Sodashi Company Overview

Discuss about the Market Segmentation and Customer Focus Strategies.

Sodashi is a skin care cosmetics company which was founded in the year 1999 in North Fremantle, WA. This is a private company and sells products which are cruelty free i.e. the products are not tested on the animals as well as they are organic products. It is a small company but it is located in areas like Japan, Malaysia, Thailand, Australia etc (Sodashi, 2018). The employee in the company are 11-50 and the products it sells are of Spa and beauty and skin care. The products which are sold by Sodashi are very helpful for the teen girls especially because they are chemical free and removes dead particles and pimples from the skin which is the basic issue found in teenage girls. People who have experienced using the company’s products have experienced rich fullness and one of kind services. The products which the company creates soothes the mind, body and soul.

The objective of the company is to get established across the world by nurturing each and every person’s beauty in a one of a kind manner and it looks forward to make people feel good about themselves whenever they look in the mirror. Their products not only hydrate the skin but also nourishes it from within and hence, people feel good about themselves after using these products. It gives the people a feeling of completeness and happiness. With these feelings, its objective is to offer a flawless skin and a holistic approach to mind and soul (Sodashi, 2018).

Political Factor: The company plans to become established in Thailand market, it should thoroughly study the political factors. The political factors of Thailand are very strict and is also corrupted to an extent. It is a democratic place and the national party is very powerful since the inception of this place. The politics in Thailand is very unstable. There are several drawbacks of the political factors in Thailand and out of which the most important is that there will always be a huge risk in investing the money into the Thailand market. To expand the market, Sodashi would also have to invest and this could be a huge risk.

Economic Factors: The world’s 27^th largest economy is Thailand and also second largest in ASEAN. The economy of Thailand grew up to 3.2 % last year and the GDP was also 3.2 % at growth. The FDI (Foreign Direct Investment) improved a lot and hence, Thailand also is always at the growth stage. But there is also low employment (Rastogi & Trivedi, 2016). Sodashi would gain a lot of market as well as cheaper service providers because of the economy. Since, the economy is on the higher side and rising always, Sodashi will have a good choice of demand from the users of such products.

Political, Economic, Social, Technological, Legal, and Environmental Factors of Expanding into Thailand

Social Factors: The culture of Thailand is related to Buddhism a lot. There are approximately 95% of the people who practice Buddhism as the main religion there is also the same (Gupta, 2013). The culture of the country is not that rich but there is also no pressure to commit to any culture. If Buddhism is concerned, it says that the mind, body and should should all be at rest and as calm as possible. People who follow Buddhism will surely be attracted towards Sodashi products as it gives a sense of their culture a bit.

Technological Factors: The technology in Thailand is still at the growth side but it is not much grown there. Asia in itself is a market on the whole where technology still have to be stronger. But at the same time, Thailand is known for the manufacturing hubs (Ho, 2014). Sodashi would not have much technology help if it wants to get established but also there is not much harm as well.

Legal factor: The legal system in Thailand is a combination of the western laws and traditional Thai principles. The government of this country is very lenient when it comes to the international trade and business. Membership in World Trade Organisation(WTO) and the Association of southeast Asian nations(ASEAN) organizations commit Thailand to the reduction and eventual removal of tariffs, duties, and non-tariff barriers to trade in an agreed upon time frame. Hence, the legal factors would not hamper much of the Sodashi’s efforts to establish there (Kozlinskis, 2016).

Environmental Factor: Thailand does its best to protect the environment and it also has made the frameworks for that. But at the same time, the rising pollution and waste has also impacted the country a lot. Weather is almost tropical all across the year there. There was flood that impacted the country a lot in recent years. Sodashi could be impacted because of the climate change but there is nothing to worry about such things as these things are not often (Lucintel, 2016).

The bargaining power of the supplier is at the lower side for the organization as it strategizes to establish itself in the Thailand Market. The suppliers will always increase the costs of the products for sale and will provide the lower quality of the product. Reducing the availability of the products is also one of them. Hence, the organization should increase the price as there are not much products available. The margin in the products should be focusses on instead of their focus being on other less important factors (Omsa, et al., 2017).

STPD Strategy for Expanding Sodashi into Thailand Market

The power of the buyer is high in the Thailand market with respect to the skin care industry like Sodashi. The buyers will always have fewer options from the people who are selling the products and they will buy the products which are of high quality and lower prices. In terms with the Thailand market, the supply of the products used in skin care is high and hence, it gives a good chance to the buyers in negotiating and bargaining. The number of the options which are available would also be created accordingly (Tehrani & Rahmani, 2014).

