the costs involved in carrying out the transfer of the international payment?

And in the target market, the terms of payment have to be settled with the channel partners.

Those things can be included in this plan.

Finally, the marketing budgets include the selling expenses, the ad and promotional expenses, the distribution expenses, the cost of the product (including the cost of modification and adaptation), and any other costs involved with regard to marketing the products in the target market.

It would be better to have the projected annual profit and loss statement.

That would be very, very helpful.

Finally, in the initial marketing plan, the requirement of the finances—initial finances, upfront finances, the requirement of the personnel to start with, and later on, what the induction program for the marketing team and the other personnel who are required will be.

Resource planning for that. The planning of the production or arranging the supply from the origin country.

That has to be worked out, and any part of the cycle to be outsourced, and to whom it is to be outsourced.

All this planning has to be done in the resource requirements.

This is how we create the initial international marketing plan with the help of the three guidelines, which are part of the country notebook or country note, whatever you call it.

That was the main aim of this course.

With the help of a case study inspired by the real events, Dr. Jain will now demonstrate how to develop the success document for the overseas target market by actually showing you the major glimpses of a real success document prepared for the case study discussed. Watch the next videos to learn about the situation.

Going forward in this course, we will now take up the case study example, which will give you an idea of how to actually, step by step, create these three guidelines and the initial marketing plan.

For this, we are going to use one case study, which you will find in my next episode.

This case study is about the export of tuna fish to Japan and the company, which is based in Mumbai, India. They have been able to make a breakthrough in exports of tuna fish to Japan.

They also have further plans, which I will just mention.

After you watch the case study, I will tell you what the company's further plans for the company based in Mumbai are.

Based on those plans, the company would seek a country note on the Japanese market and would create these three guidelines for the country, as well as the initial marketing plan, which the company wants to take further based on the developments given in this particular case study.

Please watch this case study.

When we come back, I will explain to you what the other plans of the company are and what type of three guidelines and initial marketing plan have to be framed.

Hello friends.

Welcome!

In this episode, I am going to discuss with you one case study that is related to the exports of tuna fish from India to Japan.

This case study is about Mr. Gupta of Gupta Enterprises, who is based in Mumbai.

Let me tell you that this particular case study is inspired by real events, but the names, locations, and other details have been changed.

The technical facts, however, are based on real incidents.

The idea of this case study is for educational purposes—for learning and for a better understanding of the concepts.

This case study is about the tuna exports from India by Mr. Gupta of Gupta Enterprises, which is based in Mumbai.

Mr. Gupta had been in fish exports and fish-related product exports for more than 15 years, and he was already exporting to countries like the US and the UK.

But he was very keen to get into the Japanese market, which, for some reason, he was not able to penetrate.

He had been approaching many Japanese importers, especially focusing on exporting tuna, because that was one product he was already exporting to the US, the UK, and a few other countries, and he was getting a very good response from overseas buyers for his tuna business.

He wanted to expand his tuna business to Japan.

He had been trying for the last 4 or 5 years, but he was not able to get into the Japanese market.

He could not understand why he was not getting a response.

Later, he realized that, in order to enter the Japanese market, he really needed to understand the market.

He had to understand the importers, the culture, and factors that may not be directly related to fish, but to the Japanese market and the way business is conducted there.

After some time, he realized that he needed to learn everything about Japan.

Only then would he be able to understand how to get into the Japanese market.

He studied Japan.

He studied the business culture of Japan.

He studied Japanese government policies and several case studies about the Japanese market.

Within three to four months, he felt confident about dealing with Japanese importers and how business happens in Japan.

He then realized that he had been making mistakes.

He had not been able to create the right strategy for expanding his business into Japan, but he was now more confident.

He understood that the normal type of tuna business, the tuna fish he was exporting with a quality range of $1.5 to $2 per kilogram, was probably not the right product to offer Japan to make an entry.

He realized that Japanese importers require premium quality with a strong value proposition.

He began searching for that important formula and product that could convince Japanese importers that he had a unique value proposition.

He was looking for the right supply-side opportunity.

One day, while going through business advertisements in one of India’s leading newspapers, he saw an advertisement from the Lakshadweep administration, which was trying to promote tuna fish exports harvested in Lakshadweep.

This Lakshadweep is a group of around 35 islands, which is a Union Territory of India, and is located 250 km to 400 km away from the western coast of India.

It's a very unique area with a very small surface landmass, just 32 km².

If you include the area of all these 35 islands, it is a very small Union Territory of India.

But in Lakshadweep, only ten islands out of the 35 are inhabited.

The rest do not have any human population.

They are dependent on fisheries.

There was a seminar scheduled to be held in Lakshadweep, delivered by the Fisheries Department of the Lakshadweep administration.

They had invited people involved in tuna exports and fish exports.

They were invited to that seminar by the administration.

Mr. Gupta immediately sensed an opportunity, and he registered for the seminar, which was to be held next week.

He booked his ticket to Agatti Island in Lakshadweep.

And at one of the hotels on that particular island, the seminar was to be held.

He visited Agatti, and this Agatti Island had an airstrip.

There is an airport, and this was the hotel where the seminar was to be held.

This island is a very small island, just 7.5 km in length.

And the width is just 1.5 km.

It's a very small island.

I will just show you how small it is.

This is Agatti Island, and you can see that this is one extreme of Agatti Island.

From this tip to the last tip, where the airstrip is located, it's a very small island.

And you have the Agatti airport here at the end.

From one tip to another tip, it is just about 7.5 km.

It is a very small island.

The seminar was to be held on this island.

Mr. Gupta booked the hotel for two days, the same hotel where the seminar was to be held.

He took the opportunity to visit this place, which he had never visited before.

He was very keen to attend the seminar.

In the seminar, Mr. Gupta found that the information presented by the Lakshadweep Administration Fisheries Department was very interesting.

They said that the tuna harvested from the 20,000-square-kilometer catchment area of the Lakshadweep administration, which is quite large, has the potential to yield approximately 100,000 tons of tuna fish every year.

The unique thing about this catch is that, because of the lack of any industries in Lakshadweep, with its very small population of just around 70,000 people—mostly engaged in deep-sea fishing—there is no pollution and no chemical contamination in the sea.

It is an absolutely organic harvest of fish, especially tuna.

The second point made in the seminar was that the methods used by the fishermen of Lakshadweep are traditional in nature, and they are internationally certified as organic and sustainable harvesting of tuna fish.

This is a very good selling point.

Even though the price of tuna from Lakshadweep is higher than the average price available from other places.

For example, if the price of tuna from mainland India averages around 125 Indian rupees per kilogram, the price of tuna fish in Lakshadweep would be around 200 Indian rupees per kilogram.

It is definitely higher priced, but the quality is premium.

The variety is premium.

It is organic, absolutely free from chemical contaminants, and carries an internationally recognized certification that the wild catch is absolutely sustainable and traditional in nature.

This was exactly the kind of opportunity Mr. Gupta was looking for.

He extended his stay, and after the seminar, he spoke with people about how to proceed and what needed to be done.

He conducted some research in Lakshadweep.

He made friends with some people in the fisheries department of the administration, and with all the information and data, he returned to Mumbai.

What he then aimed to do was share this information with his Japanese contacts, with whom he had been in touch for a very long time.

One of his Japanese contacts showed interest in this new opportunity—the Lakshadweep variety of tuna.

He also mentioned that, according to his research, handling is extremely important in tuna fish.

As soon as it is caught, it must be handled in a way that ensures the skin color and other features of the fish do not change, and that it retains its original appearance.

When Mr. Gupta mentioned these points to his counterparts in Tokyo, one of them invited him to Tokyo for a presentation with his group of importers.

Mr. Gupta realized that this was a good opportunity to present the whole idea and value proposition.

He prepared himself and proceeded to Tokyo, taking a direct flight from Mumbai to Tokyo.

And he reached Tokyo.

At Haneda Airport in Tokyo, he was greeted by the person who had shown interest in his proposal. He was received by this person, who took him to one of the hotels in Tokyo for a presentation meeting, where he had arranged a group of importers—a consortium of importers mostly based in the world’s biggest fish market, Toyosu.

Mr. Gupta, along with the person, went to the hotel and settled down for the day because it was already late. He started preparing for the presentation the next day.

Friends, Mr. Gupta stayed in a hotel located within the Haneda Airport complex.

He began preparing for the next day’s presentation, making sure that it would be perfect. He had designed his presentation in such a way that whatever he had learned about the Japanese market and Japanese business, he wanted to incorporate into a real value proposition.

He was determined to engage with Japanese importers.

This had been his dream for more than five years, and tomorrow was the day when his presentation might finally make it possible to realize that dream.

