Global Marketing Case Study

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One of the main challenges for direct management of GLAM's own stores in China is the country's demographics. China is a huge country with surplus population that has contrast in development of both cities and people. To control a store by its itself GLAM has to put a separate team to choose the location and also to deal with cultural difference in China. It would have been easy for GLAM in Japan due to several factors like, the Japanese market is much more open, smaller country, high number of developed cities, Corruption free political system. Therefore, In a country like China GLAM could go with franchising or joint venture. Luxury brand companies such as Louis Vuitton and Burberry have joint ventures in which they own 51% shareholding or they can partially invest in FDI and partially franchise it across the country.

3.What challenges do you foresee for GLAM as they consider entering the Indian market and how would they surmount such challenges?

GLAM will be facing several challenges as they try establishing their brand in India. The marketing of High-end brand in a low income country like India is difficult(country risk). GLAM basic accessories would cost from 35,000 INR which is way too expensive for an average India to afford for a leather bag rather people would prefer to invest in gold. However, say GLAM is targeting the upper-middle class and high class people in the society, they will be facing competition over other luxury brands such as Louis Vuittion, Michael Kors, Chanel, Gucci and Burberry. Some of the practical problems would be indentifying its potential customers across the nation. Also, the search for high street to open up a store in India will be a major challenge. Metropolitan cities like Chennai, Delhi, Mumbai, Kolkata are only available options for GLAM to set up stores in India. Compared to the geographical size of India there are very limited sites that can bring profit to the company. Promotional strategy for GLAM should be changed completely to match with the culture of India(cross-cultural risk). Ethnography, is a study where people's interest and cultural information is researched to find what kind of product suits them and what marketing strategy can be implemented to impress them. This pre-launch phase would take considerable amount of time and investment which includes finding or establishing distribution chain, finding franchisees. Glam being a US company have to bear the conversion losses and unexpected fall in US dollar rate(currency risk).

To overcome the following challenges, GLAM can use their strategy of positioning them self as top of premium segment and bottom of luxury segment. GLAM claims to be very much cheaper than other luxury brands by not compromising on the quality. GLAM can also introduce a new line of products to suit the customer need in India as they did in Japan(special edition). GLAM can go with joint venture with leading private firms like TATA, Reliance, Aditya-Brila etc. to establish in Indian market. Joint ventures can be advantageous in India as the Indian counterparts can easily deal with the political and social issues in India.

REFERENCES

China foreign investment pattern changes as challenges grow| Reuters. (n.d.). Retrieved from http://www.reuters.com/article/2014/08/26/us-china-investment-idUSKBN0GQ26M20140826

China sees FDI spikeBusiness - China Daily Asia. (n.d.). Retrieved from http://www.chinadailyasia.com/business/2015-02/16/content_15228847.html

What Is Really Happening in China’s Luxury Market? - Luxury Society - Markets. (9 oct 2014). Fflur Roberts. Retrieved from http://luxurysociety.com/articles/2014/10/what-is-really-happening-in-chinas-luxury-market