Ashtar

International Marketing: Ashtar

Executive Summary

Ashtar is a natural Dead Sea Products producer that is based in Jordan. The company has achieved success not only in the local market but also the global arena. It has entered a number of markets in the global market. Nevertheless, there are other markets the company is yet to explore. The US provides a prefect market for expansion. Ashtar needs to consider entering it to improve its competitive edge. Entering the US market will enable it expand its customer base as well as increase its market share. Its products must be well designed and packaged to attract customers. Great emphasis should be placed on product differentiation. The management must also ensure the utilization of behavioural and demographic segmentation strategies to target its customers effectively. There are various factors the company needs to consider when setting its pricing strategy. This includes production costs, the sustainability of the strategy, prices offered by the competition, and the price customers are comfortable with. Ashtar also need to consider different factors when determining its distribution strategy. Such factors include advantage, customers, control, reach, and the nature of the product.

Introduction

Ashtar is a natural Dead Sea Product company that is based in Jordan. The company has made a name for providing high quality products and services to its consumers. The company has entered the international market with success (Ashtar 2015). However, it is yet to expand to a number of markets across the world including the United States. Entering the United States will expand its customer base as well spread its business risk. This paper intends to provide an overview of the company and how it can enter the market successfully. Equally, it will analyse the product strategy to be applied by the company. It will also examine factors to consider when setting product price and distribution channel.

Company Overview

Ashtar offers skin care and beauty products including facial care products, mud mask, bath crystal salts, natural soaps, hair care products, body care products, and facial care products. Ashtar is ever committed to providing high quality products. It emphasizes on individual attention. The company works closely with its customers to determine their distinct needs and how it can address them. Ashtar offers a wide range of products targeted to different customers in the market. This has enabled it to attract many customers, hence high sales (Ashtar 2015).

Research has shown that the company operates on a global scale. Its main mission in this market is to expand its market share and customer. The international market provides it with great expansion opportunities. Ashtar has entered different markets with success, hence increased sales and profitability. The global market also helps the company to effectively deal with the issue of competition. The corporation faces stiff competition back at home as there a number of Dead Sea product producers in the market. In essence, it is able to enter market with less competition to increase its sales (French 2012).

The move to enter the international market will definitely improve the company’s competitive position. For one, it will expose it to a large customer base, hence increased sales. The company will also reduce its reliance on the Jordan market for profits or success. The move will also see the company enhance brand awareness in the international market. As a result, its ability to enter other markets is enhanced (French 2012).

Segmentation Strategy

Ashtar applies different market segmentation strategies when operating in the global market. This includes, among others, behavioural segmentation, demographic segmentation, geographic segmentation, and psychographic segmentation. The above strategies to be effective as the company are able to serve the needs of customer in each segment with ease (Ferrell & Hartline 2012). However, Ashtar should consider focusing on demographic and behavioural segmentation strategies when entering the US market.

Demographic segmentation entails a company using variables such as educational level, gender, occupation, and age to group its customers. Different types of cosmetics are consumed by people of different gender, occupation, and age (Weinstein 2013). For instance, cosmetics consumed by men are considered unattractive or inappropriate for women and vice versa.  Behavioural segmentation entails a company grouping its target customers based on response, usage rate, attitude towards, and knowledge of. This strategy will aid it to focus on customers who respond well to the introduction of the cosmetics. Consequently, it will have the opportunity to work with customers with the right attitude. Evidently, not all customers are attracted to Dead Sea Products. This implies that targeting all consumers in the market can make it hard for the company to achieve its marketing goals and objectives (Czinkota & Ronkainen, 2012).

Product Strategy

The company has made a name for providing high quality products to its customers. It must ensure that the same quality is maintained when operating in overseas markets.  Its product strategy must encompass certain characteristics including product attributes, branding, packaging and labelling (Baker & Hart 2007). Under product attributes, the company must ensure its products are of high quality. Quality consistency is also of the essence. It is important for the company to develop products that have great features and well designed. There are many substitutes to products offered by the company. Poor product attributes will attract its target consumers to substitutes (Baker & Hart 2007).

Branding relates to marketing strategies that involve the creation of differentiated image and name often log and or tagline. The company must ensure unique branding strategy to enable customers to identify its products with it. Branding will also help it improve on perceived value and personality (Baker & Hart 2007). Generally, the company cannot ignore the power of a strong brand name. The management must understand the fact that there are consumers who make purchase decisions after a careful consideration of the strengths of its brand regardless of performance or price. Poor brands struggle to market their products as customer associate them with low quality. This implies that a company may have quality products and still fail to attract customer simply because it has failed to establish a strong brand (Doole & Lowe 2011).