The next day, he was picked up by the partner who had shown interest in Mr. Gupta’s offer, and together they headed towards Toyosu Market.

Toyosu Market in Tokyo is the world’s largest fish market. It is a very modern and sophisticated market complex, built in 2018 to replace the old Tsukiji Market.

The name was changed to Toyosu, and this market quickly became a very famous and iconic trading hub.

Finally, they reached the market.

This market complex is enormous, covering almost 400,000 square meters.

It includes auction halls, wholesale markets, and retail areas.

Toyosu Market is the largest fish market in the world.

Mr. Gupta was deeply impressed by the place.

His host and the other contacts had arranged for him to give his presentation in one of the conference rooms in the market, since most of the importers had offices in Toyosu.

From the conference room, he could see below—large numbers of fish stalls.

These were wholesale stalls.

On both sides of the hall, rows of booths stretched out.

Visitors were not allowed into the hall itself for hygiene reasons, but there was a viewing gallery from which the stalls could be observed.

Fish auctions also took place in these areas.

From the gallery windows, Mr. Gupta had a clear view of this very large, very modern market.

It was truly the largest fish market in the world.

Mr. Gupta then presented his proposal in front of about five or six importers of the Toyosu market.

He explained that the Lakshadweep variety of tuna is organic, free from chemicals, and that he could offer a daily supply of at least five tons.

That was very attractive.

There was visible interest among the Japanese importers, but they were not openly revealing what they were thinking.

Mr. Gupta’s presentation went on for almost three hours. He presented many facts and statistics.

He explained that tuna exports from India to the world are significant, with Japan being the largest market. The Japanese market alone represents almost $20 billion per year in tuna trade—it is big business.

He also detailed the business he was already doing with the US and UK in tuna exports, and emphasized that the Lakshadweep variety was of premium quality.

Although a little more expensive, it was clearly positioned as a high-value product.

He further suggested the possibility of an exclusive arrangement to sell the Lakshadweep variety through his company to this group of importers, provided they assured him of at least five tons per day for export by air from India.

With all these details and facts, he did his best to convince the Japanese importers of the merits of the case and the value proposition.

He also indicated approximately what CIF Tokyo price he could offer for the Lakshadweep premium tuna.

After the presentation, the Japanese importers still did not reveal their decision.

The person who had invited Mr. Gupta accompanied him back to the hotel. On the way, he explained to Mr. Gupta that they would require at least two days to decide on any trial orders, initial orders, or commitments.

He suggested that Mr. Gupta should wait in Tokyo for two more days.

Since Mr. Gupta had long dreamed of doing business in Tokyo—the largest tuna market in the world—and here he was at Toyosu, the biggest food market in the world, he felt no hesitation.

He was so impressed with the scale and modernity of the place that he said, “Absolutely no problem.”

He extended his stay by another two days, ready to wait for the final answer and any further negotiations.

This is what happened.

Friends,

Mr. Gupta stayed in Tokyo for two days, and he visited some very interesting places with some of his other business contacts.

His visit to Tokyo was his first time.

He really wanted to see certain places in Tokyo.

He spent a good time in Tokyo learning about Japan and about doing business with Japan.

It was a slightly longer wait. For two days, he was just waiting for confirmation from the importers of Toyosu Market.

In the evening of the second day, he got a call from his main contact, the main importer, who wanted to meet him for dinner in one of the restaurants.

Mr. Gupta went there as advised by the contact.

The contact told Mr. Gupta that the five-importer consortium was willing to do business.

He gave a sheet—the final sheet—which was finalized by all five importers of the Toyosu Market. They were keen to start a business and wanted to begin with a daily supply of five tons for 90 days.

If everything went well, the duration would be extended further.

This is what he told. The sales sheet given by his contact in Japan from the Toyosu Market said that the consortium was willing to offer a price of ¥1000 per kilogram of the Lakshadweep variety of tuna fish, with a daily order of five tons, to be sent by air with direct flights from any major Indian port to Tokyo. The validity of the contract was six months, but the supply was valid for only 90 days.

This was essentially a trial order.

If everything went well, it was stated orally that the contract would be extended.

The payment terms offered were: 15 days’ supply value to be paid in advance on a CNF basis, and the balance by direct bank transfer 15 days after the last air waybill date of the 30-day supplies.

Every 30-day supply’s last day (the 30th day air waybill date) would be calculated, and within 15 days, the balance would be transferred directly to the bank.

There was no letter of credit in this arrangement.

Other conditions were also mentioned.

Use of straw packing material was prohibited.

Proposed packing was to be cleared with importers, as they had definite preferences. The person clarified that it would be approved by the importers through videos sent by Mr. Gupta before shipment.

Goods had to be marked according to normal commercial practices with metric weights and measurements only.

Japanese translation text was to be faxed for the markings on the packages.

A certificate issued by an approved authority in the country of origin (India in this case) was required, stating that the animals were free from designated infectious diseases. Mr. Gupta had already done this homework and was aware of this requirement, since he was already following similar formalities for the USA and UK.

Faxed signatures were not permitted.

Typing and other errors in documentation were to be avoided at all costs, as these often result in serious delays and complications at the point of entry in Tokyo.

The documentary requirements mentioned in the sheet were:

• Commercial invoice (minimum three copies signed by the supplier, including details such as marks and serial numbers of the packages, description and quantity of goods, C&F value, place and date of preparation, destination, consignee, name of vessel, import license number provided by the importer, and conditions of the contract relating to value determination).

• It was corrected verbally that the “CIF value” mentioned was actually the “C&F value.” A corrected copy would be sent by the contact.

• HS commodity classification of the goods was strongly recommended.

• Complete invoices and packing lists should be forwarded promptly to the importer by airmail.

About insurance, the proposal stated that air insurance from the main Indian international airport to Tokyo was not to be paid by the seller. That’s why it was CNF.

A copy of the insurance certificate against a recurring insurance policy would be provided by the importer.

It was also noted that the air waybill was required in ten copies: one original and nine copies to be sent by airmail to the importer, with a fax copy to be sent immediately after shipment.

Packing list: two copies.

Certificate of origin: required for GSP concessions, issued by the diplomatic officer in the Japanese Consulate in India.

Other requirements included:

• Health certificate from the country of origin by the approved authority (in this case, the Fisheries Department of Lakshadweep Administration).

• Complete text and representative video of the fish catch and handling process (a one-time requirement).

• No food additives at any stage.

• Analysis of chemical presence in the fish, with requisite certificates supplied.

This was the note given to Mr. Gupta.

It was mentioned that the note was valid for seven days. Mr. Gupta could review it and request discussions if required.

He was told that after reaching India (or wherever he was), he could arrange a Zoom meeting if he had any doubts or required further changes. The contact person could also arrange a video conference with the importers.

With this, Mr. Gupta received the note and thanked his main contact, the importer who had known him for a long time.

Mr. Gupta left Tokyo that same night and returned to Mumbai.

Many thoughts were going through his mind.

He looked at the note several times, trying to understand what challenges might arise from the offer.

He had seven days to confirm the business. He was quite happy that he had at least received a concrete offer from the importers.

It was on the proper letterhead of the consortium, signed by all the importers.

This made Mr. Gupta feel upbeat about the business, determined to leave no stone unturned.

He quickly looked at the cost angle of the offer and prepared a cost sheet.

This was a basic calculation.

There were challenges, since this deal was being done for the first time. Japanese customers are very demanding, and Mr. Gupta wanted to ensure that the order continued beyond the 90-day trial.

He was excited about the deal, looking at it both for its current profits and future potential.

Yet he was in a dilemma about possible challenges, cost overruns, and the documentation requirements mentioned in the note.

Mr. Gupta took almost two or three days to review the note, think over it, and talk to many people.

He even visited Agatti Island again, spoke with the Fisheries Department there, and discussed the difficulties and challenges likely to come up during the 90-day trial order.

The focus at this time was on completing the trial order.

The Fisheries Department of the Lakshadweep Administration was willing to provide all possible help.

Now, Mr. Gupta had to decide whether to go ahead with the deal or say yes or no.

This particular case study requires good brainstorming, looking at the Japanese market, and applying the things you have learned in this course.

I would like you to attempt the next assignment, which follows this case study, in the next lecture.

Submit your answer in the assignment section in the requisite area.

Your answer will be reviewed, and if you want to see my solution after the review, you can.

I have presented my views and solution to this dilemma at the end of the assignment, covering the challenges, the opportunities, and my own perspective on this deal.

Thank you very much.

You just watched the complete case study of the export of tuna fish from India to Japan and the potential this product has in Japan.

