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Green Toys Inc. Global Marketing
Transcript of Green Toys Inc. Global Marketing
KEY SUCESS FACORS TOYS INDUSTRY
Low unless new participants with a popular product idea or similar concept and economies of scale with same high quality emerge and gain access to consumers and become a significant source of competition for Green toy´s products.
High. European Countries that practice energy recovery range from 39% to 40%. offering an opportunity for suppliers and vast raw material channels.
Low Power the clients of Green Toys Company don´t play a major role in the pricing of the products
Games and toys include hobbies, school and extracurricular activities. board games.
Founder of the company is Robert von Goeben, and Laurie Hyman. Both specialized in different area as former is responsible in product, while Laurie is working on marketing.
The company makes line of children’s toys from recycled plastics and other environmental friendly materials.
Main market is US, as 90% of sales is from US, but has distributors in 35 countries.
Customer segments : Parents of 25-40 years old.
Medium. Despite the existence of larger firm as Mattel,Hasbro or Lego, currently only Green Toys Inc. offers a more differentiated product base in the market with a product extension with toys and baby food containers also from recycled milk jugs.
Brand image (being eco-friendly).
Raw materials (recycling)
Market leader in the US market (90% of sales in the US)
Customer has the choice
Advantage in some of the primary activities (Inbound logistics and operations.
Blue Ocean Strategy
Looking at themselves and not at competitors as company won‘t be successful battling but differentiating product (or low price).
Porter´s 5 Forces
Target Market :
EU (Enviro awareness↑)
15 of top 20 High EPI in EU
FTA in 23 member states
Population Age Group European
as Production base (Min Wages↓, €365/m in 2012)
Revenue stream diversification (Risk of 90% of rev from US market only).
Hierarchical Modes (Sales and production subsidiary)
for recycled material
Sales and production subsidiary
The top five countries :
(Germany, UK, France, Japan and US)
All recorded over US$1,500 per-capita
ECONOMIC of SCALE
The idea of “company saves money as it produces higher quantities of its product, as in all business areas, the more you buy, the more you save”
Step by step Experiential Learning can be obtained by companies when do Internationalization.
For example, The Uppsala Model explains how companies’ internationalization process be described in incremental steps
Experiential Learning refers to the process of accumulating market knowledge in foreign markets
Green Toys have already served the overseas markets by exporting in several countries
Green toys must expand to European (EU) market because, it offers as the best market to:
Expand market shares and sales
Poland can provide the resources they need and where they can get them at the lowest price, whereas the neighbouring country especially Germany, UK, Austria and Belgium provides the best market in terms of consumer’s demand.
Ability to produce new product line
Migitate the risk of depending on just one market.
expand globally for defensive reasons-to protect themselves from competitors or potential competitors, or to gain advantage over them.
Why EU MARKET?
Country similarities between US and UK therefore reduced administrative and compliance cost.
Safety requirement of toys are similar in US and UK. Thus, product must be made in Europe for European market (know-how can be transferred).
Management can better stay in control of production processes by keeping production close to the main markets.
The short product life cycle of toys drives the need for constant for innovation and research and development, rather than advantage of low wages.
Demand for recycle toys in Europe is high (ESCIP Consortium, 2013). Parents are looking for safety and quality as main criteria, and they are less sensitive on price (ESCIP Consortium, 2013).
Why not China?
Although Asian market is is the largest market, but
Local supplier (US) are not able to meet the demand of this market, thus, there is a need to expand production in China.
But, Toys made in China as not safe. They contains serious chemicals that posses deadly risk to children (Consumer Product Safety Commission, 2010).
Companies take a great pride in their products, thus any negative feedback will tarnish their reputation.
China is still working on its recycling policies, but their environmental concerns is still limited, and but most worrying is consumer’s mentality towards recycling is still low (NationalGeogrpahic, 2011; New Yorker, 2014).
Thus, due to the awareness and attitude, the demand for recycle items will be low even if the potential market is huge.
Risk of counterfeit in China and Hong Kong (ESCIP Consortium, 2013).
Cassidy, J. (2014). Is China Really going Green, The New Yorker. Available from : http://www.newyorker.com/news/john-cassidy/can-china-really-go-green. [19 February, 2015].
Consumer Product Safety Commision (2010). Toxic Toys R Us PVC Toxic Chemicals in Toys and Packaging. Available from https://naturalkids.wordpress.com/2011/11/25/tis-the-season-for-clean-toys-green-toys-and-toys-made-close-to-home. [19 February 2015].
ECSIP Consortium. (2013). Study on the competitiveness of the toy industry. Available from ec.europa.eu/DocsRoom/documents/6653/attachments/1/.../en/.../native. [19 February, 2015].
McKibben, B. (2011). Can China Go Green, The National Geographic Magazine. Available from http://ngm.nationalgeographic.com/2011/06/green-china/mckibben-text. [19 February 2015].
European salary survey 3rd edition, Deloitte
Environmental Performance Index
Global Dynamism Index
access to a wider market for products
economies of scale and/or scope
benefit from experimental learning
realize cost economies
diversification of revenue streams