Product packaging is equally important. Ashtar has to ensure its products are well packaged. The packages must be attractive to customers. Poorly packaged products may not attract customers especially in the contemporary world. Competitors are committed to the provision of differentiated products (Cavusgil, Rammal, & Freeman 2011). Most of them ensure great packaging to ensure their products remain unique in the market. Packaging affects product condition when it reaches the final consumer. Well-packaged products reach consumers in good conditions. The recent years have seen increased environmental pollution caused by businesses. Some product packages are harmful to environment while others are less harmful. Ashtar must use environmentally friendly materials to package its products. This will aid it to improve on its corporate social responsibility (CSR) profile (Doole & Lowe 2007).

Ashtar needs to ensure great labelling to improve on the uniqueness of its products. Well-labelled products are attractive to consumers. It is also easy for consumers to identify a product. Labelling will enable the company to avoid issues such as its products being confused with those by provided by the competition. The company must ensure that customers find it easy to spot its products even when placed among competing products (Stark 2012).

There is the need for the company to ensure effective product positioning. Ashtar must give its customers a reason to consume its products as opposed to those offered by the competition. In general, it needs to emphasize on the unique features and attributes of its products. This will attract consumers to its products as opposed to those offered by the competition. Equally, the company can emphasize on its competitive prices. However, it must be keen enough not to focus on price to the extent that unique features of its products are ignored. Product differentiation is of the essence (Stark 2012).

Ashtar needs to provide localized products. One mistake made by companies when entering the international market is the application of one size fits all strategy. Wal-Mart is an example of a company that has failed to enter a number of international markets as a result of providing standardized products and using the same pricing strategies (Doole & Lowe 2011). Ashtar can avoid similar challenges when entering the international market through the provision of localized products. Essentially, its marketing managers must engage in marketing researches to determine the type of products consumers in the target market, in this case, the United States, are attracted to. The information gathered through market research should be used to develop quality products. Ashtar will be a position to address consumer needs and wants with ease with the utilization of a localization strategy. The company will also avoid the provision of products that consumers are not interested in.  With this is strategy it needs to apply not only when entering the US market but also other markets across the globe (Ferrell & Hartline 2012).

Continuous improvement the quality of products is equally important. Consumer need and preferences keep on changing. This has had a major impact on product lifecycle. Particularly, product lifecycle has been reduced (Ferrell & Hartline 2012). Products are being rendered obsolete within a short period. Ashtar can deal with the changes through improving the quality of its products. The company needs to invest more and more in research and development to come up with innovative ideas on how to improve the competitiveness of its products and services. Competitors have applied the same strategy with great success. This is clear indication that Ashtar will lose its competitive edge in the international market when it fails to improve on the quality of its dead sea cosmetic products. The company has already made a name for producing products that are in line with consumer needs.  R&D will enable it to maintain this reputation (Stark 2012).

Product Pricing

The company has considered a number of factors to consider when setting product pricing strategy for its international markets. For one, it has to consider the costs of producing its products. One of the major goals the company seeks to achieve is ensuring profitability. As such, the company must ensure the price enables it to achieve profitability. Essentially, the selling price should be higher than the total cost of producing a product.  Failure to ensure the same can lead to losses. The company needs to consider both production and operating expenses. It is imperative that the selling price offsets production expenses and allow the company to deal with operating expenses such as taxes, insurance, and rent among others (Cavusgil, Rammal, & Freeman 2011).

The company also needs to utilize its pricing objectives. Different companies have different pricing strategies when entering the international market. For instance, there are those that focus on profit maximization while others emphasize on sales maximization. There are companies that seek to develop a special image in the minds of customers. Corporations committed to creating a special image price their products high (Cavusgil, Rammal, & Freeman 2011). The same case applies to companies committed to profit maximization. Setting low prices can hinder them from realizing high profits. On the contrary, sales maximization demands the use of low pricing strategies. The main aim is to attract as many customers as possible to boost sales. Most companies find it problematic to achieve this goal with highly priced products. However, companies enjoying monopoly maximize their profits even with high prices as customer lack access to substitute products. Ashtar faces stiff competition from not only the local market but also the international arena. With this being the case, it cannot afford the luxury of setting high prices especially when interested in sales maximization (Czinkota & Ronkainen 2012).