Mr. Gupta, who has been running this company successfully and is based in Mumbai, has focused until now on exporting tuna fish to several developed countries, including the US and the UK. After a breakthrough in the Japanese market following a very long effort, he is now very upbeat about Japan.

He now has a better understanding of the Japanese market, has successfully executed the trial orders, and further orders are coming for tuna.

Now he plans to strengthen his company's foothold in Japan in the near future by exporting a variety of seafoods other than tuna.

He had already made a breakthrough with tuna and did not want to disturb that export line.

He plans to source other varieties of seafood from India and neighboring South Asian countries.

He believes the Japanese market can be very profitable.

He intends to distribute the different varieties of seafood in Japan under a single brand owned by his company.

For this, he wants to prepare a country notebook, meaning an initial marketing plan.

After making headway in the Japanese market with the trial order you saw in this case study (an order he has already executed and subsequently received confirmed follow-up orders for), he is moving forward.

He now expects to learn much more about the Japanese market.

He believes the country note he will create based on the ideas in this course will support his plans to sell other seafood items from South Asian waters in Japan.

He has assembled a marketing team who are now working on creating the country note for Japan.

That is what we will examine in this course: how this note is created — the cultural analysis, the economic analysis, the market audit and competitive analysis, and the initial marketing plan.

These will be part of the efforts of the new marketing team created by Mr. Gupta.

Let us see what they do and what they create.

That is what we are going to discuss now in this course.

You will gain a fairly good idea of the course learnings, step by step, and of what we have included in this country note. You will also see how it can be useful.

We will also discuss how this note provides a strong understanding of the market and helps advance the marketing plans.

Based on the case study discussed, Dr. Jain is sharing with you the major parts of a real-life example of successful marketing documents required for any target country in the world.  Starting with the example of guideline 1 discussed in this course.

Hello, friends.

Welcome back to the course.

You watched the case study, and I gave you the situation.

I told you that the company has set up a team to create a country note.

What I will do is give you glimpses of the country note that is being prepared by this team on Japan.

You will get an idea of what kind of country note we are talking about and whether we are able to create our initial international marketing plan based on the three guidelines of the note, which refer to the economic analysis, cultural analysis, and the market audit and competitive analysis.

I will give you glimpses of the country note being prepared by this team, and I will show you the different parts of it.

Some parts I will leave to you to try yourself, to see whether you can create those sections based on the things I share with you in the next episodes, in the coming episodes.

Let us start with the first guideline, which is the economic analysis for Japan, based on the learnings of this course and based on the case study example that I shared with you.

Let's start.

Friends, we are talking about guideline 1 based on the format, which I discussed with you step by step.

Let us see how this team is creating this guideline, one, that is, the economic analysis.

As per the marketing team, which is working on the first guideline for creating the country note on Japan, it is working on the economic profile of the country.

What they write here is that the Japanese market is the world's third-largest market. That is the third-largest economy in the world. And the citizens of Japan are the 24th richest people in the world by GDP per capita.

This is the finding guided by the guideline or template.

The second thing that the team found is that the country Japan is an export-import-led economy, a foreign trade-led economy, which is heavily dependent on exports of high-technology goods and services. And the country has a very large service sector, which contributes the most to the economy, followed by the manufacturing sector.

This is the situation.

A very minuscule portion of this economy is contributed by agriculture. Agriculture is actually in decline.

Japan has a very low inflation rate, almost zero. In fact, it is -0.3 at present.

The data collected by the team finds that the population is almost 126 million as of 2021, and it is not really increasing. Actually, it is declining.

The population distribution in Japan is 48.6% males and 51.37% females. Females outnumber males in Japan. The ratio of the urban population as a percentage of the total population is almost 92%.

There is a heavy concentration of the population of Japan in urban areas, and a very small portion of the population lives in rural areas.

We will further study this small portion of their culture. But the major culture of Japan is urban culture, and we will talk about it in the next guideline.

The mean age of the population is 48.4 years as of 2001, and the population growth rate is -0.3%.

The life expectancy is 87.7 years, which is the 2014 estimate, but I am sure it is slightly more at present. We do not have the latest data, but this can be updated whenever available.

The adult literacy rate is 99% as per the 2020 estimate.

As you can see here, the latest data, whichever is available, has to be recorded, and it is subject to updating whenever newer data is available.

We are going by the guidelines that we discussed earlier.

There is an acute shortage of young working people in Japan. As per the information collected by the team, they find that young working hands are much fewer than required.

Further information collected by the marketing team refers to the percentage of the population living on less than two dollars a day.

In fact, two dollars a day is a very low benchmark for Japan. It can be even higher and still be considered poverty, but the people living on less than two dollars a day are approximately 0.4% as per the estimates available for the year 2008.

The latest data available on poverty is from 2018. It indicates that the poverty rate in Japan is almost 15.4%. That is not very low, actually.

Given the cash-rich nature of the people of Japan and being an advanced country, this poverty rate is significantly high. The inequality of wealth distribution is 32.1 on the scale of 0 to 100.

We can say it is much less than the average. It is a country that is more equal when we talk about wealth distribution. Zero means perfect equality, 100 means absolute inequality.

Talking about the Freedom House rating, the political rights rating is 1. Civil liberties rating is 1, as per the estimates available for 2014. A rating of 1 represents the most free and 7 represents the least free.

For all practical purposes, the Japanese population is enjoying a lot of freedom, among the best in the world.

The data available on telephone subscribers shows that total fixed telephone subscribers are almost 50% of the population. Mobile phone users are 115% as per the estimate of 2013, which must have increased by now.

The fixed telephone subscribers and mobile cellular subscribers are given there, but let me tell you, fixed telephone subscribers are on the decline. Internet users as a percentage of the total population were almost 86.25% as of the data available for 2013, and I am quite sure this figure must be around 90% at present.

The team has collected some very good data based on guideline 1, which was part of this course.

This data refers to the economic statistics and the activity.

A lot of data has been collected in this head as per the template.

The GNP figure is given there, which is almost 4.8 trillion US dollars.

Personal income per capita is almost 38,000 USD per person, and the average family income is $34,822.

The distribution of wealth can be seen from this data, which has been collected by the team.

Of the total wealth, almost 4.8% belongs to the lowest 10%. Then 10.6% of the total wealth belongs to the lowest 20%, 14.2% belongs to the second 20%, 17.6% belongs to the third 20%, 22% belongs to the fourth 20%, and the highest 20% owns almost 35.7% of the total wealth. The highest 10% own 21.7% of the total wealth.

If you compare this kind of distribution with many of the other advanced countries, you will find that Japan is more equal than many other advanced economies, and definitely much more equal compared with the developing world.

This data has been collated by the team in this figure.

As you can see here, GDP figures are given for 2019, which are slightly more than the earlier figure estimates. Some updating will take place.

GDP per capita has also improved. In 2019, it was 40,000.

The economic structure, as I mentioned, shows that agriculture contributes only 1.24%, industry contributes almost 30%, and almost 70% is contributed by services.

External trade contributes almost 37% of the GDP, as per the estimate of 2018.

The currency is the Japanese yen. The going price per US dollar is 109.

The political system is a constitutional monarchy.

Religion: The percentage of the population unaffiliated with any religion is almost 60%. 33% of the population is Buddhist, and other religions are followed by about 4.5% of the population.

The population is 126 million. Median age is 48.4. The language is Japanese.

Land area is 364,560 km², the majority of which is mountainous. The population of Japan is concentrated mostly in the coastal plains, which form the smaller part of the land area, and they are very, very dense areas.

The approximate flight time from Hong Kong to Tokyo is around four hours.

This is the data that has been collected by the team, and it seems to be quite good.

Further data on economic statistics and activity refers to the existence of minerals and resources in Japan.

The country has negligible mineral resources, and fish resources are also limited because a lot of fish have already been caught.

Food items are mostly imported. With virtually no energy resources, Japan is the world's largest importer of coal and LNG, and the second-largest importer of oil. Fuel consumption is very high in Japan because of the high level of economic activity.

Surface transportation in Japan: The most important means of surface transportation for passengers are trains, buses, trams, cars, motorcycles, and bicycles. Cargo is mostly transported by road, by trucks, because Japan has a very good road network.

Communication systems in Japan consist of telephones, cell phones, newspapers, magazines, television, radio, and the internet, and almost all types of communication systems are popular.

Another part of the economic activity refers to working conditions.

The Japanese people actually work long hours, sometimes as high as almost 60 hours a week, despite labor laws to the contrary. People who work very long hours and very hard are referred to as karoshi.

