Universitat de Barcelona - International Marketing (364563)

Supervisor: Professor Xavier Canadell

Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

Global Study Case: Mates&Mate

PART 5:

5- International Strategy for 2 destination countries - Spain and France

4.1 SWOT analysis, directions of options, confrontation matrix and strategy

approach

SWOT ANALYSIS

Positive Negative

Internal Strengths: Weaknesses:

- Well-structured - No previous project
online shopping planning experiences
platform - No international
- Wide range of experience
products - Small firm size
- Product = natural, - Too dependent on
healthy and third party suppliers
sustainable (disposal - Low financial
is easy and strength
environmentally
friendly)
- Eye-catching /
innovative product
design (calabash
and bombilla)
- Low fixed costs

External Opportunities: Threats:

- Potential for more - Strong competition
market share - Imitators with high
- Corporations with financial strength
other mate brands or - Business model can
retailers be easily copied by
- Trends: other retailers and
- vegetarian/ brands
vegan - Bottlenecks caused
(Parker, 2019) by drought in the
- plastic-free countries where
environment mate is produced
(Moss, 2019) - Political conflicts
- More opportunities if (Independence
buyers change their Catalonia, Pension
lifestyle system conflict in
- Latin America and France) → uncertainty
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

Spain → strong ties

(human, historical,
social, cultural,
political, economic and
linguistic) (Export.gov,
2019)
- Spain and France are
the largest importers
of mate in Europe
(The Observatory of
Economic Complexity,
2017) → assumption:
French and Spanish
people drink the most
mate in Europe
- Germany is the main
trading partner for
France (France
Diplomatie :: Ministry
for Europe and
Foreign Affairs, 2019)

Confrontation matrix

The higher the number (3 = highest), the better Mates&Mate can

● use a strength to take advantage of an opportunity
● use a strength to ward off a threat
● enhance a weakness to take advantage of an opportunity
● enhance a weakness to ward off a threat
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

S1 = Well-structured online shopping platform

S2 = Wide range of products

S3 = Product = natural, healthy and sustainable (disposal is easy and environmentally friendly)

S4 = Eye-catching / innovative product design (calabash and bombilla)

S5 = Low fixed costs

W1 = No previous project planning experiences

W2 = No international experience

W3 = Small firm size

Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

W4 = Too dependent on third party suppliers

W5 = Low financial strength

O1 = Potential for more market share

O2 = Corporations with other mate brands or retailers

O3 = Trends (vegetarian/vegan (Parker, 2019); plastic-free environment (Moss, 2019))

O4 = More opportunities if buyers change their lifestyle

O5 = Latin America and Spain → strong ties (human, historical, social, cultural, political, economic and
linguistic) (Export.gov, 2019)

O6 = Spain and France are the largest importers of mate in Europe (The Observatory of
Economic Complexity, 2017) → assumption: French and Spanish people drink the most mate in Europe

O7 = Germany is the main trading partner for France (France Diplomatie :: Ministry for Europe and
Foreign Affairs, 2019)

T1 = Strong competition

T2 = Imitators with high financial strength

T3 = Business model can be easily copied by other retailers and brands

T4 = Bottlenecks caused by drought in the countries where mate is produced

T5 = Political conflicts (Independence Catalonia, Pension system conflict in France) → uncertainty

Directions of options

After developing the confrontation matrix we can state that the company should
adopt an attacking position in order to enter the markets with success. That means
we have to use our inner strengths to take advantage of external opportunities and
maximize profits.
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

Strategy approach

The two markets, France and Spain, are analysed for geographical, demographic,
psychographic and behavioural factors. Unfortunately, surveys could not be carried
out and secondary sources had to be consulted. It is assumed that targeting and
positioning will not be very different from Germany, as cultures in Europe are
becoming more and more adapted to each other due to the EU. Furthermore, there
has not been enough research on mate consumption in Europe because the product
is still very unknown. Therefore, we assume a similar situation as in the German
market. We also had to think up the figures in sections 4.2.1. market share and
4.2.2. sales volume because in reality the company does not yet operate
internationally.

4.2 Objectives
1. Market share
Brand awareness: 8% ( 28% in Germany)
Consideration: 23% ( 34% in Germany)
Preference: 28% ( 36% in Germany)
Availability: 22% ( 7% in Germany)
Conversion: 38% ( 4% less than the forecast)
MSI = 8% x 23% x 28% x 22% x 38% = 0.04%

2. Sales volume
Volume Sold(units) = Market Demand(units) x Market Share
Sales(2018) = 26M units x 0.04% = 400 units
Sales(2018) = 400 units x 6€/unit = 2,400€
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

5.1 Segmentation
SPAIN
● Geographic variables
Mates & Mates’ customers will most likely be located in the big urban cities like Madrid and
Barcelona, with population from 1 to 4 million people.

● Demographic variables
The median age has risen sharply since 1970 and reached 43.1 years in 2018. The
population is ageing very quickly and is growing at a rate of 0.73% in 2018. Almost 25 % of
the population is under 24 while more than 40% of the population is over 55 years old. On
average, households are made up of 2.5 people with 25.6% of households made up of only
one person and 44.9% are couples with or without children. Regarding the ratio of men to
women there are 98 men for every 100 women. About 80% of the population lives in urban
areas. Most of the population lives in the agglomerations along the Mediterranean and the
Atlantic Ocean, but also in Madrid, Seville and Zaragoza. The three main cities in terms of
population are Madrid, Barcelona and Valencia. The OECD estimates that 58% of adults
aged 25 to 64 have a secondary education, and that 35% of this population has completed
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

tertiary education.