In the same way, the company has to consider the price of competing products. Generally, it must price its products competitively. There are many alternatives to the products offered by the company. Substitute products are priced differently. Customers normally compare prices offered by different companies before making the final purchase decision. It is essential for the company to avoid setting product prices far above what is offered by the competition. This will enable to avoid losing its target customers to the competition. In the same way, setting prices far below what is offered competition is also dangerous. Specifically, this can start bidding wars where competitors cut their price with an aim of retaining their share in the international market. As a result, the company may suffer low profit margins. Consequently, low profits may make it hard for it to achieve its expansion goals as well as maintain product quality (Lancaster & Massingham 2010).

Another factor Ashtar needs to consider when setting product prices is consumer demand. There is the need for it to engage in market research to determine how much customers are willing to pay for its products. Research has shown that consumers are willing to pay premium prices for new or unique products. On the contrary, a consumer may not purchase a low quality product that is priced high. Engaging with customers will help the company to set prices that will lure customers away (Weinstein 2013). Many customers consider value for money when purchasing products. This is a factor the company has to understand. It must provide high value money. There should no point in time when customers develop the feeling the products are overpriced. In essence, this will attract them to what is provided by the competition. In the end, the company’s ability to maintain high sales and profits is compromised. Its competitive edge is also affected.

According to Doole and Lowe (2011), it is also important for a company to consider product positioning when setting its product prices. The prices set by a company have a major impact on the way consumer perceive the quality of its products. Setting low prices communicates the message that a corporation is a discount retailer. Equally, inexpensive products are normally associated with poor quality irrespective of the authentic quality of the product in question. On the other hand, highly priced products are associated with high quality. Generally, the management at the company must consider the image it intends to create in the mind of consumers. However, it must avoid setting high prices simply because it wishes to market itself as a luxury yet its products are of low quality. This can easily result into low levels of customer satisfaction. Similarly, if the company choses to use low prices, it must explain to customers that the prices has nothing to do with quality to avoid the wrong perception linked with low priced products (Czinkota & Ronkainen 2012).

Correspondingly, the company needs to consider the sustainability of a pricing strategy. There are companies that come up with product prices only to realize they cannot sustain it over a certain period of time (Weinstein 2013). As such, they are forced to change it to ensure their continued survival. Companies that keep on changing their product prices after a short period of time find it challenging to attract and retain customers. Generally, Ashtar must ensure it does not set its prices too low to the extent that it encounters challenges to sustain its profits as it may be forced to increase it after a short period of time. Moreover, setting very high prices can make it difficult for it to attract customers as they will find it products unaffordable. Once more it will be forced to revise the prices. The company has to consider all factors that affect product prices and their sustainability. This will aid it to set the optimum price, hence its sustainability (Ferrell & Hartline 2012).

Ultimately, Ashtar must consider government rules and regulations. Failure to ensure the same can lead to it having problems with the law. For instance, it needs to avoid predatory pricing strategies. Governments are against such practices as they are used by large corporations to enjoy monopoly.

Distribution Strategy

Various critical factors are considered when developing a new distribution strategy. Top on the list, the company has to consider the nature of the products it is offering its customers. There are products that demand special distribution strategies while others can be distributed using any available strategy (Cavusgil, Rammal, & Freeman 2011). For example, some products are distributed in shopping malls while others can only be distributed through speciality stores. Cosmetics are marketing using different distribution strategies depending on what a company intends to achieve or its marketing objectives. The fact that Ashtar provides similar products means that it can utilize different distribution strategies. Its products can be distributed in many stores including convenience, speciality, and shopping. It is clear that the company intends to export its products to the US market. This implies that they can be distributed in speciality stores and supermarkets (Lancaster & Massingham 2010).

Reach is also a major factor the company needs to consider. A distribution channel utilized by a company must be accessible to target consumers. In essence, Ashtar has to ensure its customers find it convenient to access its products (Ferrell & Hartline 2012). Consumers in the contemporary world are less not attracted to companies that embrace distribution channels that are not easily accessible. This is one of the main reasons that have led to companies engaging in online marketing. Ashtar has to research the US market to determine the most convenient distribution channels considering what customers are attracted to. In general, its target customers must find it easy to find its products. For instance, target customers should have to walk or travel long distances before they can access the products. Inconvenient shopping experience will only attract customers to products offered by the competition (Doole & Lowe 2011).