Although it is not very common, there are such cases. Psychologists say that Japanese people work so hard because promotions are based on seniority and the number of hours spent in the company. The more time they put in, the higher the opportunity for advancement. Oftentimes, the quantity of work is valued more than the quality.

Although there is no reason to doubt the productivity and quality of the Japanese people, some experts observe that the focus on quantity for the sake of promotion may sometimes outweigh quality.

Desks are organized in Japan in groups of coworkers, emphasizing teamwork. The office is generally loud because of the open structure, and smoking is not illegal in the Japanese workplace.

Further, the marketing team has jotted down the data as per guideline 1, which refers to the principal industries in Japan. These include manufacturing, construction, distribution, real estate, services, and communication.

In manufacturing, automobiles and vehicles occupy the top position.

The data collected by the team on foreign investments shows that during the 2013–2015 period, Japan was the 10th most attractive destination for multinational companies for investment. The figure for that period was almost $2.3 billion.

International trade statistics collected by the team indicate that Japan’s exports totaled almost $694 billion, and imports totaled almost $816.9 billion. The balance of the two was positive.

Japan had a surplus of almost $122.5 billion as per the data available for 2014. This figure would be slightly higher for the current year.

Trade restrictions: Japan has a typical 2.5% tariff for many imported items, but a number of documents are required. Many formalities are required for customs clearance. In fact, the number of documents is more than in other advanced countries.

In accordance with the Japanese Measurement Law, all imported products and shipping documents must show metric weights and measures. Imported goods are subject to product testing and cannot be sold in Japan without certification and compliance with technical and non-mandatory voluntary standards.

The further statistics collected by the team in guideline 1 refer to economic activity, not including cash flows like countertrade, barter trade, or foreign aid.

Countertrade almost does not exist in Japan. Japan does not receive foreign aid, being the third-largest economy in the world, but it invests a lot of money abroad and also provides foreign aid to some other countries, although not very significantly.

The labor force in Japan, as of 2013, was almost 65.5 million people. The inflation rate in Japan is almost -0.3%.

This is the data collected by the team, and the collection has been very good, as per the understanding learned in this course.

Further data under this guideline refers to developments in science and technology in Japan.

Current technology in Japan includes all types of the latest computers, machinery, tools, etc. Japan is very advanced in technology, mainly focused on consumer electronics, robotics, and the automobile industry.

The newest technology is always available in Japan, if not invented there. If it is invented in Japan, even better.

They have computers, cell phones, plasma screen TVs, etc. For example, J-phone Company of Japan, the third-largest telecom company in Japan, was the first company in the world to introduce a phone camera in handsets.

There is a strong focus on innovation, and the Japanese government spends a lot of money on scientific research, technology, machinery, and medical research.

Japan has the world’s third-largest budget for research and development, almost $130 billion.

Japan has also received the largest number of science-related Nobel Prizes in Asia.

This is very interesting under the head of developments in science and technology.

The percentage of GNP invested in research and development is almost 3.2%, which is fairly good.

The technological skills of the labor force and the general population are very advanced. The Japanese are very educated and technologically skilled.

Almost 86.25% of the Japanese population uses the internet, which is about 43.35% higher than the global average of 42.9%.

The data collected under this head by the team is very satisfactory and highly indicative of the situation in Japan.

Now, talking about the data collected by the team for the channels of distribution available in Japan.

The distribution normally takes place through retailers, large retailers, as well as wholesale middlemen, who also play a very important role.

In retailing, for example, for items like clothing and footwear, there are specialized retailing networks: convenience stores, discounters, DIY products, home improvement, garden centers, electronics, and appliances. Specialist retailers are available—furniture and furnishing stores, grocery retailers, health and beauty specialty retailers, hypermarkets, internet retailing, leisure and personal goods specialist retailers, non-grocery retailers, non-store retailing, supermarkets, and vending.

As I mentioned to you, the wholesale middleman plays a very important role. The density of middlemen, retailers, and wholesalers in Japan is unparalleled. If you compare with any other Western industrialized country, it is not unusual for consumer goods to go through three or four intermediaries before reaching the consumer.

The distribution channels in Japan are relatively more complex, and a lot of hands change in the process.

The cycle is that the goods move from the producer to the primary, secondary, regional, and local wholesalers, and finally to the retailer, and then ultimately to the consumer.

This kind of complex market exists in Japan, which has to be understood very diligently.

The role of the import-export agency is also important. To export from Japan, one will need export documentation, and to import into Japan, one typically needs a commercial invoice, shipping documents such as an air waybill, and a certificate of origin.

These are the usual documents, but some additional special documents are required as per the regulations of the Japanese government. Import and export agents play a major role in Japanese business for both exports and imports to make foreign trade shipments smooth.

Talking about warehousing, the information collected indicates that various warehousing companies are located in Japan. Some of the names are Fukuyama Transporting Terminal Services, MOL Logistics Company, Sagawa, Yamato Logistics Company Limited, and Yusen Logistics.

The network of warehousing is highly advanced. Overall, logistics management in Japan is highly efficient, and logistics cost as a ratio of the total price is among the lowest in the world because of the high level of efficiency and the just-in-time concept, which is used in Japan along with many other similar management concepts.

Lean management concepts used in Japan make overall logistics costs, including warehousing costs, much lower than in many other countries.

Talking about the penetration of the urban and rural market in Japan, the team has collected some data that says it is easier to penetrate urban areas. As I mentioned to you, 92% of the population lives in urban areas, which are geographically accessible and much easier to manage and penetrate. That is where the majority of the population lives, and they have the means of purchasing luxury items.

Japan offers a mass luxury market with a lot of cash-rich customers who can spend money on a leisurely life in urban areas.

In rural areas, businesses are generally unwelcome. The people there disapprove of change. A very small portion of the population—almost around 8%—lives in rural areas.

It is also harder to conduct business in rural areas because the majority of the people there speak only Japanese, creating a huge language barrier that has to be overcome.

In this guideline, number one is the economic analysis of the Japanese market.

The last head, which is guided by guideline one, refers to the data about the media.

The availability of media in Japan is readily accessible within the country.

The average cost of expenditure is normally 27.6% as per one of the research studies, and the agency assistance available in media is provided by the Communication Media of Japan, which is the umbrella agency that includes numerous television and radio networks, as well as newspapers and magazines.

Other media companies also exist. There are five commercial broadcasting stations, which include Nippon Television, Tokyo Broadcasting System, Fuji Television, TV Asahi, and TV Tokyo. All are headquartered in Tokyo.

Tokyo is the main center for any agency assistance. Coverage of various media in Japan is extensive—people listen to all kinds of radios, read newspapers and magazines, watch television, and a very large portion of the Japanese population surfs the internet.

In the media, the last data sought by the guideline refers to the percentage of the population reached by each medium.

Some of the very useful data collected by the team refers to the total circulation of newspapers in the country, which is almost 71 million, a very large number. The number of television stations is almost 7,108. The number of television sets is 86 million. The number of cable subscribers is almost 19 million. The number of satellite subscribers is almost 10.6 million. The number of radio stations is 305. The number of radio receivers is almost 120 million, which is very high.

In present times, the number of individuals with computers is almost 40 million, and the number of individuals with internet access is almost 47 million.

As of the data available in January 2015, the digital space in Japan, a snapshot collected by the team of the country's key digital statistical indicators, shows:

• Total population: 127 million

• Active internet users: 106 million

• Active social media accounts: 24 million

• Mobile connections: 150 million

• Active mobile social accounts: 22 million

The internet user percentage is 86%. Social media user accounts are 19%. Mobile connections are 122%, and active mobile social accounts are almost 17%.

As I have already mentioned, urbanization is 91%.

This is the data collected and jotted down by the team, which is very interesting.

Now, after this, the guideline mentions a two-page executive summary, which I am not sharing here, as it has already been completed by the team.

I would like you, as a student, to try to make a two-page executive summary. This is optional, but if you attempt it, it will give you an experiential learning opportunity to understand how guideline one is applied, and it will help you.

If you wish, you may share your two-page executive summary with me either via direct messaging or in the Q&A section of this course.

This is optional, but it will definitely be very interesting and beneficial for your learning.

As I already mentioned, this complete document, without the executive summary, is available in the resource section along with the appendices.

You can see that.

This will serve as a very good example for you of how guideline one is used.

In the next few videos, an example of the guideline 2 report is discussed by Dr. Jain

Hello, friends.

Welcome back.

You must have realized that the economic analysis itself, guideline one, is giving a lot of insights into the market and is making the start of business in a new market much simpler.

What happens is that once you start this process of creating the country note or initial marketing plan, which will be discussed later, you get the starting point for updating the data continuously.

