Korea Honey Marketing Plan- Samples for Students -Assignmenthelp

Questions: 1.What aspects of the Korean honey Market are favourable for Korean Food? What aspects of the Korean honey market are unfavourable for Korean Food? 2.What are the key uncertainties in the strategy suggested in the Marketing Plan? How can these uncertainties be reduced? Is it worth doing so? 3.How could the Marketing Plan be Improved? 4.Kevin Lee Opposes Korean Foods expansion into export, on the grounds that they dont really know what they are getting into. Take Kevin Lees point of view and address the issues he raises. Answers: 1.Korean honey market and Korean food There were several aspects that made Korean honey market suitable for Korean Food Company as well not suitable. The analysis of Korean honey market can begin with those suitable factors. Commodities in the market can be said to be suitable if only they fit the needs of the consumers. The demand and supply forces in the Korean market do not match (Kohsaka et al. 2017, 49). More of the honey is demanded by the 50 million people living in Korea with consumptions estimated at 1.2kg/person that are higher than what the market can produce. The domestic and foreign market can only provide an average of 0.95kg/person or the total honey production in Korea was estimated at 18.5 million kilograms in 2013. The statistic shows the need to fill the gap created by the demand and supply in Korean honey market (Czinkota Ronkainen 2013, 8). Table 1 shows the domestic honey production in Korea for a period 2004 to 2011 in metric tons. Years 2004 2005 2008 2009 2010 2011 Yields 16,509 18,248 27,585 23,028 38,505 35,310 Source: Korea trade information service 2011 The table1 show a slight improvement of domestic production over the years. In 2011the production dropped from 35,310 from 38,505. The findings showed that the domestic production is not sufficient for domestic consumption. Another factor that justifies suitability of the Korean honey market for Korean Food Company is on the household economic power. The honey was becoming affordable among the households in the country. The country economic stability as led to an increase in workers monthly earning power (Schlegelmilch 2016, 78). Once workers are economically empowered they have contributed more demand for honey which eventually contributes to per unit price of honey decreasing and supply to increase. The Korean change in lifestyle is another factor contributing to suitability of Korean honey market to Korean Food Company. For the last 10years the Koreans have changed their lifestyles to become health conscious (Jung and Cho 2015, 9). Economic and health statistics showed that the percentage spent by households on food and beverage in 2014 had decreased from 48.1% to 44.6%, and that of medical expenditure had increased from 3.9% in 2004 to 4.3% in 2009. Honey being part of their medical expenditure explains why the demand of it has increased over the years. The customer bad perception towards their domestic honey credibility is another factor that can contribute positively to suitability to Korean Food Company. The Koreans believe that honey produced locally is not pure as compared to a foreign one. The have continued importing honey from other countries to justify lack of believe. Figure 1 shows a summary of Korea honey imports. Figure 1 Korea honey imports Source: Korea trade information service 2011 Figure 1 show that there was increase in honey imports in Korea since 2008 to 2013. It means that more of the foreign honey is consumed where the company can capitalize on it. The internal characteristics of the company made it even more suitable (Baker 2014, 34). The company is reported to be in a good strong financial position and experience in dealing with Korean type of foods. That makes them able to understand the Korean market dynamics of culture and connections. On contrary to the mentioned factors there are others that make Korean honey market unsuitable to Korean Food Company. The Korean government legislation of imposing a 25% tariff of any honey import and legislations for hotel honey market use hinders foreign companies who want to venture in the sector (Percy 2014, 45). The economic quota makes countries and companies like Korean Food to compete for the smaller supply space created for them. Table 2 shows a summary of Korea imports of honey of three countries for three years. It shows that Koreans prefer to import from other countries rather than in Canada. Table 2 Korea import of honey Country 2012 000 kg 2013 000 kg 2014 000 kg United States 2738 451 293 Australia 596 83 0 Canada 249 2 0 Source: Kenya trade information service 2014 Table 2 shows that in 2014 no imports were done in the two countries which mean the honey may not be favorable among importers. The Korean perception of honey as medicine and not food is another factor which makes Korean honey unsuitable to Korean Food. If Koreans view honey as medicine a smaller percentage of it will be bought in comparison if it were for food. That means Korean Food will be limited in supplying large quantities to the Korean Market. Based on economies of scale that will not be a suitable venture the cost production of one unit will be more than output per unit. One market dynamic that made it unsuitable is that the Korean market is controlled by middlemen and agents. That makes it difficult for companies like Korean Food to have control over suppliers in terms of making contracts, quality, quantity and packaging. 