International Marketing and Communications 

Executive Summary

Penguin Publishers is an internationally recognized company. Through a strategic marketing plan, the company can be able to expand its services to Brazil. Through this step, it is anticipated that more than 45% of the total publishing works in the country will be tapped. Penguin Publishers publishes all kinds of works. The company would like to target cultural-based publishing during the 2016Olympics and immediately after the 2014 World Cup. This forms the basis of the target market. After these two main occasions, the market will be directed towards education-based publishing.

The corporation will have an opportunity to take away a sizeable part of the market from Bloomsbury Publishers by offering diverse publishing services. The company hopes to target the creative arts section in the region which also forms the main priority to the Brazilian government. The major mission of Penguin Publishers in Brazil will be to facilitate diversity through the employment of different cultures to enable the company to become one of the leading publishers in the world. The company will aim at publishing in the Portuguese language.

PHASE 1: GOAL SETTING

The mission of Penguin Publishers

The main reason why the corporation is carrying out this market research in Brazil is to identify various loopholes that exist in the publishing industry of Brazil. Penguin Publishers will seek the most appropriate ways that it can employ in order to optimize its activities in the publishing industry. After all, its mission is to become the leading publishing corporation in the world. Therefore, it intends to employ the most suitable strategies that can help it solidify its presence in the Brazilian market, thus, dominating over its rivals such as the Pearson Publishing Ltd. The company intends to create stronger liaisons with the Brazilian government as well as with the main distributors in the country. This is because these institutions are the main sources of revenue for a publishing company.

Corporate Objective

Some of the findings that the company will seek to establish relate to various concepts that define international marketing. First, Penguin Publishers will define how the concept of culture relates to marketing on the international level. The international marketing sources of information will be determined and evaluated. Both primary and secondary sources of information will be evaluated (McDonald 2011). The next assignment will be to reveal and apply the acquired knowledge. This will ensure that there will be proper formulation as well as the development of appropriate communication and marketing plans at the international level. The research will also discuss how assimilation, as well as a critical assessment of marketing information, can be obtained from various sources (Westwood 2002). Lastly, the research will seek to depict how both communication and time can be managed.

Penguin Publishers will seek to create a marketing outline that will help it increase its market share starting from January 2015 to December 2016 in Brazil. The company’s marketing and sales director delegated the research to a new trainee. The company expects the person in charge of the research to set up his priorities right in order to come up with good report findings. First, the researcher should define a market before trying to understand its values. According to the IPA (“International Publisher’s Association”), the United States topped the list of Publishing Companies. According to Nawotka (2012), the United States registered the highest total market value in terms of consumer prices. It had a total of $31,000 whereas China came second registering a total of $10,602. Germany was ranked third with the overall market value of $9, 73. Brazil, the country under study, also did well as it was ranked 11th with a total of $2,546. Briefly, Brazil was among the top 22 best countries in terms of buying books. However, Penguin Publishers was able to collect a total of $2,027 worth of revenue. The high ranking of Brazil as a country in terms of adoption of a culture of reading makes it a viable investment destination for big publishing companies across the world. Penguin Publishers will be guaranteed of a promising return if the company decides to set up a multinational corporation. Moreover, the corporation’s investment decision of buying 45% of the total stake of the most prominent publishing firm in Brazil was a well-calculated decision. In 2011 Penguin Publishers partly merged with the biggest publishing corporation called “Companhia das Letras”. The company`s decision to invest in Brazil seems like one of the best decisions that the company has ever made. The first year will be the most difficult since the corporation will continue having cash outflow with no or minimum cash inflow. With time, the company will start recording positive income.

This scenario implies that a number of procedural activities have to be undertaken before any measures are implemented. First, there is a need to look at how the Brazilian publishing market is segmented. Market segmentation is one of the critical things that will be observed before any serious decision is taken. Brazil was ranked ninth according to another report presented on October 9, 2012. Market segmentation seems to be not well established due to a number of hindrances. Indeed, the publishing industry is flourishing as well as registering impressive performances. Despite this, there are barriers to entry for new multinational publishing firms into the market. These obstacles emanate from a complicated administration system of Brazil’s. The country has enacted highly complicated legal and tax systems that have sidelined retailers of international books for a long time. According to Nawotka (2012), Carlo Carrenho, a publisher who works at “Publish News Brazil”, once admitted that he even doubted whether it was legal to have an agency that deals with publishing in Brazil.