As the data becomes more and more accurate, more recent, and robust, your grip on the market becomes stronger, overall marketing decisions become smoother, and the possibility of achieving good results from marketing decisions becomes very high.

In this direction, we have already discussed the economic analysis. Let us now discuss the cultural analysis.

In guideline two of this country note, we are talking about the cultural analysis.

In this course, I give you step-by-step instructions on what needs to be collected in cultural analysis.

Let us see what Mr. Gupta’s team has done and what data has been collected for the situation and the case study, which I have discussed, and we have already watched.

Let us see the outcome of the team as far as the cultural analysis is concerned.

Talking about the cultural profile of Japan, the team finds that the culture of Japan is unique when compared with other advanced countries and other industrialized nations. What we find is that it is unique.

The team also finds that the culture of Japan is a high-context culture, which means the cultural ethos of the people in Japan relies more on context. This means non-verbal communication plays an important role.

If you want to understand more about high-context culture and low-context culture, you can see the link in the resource section of this episode. You will understand the difference between the two. But let me tell you that Japanese culture is truly a high-context culture.

Another finding of the team is that customers in Japan are very rich and very demanding. Their expectations from products, especially in terms of high quality, are very strong. They are ready to pay for quality, but they are really very demanding customers.

Japanese customers basically look for high quality and a value proposition. Most of the buying is of luxury items, and Japan offers a mass luxury market—one of the few in the world.

The team also finds that the culture of Japan is ancient and very rich, and Japan has retained its ancient traditions with sophisticated aesthetics. We will be discussing Japanese aesthetics later in this episode.

Looking at the brief history of Japan, we have the history starting from 500 A.D., when Buddhism came to Japan during the first hundred years. Today, more than 70% of the Japanese people are Buddhist.

From 1274 to 1281, military dictators known as shoguns ruled Japan and successfully kept outside invaders away.

In 1853, United States Commodore Matthew Perry entered Japan and demanded that Japan trade with the US. Until then, Japan was a very inward-looking country, having almost sealed its borders to the outside world, especially for trade. This was a milestone in 1853, when Matthew Perry entered Japan and demanded trade with the US.

From 1868 to 1912, under Emperor Meiji, Japan became wealthy and powerful. The country won wars against big nations like China and Russia.

In 1910, Japan took over the Korean Peninsula and ruled it for almost 35 years until 1945, when World War II ended.

In 1923, the Great Kanto earthquake, one of the worst quakes in world history, destroyed Tokyo and Yokohama, two very important areas today. More than 140,000 people were killed in this earthquake.

In 1926, Hirohito became Emperor of Japan.

In 1931, Japan invaded Manchuria, China.

In 1937, Japan went to war against China.

From 1940 to 1941, Japan became an ally of Germany and Italy in World War II.

On December 7th, 1941, Japan attacked the US at Pearl Harbor, the US naval base in Hawaii.

In 1945, the US dropped atomic bombs on Hiroshima and Nagasaki, two southern cities of Japan, resulting in Japan’s surrender in World War II, marking its end.

In 1964, Tokyo hosted the Summer Olympics—the first time the games were held in Asia.

In 1995, a major earthquake again hit central Japan.

From 2001 to 2006, Crown Princess Masako gave birth to a baby girl, Princess Aiko. Five years later, Princess Kiko gave birth to a baby boy, Hisahito, who is third in line to the throne.

From 2006 to 2007, Prime Minister Shinzo Abe held office.

In 2009, the Democratic Party of Japan became the ruling party.

In 2010, China overtook Japan as the world's second-largest economy.

In 2011, a massive offshore earthquake and tsunami caused major damage to Japanese cities. The country faced a nuclear threat when a power plant was severely damaged.

In 2012, Shinzo Abe was re-elected as the Prime Minister of Japan.

In 2013, Japan's Nuclear Regulatory Authority (NRA) reported that radioactive water was seeping from the Fukushima Daiichi nuclear plant into the ocean.

In 2014, Prime Minister Shinzo Abe and his cabinet approved a measure that lifted the Japanese ban on the export of weapons.

The outline in these two slides gives a very good brief history of Japan.

This is the type of data that has to be collected for any company wishing to do business in Japan. Similar information is required for any country you are working in.

Now, as per the guideline, the team has collected the geographical setting of Japan, which is located east of the Korean Peninsula and is bordered by the Pacific Ocean on the north and east, by the Philippine Sea and the East China Sea in the south, and by the Sea of Japan (East Sea) on the west.

This is the geographical setting of Japan.

As far as the climate of Japan is concerned, it has four seasons. Winter, from December to February: on the Pacific coast, it is dry and sunny, the central and northern regions experience snow, and southern Japan is temperate and mild.

The next season is spring, from March to May. The temperature is warm but not too hot, and there is not much rain. The cherry blossoms bloom during this time.

Summer is from June to August. During this time, they experience three or four weeks of rain, which is not very long. During the rainy season, farmers plant their rice. It is also hot and humid, with temperatures usually in the high 90s.

Finally, autumn is from September to November, with light breezes and cooler temperatures around 46 to 50°F. During this time, many exhibitions, music concerts, sports events, and tournaments are held.

It is more like a festive season in Japan.

This basic information about the climate cycle and seasonal cycle is required in guideline 2.

Talking about the topography of Japan: Japan is mostly composed of mountains, as I have already mentioned, along with some plains. A smaller portion of the land consists of plains and rivers.

Mountains cover almost 75% of the total landmass. Landforms are steep and rugged, and there are 265 volcanoes, of which only 20 are still active.

Only 29% of the land is plains, which are few and small. Rivers are short and swift, but Japan is home to Lake Kushiro in Akan National Park of Hokkaido, which is the cleanest lake in the world, with a transparency of almost 41m (135 ft).

Japan is actually a country of islands. The prefectures form the larger islands. In total, Japan has more than 6,000 islands, ranging from very small ones to very large ones, like Hokkaido.

Talking about the social institutions in Japan, the overall culture of Japan is very rich and diverse, and Japan is widely known for its traditional arts and contemporary pop culture.

In fact, the culture of Japan is so rich and diverse that in many countries it has become very attractive and even fashionable for many foreigners to copy the culture of Japan.

The dress of Japan and its unique social customs are very popular. A lot of books are written on Japanese culture because of its richness and diversity.

Japanese families are very similar to American families in the sense that, like in the US, married couples live with their children, and sometimes grandparents also live with them. This is a very common family structure, which is quite similar in Japan.

The people are very hardworking, and generally, the father goes to work outside the home, while in most cases, females take care of the home affairs, home finances, and children. Typically, fathers eat dinner with their family members mostly on weekends.

Education in Japan is also quite evolved. There is a law in Japan requiring six years of elementary education and three years of junior high school. The rest requires very competitive efforts by students to enter the best higher education institutions through entrance exams.

Generally, these exams are so competitive that students take special preparation classes along with regular classes to secure the best admissions.

The political system in Japan is a democratic constitutional monarchy based on the parliamentary system, which started in 1947 after World War II. The system has its own unique features.

The legal system in Japan has five types of courts: the Supreme Court, the High Court, the District Court, the Family Court, and the Summary Court. The Summary Courts handle mostly civil cases involving claims that do not exceed ¥900,000, criminal cases relating to offenses punishable by fines or lighter penalties, and civil conciliation.

There are different layers of the courts, and the rulings of the lower courts can be challenged in the higher courts, as in many other countries.

Japanese society has a very strong sense of family solidarity and is an extremely homogeneous society.

As I mentioned earlier, the Japanese people have retained their ancient culture, and the acculturation of outside cultures is very low. Japan is also collectivist, meaning the harmony of the group takes precedence over the wants of individuals.

The society is vertically structured, and people believe in respecting higher authorities such as the state, the employer, and senior family members. The society and culture are definitely unique in Japan.

Looking at race and ethnicity in Japan, 98.5% of the country is represented by Japanese people. Koreans represent only 0.5%, Chinese represent 0.4%, and all other ethnicities represent 0.6%. It is easy to see that Japanese society is very homogeneous.

Certain subcultures do exist in small proportions. Examples include gyaru, or girl culture, which reflects Japanese interpretations of Western beauty standards such as tanned skin, blonde hair, casual clothing, and an outgoing personality.

Other subcultures include bosozoku or hashiriya, meaning car and motorcycle enthusiasts, particularly those interested in street racing and illegal vehicle modifications. Then there is hikikomori, another subculture of young people who withdraw from active life outside their homes.

There are cases where some hikikomori individuals have not left their apartments for almost ten years, living entirely in isolation. This is very unusual and reflects a strange aspect of Japanese subcultures.