There is moderate threat if new entry is studied in the Thailand market as there does not exist any rules and regulation which are strict enough to restrict new entries. New companies can enter the market with not much hurdle and the new company just will have to follow a few laws and norms which will eventually help the company to establish itself in the market (Ogutu, 2015).

There are so many alternate products which exists in the market if Thailand which can easily be used as a substitute of Sodashi’s products. Sodashi is also one of the companies which provides a wide range of products and also provides a huge variety in that wide range but Thailand market is one of the markets which is eventually growing and people are looking to invest much more than it can be assumed. Hence, it is tough for Sodashi to capture the market with only its products being sold out (Arons, 1999).

There are a lot of competitors in the Thailand market for Sodashi. As it is already discussed that it is a growing market, there are many companies which are trying to come in that market and the competition is strong. The company will have to provide unique products to gain the competitive advantage. Hence, under such situations Sodashi should bring new products into picture so that it will attract the eyes of the customers in the Thailand market.

Strengths: The physical location of Thailand is central and the country has low cost of living which means that the amount of money is saved a lot by the people of Thailand. Then people try and send their money on valuable and long lasting things. There is also very healthy atmosphere if employment is concerned. Sodashi can sell products in Thailand as they are everlasting.

Weaknesses: There are issues which are related to the environment as there is always quick development in the country goes on and that means it created growth for cost with the environment costs. Sodashi offers products which are only organic, this can be a problem to the organization in dealing with the established competitors who sell wide range of products which are already running well in the customers.

Opportunities: Since Sodashi is an international brand if we talk about Thailand, it has a good chance of establishment as Thailand has good international mobility. The connectivity is also very good. People do care about the health and safety there. Sodashi’s products will appeal to people in Thailand as it sells organic products which would prove to be easy on people’s skin there.

Threats: The society of Thailand if seen on the whole is aging. There is still strong focus on governance.  The ingredients required to build the product must be originated in Malaysia only because Malaysia offers strict trades laws with high penalties as well.

Sodashi is a well-known brand if Australia is concerned. It is established in Australia in a very good manner. Hence, Sodashi knew the mode of entry in other countries as well. As far as the Thailand country is concerned, it is located in all the 5 star hotels so that it can attract maximum amount of footfall. The company associated with the huge number of brands of hotels and these kinds of hotels comes in the eyes of people all the time and it will easily be able to provide the 5 star services too. The company ships the products to Thailand and the price of shipping is determined by the checkout process before the entry of credit details. Australia Post International Service is used by Sodashi. The company also sell it products into the malls where they are in contact with the distributors for getting their products into the malls. Local shops also should have products of skin care as many people still do not feel like going to the mall for buying few products.

For capturing the complete market, STPD strategy is established by Sodashi and is implemented too in Thailand. STPD means Segmentation, Targeting, Positioning and Differentiation.

Segmentation: There is none of the company in the world which can say that it is capable of serving all the customers in the whole market. There is no profitability which can come from serving all the customers in the market. There are so much different needs which a customer possesses. The characteristics, needs and wishes and different behaviors that the firm deals with is a challenging job before establishment of the organization ( Lynn, 2011). It is the process which includes the market deviation within many groups of the buyers which is going to be done according to their needs, wishes and behaviours. Each segment is known as the group of the users which will react in the similar way for the marketing efforts done by the company. The demand of the product is influenced by the similar factors (Kottier, 2017).

Geographic: In case of Sodashi, the regions, cities and whole Thailand must consider if that is possible for the founding of the firm or not.

Demography: Gender, life cycle of a family, age income, job kind, religion, race, size of the family and nationality should be reserved in intellect.

Psychographic: social class, routine, socio economic aspects should be studied.

Behavioural: Events like Valentine Day behaviors should be learnt, welfares required by the people, status of the user, rate of the usage of the products, willingness phase for the division should be kept in mind.

There is distinctive type of segments which are used by the dealers for getting little and improved groups to target (Gnepa & Cordeiro, 2011).

Demographic segmentation includes Geo, city, income – low or not etc.

Business Market Segmentation involves individual features, demographic, variables for procedures and approaches of public towards the buys.

International Market segmentation is always done by segmenting Geographic economy, Legal and political factors, cultural languages spoken in Thailand etc.

Inter-Market Segmentation involves of the clients with the identical supplies, behaviours situated in the related country.

• Quantifiable in which the size, influence of purchase and profile segment ought to be measured.
• Accessible which can competently spread to the community.
• Substantial and must be enormous to serve sufficient folks.
• Differentiable in which the discrimination is done abstractly and also replies exceptionally to all the kind of marketing programs(Bose , 2012).
• Actionable in which the programs would be efficient enough to entice and serve the sectors or segments.

