9/30/2013

Internationalization cases

26.9.2013

Tuija Marstio

- Export of goods and services, % of GNP ?

- The most important target countries ?

Importance of foreign trade

for Finland

Export of goods and services, % of GNP, 2012

The most important trading partners of Finland

Why do the companies

become international?

Reflection:

Czinkota, Ronkainen, Moffet:

• Proactive and reactive reasons

Luostarinen, Korhonen, Jokinen:

• Macro factors – push from the home, pull from outside

• Micro factors – related to the company

• Millimicro factors- the decision making process of the company and the decision makers

Pope:

• Small companies: a unique product and technological advantage in comparison with the competitors

Classification of the reasons for

internationalization

The internationalization award of the

President of the Republic of Finland 2011

(www.finpro.fi)

The Finnish game cluster

- Habbo Hotel, Max Payne ja Angry Birds are

examples of international success stories

- Target markets: USA ja Western Europe

The internationalization award 2012

(www.finpro.fi)

Rovio

Has succeeded in continuously

expanding its activties to new fields of

business. Effective marketing and a

branded ecosystem for the games and

supplementary products.

The internationalization award 2012

(www.finpro.fi)

L-Fashion Group

- Vaatemerkkejä ovat muun muassa

Luhta, Rukka, Icepeak, Ril’s, O.i.s,

STORY, J.A.P. ja Your FACE.

The internationalization award 2012

(www.finpro.fi)

Information destruction: Blancco

- - In 15 years has grown up as a global

market leader for information destruction.

Case Genelec

Products: Active loudspeakers and monitors for professional and

for household use (e.g. home theatres)

+ technical support

Clients: YLE, TV-channels, music studios, radio stations,

sound system amateurs

Mission: To bring joy to customers’ lives with the best sound

reproduction possible

Exports:

- 80% of turnover

- 60 target countries

•Spurred by enthusiasm for sound and

electronics the company was established in 1978

”The company was established

because YLE ordered

an active monitor speaker

from us”

• Unknown company – special products

• Brand construction started towards

the end of 80´s

• Marketing communications: How to stand out

→ cooperation with Herbie Kastemaa

”Perhaps we should have some

kind of product image..”

Case Genelec

• 1989 Launching of a studio loudspeaker installed

in the three most appreciated studios

→ international broadcasts

• 1992: Product family – smaller loudspeakers

• Strong focus on R&D

• Delivery channels built gradually

• Design is an important part of planning

and branding the loudspeaker

Case Genelec

”The importer likes to do business with someone who

- is nice,

- whose products sell well

- gives me a good margin for the sales of his products”

(Ilpo Martikainen, Managing Director, Genelec, 24.1.2008)

CONSULTATIVE SELLING

www.laurea.fi

Case Zara Based on an article ”A case study on the

internationalization process of a ’born global’ fashion

retailer by Verica Bhardwaj, Megan Eickman & Rodney C.

Ruyan (2011). The International Review of Retail,

Distribution and Consumer Researchm 21:3, 293-307

Tuija Marstio Lohja Unit 26/9/2013

18

Definitions

Born global: quick expansion to international

markets

Fast fasion: the design, delivery purchase cycle

goes around faster to satisfy the consumer demand

at its peak

Psychic distance: degree to which one culture is

comfortable dealing with another culture

Physhic distance paradox: Companies tend to be

more successful in markets with greater psychic

distance

19

Integration of design and

manufacturing

New items every week

Low-price strategy with a limited stock

Backward and forward knowledge

sharing

Focus on location strategies and store

atmospherics

Advertising is based on WOM and

repeat business

20

Stages of internationalization

Established in 1975, first international

store in 1988

First France and Mexico, then quickly to

psychically distant markets

After a gradual start, accelerated

internationalization to psychically

distant markets

First Now 2700 stores in more than

60countries

Case Marinetek

•http://www.youtube.com/watch?feature=

player_embedded&v=QYHQgUj0EXg

• World’s leading manufacturer

of docks, marinas, pontoons

• More than 1000 executed

projects in 40 countries

• Turnover 21 MEUR

• 30 – 40% of salesprice to the

shipping company

→ Establishment of factories

near the markets

Marina in Porto Carras, Greece

Kelluva taloponttooni →

Case Marinetek

”Marinetek conquered the marina of Monacon (Kauppalehti 29.10.2010)

Case Marinetek

”Marinetek sold a marina to China” (Kauppalehti 22.9.2011)

• Contribution to employment in EU countries 60

– 80% (Finland 69%)

• Value of the exports has multiplied within two

decades

• Exports of services: travel services (2 MRD €),

transport srvices (2 MRD €) and other services

(10 MRD €)

• KIBS – fastest growth (KNOWLEDG INTENSIVE BUSINESS SERVICES)

Internationalization of services

(Bradley, 2005)

Difference from docmestic services:

• Elements that cross the borders

• Interaction with a different culture

Direct export: services that form part of the

products (e.g. video, software)

Internationalization of services

Forms of internationalization of services

1. Exports of services

2. Foreign investment

3. Internationalization via third partner

- the company is serving its clients via a local

representative or partner

(TEKES 265/2009)

Exports of services

• In material or electronic format (letter,

report, CD-rom)

• The seller travels to the target country

• The buyer travels to the service provider

(TEKES 265/2009)

(Bradley, 2005, s. 185)

Categorization of services:

need for contact/ concreteness N

eed f

or

conta

ct

H

L

Concreteness

L H

Services free of

the location Standardized services

Supplementary services

Services tied to

the location

Reflection:

The importance of cultural aspects depends

on the type of service to be exported. What

kind of services are sensitive to cultural

factors? Think also of examples of services

that are not sensitive to cultural factors.