2.Market plan uncertainties Based on the market plan strategy there are two main uncertainties mentioned that can influence Korean honey market business. The first is based on the culture and values of the Koreans regarding consumption and use of honey. The Koreans regard honey to be a medicinal substance rather than food. Honey was viewed to be a source of vigor, a miracle medicine, and curative for operations and hangovers. In other countries honey is perceived to be a normal food consumed using different methods (Messer, Wu Delaney 2015, 4384). The market strategy was that the Koreans will eventually change their perception and values over sometime so as to consume it as food. But it is uncertain if Korean will abandon their old tradition of honey being medicine and start consuming it as food. The company did employ different methodologies in the market plan in order to solve the uncertainty. The uncertainty was to be reduced if the company decides to advertise in order to create awareness of honey has a fo od commodity. But using the method can sound worthy because it can change the perception of users and values towards the commodity as food rather than medicine. The second uncertainty is based on the Korean government honey market legislations. The market plan strategy in phase two assumed that the government will open and relax import restrictions. The current situation in the market is that there are import restrictions that only allow imports of honey to be used in hotel industry only. Other restrictions are based on the quota system a certain % is to be supplied with 25% tariff imposed on them. The legislations imposed by the government are protecting its local honey production industries. The situation is uncertain because the company will not know when the legislation will be changed. The Korean company can reduce the uncertainty by carrying out government lobbying. This is to entice the government to change its legislations and allow an open market for imports. The method of using government lobbying is difficult to measure if it will be successful. The use of government lobbying is a costly and time wasting initiative it may not be w orth doing so. 3.Market plan improvement There are several items and strategies that can be included in the market plan to improve it. Risk management is required in the market plan. Any marketing plan begins with goals and objectives to achieve either long term or short term (Pride Ferrell 2016, 23). The market plan can be improved by setting objectives to achieve in Korean honey market. Other marketing strategies employed will provide answers to the marketing objectives set. The market plan in the case study lacks the description of Korean Food Company. The brief descriptions of its performance, experience and products offered to its customers. The market plan can be improved by having a full description of the honey products being offered to customers (Kim 2016, 110). The product description goes hand in hand with experience in the Korean market. Product analysis will make it possible to identify the type of product suitable to a specific environment. Venturing in a new market can be a risky venture due to several known and unknown uncertainties. If risk identification and analysis is done it will enable the company to identify the risks facing it and emanating from the environment (Appiah-Adu 2016, 20). The risks facing the company can be political, social, economic and legislative. Having a risk management plan will enable the company to be able to mitigate the severity of the risks if they occur. The market plan can be improved if the target market population is specified clearly. One target market need to be identified, analyzed, and suitable marketing strategies designed for them. Different market has different needs and characteristics that is why it is necessary to design independent market strategies for them (Sanova et.al.2017, 62). For example the target market in the case study was households (house wives), distribution stores and hotels. Each could have had different marketing strategies of reaching to their needs. Another method that will improve the marketing plan is carrying out an analysis of the competitors. Not much is mentioned on the competition found in the honey market in Korea. The analysis could have identified the strength and weakness of each competitor found in Korea market supplying honey. The findings of the analysis of competitors can lead to development of competitive advantage strategies in the market (Bickhoff et al. 2014, 114). In addition to improve the market plan a SWOT analysis could have been done. The SWOT analysis is a useful marketing managerial decision tool employed in strategy formulation and management. The SWOT analysis process involves analyzing the strength, weaknesses, opportunities and threats facing Korean Food in Korean honey market (Shukla Gupta 2017, 56). The company can capitalize on its strength in exploiting several opportunities identified through the analysis. In addition the company needs to identify its weaknesses and threats facing them within and outside to formulate strategies to mitigate and manage them (Armstrong et.al. 2014, 12). The resources were not located in specific terms. To improve the marketing plan individuals need to have been allocated duties to perform for example person in charge of government lobbying and marketing functions. A detailed budget and work plan need to be included in the market plan to improve its workability and implementation (Steenkamp 2017, 89). 4.Kevin Lees point of view Kevin lee points out certain issues that oppose Korean food expansion into export in Korean honey market. The Kelvins point of concern was that they lack sufficient information than justify them to go to Korean honey market. Some of the issues that probably were mentioned by Kelvin were covering economic, legal and social concerns. The economic viability of exporting honey was unknown as per the market plan created. That can be justified by carrying out a financial analysis to establish the economic viability of the products in the market. They could have rather stuck on their normal food commodity exports. The concern is that of a conservative leader than that of a risk taker (Lee 2016, 201). Risk taking is of any successful venture. The Korean government legislations may hinder penetration to the market that was a point of concern they ought to look at. Another concern pointed by Kelvin was the company was employing investment on the new market despite uncertainty raised in the mar kets. A total of $500,000 million had to be invested to the export of Korean honey market. Successful businesses are those that provide enough resources to undertake operations (Hollensen 2015, 34). From their experience with food commodities they know that Koreans are cultural conversant people, and it would be difficult for them to change their values and perceptions regarding honey products for food rather than being medicines. Investment of advertising and campaigns can help change customer perception and values towards certain products. The changing society that has led individuals from different cultures interacts through immigrations policies will eventually change how customers perceive certain products and lifestyles. 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