Term Paper on "Global Market Development"

>

Regionalized competitors in the United States are pervasive, as there are known high levels of customer loyalties with regionalized brands. This is especially true throughout the Midwest and Southeastern United States. The dominance of Proctor and Gamble is evident in shelf space and presence in the majority of grocery stores, super stores and markets.

Proctor & Gamble has launched a price war in India this year, charging 49 cents per soap container (22 rupees), attempting to force out key competitors including Lever Brothers and others. This price war makes the addition of supply chain joint ventures throughout India critical.

Pressure from Substitute Products

The cleaning rituals in India are overflowing with symbolism for the religions of the region and need to be considered as both a level of performance to accomplish, in addition to recognizing that existing cleansing rituals are also substitute products. The use of detergents and soaps are not as popular in the urban areas, where salts, soaking, and highly ritualized and religious cleaning steps are followed. In the urban areas of India however, there is greater westernization and the use of hand and clothes washing detergents.

Substitutes also abound in the local Indian and Pakistani marketplace as there are strong regional brands, yet not single brand dominates the entire marketplace. This translates into the opportunity for launching a strong national brand that takes into account the cultural differences and nuances of this country yet also brings in greater potential capture of new customers.

Bargaining Power of Buyers

There is significant power from buyers within the Indian and Pakistani markets as the markets are by definition extremely price-sensitive. Competitive factors also include the highly religious nature of cleansing clothes, dishes and themselves within the rural sections of India and Pakistan. To attract these buyers, regional variations must be carefully studied and the detergent products must be aligned with the religious beliefs of the specific religions who are members of the potential target market.

Buyers prefer local manufacturing and require bleaches that produce exceptionally high levels of white contrasts. This is a critical point for the growth of any development strategy within India and Pakistan. Buyers are not as particular as westernized buyers relative to the consistency of bleach however. The Indian purchaser of detergent does not mind if there are small packets of powder instead liquids, and there is more of a focus on minimizing waste instead of large purchases that are beyond many of the Indian's budgets.

Bargaining Power of Suppliers

Highly dependent on the very volatile commodity of chemicals and detergents throughout the region, suppliers have a strong influence on… READ MORE