Japan also faces the problem of very high suicide rates. In large cities like Tokyo, one can see billboards and warning signs urging pedestrians to “mind your sky” in case someone jumps from a high-rise building in a suicide attempt.

Other subcultures include otaku, which refers to obsessive enthusiasts of a particular hobby—such as computer games or other activities—and visual kei, which refers to musicians who dress in elaborate and artistic styles.

These subcultures make up very small proportions of the population, but as in many other countries, Japan also has such groups.

Then, talking about the business and customs practices in Japan: in the business world of Japan, the most important thing is the building of relationships, and values like trust, confidence, loyalty, and commitment are emphasized and appreciated.

Decision-making in Japan is a group effort and usually takes place from the bottom up, where even people on the shop floor are involved, and decisions move from the bottom to the top.

Consistent follow-up is vital since decision-making tends to be very slow.

Gift giving is expected when you do business in Japan, and the packaging of the gift is just as important as the gift itself. A lot of emphasis is placed on packaging.

Business cards are exchanged to formalize the introduction process and establish all parties involved. In fact, business cards are very important. Whenever you are in business meetings, you must carry business cards. If you are not sure whether you have already given your business card to someone, it is still better to offer it again.

Japanese executives are addressed on a last-name basis in business relationships.

The Japanese bow when they greet each other, but when dealing with foreign executives, they shake hands. If you are doing business in Japan, you should give a slight bow to acknowledge and appreciate their culture.

A written contract is generally essential to meet the legal, tax, customs, and accounting requirements of the Government of Japan.

Talking about religion and aesthetics, religion in Japan is very diverse. Many religions are practiced in Japan, but most Japanese follow either Shintoism or Buddhism, or sometimes both.

Religion does play a major role in everyday Japanese life. However, it comes to the forefront during special occasions such as birthdays, weddings, funerals, and religious holidays, when there is a lot of emphasis on practiced rituals.

Talking about Japanese aesthetics, they are very rich. The seven features of Japanese aesthetics include simplicity or elimination of clutter, asymmetry or irregularity, naturalness, subtlety, break from routine, stillness, and austerity. These seven features of Japanese aesthetics are world-famous.

If we look at the living conditions of Japan, it is a very advanced country and among the most well-nourished populations in the world, with a lot of health care support.

Diet and nutrition: fish, rice, and vegetables are an integral part of the Japanese diet and are usually included in every meal in some way, shape, or form. Japan also offers a wide variety of fruits and vegetables, and some of the best pastries, which can be compared with those of France, which is famous for its pastries.

In Japan, eating out is also an option, and the experience is just as important as the meal itself, like in many other countries.

Talking about housing in Japan: traditional Japanese homes are made of wood and supported by wooden pillars. They are very famous designs, and you will find many pictures of such Japanese houses.

But today’s homes are built in Western style, with wooden flooring and steel pillars, in the form of apartment buildings. They use special tatami flooring, which is cool in summer and warm in winter, and stays fresher than carpet in humid conditions. Tatami floors are very famous in Japan, and you will find them in almost all Japanese homes and apartments.

Talking about clothing in Japan today, people wear clothes that look exactly like those in the Western world, such as in America or Europe. In everyday life, they prefer clothes that are easy to move around in, such as T-shirts, jeans, polo shirts, and sweatshirts.

They also wear traditional clothing, mainly for festivals and special events, such as fundoshi, furisode, hakama, hanten, happi, jinbei, kimono, obi, samue, sokutai, ohagi, and yukata. Japan has very special traditional clothing, which is worn for widely practiced rituals.

Recreation, sports, and other leisure activities in Japan: for fun, the Japanese enjoy going to karaoke with friends and coworkers, as well as dining out and drinking. They also enjoy shopping, watching television, visiting arcades, amusement parks, festivals, bookstores, and manga cafés.

For example, Universal Studios, the famous amusement park from America, is present in only three countries: the US, Japan, and Singapore.

The Japanese enjoy playing numerous sports, but the two main ones are baseball and sumo. They also take part in soccer, kendo, judo, aikido, karate, volleyball, golf, swimming, ice skating, and football.

Being a highly advanced country, Japan has some of the best social security and health care systems in the world.

As part of social security in Japan, there is a public health care policy for all Japanese citizens and foreigners who have lived in Japan for more than one year. Companies in Japan also provide health insurance plans for their employees.

As a Japanese employee, you are covered by Japan, and both you and your employer pay social security taxes only to Japan.

The Japanese language is spoken by more than 130 million people. It has a small number of sounds and accents, which are very significant. There are numerous dialects spoken throughout the country, but two major dialects are most common: Tokyo-shiki (Tokyo type) and Chi-shiki (Kyoto-Osaka type).

The script used in the Japanese language includes kanji (Chinese characters), hiragana (for Japanese words), katakana (for foreign words), and romaji (Latin alphabet). These are the characters commonly used in Japanese writing.

The two-page executive summary for guideline 2, I am not sharing here with you. I encourage you to create a two-page summary based on the data that I have shared with you. The whole document can be found in the resource section of this episode.

Although optional, preparing a two-page executive summary of the information I have just shared will give you an experiential learning opportunity. You can share it with me either through direct message or in the Q&A section.

By doing this summary yourself, you will learn the concept of creating a country note or initial marketing plan. It will be very interesting and highly beneficial for your learning.

Guideline 3 report example based on the case study already discussed is presented in this section.

Hello, friends.

Welcome back.

Friends, in this case study cum example, we have already progressed with guidelines 1 and 2, where we created the economic analysis note and the cultural analysis note.

Now we are getting a grip on the market. You can see that we know several strengths and weaknesses of the market. We know the cultural ethos of the market. We have a fairly good idea about the economic conditions.

Now, in the third guideline, when we work on the market audit, which we will be doing just now, you will gain more confidence in the market. That is how we approach the creation of an initial marketing plan, an initial country marketing plan, or an initial international marketing plan.

Friends, this is the process. This is the process I am trying to teach you. Step by step, you are learning the importance of the country note cum initial country marketing plan.

In this series, let us now talk about the third guideline, which refers to the market audit and market competitive analysis.

Let us work on it.

Friends, this third guideline, which concerns the market audit, has been created by the team, and I am sharing with you some of the important highlights of this market audit. The complete document is available in the resource section of this episode. You can download it from there.

Friends, in the market audit of Japan, the team finds that the Japanese market is a very sophisticated and rich market. We already have this idea of how rich and how sophisticated the world's third-largest market, Japan, is.

Friends, in this market, wholesalers play a very important role, especially in the product categories of food and perishable items, which are the focus of the company we are referring to.

Friends, consumer buying habits are changing in different directions in Japan. In recent times, consumer buying habits have changed. We will talk about this in detail in this section. The habits are changing for many reasons. A lot of research papers discuss the changing habits of the Japanese market, and after a long time, these changes are being seen.

Friends, the marketing team finds that advertising is quite different in Japan from Western advertising.

Friends, we will also be talking about the market size, market overview, and the product overview—the product that the company wants to introduce in Japan. We will look at the strengths, weaknesses, complexities, and advantages the product has.

At this stage, in this third guideline, market- and product-specific information has been collected.

Let us start with the product itself. In terms of the product range that the company has, some data has been collected.

Japan is the world's largest importer and the world's largest consumer of tuna fish. In 2018, tuna imports in Japan increased by around 10 percent. However, by 2020, due to the COVID-19 pandemic, there was a steep decline in the imports of not only tuna fish but all seafood. The prices of fish products and fisheries reduced by as much as nine percent.

The average decline had been around 1–1.5 percent annually, but this time, due to COVID-19 lockdowns and many resulting factors, the prices reduced by almost nine percent.

Friends, the Japanese generally eat high-quality tuna, paying higher prices for premium varieties. They are not looking for regular qualities. They normally prefer premium quality tuna and usually eat it in restaurants because of the cumbersome process of defrosting it before it is cooked. Tuna needs to be defrosted, and it is a complex procedure. To avoid that, Japanese customers prefer to eat tuna in restaurants.

The world's largest fish market, the Toyosu Market, is located in Tokyo. It is not only the world's largest market but also the world's most high-tech and sophisticated market.

We talked about the Toyosu Market in the case study you already watched, where I showed you some glimpses of this market.

Friends, the team finds that the potential of Indian premium seafood products in Japan is quite good. A relative advantage exists, especially for food coming from the Lakshadweep waters, because it is free from pollution. It is wild-caught in the vast waters of Lakshadweep using traditional techniques. These are the premium features of the product exported from India.

What is required is proper marketing and proper follow-up with the middlemen in Japan.