Targeting:  In the targeting procedure, one or more segments which the firm senses are equipped to be enticed and served are targeted. This type of market for whom the designs are vended with a positive level of marketing mix is recognised as the target market (Janiszewska & Insch, 2012).

• Growth and the Size: The statistics of the rates of growth, deals and the viability which is predictable and is collected.
• Attractiveness of structure: In this the quantity of rivals in the market and the fierceness of competitors are considered. Also, their product which can be the alternatives of the products the firm is providing is investigated and the power of the buyers and suppliers is noted.
• Objective of Company and resources: The ambitions that the firm has for creation of the long period are investigated here in this calculation.

• Undifferentiated or Mass marketing: The market segment changes are evaded and the whole market with only one offer is targeted in order to request the buyers mostly. This stage emphasis on the cliché necessities of the clienteles instead of keep on finding with what is dissimilar.
• Differentiated or Segmented marketing: In this type of targeting, the company chooses to aim a rare market segment and delivers various different proposals for each segment. This way is decent for acquiring the tougher market spot and sales. It is also good for gaining good turnover but mostly at the advanced rates as compared to mass marketing(Malinen, 2013).
• Niche or concentrated Marketing: The segments which are at the target must be enormous in niche marketing. Fine-tuned market should be varied successfully for this. There is fewer competition as compared to other two. Big competitors are ignored.
• Micro and local marketing: The products are nicely designed and programs for marketing are also created according to the prerequisites of the individuals or local consumers in this marketing. This type of marketing is simpler when joints with communication expertise, the cost if higher and might get weak with the appearance of the product.
• Individual Marketing: Face to face marketing of the products and new technologies when done, it is known as individual marketing.

Differentiation and Positioning: The location of the product is the means in which the product might be well-defined by the patrons on substantial qualities like place that the outcome takes in the intellects of the customers’ comparative to opponent products- based on the thoughts, imprint and sense of the consumers.

• The firm must classify the set of discriminating competitive rewards on which the position is to be made. The continuous positioning maps show the insights of the consumers that they possess around the brand as competed with the competitive brands on substantial dimensions(Claessens , 2015).
• Identification and selecting of the correct modest advantages should be done. These competitive advantages could be gained by gigantic customer value and the lesser charges etc. The competitive advantages could be done by:

1. Differentiating in the product types, presentation, dependability, scheme, class and steadiness etc.
2. Service differentiation in product which ought to be quick, easy-going in delivery and connection and mending etc.
3. Channel Differentiation in which exposure of the channel is done, performance and proficiency are judged.
4. People Differentiation in which employing and employee training is done in a way that they show to be better than the entrants or rivals.
5. Image Differentiation in which the pictures are recognized for transferring contributions with welfares and better positioning(Ingenhoff & Fuhrer, 2010).

• By selecting from one of the positioning approaches, the positioning is done which is known as value proposition. In this the complete mix of the brand is differentiated and positioned.

This is how; Sodashi can use STPD strategy to create itself in Thailand.

This strategy is the set of marketing tactical tool which the firm uses for producing the aspiring response from the market it is targeting. It has everything that the firm could work on for influencing the demands of the product. This strategy also helps in the market plan and execution of the product and the firm (Vilkey & Dehbid, 2016).

The marketing mix can be stated in terms of four components – product, price, place, and promotion. Understanding each of such features can give a clear image of the tool (Genestre, et al., 2008).

It is the contribution which the company provides to the customers. It is established by the firm and then becomes prepared for the customers. It can also be defined as a form of service. For example: Sodashi offers skin care products. These are the products which the firm offers in Thailand. “P” is the fundamental of the business if marketing mix is talked about. When creating a product, a firm should ponder some of the factors in brain. They are:

• The demand which exists for the product(S., 2016).
• The need of the customer is content with the product or not.
• The future of the market is also considered.
• What type of products are there in the market which can compete with that particular product.
• Adaptability should be analyzed according to the changing environment.
• The factors which can impact the demand of the product should be considered.
• The branding and the packing of the product.
• If the goals will be achieved by selling the product or not.

The strategy that Japanese market people apply is that they produce high quality product due to which they are long lasting and people appreciate long lasting products.

It is a significant factor in the marketing mix strategy. There are multiple firms which advertise for free services and products which are complimentary. However, that really does not mean that price should not be considered important at all because the products which are sold at low cost always have preferences from the users or the customers. Price is not always seen as the price of the produce but is observed as the value of the product (Išorait?, 2016).

