Patrizia Beier
Analytic and Strategic Approaches to the Development of International (European)
Markets
Taking the Example of the US-Pixel-Magic Imaging Company
ISBN: 978-3-8366-0305-8
Druck Diplomica® Verlag GmbH, Hamburg, 2007
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C u r r i c u l u m V i t a e - P a t r i z i a B e i e r
Q u a l i f i c a t i o n
C A R E E R S U M M A R Y / W O R K E X P E R I E N C E
Diplom Betriebswirt Business Administration (FH)
* University of Applied Science, Neu-Ulm, Germany
(October 1995 - January 2001)
* specialization in International Marketing
* Degree Thesis "Analysis and Strategic Approaches to the
Development of International (European) Markets" for
Pixel Magic Imaging Inc., Texas/USA
Deutscher Sparkassen Verlag Ltd,
Stuttgart, Germany
Since June 2004
Administrative and strategic position at the Head of Card
Payment Debit and Creditcard System department
* Analyzing of new markets and business opportunities
* Strategic development of new business segments and
markets
* Creating business models and product design concepts
* Quantifying business cases
* Leading interdisciplinary teams for the development of
markets and products
* Developing of strategic partnerships
January 2002 June 2004
Productmanager for Credit-Card-Payment -Systems and
Chiptechnologies for the German Banking Industry
* Implemented creditcard programmes
(MasterCard and VISA) and payment systems
for the German Savings Banks Group
* Implemented the EMV-payment chiptechnology for
creditcards for the German Savings Banks Group
FINsys Software Ltd,. Munich,
Germany
July 2001 December 2001
Financial Controlling and IT-Consultant
* Designed and implemented of customized accounting
systems for the financial industry
I N T E R N A T I O N A L E X P E R I E N C E
P e r s o n a l D e t a i l s
Horváth & Partners Management
Consultants, Stuttgart, Germany
October 2000 July 2001
Productmanager and IT-Consultant at the Competence
Center for IT-Solutions
* Designed and implemented balanced scorecard
strategies and IT-systems for companies in diverse
branches
* Product developing, marketing and mangement of the
balanced scorecard software "Score IT"
DaimlerChrysler Corp.,Italy
(January 2000 - May 2000)
* International Internship at the Departement for Service,
Sales and Marketing
Pixel Magic Inc., San Marcos, TX, USA
(March 1999 - August 1999)
* International Internship at the Marketing Departement
Közgaz-University for Economics, Budapest, Hungary
(September 1997 - Februrary 1998)
* Univ. Semester
Languages
* German (fluent)
* English (very good)
* Spanish (basics)
* Hungarian (basics)
Date and place of birth
* June 10
th
1974 in Illertissen
III
Preface
The foundations of this thesis were laid during my conversation with the US Pixel Magic
Imaging, Inc. company at the "photokina `98"
1
in Cologne, where I completed a five month
internship in March 1999. While this conversation, aim and object were crystallized: " To
provide innovative, quality, photographic and imaging equipment, service and education to
professional photographers, photographic entrepreneurs and retail outlets worldwide."
2
Pixel
Magic Imaging's intentions and long-term strategy, is to realize their Corporate Mission
statement; to spread their business to international markets.
My scope of duties consisted in gathering data and compiling reports for international sales
opportunities in so far unknown international markets. I hope this thesis has contributed to
fulfilling Pixel Magic's strategy and targets in part.
This thesis benefits from the empirical data gained and its success based on an intensive
exchange of ideas from theory and practice.
I want to express my thanks to Dr. Henry and Marian Oles, David and Laura Oles, who made
my internship at Pixel Magic possible, and Jim Hennessee, who helped me out every time I had
problems. Special thanks goes to Laura, who always supported and convinced me about my
work and everybody else at Pixel Magic, who were very helpful whenever I had questions or
problems.
I want to continue my thanks to Mr. Knäpper, who sacrificed a lot of time in giving me the right
directions for this paper. I am very grateful to my parents, who enabled and supported my
studies and to my relations and my friends, who gave me with their "lack of interest" the
necessary calmness for this thesis.