But challenges remain, such as handling the catch, refrigeration, and storage methods of seafood. This infrastructure requires a lot of investment. Government agencies may need to step in to provide and acquire the correct infrastructure. Training is also required. These challenges remain.

Secondly, the image of Indian seafood is not very good in Japan. Traditionally, India has not been a major supplier to Japan, mainly because Japanese customers perceive Indian seafood as low quality.

Thirdly, the overall logistics costs from India to Japan are quite high.

Talking about the trialability of Indian premium seafood: once local distributors and middlemen (wholesalers) in Japan start taking an interest in the Indian product and see its merit and value proposition, it is possible to try out new premium varieties of seafood from India.

Regarding observability: seafood, especially fish, is sold in Japan under the most hygienic conditions, as I showed you in the case study, in closed and highly controlled fish markets. It is very difficult to observe the whole process and the complete cycle of distribution.

Therefore, the market distribution is very complex and cannot be easily observed or understood by foreign companies. Local help is required in this.

Talking about the Japanese seafood market and, in general, the consumer buying habits, the product use pattern in Japan is very similar to that of Americans, in the sense that they are constantly using their products.

The items that are commonly sold internationally are being used constantly in Japan.

Japanese people are really big on luxury goods. They always want to show them off to family, friends, and co-workers. It is one of the rare markets in the world that is actually a mass luxury market.

The product feature preferences in Japan: consumers tend to avoid low-priced goods, preferring high-end department stores and pricier regional supermarkets. We have discussed many times that Japanese customers are cash-rich customers and generally buy luxury, higher-priced items. Within that, however, they look for value propositions.

Talking about shopping habits, currently, people in Japan are flocking to discount and online retailers. But again, this is only for high-quality items, not low-quality ones. Many consumers are buying in bulk. Despite the fact that in Japan people are generally not used to buying in bulk due to limited home storage space, they are buying in bulk now for several reasons: one is to reduce their purchase budget, and another is to save time.

Common retail outlets in Japan include drugstores, convenience stores, apparel stores, home centers, furniture stores, consumer electronics outlets, and discounters. If you want the complete list of retail outlets, you can see the appendix in the resource section of this lecture.

Let us now talk about business etiquette. It is very important to understand the market. For men, business attire includes dark suits (navy or black) with a white shirt and subdued tie from October to April, which is the cooler season. From May to September, they wear grey suits, and in summer, which is hot and humid, most Japanese men wear half-sleeved shirts. They do not wear black suits, white shirts, and black ties together because that attire is reserved for funerals.

For women, business attire includes shorter or tied-back hair, trouser suits, or longer skirt suits in seasonal colors, as is common with men. Japanese women are very fashion-conscious, and many wear Gucci, Chanel, Prada, etc. They generally prefer branded items. In general, Japanese companies do not allow female employees to wear jewelry, very short skirts, or high-heeled shoes. This shows some conservatism in Japanese society and business attire.

Regarding business meetings, it is very common to always call one to two hours before the scheduled meeting to confirm that you are on the way and everything is on track. If you will be late arriving, you must call at least one hour in advance to allow the business partner to reschedule or adjust. It is always better to arrive 10 minutes early for the meeting, even earlier if it is with senior people, because cultural factors dictate punctuality.

Plan an exit agenda for the meeting. Wait to be seated in the meeting room because there are customs regarding seating arrangements. Someone will guide you to the correct seat.

Some personal habits required to survive in the Japanese market: do not blow your nose in public places, do not grab your host, and during the first meeting, never pat a Japanese man on the back or shoulder. Never make derogatory remarks about anyone, including competitors and your own employees. This is absolutely unacceptable. Always smile, be pleasant, and be willing to learn. Ask many questions about your business partner’s company and the context of the meeting. Avoid private or personal questions.

Friends, talking about advertising and promotion, Japanese advertising is quite different from Western advertising. For example, the picture on the left is an American ad for Oreo, and on the right is a Japanese ad for Oreo. Although they market the same product, Japan’s ad is much more explicit than the American ad. Japan’s ad reads Milk’s favorite cookie with the image of a baby breastfeeding, while the American ad simply says wonderfilled with the picture of an Oreo.

In Japan, ads tend to be more colorful and exotic than American ads. In the American Oreo commercial, which I have linked, there is a lot of singing and animation. It is really fun and enticing. In the Japanese ad, there is also singing, but it is more personified. You will notice that Japanese Oreo commercials are more personal in nature.

Friends, these kinds of differences do exist between Western advertising and Japanese advertising, and this information has been rightly collected by the team.

Now talking about the seafood market overview: Japan imports almost 40 percent of its total seafood consumption, mainly from China, the U.S., Norway, Chile, Thailand, Russia, and Vietnam. The top imported seafood categories are tuna, salmon, and shrimp/prawns.

In terms of global trends, the price of seafood has been increasing due to emerging demand from China and India, and this is a global phenomenon. There is also growing emphasis on the health benefits of seafood in Western countries.

Seafood prices in Japan have also become more expensive, which is leading Japanese customers to eat less seafood in order to stay within their budgets.

Friends, there is now a common belief among Japanese consumers that seafood is more expensive than other types of meat. The Japanese market is very competitive with many import competitors, but there is always strong demand for seafood among consumers and a strong interest in products that have innovation or a unique selling proposition (USP).

This is a very interesting market overview collected by the team.

Looking at the numbers: the market size of total imports in Japan across all items is almost 75,000 billion yen, of which imports of agriculture, forestry, and fisheries products account for about 9,000 billion yen. Among these, imports of fishery products in Japan are almost 2,000 billion yen.

Total exports of Japan are almost 78,000 billion yen, of which exports of agriculture, forestry, and fisheries products account for about 800 billion yen. Exports of fishery products are 275 billion yen. Imports of fishery products are 1,775 billion yen. Clearly, there is a big gap.

The top three countries from which Japan imports agricultural, forestry, and fisheries products are the United States, China, and Thailand. The top three countries from which Japan imports fishery products are China, the U.S., and Chile.

This is the latest data about the fishery market in Japan.

So in the next few videos, Dr. Jain is now sharing the initial marketing plan for market entry to Japan in the given case study. It is hoped this example will provide you with the best example of the success document, which is the main focus of this course.

Hello, friends.

Welcome back to the course.

Friends, in the earlier episodes, we have already talked about the three guidelines, which are extremely helpful in creating a robust initial country marketing plan.

In our example, we are talking about Japan, and I will now show you some of the highlights of the initial marketing plan made out of these three guidelines.

This serves as a sample for you. The complete document on this plan is available in the resource section, from where you can download the file, and I will just show you some of the highlights.

Let's start that.

This is guideline 4 of the course, which we have discussed, and this is what we have learned.

This initial international marketing plan cum country plan, is as follows.

Friends, we have developed this initial marketing plan for taking off in the Japanese market, which is the target market in this case, based on the work that has already been done in the three guidelines earlier.

The same guidelines we are discussing in this course—the same guidelines for which I gave you some samples and examples.

Taking cues from these three reports, which we developed earlier, we are creating this plan. That is actually the aim of this course: to emphasize that these three guidelines make the process of creating and devising an initial country plan much easier.

Here, our focus is absolutely on the target market we have chosen, as well as the product range we want to promote.

The marketing of premium quality seafood from South Asia is our plan for Japan, and the market is quite dynamic and looks very promising.

The company’s products in the target market are our sole focus in this plan.

What we find in this plan is that wholesalers play an important role. That is very important because without these intermediaries in between, it is very difficult to penetrate the Japanese market. This is a very complex distribution market. Entering the Japanese market without intermediaries is very difficult.

The plan acknowledges the role of the local wholesalers and other intermediaries. You can easily assume that before the goods reach the retailers for sale to the ultimate consumer, they change hands at least two to three times.

Another highlight of this plan is that the goods are perishable in nature, so they are required to be shipped by air, which will add to the cost. We cannot think of any other mode in this case.

These are some of the important highlights of the plan. Based on these facts, we have created this plan.

Friends, our initial marketing objectives for the next two years in Japan are to promote new products and services, which means premium quality products from India and neighboring countries. We are also planning to grow our presence in digital mode.

The modalities of getting into digital mode and how the goods will be distributed have to be further investigated because here, too, the role of intermediaries cannot be ignored.

Another objective of our marketing plan is lead generation. Now, leads here do not mean B2C leads. What it means is leads in the sense of identifying intermediaries in different cities of Japan.

Although this plan initially covers the top five largest markets, lead generation will also focus on getting leads from other markets. That is also very important, along with building relationships with them. Without intermediaries, goods cannot be distributed in any Japanese city.

Another marketing objective of our plan is to target new customers. When we say customers, we are talking about wholesalers and distributors. We are not talking about retailers, as that is very difficult.