The main aim of the researcher working for Penguin Publishers should be to set goals. It will be based on the company`s mission and objectives. It should be realized that Brazil has stringent measures that work against the entrance of new publishing firms. Therefore, the main goal will be to strengthen the already existing bond between Penguin Publishers and the local publishing firm. Any effort of introducing an autonomous publishing body may not be supported by the tax authority of Brazil and may end up being closed down. The main objective should be to enhance greater cooperation between Penguin Publishers and the publishing house of Brazil, Companhia das Letras. The main objective of the company is to continue to thrive further, thus, registering higher growth in terms of increased revenue. For instance, more efforts will be directed towards strengthening the tie that already exists between the two corporations. The main efforts will be directed towards a more productive negotiation dialogue with the Brazilian government for better terms of operation. The company will aim at creating a possibility to form a lenient method of carrying out a merger. This will help the company realize a better working relationship within the boundaries of Brazil. According to Ros (2012), there exists a relationship between the trade and rights to own intellectual properties. Therefore, there is better law enforcement and co-operation.

PHASE 2: SITUATION REVIEW

Marketing Audit

It is estimated that the population of Brazil is196, 523,097 as of 2012 (Buchmesse 2013). This information is highly critical as it will help Penguin Publishers to strategically position itself in the market. According to a survey conducted in 2011, the illiteracy level in the country was quite low (9.3%) (Buchmesse 2013). Therefore, this sounds like good news to Penguin Publishers given that book publishers can only thrive in a country that has higher literacy rate.

According to Pessoa (2013), approximately 80 million Brazilians are able to access and use the internet. The fraction represented 40% of the total population with a promise of an annual penetration rate of around 43%. Penguin Publishers can be sure of optimizing its e-book business profit through investing heavily in the Brazilian market. The country has over 14 new universities. Additionally, there are hundreds of technical institutes (Pessoa 2013). Brazilian Universities have been ranked the best in Latin America. This means that these learning institutions will readily buy competent publications such as those of Penguin Publishers. Therefore, the decision of the company to invest in Brazil will help to fill a deficit of books created due to this change in education.

Brazilians value direct interactions when they are making purchasing decisions. They also prefer purchasing in a language that they can easily understand. Penguin Publishers has realized this and has responded positively. Arrangements are made for conference participants that will be held in Belo Horizonte on 16-21 of November 2014. It will bring together various University libraries for a science seminar “National Seminar of University Libraries” (Pessoa 2013). Penguin Publishers will seek to attend such seminars in order to popularise itself locally as the cost competent international book publishing corporation. Penguin Publishers has to pass through an agency referred to as CAPES in order to be able to sell its books to individual institutions of learning. “CAPES” is in charge of the seminar that is held, thus, making a better marketing strategy to pass through it.

SWOT Analysis

Penguin Publishers is a company that specializes in the publication of books and its operations are distributed all over the world making it an international company. Thus, the company’s internal environment contributes to its success or halting of its activities (Nargundkar 2008). Moreover, the company is not immune to negative externalities that act as disincentives. For instance, Penguin Publishers is a multinational company, meaning that it is able to carry out its activities at much lower costs as compared to many other publishers. Penguin Publishers is one of the world most renowned book publishers. It publishes its books in the English language. It publishes over 250 titles of books on an annual basis. This fact alone will make it a suitable partner in the Brazilian market. Its history will act as enough proof that the corporation has abundant experience in dealing with various challenging situations that arise in the public arena. This could be one of the reasons why the corporation managed to acquire 45% of the total shares of Companhia das Letras. This will act as an avenue to advance business activities to increase the number of mergers. Penguin books are widely distributed across the major cities of the world. This means that the expansion of its publishing services into the Brazilian market will be done at ease. It means that Penguin Publishers has gained enough experience regarding the appropriate measures that should be implemented in the international marketing arena.