1
International tradeshow for photography
2
Corporate Mission Statement of Pixel Magic
Patrizia Beier
IV
Table of Contents
Preface ...III
Table of Contents ... IV
List of Abbreviations ...VII
List of Illustrations ...IX
List of Appendices ...X
1
Representation of Pixel Magic Imaging, Inc... 1
1.1 History...1
1.1.1 EPS
Photographic...1
1.1.2 Pixel Magic Imaging, Inc. ...1
1.2 Explanations...4
1.2.1 Range of products ...4
1.2.2 Technical and branch specific expressions ...6
1.3 Objective ...8
2
International Marketing Research... 10
2.1 The General Term of Marketing Research...10
2.2 The Definition of International Marketing Research...10
2.3 Context with Research and the Decision-Making Process...11
2.3.1 Position in the Decision-Making Process ... 11
2.3.2 The Role of Secondary and Primary Data ... 13
3
Methodology of the International Marketing Research Project ... 15
3.1 Determining Research Project and Objectives...15
3.2 Secondary Data Collection...17
3.2.1 Filter of the Appropriate Data ... 17
3.2.2 Compiling
Data... 18
3.2.3 Data Interpretation and Analysis... 20
3.3 Primary Data Collection...22
3.3.1 The Nature of Primary Research ... 22
3.3.2 Determining Research Objectives... 24
3.3.3 Research
Technique... 24
3.3.4 Interpreting and Analyzing Data ... 25
3.4 Competitor
Research ...27
V
3.4.1 Secondary Competitor Research... 27
3.4.2 Pre-Results and Effects of the Competitor Research ... 28
3.4.3 Primary Competitor Research ... 29
3.4.4 Pre-Results and Effects of the Primary Competitor Research ... 30
4
Designing of an International Marketing Concept... 33
4.1 Market
Attractiveness...33
4.1.1 Market
Analysis... 33
4.1.2 Market and Customer Segmentation ... 35
4.1.3 Product Segmentation Matrix ... 36
4.1.4 SWOT-Analysis ... 37
4.2 Assessment of the Market Attractiveness ...39
4.2.1 Portfolio
Technique ... 39
4.2.1.1 The General Electric's Multifactor Portfolio Model ...39
4.2.1.1.1 Ratings...39
4.2.1.1.2 Weights...40
4.2.1.2 The Mc-Kinsey-Matrix ...41
4.3 Positioning
Strategies ...43
4.3.1 Marketing
Mix... 43
4.3.1.1 Product ...44
4.3.1.2 Promotion...45
4.3.1.3 Price...47
4.3.1.4 Place/Distribution ...50
4.3.2 Visualization of the positioning... 53
4.3.2.1 Product Positioning...53
4.3.2.2 Promotion Positioning...54
4.3.2.3 Price Positioning...54
4.3.2.4 Place/Distribution Positioning ...54
5
Market Implantation Strategies ... 55
5.1 Waterfall vs. Sprinkle Strategy ...55
5.1.1 Waterfall
Strategy ... 55
5.1.2 Sprinkle
Strategy ... 56
5.2 Standardization vs. Adaptation ...57
5.2.1 Product ... 58
5.2.2 Promotion... 58
5.2.3 Price... 59
5.2.4 Place/Distribution... 59
5.3 International Cost vs. Quality Leadership...59
5.3.1 Strategy of the international Cost-Leadership ... 59
5.3.2 Strategy of the international Quality-Leadership ... 60
5.3.3 Outpacing
Strategy ... 60
5.4 Skimming vs. Penetration Strategy...60
5.4.1 Skimming
Strategy ... 60
VI
5.4.2 Penetration
Strategy ... 61
6 Resume... 62
7 Appendix ... 64
8 Author
Index... 148
VII
List of Abbreviations
DI
Digital
Imaging
DM Deutsche
Mark
e. g. for
example
EIS Event
Imaging
System
EPS
Environmental
Projection
Systems
etc.
et
cetera
EU
European
Union
Foll.
following
GfK
Gesellschaft für Konsumgüterforschung (=German market research
company)
GNP
Gross National Product
i. a.
among
others
i. e.
that
is
n. a.
not
available
PMA Photo
Marketing
Association
PMI
Pixel Magic Imaging, Inc.
