M&S overlooked Chinese body frame. They tend to
have smaller body frame compared to Western and European people. M&S has
clothes ranging from 6 to 18 but usually Chinese people wear sizes from 2s to
4s due to that reason whenever any Chinese person goes to M&S they find
oversized clothes. This is one of the main reason why M&S is facing
difficult time in selling clothes in China. M&S had still not solved this
problem. Another thing that they overlooked is that their products is mainly
focused on middle age men and women, due to this their products have been
critiqued as unfashionable and outmoded. Instead of focusing on middle aged people
if they have focused on young men and women then they would have sold more
clothes because young people are not afraid to try new things and they have a
huge spending power and the disposable income to back it. Another thing that
they haven’t noticed is the affordability of M products, most of the
middle-aged people does not have a huge income, so they are not able to
purchase M products even if they somehow find a correct fit.
These elements are important when expanding
internationally because every country has their own fashion sense. Their
fashion is affected by their body type their culture, there taste and
preferences and the weather over there. If a company does not focus on these
aspects when they are expanding their business internationally they won’t be
able to survive in that country, they will increase the cost for the company, but
they won’t be able to increase sales which will lead to a huge loss for the
Factors influence international pricing
A: Factors that influence
international pricing decisions
1. COST: this is the main factor
that will affect the pricing decision because the company should know how much
will a product cost for a company to make. Cost of a product will include raw
materials and indirect cost. If they are not able to find out how much will it
cost, they won’t be able to decide the margin for profits.
2. Government Regulations: Government can control
the price directly, they can keep the limit how much high the price can go and
how much low the price can it go.
3. Custom Duties and Taxes: The company should
collect information regarding tax and custom duties so that they can keep the
price according to that. Some countries have high tax rate and custom duties
and some countries have low tax rate and custom duties. Higher tax rate will
lead to higher price which will affect the sale of the products.
4. Currency Exchange rate: Fluctuation in exchange
rate will affect the price of a product and profit for the company. So, a
company should study exchange rate and how much it fluctuated in a certain period.
5. Brand Image: A company with strong
brand image like Apple can charge premium price because people have faith in
that company, but a new company will not have a strong brand image so people in
other country will not purchase their products if the company have a premium
price on their products because they won’t trust the company.
A company should really know their competitors of the country where they are going
to expand their business. People love and trust local companies more than
international company. So, the international company should have a good brand
image or less or no competitors in that country so that they can sell their
products at the price that they want.
Trade-off between Standard and Local marketing
With regards to the marketing strategy, M
& S should adopt local marketing to succeed in Chinese market. As we already know that most of the global
companies follow standardized marketing strategy as it saved a lot of money.
However, in some cases local marketing also plays a vital part when the brand
is not much familiar among the local population of the country. In such cases,
local marketing is essential to grab attention of the local consumers. However,
it requires a lot of investment in research and marketing as it must be done to
suit local audience and could not be used globally. Considering the fact that
Chinese population roughly accounts for 20% of world’s global population and
Chinese middle & upper-class accounts roughly around 70% of the total
population, it wouldn’t be a bad decision to localize if not at least modify
based on Chinese consumer preferences (Iskyan, 2016) . Capturing Chinese market would increase the
market share of M to a greater extent.
M in china focused on the target market
of age group 35 years and older. We know that teenagers and youth are the
primary target groups that adopt to the current trends easily when compared to
older adults. Hence, we believe that the company should revise its target
audience to age group of 20 years to 45 years in order to increase the sales.
Having said that M is not a flashy brand and believes in delivering quality
products, it wouldn’t be a bad decision to focus on the youth as they account
for the majority of the growing upper-class population of the country (Index Mundi,
As already discussed earlier, M&S should
definitely consider the localization of its marketing strategy especially in
countries that has a huge middle & upper-class population. Many
international brands have already done local customizations in different
markets and have been successful. For example, Taco Bell in India removed usage
of “Beef” from its menu and has been successful (PTI, 2016).
Also, these customizations haven’t affected them in the global market. Hence,
the company could customize products based on preference of the Chinese
consumers if not the whole, slight modifications would not affect the brand in
china as well as the global world.
With respect to the local advertising and
communication of the brand, M should translate their ads into mandarin
and use Chinese celebrities to increase their reach. It has been mentioned in
the case that Chinese population are not much aware about the brand and one of
the reasons for the brand being not successful was due to the usage of
international models for displaying their products. For example, leading global
companies like Pepsi and Coca Cola use local media influencers in countries
that are not much aware about the international celebrities. Pepsi uses local
sports celebrities to promote its products in India and has been successful.
Using Chinese celebrities will definitely raise the awareness among the local
To conclude, localizing marketing strategy in
china will not affect the company’s market share as capturing Chinese audience
would increase a greater market share of the company considering the age and
age and income demographics of the country.