Business_Management

Our company background HQC (call High Quality International Electronic Limited Company) is a listed company in 2006. The main products are mobile phones, such as Smartphone. Founded by Cherry Wong, Henry Lam, Joe Chan, Director of the board & Chairman of HQC Foundation and Andy Chou, President and CEO. It established special partnership with the main mobile brands, including the leading five operators in Europe, the top three in the US, etc. It has brought the products to the market with the industry leading OEM partners, then since July 2006 to develop our own HQC brand. Then, we had more than three hundred employees to help our company to create more equipment. HQC’s mission about it can become the leading innovative supplier of mobile phone and develop some innovative Smartphone to lead the user to experience real freedom of movement. Our company was launched HQC 4G phone in Hong Kong to meet our consumer ‘need and satisfy because people also need the mobile phone to communicate with others. In additional, marketing objectives are testing and observation Hong Kong reaction by our product and matching our consumer’s needs and requirements. Then, we can try to launch HQC 4G phone in China market to expand our market share. We focus to sell HQC 4G phone, between the age of 18 to 59 years old of male and female. According our company annual business report, HQC’s sale revenue is US $12 billion to increase 40 percent in 2009-2010. Marketing Mix Price: we also face our business may increase or decrease the price of 4G phone if other stores have the same product. The price of HQC 4G phone about 5000 dollars. Place: We can use the horizontal marketing system to distribute our 4G phone in various regions of Hong Kong mobile phone shops. We must sell fifty above 4G phone per day. Promotion: we can use television advertising to promote our 4G phone to attract more consumer attention. We can give premiums such as memory cards. Now, our company wants to expand in China market so we should develop the product to launch in China market to increase market share. Then, we through the product or the cost to choose a product-communication strategy to help our firm‘s development. China market-Environmental analysis The China has over 1.3 billion people so the People’s Republic of China is the world’s fourth largest country and the world’s fastest growing economy. Then, China is a dynamic market, so some of the international investors and buyers can find a lot of quality products at the competitive prices. Regarding National Bureau of Statistics of China released data of the China‘s economy in 2010, The GDP was 397983 trillion in 2010, at the constant price an increase 10.3 percent so the growth rate 1.1 percentage points faster than the previous year. We can be seen China‘s economic was increased. In China market, our main competitors are HTC, Apple Iphone 4, Nokia, Motorola or Samsung. According Gartner Dataquest’s analysis, mobile phones competitive are increasing continuously because there are different types of new products to launch, such as Iphone 4, HTC Wildfire (G8), etc. It can make consumers optional to continue increasing. In 2010, HTC’s market share increased 0.5 percent and Nokia decreased 1.5 percent. Others, other brands also use the low price, usually between about 1500-2700 RMB. Then, the price of Apple Iphone 4 between about 5600 RMB ( CHINA MOBILE 2003-2011). Market size In 2009-2010, our overall products reached US $ 12 billion to increase 40 percent. Our company forecasts 2011-2015 Compound Annual Growth Rate for China’s Smartphone market can reach 20 percent. In 2010, the Current Mobile Market Size was 590 billion with RMB. The China Mobile Market Share was 78 percent. The China Mobile Market Revenue was 555.4 billion with RMB. (YAHOO’S BLOG, 2008). So that our company can take advantage of the growth of China Mobile to launch HQC 4G phone increase sales, make more customers use our 4G phone to broaden our company market size in the China market. Target market When our company launch HQC 4G phone, we want to focus on the part of city people in Shenzhen. The age of 18 to 59 years old with male and female, the main of the people have the working experience because they have the ability to almost buy the phone advantage. Others, the age of less than 18 or more than 59 years old is the secondary choice. According the research, the total urban population of Shenzhen is 1400 million people. Disposable incomes of urban residents are 17175 dollars, so the real increase of 9.8 percent. In 2011 of January, The total level of urban consumer price increase 4.9 percent. The urban increase 4.8 percent and the rural areas increase 5.2 percent. Then, the urban resident’s consumer ability can buy HQC 4G phone because the urban residents of buying power is increasing continuously (National Bureau of Statistics of China, 2006-2011). Product Positioning Our 4G phone is firstly launch a powerful mobile phone in the China market. It contains some unique specifications and WiMax network. For example, compare with LG and Samsung products, our 4G phone has a competitive advantage because they are not launch more high quality mobile phone and their phone do not offer WiMax Network so our 4G phone has a unique differentiation, such as it can offer more multimedia service and the price about 4300 RMB so the urban residents have the ability to buy. So our 4G phone can help to business to get value and consumer to create benefit potential and put the impression in their mind ( Gary, Philip, 2009, p222). Product Our company expands our products line length in China market so our company launch the HQC 4G phone to attract customers to buy. The HQC 4G phone manufacture by High Quality International Electronic Limited Company. The 4G phone will support WiMax network and use the Android system. The 4G