PoS
Point
of
Sale
R&D
Research
and
Development
VIII
resp.
respectively
UAP Unique
Advertising
Proposition
USA
United States of America
USD
US-Dollar
USP
Unique
Selling
Proposition
vs.
versus
IX
List of Illustrations
Illustration 1: Ranking of a Strategy Conception in the International Marketing ...13
Illustration 2: The Marketing Research Process...15
Illustration 3: GNP per capita ...16
Illustration 4: Information Intelligence ...18
Illustration 5: Corporate Usefulness of Different Types of Research ...23
Illustration 6: Markets and their Characteristics ...29
Illustration 7: Media costs for a four-colored one-page format advertisement...47
Illustration 8: Pattern for a function performance in the channel system for the German
Digital Imaging Market...53
Illustration 9: Need for Adaptation...58
X
List of Appendices
Appendix 1: European Industry Trend Report 1997-1998...65
Appendix 2: Qualitative Questionnaire ...89
Appendix 3: Summary of the Qualitative Research ...91
Appendix 4: Secondary Competitor Research ...96
Appendix 5: Primary Competitor Research ... 122
Appendix 6: Market Analysis Matrix... 123
Appendix 7: Rank of the Market Analysis ... 124
Appendix 8: US Digital Imaging Market and Customer Segment ... 125
Appendix 9: US vs. European Customer Segment... 126
Appendix 10: Product Segmentation Matrix ... 127
Appendix 11: SWOT-Analysis... 128
Appendix 12: Multifactor Portfolio Model... 137
Appendix 13: MC-Kinsey Matrix ... 141
Appendix 14: Product-Mix Categorization ... 142
Appendix 15: US Product-Mix Calculation... 143
Appendix 16: Pattern for an International Product-Mix Calculation ... 144
Appendix 17: Competitor's Ex-Factory Prices ... 145
Appendix 18: Positioning Model for the Product-Mix ... 147
1
1 Representation of Pixel Magic Imaging, Inc.
1.1 History
1.1.1 EPS Photographic
The Environmental Projection Systems (later known as EPS Photographic company) success
story began in 1976, when Dr. Henry Oles, the founder and at that time a professional
photographer, published the book " Successful Projected Environmental Photography". This
first book ever written on background projection was a worldwide success, since using
background projection technology was a completely new and revolutionary invention in
photography at that time.
Unsatisfied with the technology used in then available projection systems, Dr. Oles developed
together with a partner the Scene Machine background projection system, which was
introduced in 1981.
Initially as a small family business, EPS grew over the years, manufacturing and distributing
innovative photographic products to professional photographers worldwide.
1.1.2 Pixel Magic Imaging, Inc.
PMI was founded in 1992 by David Oles and father, Dr. Henry Oles. Pixel Magic introduced
the digital imaging technology to retail photofinishers.
1998 EPS and Pixel Magic merged. With this acquisition of EPS Pixel Magic now has a
diverse product line ranging from retail and professional digital imaging products. With "First
Impression", a division of the company, PMI is represented in the field of e-commerce.
PMI's transactions must be described in three areas: It is a high-tech company positioned in the
field of digital imaging technologies by producing highly sophisticated software and Internet
2
services while combining it with fully equipped devices and studio systems. The devices and
studio systems consist of, according to the corresponding software system, PC, operating
system, which is Windows, photo printer, modem, spotlights, screens and digital camera. The
complete devices were provided by common producers. Their regular customers are
professional photographers, the retail channel, like mini-laboratories and/or photo retailers,
Event-Photographers and the government channel.
PMI's customer segment:
PMI is headquartered in San Marcos, Texas and is a high growth company with a turnover of
about 20 million USD in 1998 and averaging over 40% growth per year since the merger. The
company expanded its business from a regional to a nationwide business and hold a very high
share of the market. PMI is led by David Oles, who serves as both Chief Executive Officer and
Chief Technology Officer and Henry Oles became Chairman of the Board.
x Professional Photographers
¾ Event Photographers
¾ Portrait/Studio /Commercial
Photographers
x Specialty Photo Retailers
¾ Minilabs and/or Portrait Studios
and/or Digital Services
x Retailers
¾ Drug stores, supermarkets,
department stores etc.
x Institutions
¾ Hospital
¾ Government
3
The company has 6 different departments with over 100 employees:
¾ Management
¾ Sales, Marketing and Customer Service
¾ Finance and Accounting
¾ Engineering
¾ Production, Inventory and Shipping
¾ Technical Service
4
1.2 Explanations
In order to understand the further procedure better; it is necessary to explain several terms,
which concern products, technical and branch specific expressions.