The potential and immense market of Brazil is an opportunity that Penguin Publishers will seek to optimize. High literacy rate of Brazilians that is estimated to be over 90% will be another opportunity that the corporation should seek to optimize. Brazil has a culture of a creative industry that incorporates the publishing industry as one of its main components. This means that the country has high feasibility of adopting any serious publication works. Therefore, Penguin Publishers will seek to legitimize its business in Brazil in order to take advantage of this opportunity. The fact that the same country will host the 2014 World Cup and the 2016 Olympics will bring together different people of different nationalities and cultures to Brazil. Consequently, demand for arts and cultural works will shoot up, thus, presenting a business opportunity to Penguin Publishers.

Penguin Publishers will operate under external conditions, some of which will be beneficial while the others will pose a threat to its survival. The company will operate under different strategic analyses with a number of publishers in order to increase its customer base. Full implementation of the same strategic procedure will help Penguin Publisher expand its market in Brazil. Nonetheless, this will not mean that Penguin Publishers will operate in a threat-free environment. Penguin Publishers will face stiff competition that will emanate from other publishers within the region and outside it. One publishing company that will act as a major threat will be Bloomsbury Publishers. Brazil tends to give more attention to it due to its vigorous cultural involvement. Therefore, this means that the corporation will have to plan in advance before it decides to fully enter the Brazilian market. Other threats that the company will face include such things as a change in the loyalty of the renowned writers (Shankar & Carpenter 2012). Moreover, the decision to invest in Brazil will act as another threat. This is due to the recent report concerning the best book capital in the world. According to Nawotka (2012), Yerevan, the capital of Armenia, was named the world book capital. Thus, the future of an initiative of Penguin Publishers to invest in the Brazilian market is uncertain. The SWOT analysis, therefore, indicates that the company must study the market situation before making an investment decision. The counterfeit culture of the Brazilians will present another major threat to the corporation. The practice will lead to a great loss suffered by the Penguin Corporation once it proliferates. Increase in the rate of organized crime will be another major threat to the corporation. Thus, it is possible that unscrupulous business people will replicate the original publications of the corporation. Therefore, Penguin Publishers will have to be highly careful not to fall prey to this threat. However, marketing managers must be willing to make an assumption of some real situations on the ground to ensure that there is no exaggeration. For instance, publishing competition among different cities across the globe will be held constant. This will help to reflect Brazil in a more positive light as a suitable investment destination.

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Assumptions

In order for Penguin Publishers to thrive, it will need to operate under a number of assumptions. First, the management team will be required to operate as if Penguin Publishers is a monopoly in the Brazilian market. This assumption will help to build confidence, thus, making the company more profitable. The corporation will have to assume that operation costs are uniform globally, including Brazil. The assumption will make it easier for the company to project its feasible profit in the future. The overall effect of these assumptions will be highly crucial to the projected growth and establishment of its operations in Brazil which has a lot of untapped publishing market.

PHASE 3: STRATEGY FORMULATION

A marketing strategy refers to planned mechanisms that a corporation will use in order to reach its goals and increase its sales and profit. In brief, a strategy must be formulated immediately after all the significant data that can be used in international marketing is collected. First, many investors view Brazil as a viable business destination. According to UKTI (2013), there is high anticipation that corporations will thrive further in Brazil. As such it is upon the sales as well as marketing teams to come up with better policy formulation that can help the company to tap the newly created market. Many anticipate that the ever-growing middle class in Brazil creates a wide market base for various products. Additionally, Brazil is among the fastest developing economies in the world today. It has a total population of over 185 million people (Smallman 2002). According to research, the marketing environment in Brazil is just the same as in the world (UKTI 2013). The condition has created a more conducive business environment where the UK has remained the most crucial trading partner of Brazil. It has made a lot of investments in Brazil.