The consumer always chooses best product according to them based on the value they have for the product and they think that the product deserves. This value can be a personal choice, economic conditions, prior experience etc. For example: Sodashi products will be bought by the customer even if the customer think that they are a being sold on a little high price because of many reasons they put over the cost. It can be because they are organic, huge variety, healthy for skin etc. In the same way, some customers are loyal to a brand as they have always had very good experiences with that brand. Hence, cost of product is not just the only factor in defining the purchase of the product (Pour, et al., 201).

The factors which must be considered by a firm before analyzing the price of the service are:

• The cost of the product.
• Value of the product for the user.
• The sensitivity of price for the product.
• Competitor product pricing.
• Incentives and discounts which are offered by the product.
• Consumer’s tradeoffs.

Japanese chose the penetration pricing for assimilating into the Japan’s market. The strategy besides cheap after-sales service price was introduced to American’s market.

Place is usually considered as the location from where the product is being sold. People usually feel that the place of product is physical. But since E-commerce is on a boom, the place could be virtual as well. In fact, place is also considered to be as the methods by which the product is allocated in the users.

The following factors are to be considered for distribution of the product:

• Medium from where the user will seek for the product.
• Location where the physical store is located.
• Online place of the product.
• Channels of the distribution.
• Salesforce requirement.
• Distribution channel for the competitors and scope for differentiation.

Distribution strategy for entering into the market was estimated by careful analyzing. All the Thailand companies made the effort to present exclusive services.

The methods through which the product reaches out to the public is known as the promotion of the product. It is the service which is offered by the firm to let people know that there is a new product coming in the market. The process contains advertising, branding, sales, public relations etc. The promotion of the product can upsurge the sales like a skyrocket as the consumers are swayed a lot by such methods.

There should be some points which are considered for promotional strategy.

• The news about the audiences to be targeted.
• Must be able to find the average for acquirement of the entry to the users.
• For getting full devotion, there should be enough time for the campaigns.
• Use of internet and television for making the product evident.
• Ways by which brand awareness upsurges.
• Environmental factors and social factors(Goi , 2009).

There is permanent willingness for the future market in Thailand and this readiness supports in the enlargement of the firm.

The primary efforts of Thailand companies were alongside direct publicity on the target market. The center of advertising was protection of the belongings of the product and excellence of the services as well as affordability and compelling to customers. Therefore, Thailand people accepted that the production of the ventures should be measured for the future.

Conclusion

This report emphases on the business named Sodashi and its founding in the country Thailand. A firm always has to go via a lot of study when it wants to create itself in any foreign market.  There is always a procedure for doing it. Mainly, the PETLE analysis of Sodashi is discussed in order to analyze the marketing background for the firm in Thailand. Then the Porter’s analysis is examined for knowing the competitive market. Later when these researches are ready, the STPD strategy which is used in the product formation is discussed. After all these analysis, it can be concluded that Sodashi has a very good scope of establishment in Thailand as well as to make revenue.

References

Lynn, M., 2011. Segmenting and Targeting Your Market: Strategies and Limitations. School of Hotel Administration Collection.

Kottier, W., 2017. Marketing strategy for online SMEs. [Online] Available at: https://essay.utwente.nl/71976/1/Kottier_MA_BMS.pdf[Accessed 25 May 2018].

Gnepa, T. J. & Cordeiro, W. P., 2011. STRATEGIC ENTREPRENEURSHIP MANAGEMENT COMPETENCY AND FIRM SUCCESS: A COMPARATIVE STUDY OF SMEs IN AUTO AND ELECTRONIC PARTS IN THAILAND. INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, 11(2).

Bose , T. K., 2012. Market Segmentation and Customer Focus Strategies and Their Contribution towards Effective Value Chain Management. International Journal of Marketing Studies, 4(3).

Janiszewska, K. & Insch, A., 2012. Th e strategic importance of brand positioning in the place brand concept: elements, structure and application capabilities. Journal of International Studies, 5(1), pp. 9-19.

Malinen, M., 2013. STRATEGIC MARKETING PLANNING FOR A B2B HIGH-TECH MANUFACTURER. [Online] Available at: https://www.theseus.fi/bitstream/handle/10024/65829/Malinen_Mikko.pdf;jsessionid=084FAFBCB8FEA40AA330CA352D4D3E04?sequence=2[Accessed 25 May 2018].

Claessens , . M., 2015. The Markting Strategy: Segmentation, Targeting, Positioning & Differentiation.. [Online] Available at: https://marketing-insider.eu/marketing-strategy/[Accessed 25 May 2018].