1.2.1 Range of products
¾ Digital Designer Workstation
The Digital Designer is a photo retouching and enhancement workstation. It utilizes powerful
retouching software to enable any type of photo alteration or enhancement. Main customers are
photo retailers and photographers
¾ Photo Ditto Print and Enhancement Station
The Photo Ditto workstation is a print to print copy station. The easy to use touch screen driven
by a software package allows enhancing images and can be directly used by end users. The
customer segments are photo retailers, supermarkets, department stores, drug stores etc.
¾ Event Imaging System
It is a portable digital photography system. The multi-tasking software allows for simultaneous
acquisition and printing of photos. Once taken, photos can be cropped, color corrected, text can
be added as well as graphical borders. Common uses for this system are all kind of events, like
parties, dances, reunions etc. where photography is requested. The system can produce
immediate prints. Main customers are photographers especially event photographers.
¾ Backlab Scanning and Internet Station
The Backlab system is a high speed scanning station designed for use by one-hour photo labs.
This system creates index prints, puts customer photos on floppy or zip disks, uploads photos
for viewing on the Internet, and can create CD-ROM media with customer photos. Index prints
are now only offered by labs that have the most modern equipment. The Backlab enables any
5
photo lab to offer this new service without replacing their existing minilab equipment.
Customers are photo retailers and photographers. This product is positioned for photo retailers.
¾ Photo View Sales Preview and Ordering Station
This system is an optional part of the Backlab system. Designed to be in the front of a photo
retailer, the Photo View system allows customers to view their images before they are printed.
For example, a customer brings a roll of film to the lab and when they return, the customer
views their photos on a monitor. Using the touch screen software the customer decides how
many of each image they would like to have printed. The customer can order enlargements and
specify the crop as well. Customers are photo retailers.
¾ First Impressions Systems for Hospitals
This system is used by the First Impressions division of Pixel Magic and acts as a point of sale
system for baby photography. The system incorporates a high resolution digital camera, custom
software and a dye-sublimation printer. The software acts as a point of sale system for baby
photography. The software collects names and addresses, takes photographs and prints the final
order. All photos, were taken are transferred daily to file servers at PMI headquarters. These
images are permanently stored on CD-ROM. It can also be seen as an Internet service and is
especially for hospitals.
¾ Gallery and Portrait View Digital Proofing System
This System is the latest generation of computer based proofing systems. Proofing systems
allow professional photographers to show their customers their just taken photos via a film
camera on a screen, while the customers are still in the studio. The typical customers are
photographers and photo retailers.
6
¾ Gallery Digital Studio System
This system is identical in features to the normal Gallery Proofing System, however no film
camera is required, feature is a digital camera. Customer segments are photographers and photo
retailers.
¾ Scene Machine
The Scene Machine is a virtual background system used by professional photographers to
project any background behind subjects on a special ultra reflective screen. The system uses
standard slides to the background on a special screen that PMI manufacture. Photographers can
take their own slides or purchase it. Main customers are photographers.
¾ Lab Pro series of package printing equipment
The Lab Pro product line consist of two photographic enlargers that use traditional photo paper
and chemistry. Customers are photo retailers and photographers.
1.2.2 Technical and branch specific expressions
¾ Digital Imaging
The art and science of producing and manipulating digital photographs - photographs that are
represented as bit maps. Digital photographs can be produced in a number of ways:
x Directly with a digital camera
x By capturing a frame from a video
x By scanning a conventional photograph
The biggest advantage of digital imaging compared with conventional photography is, that no
development of films is required anymore.
7
¾ E-Commerce
"E-Commerce " ("electronic commerce", derived from such terms as "e-mail" and "e-
business") is the conduct of business on the Internet, not only buying and selling but also
servicing customers and collaborating with business partners."
3
¾ Enhancement
Once an image is in digital format, you can apply a wide variety of special effects. You can
modify images, e. g. setting borders, text, logos or to improve images, e.g. remove scratches,
red-eyes etc.
¾ Event Photography
Event-Photography is an established notion in the photography business. It is taking pictures on
the spot for special occasions, like family and class reunions, sport events, holiday photography
etc..
¾ Mini-Lab
Mini-Lab is an expression for photo labs, which are not just specialized in film developing like
mass photo labs. Their output is smaller and more specialized for special customer's requests.
Most photo-retailers combine a mini-lab with their business.
¾ Print-to-Print
The original image is copied by scanning and printed instantly.
¾ Professional Photographer
Professional Photographer is defined as an event- and/or studio photographer.