Another objective is to build brand awareness. A certain amount of brand building is required because you can still sell your goods under some brand, and a certain amount of pull strategy can also be used.

Finally, we aim to increase sales and revenue.

Friends, based on our strenuous investigation—though not comprehensive, because a comprehensive investigation is still pending—the questions raised in this plan will be used for a more detailed market investigation. This is a precursor, and that is why it is called an initial country plan.

Based on our meticulous efforts in the three guidelines, the sales forecast for the next two years in the five largest urban areas of Japan, which are our target regions, is as follows:

In the next year after operations begin, sales volume is likely to reach 15 tons of seafood daily, consisting of a mix of different varieties. This would mean approximately 15 million yen per day.

In the next two years, we expect the sales volume to reach almost 25 tons of seafood daily. That means 25 tons of seafood are shipped daily from India or neighboring countries to the international airport in Japan. With different varieties, this would approximately mean 25 million yen per day. That will be the landed price.

Friends, in this plan, we are also writing about the strengths, weaknesses, opportunities, and threats.

It is very important that we know this.

And again, it is brand-specific, product-specific, and market-specific.

Strengths
From the earlier work done, we see that hygienic, organic, traditionally caught premium varieties of seafood are available. We have the supply, and there is great demand, with consumers willing to buy.

Abundant quantities are still available in South Asia, while the catch is being reduced worldwide. Seafood is getting scarcer globally, but abundant quantities are still available in South Asia. That is our strength.

The company also has good relationships with fishermen’s bodies, cooperatives, different agencies, and government bodies because of the earlier work done by the company.

Weaknesses
Some weaknesses of the company are the lack of the latest equipment, especially refrigeration and storage facilities. Investment in the latest high-tech equipment has to be made very quickly.

Another weakness is the lack of a good image of seafood from India in the Japanese market. The Japanese market has traditionally been a very sophisticated one, mainly importing from countries like the US or Chile. These are the countries from which Japanese importers have been sourcing their seafood.

India has not been successful in creating a good image for its seafood items in Japan, so the image has to be built. That is one very important objective of our initial international marketing plan.

Another weakness is that the goods are perishable and can mostly be supplied only by air. Obviously, the cost of transportation will be very high and will play a very important role in the landed cost.

Opportunities
The opportunity we see in the market is that the average price of seafood is increasing worldwide. Although due to COVID-19, the prices of seafood in Japan reduced by around nine percent in the last year, this is a temporary phenomenon.

The prices are likely to increase again because seafood prices are rising worldwide due to scarcity. More and more consumers are looking at seafood for its perceived health benefits. Consumption is increasing not only in Japan but all over the world.

This is making things even more difficult for consumers because supplies are not able to keep pace with demand. Japanese consumers, especially, are very upbeat because, for them, seafood is a delicacy, an important part of their diet, and they are willing to pay extra for it.

Threats
One of the major threats we see is that the COVID-19 pandemic is still not contained, and there can still be many disruptions. Lockdowns may occur, which will disturb the international supply chain.

The potential for sudden losses is therefore very high.

These are some of the important factors we could identify based on the three guidelines.

Friends, talking about product adaptation and modification, there is a greater role of guidance from Japanese wholesalers. Since they are already doing this with other countries, they are experts. They know their market very well.

The market distribution in Japan is so dense that penetrating it with your own wisdom is not possible. Relationship building is therefore very important with Japanese wholesalers, who are definitely going to guide you for mutual benefit.

Friends, as far as packing, handling, storage, and testing are concerned, you will require a lot of inputs and research by sitting with intermediaries in Japan and getting their full support. That is very important because here, Mr. Gupta of this company will have to put the right people on the job. They have to be trained, learn from Japan, and share the knowledge in India.

High-quality packing that matches Japanese standards is another very big challenge in terms of modification and adaptation. It will definitely be required. Suitable suppliers and consultants will be necessary, and this process has to start now in the plan.

Talking about the promotion mix, the proposed promotion mix for the Japanese market is based on the earlier guideline, where we talked about the different types of media in the economic analysis. We discussed the areas of media that are diverse in nature. Based on those data, we have allocated the overall budget in percentages: 20 percent in digital media, 30 percent in print media, 30 percent in TV advertising, 10 percent in cable ads, and 10 percent in radio.

These are the approximate figures in the initial plan.

In sales promotion, the main objectives are to increase sales volume, launch new products, increase trials, encourage repeat purchases, and block competitor moves, if any. Some competitors from other countries, like Vietnam or Chile, are very big exporters to Japan. They will feel threatened by the premium quality of seafood from Lakshadweep and South Asia.

Blocking competitor moves will require a lot of relationship building with intermediaries in Japan. Dealers, wholesalers, and retailers must be encouraged to participate in display sales contests, the idea being to increase brand awareness and deflect customer attention away from price, since premium quality products are being sold.

A message has to be conveyed in the marketing plan that customer attention is shifted from price to the features of the products. Another objective of this information is to supplement advertising and personal selling efforts.

Although personal selling efforts are not the main strategy, personal selling will definitely help build brand awareness, so it is required.

The proposed budget allocation for sales promotion includes:

• 30 percent of the total budget for coupons,

• 40 percent for premiums like prizes, gifts, or other special offers,

• 30 percent for outsourcing promotional campaigns, carrying out these activities, and the personnel cost for that.

As I just mentioned, personal selling will not have a direct impact on sales because the Japanese market is very dense, and every penny earned is through intermediaries. You cannot do away with that.

Still, in the initial two years, personal selling may be effective to generate interest in the brand name, even on a no-profit, no-loss basis. The idea is to build brand awareness and the image of Indian seafood, which is very important, and to support intermediaries.

However, personal selling may not be the main strategy for sales growth in our product category, mainly due to the perishable nature of the product and the unique factors of the Japanese market, including the dense distribution channels that exist there.

Now, Friends,

Talking about distribution: the goods will be procured locally with the help of local fishermen's cooperatives, other bodies, and local marketing agencies. Government bodies can also be supportive.

The goods procured will then be professionally handled and supplied to the nearest international airport, mostly Indian international airports, from where direct air shipments will be made to major cities of Japan, almost daily.

The arrangement in Japan for distribution is through intermediaries, which is a very dense market, as I already mentioned to you.

Other factors of distribution include the packing of goods, which will be dictated by professional, hygiene, and safety requirements, as well as Japan’s government regulatory requirements. These requirements, especially for perishable food items, must be strictly adhered to.

The documentation requirement is standard. LC documents such as invoice, packing list, certificate of origin, and air waybill are required. But in addition to these normal commercial documents, certain regulatory documents prescribed by the Japanese government must also be supplied.

Insurance claims for the main air passage are generally covered at the Japanese end, as per Japanese government guidelines. This will be done by Japanese insurance companies. Therefore, most of the business is conducted on a C&F basis, so the landed C&F cost has to be applied.

The freight forwarder to be used in India—in this case, the company already has very good relationships with a few freight forwarding companies, and they will be engaged as in earlier shipments.

In Japan, a couple of C&F agents for different cities are already being identified, and some have already been finalized by the team.

Talking about price determination, generally, the goods will be billed to large importers and wholesalers, which we discussed earlier, on a C&F basis (cost and freight).

Therefore, the cost will depend on a case-by-case basis and the requirements of the Wholesaler Importers Consortium. Whatever the case may be, a typical cost breakup is given in the resource section in the Excel sheet, which you can download. This example is for tuna fish, but a similar price breakup will work for other seafood items as well.

In terms of sales, as I already mentioned, generally it would be C&F.

Method of payment
Generally, any of the following methods of payment may be used: mostly advance plus consignment sales, documentary letter of credit, or dated drafts. It depends on the general practices of the main wholesalers and importers in each city of Japan. These terms can be negotiated to some extent, but not much.

Marketing budgets
As far as marketing budgets are concerned, given the peculiar deep involvement of intermediaries in the Japanese market and the nature of the distribution system in Japan, the marketing budgets should not be too high or too substantial. This is to avoid crossing the competitive price points suggested by the importers.

However, a nominal annual budget is proposed to the tune of 100 million yen for the next two years on a yearly basis, subject to review at the end of each financial year.

Other resources required
Due to the deep involvement of intermediaries for the proposed product mix in Japan, a small team of marketing-cum-liaison agents will be required to coordinate with importers and wholesalers to keep costs in check. Their salaries and compensation will be set as per local market norms, and in many cases, local personnel will be hired for this purpose.

The supply of seafood will be ensured as per the projected sales with the help of the existing procurement team of the company, which is based at the headquarters in Mumbai.