● Psychographic variables
Spain is a consumer society. As a result of the economic crisis and the level of
unemployment price has become one of the main purchase determinants. The ease of
payment, promotions and effective customer service are other key factors. On average, the
Spanish shops two to three times a week, including weekends and 70% of consumers say
they plan their purchases in advance with room for unplanned items.
On average, Spaniards spend 328 euros a month on food. Consumer confidence has been
falling since mid-2018. There are 38 million internet users in Spain, making ecommerce a
huge market. Ecommerce revenues are expected to increase by 13.8% in 2019. On
average, a Spaniard spends 460 euros on the internet and Cyber Monday usually attracts a
lot of consumers. Even if the imported products are widely consumed in Spain, the national
products inspired by Spanish culture (in the packaging for example) are generally preferred.

● Behavioral variables
Spanish consumers are increasingly less focussed on a brand's popularity. Young people
are less loyal to brands than the rest of consumers and are more open to new products.
About 85% of Internet users between the ages of 16 and 65 are active on social networks,
and the opinion of an influencer or other consumers will sometimes influence purchasing
decisions. Spaniards are among the Europeans most concerned about personal data
protection with 47% expressing their lack in confidence.
Responsible consumption is developing in Spain. Whereas 4 years ago only 30% of
consumers said they took into account environment concerns in their purchases the number
rose to 41% in 2018. The number of consumers looking for more responsible products,
traceability and better quality is increasing. (Santandertrade.com, 2019)

FRANCE
● Geographic variables
Mates & Mates’ customers will most likely be located in the capital of Paris, since it will be
easier to reach .France’s population has a high and diversified level of mass consumption
(defined as the very high average level of consumption whereby most of the people
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

consume a large amount of goods and services other than satisfaction of basic needs)

● Demographic variables
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

● Psychographic variables
In France, GDP per capita has been rising since 2009 and reached EUR 37,000 PPP in
2017 (approximately USD 42,850 PPP). The yearly average salary of a French person is
EUR 33,048 while the disposable personal income is EUR 16,668. Purchasing power is
expected to rise in 2018 (+ 0.6%), after 1% growth in 2017. In 2018, household consumption
is stable. However, income inequalities exist (the Gini index is 0.288, 1 representing the
highest level of inequality). The median salary of men is on average 19% higher than that of
women, according to INSEE. Seniors have the highest median standard of living, while
young people have the lowest median standard of living. The self-employed have the highest
standard of living, followed by employees and pensioners. Below average are children under
18, and other inactive populations, i.e. students and unemployed.

● Behavioral variables
Most French believe that consumption is synonymous with pleasure. Most consumers
purchase from mass retailers and large companies. The average purchase in urban areas is
falling but is offset by a higher number of visits to several shops. However, consumer
confidence in mass retailers and large companies is two times lower than the trust given to
small shops and craftsmen (40% versus 80%). French people are increasingly attracted by
online sales, e-commerce and m-commerce (smartphone use). This practice also applies
to the purchase of consumer products (primarily food), through the development of
drive and home delivery services in major cities. Foreign products are widespread in
supermarkets and other distribution channels. In cities, foreign restaurant chains and other
foreign services are also omnipresent. However, "Made in France" products are gaining
importance to 79% of French consumers, who believe they are participating in support of the
local economy and perceive domestic products as a guarantee of quality.
(Santandertrade.com, 2019)

5.2 Targeting
1 - Students
Age 18 – 26
Male or female
Urban
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

Travel-enthusiastic, willing to try and accept new things

2 - LOHAS
Age 25 – 40
Male and female
Urban
Healthy and sustainable lifestyle

3 - People with a connection to South America

Age 18 – 50
Male and female
Urban
Have family roots or friends from South America
4 - Immigrants from Syria and Lebanon
Age 25 – 40
Male
Urban
Home-loving

5.3 Positioning
As positioning is arranging a product to occupy a distinctive place relative to
competing products in the minds of our target customers, It depends on the
differentiation we give to our product. Hence, we should make our mates sell to the
targets we stated before as;

1 - Students
Natural and healthy
Coffee alternative
Easy to make
Cool to share

2 - LOHAS
Vegan and healthy
Exclusivity (Calabash)
Sustainable and environmentally friendly
Universitat de Barcelona - International Marketing (364563)
Supervisor: Professor Xavier Canadell
Group members: Xinya Feng, Anna Magnusdottir & Ludwig Rucker

3 - People with a connection to South America(frequent consume)

Natural and healthy
Sense of belonging
Perfect after having a hangover

4 - Immigrants from Syria and Lebanon (daily essentials)

Non alcoholic drink
Perfect to share with friends
Sense of belonging

Reference list

Export.gov. (2019). Spain - Market Overview | export.gov. [online] Available at:

https://www.export.gov/article?id=Spain-market-overview [Accessed 7 Dec. 2019].

France Diplomatie :: Ministry for Europe and Foreign Affairs. (2019). France and Germany. [online]
Available at: https://www.diplomatie.gouv.fr/en/country-files/germany/france-and-germany/ [Accessed
8 Dec. 2019].

Santandertrade.com. (2019). Reaching the French consumer - Santandertrade.com. [online]

Available at: https://santandertrade.com/en/portal/analyse-markets/france/reaching-the-
consumers [Accessed 7 Dec. 2019].

Santandertrade.com. (2019). Reaching the Spanish consumer - Santandertrade.com.

[online] Available at: https://santandertrade.com/en/portal/analyse-markets/spain/reaching-
the-consumers [Accessed 7 Dec. 2019].

The Observatory of Economic Complexity. (2017). Countries that import Maté (2017).
[online] Available at:
https://oec.world/en/visualize/tree_map/hs92/import/show/all/0903/2017/ [Accessed 3 Nov.
2019].