1
Source: http://www.whatis.com, 12/12/99
3
Source:
http://www.whatis.com
, 12/12/99
8
¾ Retailer
In general a retailer is defined as one who sells goods to consumers. In terms of photo business,
a retailer sells merchandise, like cameras, frames, albums etc.. A retailer often combines his
business with offering other services, like photo finishing, portrait studio, retouching services
etc.
¾ Touch screen
Screen used as an input device, by identifying where a screen is touched.
1.3 Objective
The actual situation of PMI's international activities is that there already exist some business
relations to international customers, i. e. in South America, Australia and Great Britain, but
concerning these sales the individual customer made a request by himself. In other words, PMI
has neither an organized and international marketing conception nor a regular business to
foreign customers and markets so far.
The motivations for internationalizing and expanding their business to overseas was at the
"photokina `98" in Cologne, an international trade show for professional photographers and the
photograph industry. This show gave insights to foreign markets and especially to European
markets and their potential buyers. It was recognized that there is a demand for PMI's products
especially in the European market.
PMI is in its infancy in terms of "going international". Aim and object of this project was
analyzing marketing opportunities and to approach adequate marketing strategies. Therefore
data of international markets must be collected, evaluated and analyzed to put these results in a
strategic order. This thesis deals with the development of foreign markets and how market entry
could be realized. It focuses on explaining ways how to get there. The aim of this thesis is to
9
prove which strategies are possible and to explain them in a general approach. It is not the aim
and object to define an obligatory strategy.
10
2 International Marketing Research
2.1 The General Term of Marketing Research
Marketing research in general "is the systematic gathering, recording, and analyzing of data to
provide information to guide marketing decision making."
4
The activities in marketing contain besides product development, distribution and pricing also
marketing research.
The essence of marketing consists of making profit from the market, but in the end success
depends on efficiency and well chosen marketing activities.
This asks for an overall view and transparency of the market regarding for example its
structure, potential, attraction etc.. Therefore one of the first tasks, before a specific marketing
activity takes place is to analyze the market and its environment.
In general, this fact applies for each company and it is regardless of whether business takes
place internationally or within national borders.
2.2 The Definition of International Marketing Research
Basically most of the domestic marketing scene is used for international marketing research as
4
Terpstra (International Dimensions of Marketing, 1993), p. 69
11
well, like questionnaire design, focus group research, survey techniques etc.. Also a typical
sequence of a multi-country market research process follows the familiar pattern used in
domestic market research.
The actual difference between ordinary marketing research and international marketing
research is the difference of general conditions in other countries and the complexity of data
which is needed.
International marketing research contains the same function but the dimensions are more
complex. The extended task is presented in terms of "gaining of specific, relevant information
for decision-making about concrete foreign markets, especially about the resident consumer
there."
5
This must be taken into consideration, since in foreign economies many other variables
exists. Facts, which are taken for granted in the home market, like consumer segments and their
behavior or legal systems are changeable and different in each foreign market. Furthermore, the
ethical background of foreign countries has to be taken into consideration. These countries
contain different culture, religion and social facts and thus different ways of life and manners.
In this context, the researcher has to figure out, which of these variables are effective for the
company's marketing plan.
2.3 Context with Research and the Decision-Making Process
2.3.1 Position in the Decision-Making Process
As mentioned in 2.2 marketing research is an important part in the sequence of decision-
making. Research is gathering information and converting it into appropriate data and analysis,
which provides management with facts and ideas to implement marketing strategies. " A
5
Diller (Marketing-Lexikon,, 1994), p. 54 (emphasized by the author.),
>translated into English@
12
marketing strategy is to characterize as a conditionally, long-term, global plan of reaction
attainment targets of the company and marketing."
6
In this context, the international marketing research is one of the first step within the scope of
the process of decision-making. Its purpose is to assist and to support, while searching and
selecting a proper strategy for the development of a market. Explicitly, it can be said that the
gathered information serves the market segmentation, selection of a market and therefore the
formulation for the marketing concept and program, which was attached importance in the
example of PMI. There the compiled data can be used for the development of an international
marketing plan and for the latter for the specific use of marketing instruments.
Illustration 1 demonstrates the logical order of the analysis of foreign markets and the target as
a result from this.
This illustration shows, that the procurement of information is a crucial element in the whole
strategy process, which has to be executed, since it points the way to the formulation of the
strategy. The collected information consists of knowledge, e. g. economic, technological or
political areas. Patterns for a strategy appears by linking these bundles of information.