Ingenhoff, D. & Fuhrer, T., 2010. Corporate Communications: An International JournalPositioning and differentiation by using brand personality attributes. Corporate Communications: An International Journal, 15(1), pp. 83-101.

Sodashi, 2018. Our Story. [Online] Available at: https://www.sodashi.com.au/about/our-story/[Accessed 25 May 2018].

Sodashi, 2018. Our Values. [Online] Available at: https://www.sodashi.com.au/about/our-values/[Accessed 25 May 2018].

Rastogi, N. & Trivedi, M. K., 2016. PESTLE TECHNIQUE – A TOOL TO IDENTIFY EXTERNAL RISKS IN CONSTRUCTION PROJECTS. International Research Journal of Engineering and Technology, 3(1).

Gupta, A., 2013. Environment & PEST Analysis: An Approach to External Business Environment. International Journal of Modern Social Sciences, 2(1), pp. 34-43.

Ho, J. K.-K., 2014. Formulation of a Systemic PEST Analysis for Strategic Analysis. EUROPEAN ACADEMIC RESEARCH, 2(5).

Kozlinskis, V., 2016. GROWING INSTABILITY OF THE SOCIO-ECONOMIC SYSTEM. Journal of Business Management, Issue 11.

Lucintel, 2016. PESTLE Analysis of Japan 2016,. [Online]
Available at: https://www.lucintel.com/pestle-analysis-japan-2016.aspx
[Accessed 25 May 2018].

Omsa, S., Abdullah, I. H. & Jamali, H., 2017. Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Science Journal of Business and Management, 5(1), pp. 9-16.

Ogutu, F. M. M., 2015. Porter’s five competitive forces framework and other factors that influence the choice of response strategies adopted by public universities in Kenya. International Journal of Educational Management, 29(3).

Tehrani, M. B. & Rahmani, F., 2014. Evaluation Strategy Michael Porter’s five forces model of the competitive environment on the dairy industry (Case Study: Amoll Haraz Dvshh dairy company). American Journal of Engineering Research, 3(5), pp. 80-85.

Arons, H. D. S., 1999. A Knowledge Base Representing Porter’s Five Forces Model. [Online] Available at: https://repub.eur.nl/pub/753/eur-few-cs-99-02.pdf[Accessed 25 May 2018].

Morgointelligence, 2017. Japan Cosmetics Products Market – By Products, Distribution Channels, and Vendors – Market Trends and Forecasts (2016 – 2021). [Online]
Available at: https://www.mordorintelligence.com/industry-reports/japan-cosmetics-products-market-industry
[Accessed 25 May 2018].

Hunwick, S., 2015. Sodashi launches into Japan. [Online] Available at: https://www.professionalbeauty.com.au/news/sodashi-launches-into-japan/[Accessed 25 May 2018].

O., 2014. Strengths, weaknesses, opportunities and threats (SWOT) analysis for farming system businesses management: Case of wheat farmers of Shadervan District, Shoushtar Township, Iran. African Journal of Business Management, 5(22), pp. 9448-9454.

GÜREL, E., 2017. SWOT ANALYSIS: A THEORETICAL REVIEW. The Journal of International Social Research, 10(51).

Valentin, E. K., 2005. Away With SWOT Analysis: Use Defensive/Offensive Evaluation Instead. The Journal of Applied Business Research –, 21(2).

Hovardas, T., 2015. Strengths, Weaknesses, Opportunities and Threats (SWOT) Analysis: A template for addressing the social dimension in the study of socioscientific issues. AEJES, Volume 1, pp. 1-12.

Bhasin, H., 2017. SWOT analysis of Japan. [Online] Available at: https://www.marketing91.com/swot-analysis-japan/[Accessed 25 May 2018].

Vilkey, A. & Dehbid, . M., 2016. Strategic Marketing Management with Japanese Management Approach. Journal of Politics and Law, 9(10).

Genestre, A., Herbig, P. & Shao, A. T., 2008. Japanese international marketing strategy. Marketing Intelligence & Planning, 13(11).

S., A. K., 2016. Brand and Marketing Mix-A Review. Journal of Global Economics, 4(3).

Išorait?, M., 2016. MARKETING MIX THEORETICAL ASPECTS. International Journal of Research Granthalayaah, 4(6).

Pour, B. S., Nazari, . K. & Emami, M., 201. The effect of marketing mix in attracting customers: Case study of Saderat Bank in Kermanshah Province. African Journal of Business Management, 7(34), p. 327203280.

Goi , C. L., 2009. A Review of Marketing Mix: 4Ps or More?. International Journal of Marketing Strategies, 1(1).]