International Expansion, Marketing Plan Example

Zinc Inc is currently looking to expand its market for the Holter monitoring device in China. Holter monitoring device is a wearable communication device system used in the medical field to provide real-time data about a patient’s heart rhythm. It detects heart diseases by recording abnormal rhythms of the heart. It is a critical device at this time and age where heart problems are rampant. Below is a market report regarding the expansion.

Market and Segment Growth

Market segmentation is an essential aspect of any business because it enables the seller to identify real markets (Dibb & Simkin, 2016). Given this, China is one of the most suitable markets for Holter monitoring device needs for various reasons. According to GlobeNewswire (2020), China’s demand for Holter devices is expected to grow by more than 6%, equivalent to approximately USD 47 Million. These statistics show that the companies producing these devices will make significant sales. Hence, Zinc Inc should expect a steady increase in Holter devices’ sales for the next three years.

Upon entry, our customer profile will be people who suffer from rhythmic heart issues which need an easy to wear a non-invasive device to monitor and record their heart activity. This category comprises people of all ages. Notably, the geriatric population is likely to increase and consequently increase the market. Moreover, cardiovascular diseases are on the rise, accounting for the expected increased demand for the devices.

On the other hand, innovation is at its peak, and hospitals are looking out for technologically advanced devices to provide quality care. Cardiovascular diseases have caused so many deaths, and physicians are advocating for preventative. These preventative measures are exercised on a wide range of patients hence expanding the market. Thus, hospitals, ambulatory care centers, and diagnostic centers will be the devices’ real market.

Another aspect that will fuel demand is the attitude of the consumers. Currently, most patients and prospective patients are well informed and have the economic power to decide their health. Therefore, they opt for wearable devices over invasive procedures for safety and minimal risks. This, in turn, is expected to increase the demand significantly. Notably, there is no single way of segmenting a market; these factors will determine China’s segment focus.

Competitive Edge

Zinc Inc has invested in quality manufacturing plants, a real source of competitive advantage through quality and cost controls. Hence, Zinc has a unique opportunity to develop new products and new manufacturing processes. This way, they can present unique products to their market, serving users more value than what the competitors offer and thus scoop a significant portion of the market share—besides, high-tech manufacturing positions Zinc Inc to ramp-up volumes. It also enables them to deliver the goods faster to the market with enhanced functionality.

Relocating Outbound Logistics and General Operations to China

The most suitable approach to serving the China market is relocating outbound logistics and general operations to China. According to Porter’s value chain analysis, a company can only manage to take advantage of the cost position by determining the appropriate value chain activities and positioning them to speed up work and reduce costs (Simatupang et al., 2017). Outbound logistics is one of the primary activities suggested by Porter and Zinc Inc can relocate this set of actions. The activities include distribution, storage, and delivery. The outbound logistic activities would be backed up by general operations such as sales and marketing and procurement. Relocation of these activities yields a competitive advantage for Zinc Inc in terms of production and distribution costs. Consequently, Zinc Inc can offer competitive prices, which are slightly lower than its competitors’.

Modes of Entry to China Market

Exporting is one appropriate method to manoeuvre through international trade. It can either be direct or indirect marketing. Indirect marketing is the best option, and it involves reaching out to domestic companies who then take up the export process and sell the products through their channels of distribution. In essence, this strategy saves on costs of setting up an export operation center. It also requires no prior experience in export and trade in the host country because the burden is transferred to the third party.

Understanding the market is a critical step before launching a business or a new product to the market. Comprehensive data enables the firm to determine the right time and ways in which to leverage its advantages.

References

Dibb, S., & Simkin, L. (2016). Market segmentation and segment strategy. Marketing theory: A student text, 251-279.

Gupta, C. B. (2014). International Business. S. Chand Publishing.

Holter Monitoring Systems market worldwide is projected to grow by US$166 Million. GlobeNewswire News Room. (2020). Retrieved 19 November 2020, from https://www.globenewswire.com/news-release/2020/05/23/2037882/0/en/Holter-Monitoring-Systems-market-worldwide-is-projected-to-grow-by-US-166-Million.html.

Simatupang, T. M., Piboonrungroj, P., & Williams, S. J. (2017). The emergence of value chain thinking. International Journal of value chain management, 8(1), 40-57. https://doi.org/10.1504/IJVCM.2017.082685