6
Meffert (Strategische Unternehmensführung und Marketing, 1988), p. 55,
>translated into English@
13
Illustration 1: Ranking of a Strategy Conception in the International Marketing
7
Formulation of the global
company's targets
Collecting of information
Country profiles
SWOT-Analysis from
the company and the
destined country
Arrangement of the basic strategies
to developing foreign countries
Marketing concepts for
the country markets
2.3.2 The Role of Secondary and Primary Data
The nature of information, namely primary and secondary data, has different meanings for the
utilization in strategic marketing and is important for strategic approaches.
Decisions for international market entry are made in the first place by secondary data, while
primary data is used for the selection of suitable market processing strategies, especially for
operational and tactical decisions and for additional information, which could not gathered with
secondary research. For foreign marketing research " ... constitutes secondary research the
7
Source: Meissner ,,Strategisches internationales Marketing", p. 103,
>translated into English@
14
essential informative condition to be able to judge the future of markets and the chances and
risks."
8
The unfamiliarity with foreign markets brings along uncertainty and thus risks as well.
The risks are hidden in the variables, which were already mentioned in 2.2:
¾ market potential, e. g. the demand and consumption in a market
¾ competition, e. g. too much competition affects the attractiveness of a market
¾ political environment, e. g. in terms of trade restrictions or political instability
¾ the consumer, e. g. in terms of the ethical background and social situation
Its task is to observe all the variables and supports the decision-making process by making
better decisions that recognize cross-country similarities and differences in revealing either new
opportunities in sales or that it would be better to remain in the national border of business. In
other words: International marketing research together with its elements of the secondary and
primary data assists marketing management to reduce risks in examining the question "go
international or remain a domestic marketer?"
9
To weigh this question the company is more
protected to fail in international business and thus more bewared of high investments.
8
Meissner (Strategisches Marketing, 1995), p. 108,
>translated into English@
9
Terpstra (International Dimensions of Marketing, 1993), p. 73
15
3 Methodology of the International Marketing Research Project
The course of the research project took place according of Kotler's description of a marketing
research process. The proceedings you see at illustration 2 will be closer explained next.
Illustration 2: The Marketing Research Process
10
3.1 Determining Research Project and Objectives
In chapter 2 was discussed relevant information, which is needed for solid decision making. In
the procedure of international marketing research any project begins with a precise definition of
the research problem and research objectives as guidelines, on the one hand to avoid collecting
unnecessary information and on the other hand to keep the research's and thus the strategic
target in mind.
Each company has to figure out its own need for information. In PMI's case the research
problem was described as follows:
Developing new sales opportunities for PMI in Germany or elsewhere in Western Europe.
Since this formulation was too broad, it was downsized into more specific objects:
¾ Constructing a channel of distribution
10
Source: Kotler " Marketing Management", p. 116
Define the
problem and
research
project
Develop the
research
plan
Collect the
information
Analyze the
information
Present the
findings
16
¾ Building up an international Marketing plan
¾ Establishing of international sales offices or finding a distributor
¾ Market entry in Europe: How and Where? Focus on Italy, France, Great Britain and
Germany
¾ Finding foreign market/customer segments
In the run-up to determining the research project, it was demarcated, which European countries
should be focused on for the research activities. The reason for choosing these specific
countries (see above) was that they can be rather viewed as equal markets, since these countries
belong to the EU. Therefore certain risks could be excluded and thus certain conditions are facts
in terms of technology development, infrastructure, economic power, tariffs and trades, stable
currency exchange rate and government. Illustration 3 presents partly the economic power of
these four chosen countries in the sense of the GNP per capita. To gather the relevant data the
determined objects can be divided in secondary and primary data research, which will be
discussed next.
Illustration 3: GNP per capita
11
Country
GNP per capita
in US $
Germany
28,280
France
26,300
Great Britain
20,870
Italy
20,170
11
Source: http://www.statistik-bund.de/basis/d/ausl.htm, 06/11/99
17
3.2 Secondary Data Collection
The use of secondary data is a common first step to reduce the gap of uncertainty in the foreign
business. "Secondary research (also known as desk, library or bibliographical research)
involves the location and examination of available, usually published, data of relevance to the
project."
12
It emphasizes that the collected data contains the specific items for the research
objectives and conveys a general idea, since it was located and examined on focusing the
research problem.