Marketing Objectives

Therefore, Penguin Publishers will be ready to come up with management strategies that can enable the corporation to realize more growth in Brazil. Taking into consideration that according to statistics GDP in Brazil is higher than that of China or India, it becomes fundamental for investors to ponder on the issue of investing in the country (UKTI 2013). The economic as well as per capita growth clearly represents a highly latent market for products of international companies. In the case of Penguin Publishers, the corporation will seek to understand that rising income level comes with improved living standards. Owing to this situation, market formulation strategies should be aimed at enhancing strategies that will maximize this opportunity (Luther 2011). One of the best marketing strategies that the corporation will aim at attaining will be the publication of books that are written in a language that Brazilians can understand. For instance, Brazilians use Portuguese as their official language (Azevedo 2005). Thus, more energy will be dedicated to the publication of books that are written in the Portuguese language. Penguin Publishers will publish fewer books written in the English language since the majority of Brazilians find it ambiguous and do not understand it. The Penguin Publishers will allocate a lot of positions to the locals especially when it comes to those positions that require contact with customers. Such people are culturally integrated with their compatriots and the language that they use is better than the official language of Penguin headquarters. Moreover, they will be capable of integrating with other local people, providing them with the exact information about the nature of the product that they need. The hiring of the locals to be in charge of various positions within the organization will help Penguin Publishers win confidence and trust of Brazilians. They will feel that the company is part of them due to its strict adherence to the social-cultural practices of Brazilian society.

Expected Results

Adherence to such marketing strategies will be expected to yield positive results such as increased revenue. Better marketing strategies help in the acceleration of the assimilation process of Penguin Publishers in Brazil. Apart from the formulation of the above-mentioned marketing strategies, Penguin Publishers will have to incorporate another marketing option referred to as e-marketing (Pride, W. 2011). E-marketing will entail the use of social networking sites such as Facebook and Tweeter. Communication through social media tools is a contemporary mode of communication that is used by a majority of young people (Clarke & Flaherty 2005). One of the expected results that will be anticipated from this form of communication is that it will help to capture a wide base of potential clients. It will help to win the trust of the vast majority of the internet users, thus, compelling them into buying Penguin products.

According to Rodriguez (2011) sales of publication, works have continued to constantly grow in Brazil since 2006. The unit number that was sold in 2009 stood at 310 million, in 2007 at 329, in 2008 at 333 million, and in 2009 at 370 million. Textbooks represent over 51% of the total sales. Penguin Publishers will seek to optimize this trend through increased supply of its textbooks in the region in order to increase profit. Nonetheless, the corporation must keep its prices as low as possible. The same trend indicates that the average market price of books stood at R$12.68 back in 2004 and declined to R$11.11 in 2009 (Rodriguez 2011). Therefore, Penguin Publishers will have to adjust the prices of its books accordingly in order to realize a positive growth. The fact that e-books were projected to reach a 2.63 share of the Brazilian market is another aspect that should be considered (Carrenho & Steven 2013). Therefore, as Penguin Publishers will seek to introduce more books in Brazil, there will be a need to consider the possibility of displaying e-books. The will help the corporation to fill the gap created by the steady rise in demand for the e-books in Brazil.

In 2012, the book industry in Brazil published a total of 57, 473 book titles. A total of 20, 769 of these book titles were new. Thus, a total of 485,261,331 copies were published in 2012. These copies were able to generate $1.85 billion (Costa 2013). This will presents a good chance for Penguin Publishers to expand its international production. Therefore, it will expand its operations in the country in order to tap the expanding market.

Identified Options

Use of social media portrays a scenario that depicts that Penguin Publishers has adhered to Brazilian contemporary culture. Local people have used to communicate through social networking tools, meaning that any information that passed through this system reaches millions of people at once. Moreover, the corporation will seek to merge with various local publishing companies in order to win more market share. Such merges will help boost its public image and endow more trust of the locals.