It is also of great importance for the company to consider its sales personnel skills. As mentioned above Ashtar will be exporting its products to the US market. As such, it requires highly skilled sales people. Skilled employees will create good relationships with target customers. As such, it will find it easy to attract and retain them. Generally, the company must settle on a channel that its people have the knowledge and skills to manage and achieve the right results. Usually, some distribution channels require advanced marketing skills as compared to others. It is upon the management at Ashtar to examine the strengths and weaknesses of its people before deciding on which strategy to employ (Doole & Lowe 2007).

Customers also determine which channel a company is likely to employ to distribute its products. Normally, companies ensure they are closer to customers to serve them at their convenience. They avoid channels that customers will struggle to access their products. Companies that use third party distributors target companies that provide products that are complementary to their own. This is also a strategy the company needs to consider utilizing as it will enable it to achieve affective marketing (Ferrell & Hartline 2012). Ashtar must also consider incentives distributors may require to market its products. For instance, distributors that offer complementary products will accept its products as the find it easy to market them as opposed to dealing with distributors offering completely different products. Ashtar can also use the opportunity to grow its business. Specifically, it can tap into their customer base to expand its product portfolio. This can be achieved through the analysis of what the customer is interested in. The company can then expand its product portfolio to expand its customer base and increase its sales (Weinstein 2013).

Control is also an important factor when selecting the best distribution strategy. Many companies ensure they have control over the way their products are distributed in the market. This helps them in ensuring the provision of quality customer service (Doole & Lowe 2007). Research has shown that customer service can be compromised when dealing with third party distributors who are less concerned with how a customer feels or how they should be treated. This means that a company may be providing high quality products and still fail to attract customers as a result of poor services rendered by its distributors. It is advisable for companies to monitor the services provided to customer to ascertain on whether customers are fully satisfied with what is being provided. Ashtar must also ensure the same after choosing its distribution strategy.

According to Ferrell and Hartline (2012), the most obvious distribution strategy is not always the best. Channel innovation is very important as it can give a company a competitive edge. Consumers in the contemporary world are more interested in faster and cheaper ways of buying goods and services. The management at Ashtar must engage in channel innovation to determine the most appropriate distribution strategy.

Ashtar needs to work with third party distributors including supermarkets and speciality stores. Consumers visit supermarkets to purchase different cosmetic products. They are also able to access the same products in speciality stores or shops committed to the distribution of certain type of products, for example, cosmetic shops. Ashtar can work with renowned retailers such as Wal-Mart. It should also strike deals with different cosmetic shops around the country. The use of different distribution channel will help it to reach it out to its target customers with ease (Baker 2014).

Conclusion

Ashtar has achieved great success in the market since its inception. The company has expanded to the international market to improve its competitiveness as well as increase its market share. However, there are many international markets that it is yet to expand to including the US market. Ashtar is known for its quality products and services. It is important that it maintains the same quality when entering the United States market. The management at Ashtar needs to embrace behavioural and demographic market segmentation to target its customers effectively. It is also imperative that they come up with an effective product strategy to attract and retain the highest number of customers. There are various factors it has to consider when developing its pricing strategy including production costs, rate provided by the competition, and sustainability of the strategy among others. The management must also consider different factors when determining the most appropriate distribution strategy. Failure to ensure the same can lead to it relying on the wrong distribution channel, hence its inability to attract its target customers.

Bibliography

Ashtar. 2015, Ashtar Dead Sea Products, Retrieved September 19 2015, from http://www.abdingroup.com/aboutus.html

Baker, M J 2014, Marketing strategy and management, Macmillan Education, New York, NY .

Baker, M J & Hart, S J 2007, Product strategy and management, FT Prentice Hall, New York, NY.

Cavusgil, S T Rammal, H & Freeman, S 2011, International Business: The New Realities, Pearson Higher Education AU, New York, NY.

Czinkota, M & Ronkainen, I 2012, International Marketing, Cengage Learning, Mason, OH.

Doole, I & Lowe, R 2007, International marketing strategy : contemporary readings, Bonn, London.

Doole, I & Lowe, R 2011, Strategic marketing decisions in global markets, Thomson Learning, London.

Ferrell, O C & Hartline, M 2012, Marketing Strategy, Cengage Learning, Mason, OH.

Lancaster, G & Massingham, L 2010, Essentials of Marketing Management, Routledge, New York, NY.

Stark, J 2012, Global product : strategy, product lifecycle management and the billion customer question, Springer, London .

Weinstein, A 2013, Handbook of Market Segmentation: Strategic Targeting for Business and Technology Firms, Third Edition, Routledge, New York, NY.

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