The feature of secondary data is, it is already collected and available from various sources. To
obtain this information is relatively cheap and fast, which is another advantage of secondary
data.
3.2.1 Filter of the Appropriate Data
In 3.1 the core of the research problem was assumed. The next step is to approach the volume
of the research objectives, i. e. to identify the concrete and detailed need of background
information, therefore the information intelligence. The required items were derived from the
research objectives. The items were converted into precise questions, which is helpful to
determine the information requirements. Additionally, the research objectives were summarized
in a checklist with "Key-Headlines". (See Illustration 4). In addition it also has to be
mentioned, that the research problem deals exclusively with capital goods, unlike research into
consumer goods, which goes into the buyer's personal backgrounds, i. e. attitudes concerning
social status and cultural facts, the research context based on the attitudes and behavior of their
work.
12
Walsh (International Marketing, 1993), p. 57
18
Illustration 4: Information Intelligence
1. Foreign Market Assessment and
Selection
2. Customer Attitudes/Behavior
¾ Where in one of this single European
country is an appropriate location to
market?
¾ What are their main activities in photography,
photo finishing and retail?/What service do they
offer?
¾ How does the DI market in these countries
look like?
¾ What kind of equipment (PC, photo-devices) is
used by prospects?
¾ How attractive is new technology, like
Internet, DI and PC's among the
prospects?
(Is the market ready?)
¾ What would it take for an European prospect to
get a product by PMI
¾ Who are the major competitors?
¾ What are the European attitudes about our
products?
3. Broad Strategic issues
¾ Who are our present and potential
customers abroad?
¾ What kind of product could be market
there?
¾ What are the costs for transport and
distribution?
3.2.2 Compiling Data
Before obtaining the data, sources have to be identified. For that purpose all imaginable sources
should be taken into consideration. For sources of secondary data there are a lot of possibilities
of publications from institutions, like national and international governments, trade
associations, banks, chamber of commerce etc.. Parallel to identifying sources, attention need to
be paid to which secondary statistical data can be obtained. In the example of PMI, secondary
information of micro issues and specific data were needed. Micro issues include materials on
specific industries in the respective countries and their growth prospects and specific data
which provide with customized information. As a result for this search the sources were
referred to which met these criteria:
19
¾ International Chamber of Commerce, New York
¾ Gfk, Nuremberg
¾ Internet
¾ PMA Association, MI, Jackson
¾ Central Verband Deutscher Berufsphotographen, Cologne
¾ Statistisches Bundesamt, Wiesbaden
¾ European Union
These organizations were chosen since they provide reliable material. PMA an international
association for professional photographers, photofinishers and retailers provides statistical data
on people, who are involved in the photo business, e. g. about their activities in this business,
the aggregate market, i. e. volume, potential and the market size, present and future trends,
target groups etc.. The advantage of this statistical data is that it concerns PMI's consumer
segments. The GfK, a German market research company supplied suitable information with a
photographic consumer panel. The Internet was helpful to acquire additional and general
material, like computer and Internet usage among the population, which is important, because
all the PMI devices are adaptable for E-Commerce as well. The Chamber of Commerce and the
Central Verband Deutscher Berufsphotographen (a German association for professional
photographers) submitted addresses of other photographic institutions and professional
photographers.
The survey frequency took place in a constantly systematic gathering of information, which had
the advantage that it was possible to assess the research project; to see what further information
was still needed. The information intelligence checklist served as a scale to measure the
projects progress (see Illustration 3). It was ensured that the survey would contain the equal
information for each individual country.
20
3.2.3 Data Interpretation and Analysis
During the research process it is important to put the gathered material in an order. Subject
areas were formed with subheadings in brief outlines by means of the checklist, which the
information was assigned. The subject areas concerned PMI's product devices and prospective
customer segments.
The subject areas are:
¾ Photofinishers
¾ Digital Imaging
¾ Portrait Studios
¾ Minilab Equipment
¾ Computer and Internet Usage
The subheadings for every subject are:
¾ What kind of services are offered
¾ How many are offering these services
¾ The amount of annual investments
¾ Reasons for investments
¾ What kind of equipment is already used
¾ What kind of equipment is planned to be purchase
¾ The amount of annual profits
The shape of the obtained information were partly reports and statistical data. The reports were
prepared for PMI's need and some facts were represented graphically and interpretive in a
21
written way. The next step was to document the compiled data. The contents of the subheadings
was put in an order within the subject areas for each individual country: Great Britain, Italy,
Germany and France and combined to a report, the "European Industry Trend Report 1997-
1998". For the detailed report see appendix 1.