PHASE 4: RESOURCE ALLOCATION

Resource allocation will be the final stage of the firm’s marketing plan. Resource allocation will be the most crucial part of the whole business plan. It will entail detailed budgeting which will be used for detailed implementation (Luther 2001). Resource allocation will entail various ways through which Brazilians will be taken care of (Shankar & Carpenter 2012). Managers will be expected to be able to justify the investments of their customers. Additionally, they will develop analytical skills. Thus, Penguin Publishers can employ this strategy to have a competitive advantage that is sustainable. This is because the managers will be able to understand what Brazilians want and the way in which they will behave in the market place. Allocation of resources will be determined in two ways (Czinkota & Ronkainen 2013). The first method is through demand analysis. This will help in predicting varying marketing actions and how they will affect the behavior of customers. Secondly, various economic impacts can be analyzed which will be significant in determining Penguin Publishers’ best allocation of resources.

Budgets

Better resource allocation will see Penguin Publishers among the best global publishing firms. Indeed, Penguin Publishers is among the best 60 publishers in the world (Wischenbart 2013). Better resource allocation will have some benefits that will be associated with it. One of them is called “lead generated”. The second is referred to as “sale-ready leads”, while the last part deals with business opportunities. In 2012, a total of 57,473 titles were published in Brazil and 20,792 were the first time publications. A total of 485,261,331 copies were published in 2012, resulting in $1.85 billion in sales and almost a third of the total sales came from the government. It is important to note that the government will have a significant influence on the book market. Therefore, there will be a need to integrate the company`s service delivery with the expectations of the Brazilian government. The statistics here show that a publishing company may perform well in the Brazilian environment given the two consecutive international events: the 2014World Cup and the 2016 Olympics (Costa 2013). Although our marketing plan might not rely much on the 2014 World Cup events, several activities undertaken during the activity will be captured as the company awaits the next big event in Brazil, the 2016Olympic games. The prices of books published increased by 12.46% during a decade in Brazil (Costa 2013). Since 2004, the prices of books have been decreasing but the current trend is promising and with proper pricing strategy, the company can be able to tap a wider market for the published works. With increased intercultural activities within a two-year period, the company will be able to maximize the opportunity and make huge sales.

Therefore, Penguin Publishers will come up with a detailed budget that will ensure that it attains much of its set targets. The company will need to have proper budgeting strategies that will help it cover the potential market population. For instance, it will need to budget for the product of around a third of 485,261,331 copies of the total publications. This would translate into a budget that will cater to around 161,753,777 copies within the first year. The corporation’s target will be to clinch around a third of the market share during the first year. More budgeting will be allocated towards textbooks. The Brazilian government is dedicated to allocating more resources towards buying textbooks compared to leisure ones. The government expenditure on education increased from 10.5% in 2000 up to 17.4 % in 2012 (Groth, 2013). This depicts how committed the Brazilian Government is towards the provision of quality education to its citizens. Therefore, allocating more resources towards the production of textbooks will translate into more profit for the corporation. Budgeting will be adjusted in the following and subsequent years depending on the change in publication policy in Brazil. The company will need to review its prices carefully to make sure they are customers friendly. A lot of efforts should be directed towards customers` satisfaction. The company will start focusing on making a profit after establishing itself in the subsequent years by adjusting its prices accordingly.

Detailed Implementation

According to the current trends in the Brazilian market, it is estimated that publishing companies can be able to publish and sell more than 500,000,000 copies per year. Thus, the company has the possibility to tap future opportunities. The market situation will require careful consideration. Penguin Corporation will need a detailed implementation plan that will help the company realize sales during its first year of operation in Brazil. First, the corporation will seek to establish a better business partnership with various sales body, distribution channels, and the government of Brazil. The three bodies have contributed a lot to the success of the publishing industry in Brazil. Therefore, Penguin Publishers will need to place them at the center of any marketing implementation plan that it intends to undertake. The company will also employ social media advertisement strategy as the Brazilian population has readily absorbed this mode of communication. The move will not only help the company to realize faster growth but will greatly increase its customer base. Majority of the targeted market is young people who are still in institutions of learning. This is the same population that is highly active in social media. Therefore, vigorous use of social networking sites such as Facebook will boost the corporation’s image a lot. Creation of local employment is another strategy that the corporation will seek to use. Provision of various positions to local people will result to boost of the corporation’s operations. The process of cultural integration will be hastened since local people will be more conversant with the shopping behaviors of Brazilian people. Consequently, such strategic implementation methods will translate into big success in the long run.