phone’s speed compare with other phones is faster. It can offer some multimedia services. In functional specification, the HQC phone contains a 4.5 inch WVGA AMOLED display, 1 GHZ CPU, 1GB capacity and 512MB RAM memory. The 800 million of the lens can be take HD videos, the 4G phone can support HDMI interface, can be connected high-definition television to play the 4G phone content. If HQC 4G phone fits the China market, we do not execute product adaptation because there are the same Smartphone in China, such as Iphone 4 (China mobile 2003-2010). Both have touch screen, so they will naturally adapt to HQC 4G phone. Market In the market, everyone needs to use the phone to communicate with others and can through the network service of the phone to find some information and play games so the phone is important for everyone. According our company research, the main target customer through functions, quality or colors to buy the phone, such as they like the colors of the phone are black or grey and they want to have Bluetooth, network services with the phone. Our target customers through their income to decide to buy the phone, they want the price is 2000-4300 RMB Cost Our company does not execute product adaption so it can reduce more manufacture costs. But we want to change the communication strategy to fit the China market, the total communication costs are about 800000-1000000 RMB. Analysis the strategic alternatives Strategy 1: Product and Communication Extension This strategy involves marketing standardized product to use the uniform communications strategy. Then, it depends on a small company with few resources. When the firm sells the same product, they also use the same advertising promotional themes and appeal in domestic market.(Warren J 2002, p347). Advantage This strategy has super attractive to some multinationals use the cost saving because some company also use the same advertising promotion to sell the same product. It can make the company will focus on other aspects of additional costs. This strategy can reduce the product adaptation cost and communication cost because do not change anything. Disadvantage If the firm use the same product with same advertising promotion and appeal, the result lead to outstanding do not well and reduce attractive. Strategy 2: Product Extension-Communication Adaptation It refers to the same product sold in foreign market with adjustments in marketing communications because a product also fill different need or serve different function. (Warren J, 2002 ,p 347-348) Advantage This strategy is low cost strategy because the strategy only needs to develop the appropriate communication mix. Disadvantage The product in this strategy is unchanged, R&D, manufacturing setup or inventory costs can be avoided but also a product need to continue improvement to do more well. The firm retains economies of scale in manufacturing but sacrifices potential savings in advertising. Strategy 3: Product Adaptation-Communication Extension It refers to the product is modified but the communications strategy remains to unchanged. Then, when using the product serves the same function in foreign markets. (Sak, John J p350) Advantage When we launch the product, we can show the same function in foreign market. In additional, we can unchange communications strategy, such as marketing mix. Disadvantage: It is just to modify the product but do not change communication strategy, so it may be reflect the disagreement situation. Because also as a product to select the right communication strategy. Strategy 4: Dual Adaptation This means the product and communications strategy are modified that it is to suit different markets ( Sak, John J p351). Advantage: The strategy used in there is differences in environmental conditions and in the functions that product serves. Disadvantage: The product and communication strategy are modified so it can make our company expenses cost to increase. Strategy 5: Product Invention It refers to this strategy involves planning and design of new products for global markets ( Warren J ,2002 ,p349). Advantage This strategy can tell to foreign countries do not have purchasing power for existing products. This strategy can launch the new products to the market to increase the sale. Disadvantage This strategy should increase overall costs, such as manufacturing cost, promotion cost, strategy cost etc. Our company chooses the Product extension-Communication Adaptation strategy because this strategy is most profitable and cost-effective. Our company just needs to change communication strategy with the same product because HQC 4G phone adapt different need or serve in the China market. It can reduce the parts of costs, such as product modifies cost and manufacturing cost because product modifies cost expensive than change communication strategy cost etc. Suppose we modify the product, we should pay the cost of parts, such as material cost, the shell cost. When HQC phone of parts only US 250.5 per one, about 2000-3000 RMB. If we re-modify and re mass production of new batch of HQC phones, the estimated cost will more than ten million dollars. So that we change the communication strategy is the right thing. Then, we should change the marketing mix. In the part of price, we would reduce HQC phone’s price between 4300-4500 RMB because China’s mobile phone also between 2000-4000 RMB. In the part of place, we mainly focus on the urban population of Shenzhen because Shenzhen compare concentrate and many populations. In the part of promotion, we want to use television advertising to promote our product, such as we want to focus the advertising on CCTV-4 of the China International Channels, we can put the advertising with twenty minutes and , the total of advertising cost about 27200 RMB× 30days= 816000 RMB. We use television advertising can and increase the brand awareness.