Problems while interpreting and analyzing of the data were, that the origin of the sources were
different and thus the sample size was different as well. To deal with the problem with the
comparability and in order not to falsify the results and the gathered data, it was attached
importance to use data and facts from one source for preparing each single graphic. Another
problem was different definitions of the fields of retailers, photographers and photofinishers in
the various markets. In some countries photographers, who offer digital imaging services, come
under the field of "specialty retailer"; another example is with photofinishing, the term
"photophinishing" includes retail shops, mail order and minilabs in some countries, but in other
countries the term "minilab" is a stand alone expression. During structuring this report it was
also necessary, to formulate a phrase which expresses the whole amount of prospective
customers. The phrase "All respondents" contains thus:
¾ Specialty Retailers
¾ Discount Stores
¾ Portrait Studios
¾ Digital Imaging Firms
To mention is the timeliness as well, which was not of very great importance. The "European
Industry Trend Report 1997-1998", contains data from 1997 and 1998, like the title already
expresses, since the research project took place in 1999. In this case care was taken to use data
and facts from one source for preparing each single graphic as well. Fortunately, information
could be utilized mostly from one source and alternative variables as information was used to
fill the gaps in information.
22
3.3 Primary Data Collection
3.3.1 The Nature of Primary Research
" Primary research (also known as original or field research) involves obtaining information
from informants by observation, interview or mail questionnaire."
13
Walsh's quotation explains
the feature of primary research, namely that interesting information in the form of a survey and
data is gathered for a specific intention - compared to secondary data research, which is a
collection of existing information - and reflects first hand attitudes and data for research
objectives. Secondary data does not often contain sufficient specific information for the
requirements of the company, therefore obtaining of preliminary data is necessary, since it
supplies the researcher with answers to the specific questions posed, but in international
marketing research primary research has a comparatively low rate of usage, since it is very cost-
intensive. Usually it is used to gain additional information or to complete data.
In general "primary research is essential for the formulation of strategic marketing plans."
14
Kotler described preliminary data as " ... backbone of later marketing campaigns."
15
Thus this
already applies for the future marketing instruments. These two statements are faced with a
controversial context, Czinkota emphasized more the strategic feature and Kotler the tactical
respectively the operational feature of primary data. However, these claims must be qualified in
terms of which design for a survey is being used. In the literature, three possible research
objectives can be found: exploratory, descriptive and causal research, which has different
meanings for strategic and tactical marketing. Illustration 5 shows the context for the use of
the survey design. To explain each of these survey designs would go beyond the scope of this
thesis, therefore the three possibilities are explained briefly.
13
Walsh (International Marketing, 1993), p. 57
14
Czinkota and Ronkainen (International Marketing, 1993), p. 464
15
Kotler (Marketing Management, 1997), p. 117
23
¾ Exploratory Research: " ... is most appropriate when the primary objective is to identify
problems, to define problems more precisely, or to investigate the possibility of new
alternative courses of action."
16
¾ Descriptive Research: " The aim of descriptive research is to provide a description of
existing market phenomena. For example, market characteristics such as the socio-
economic position of customers or their purchasing intent may be analyzed."
17
¾ Causal Research: " The aim of causal research is to identify precise cause-and-effect
relationships present in the market. The level of precision is higher than that for other types
of research because reasonably unambiguous conclusions regarding causality must be
presented."
18
Illustration 5: Corporate Usefulness of Different Types of Research
19
16
Czinkota and Ronkainen (International Marketing, 1993), p. 466
17
Czinkota and Ronkainen (International Marketing, 1993), p. 466
18
Czinkota and Ronkainen (International Marketing, 1993), p. 467
19
Source: Czinkota and Ronkainen " International Marketing", p. 467
ta (International Marketing), p.467
19
Source: Czinkota " International Marketing", p. 467 ta (International Marketing), p.467
Exploratory Descriptive Causal
Strategic
Tactical
Ende der Leseprobe aus 163 Seiten
- nach oben
Details
- Arbeit zitieren
- , 2000, Analytic and Strategic Approaches to the Development of International (European) Markets, Hamburg, Bedey Media GmbH, https://www.diplom.de/document/225258
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