October  2010    

                 

     

[ T y p e   t h e   c o m p a n y   a d d r e s s ]  

Amber  Dubinsky  [Type  the  abstract  of  the  document  here.  The  abstract  is  typically  a  short  summary  of  the  contents  of  the  document.]  

Project  Proposal  for  International  Marketing  

 

International  Market  Analysis  for  getAbstract      Authors    Brandy  Visscher  Amber  Dubinsky    Lecturer    Christina  Neylan      

BA  Class  351  -­‐  Bachelor  in  International  Management  and  Economics  Lucerne  University  of  Applied  Sciences  and  Arts  –  School  of  Business      

 

Management  Summary  

GetAbstract, a Lucerne based SME, is planning to expand to Edmonton, Canada.

GetAbstract summarizes business books, making subscribers the best-read, most expert players in

the business scene of today. The mission is to provide executives worldwide with the best in

business knowledge. GetAbstract offers the world’s largest library of business books summaries.

As the service is online only, the expansion to other countries is primarily about promoting

getAbstract to potential customers. Visscher as a resident sales representative in Edmonton will

promote getAbstract in different ways. Not only will she have personal contact with the targeted

potential customers but she will also monitor the business book trends and assist when choosing

North American newly published books to be summarized.

GetAbstract will consider expanding its product range for the Canadian market by offering an

additional length of summary and also have the summaries translated into French.

The expansion to Edmonton was coming from a personal trigger. However, the report conveys

that both, the PEST and competition analysis conducted by Porter’s Five Forces, support the

expansion to the chosen location –Edmonton.

The analysis was done by a thorough market survey, taking all possible factors into consideration.

Concluding the findings, even though there is a large geographic distance between the two

countries, psychic distance is rather small. Therefore, getAbstract can rely on dealing with a

similar culture and can remain with the same values and norms. These facts make getAbstract

confident that Edmonton will demand the summaries and that the market can gradually be further

expanded.

 

Table of Contents 1   Introduction ....................................................................................................................................... 1  1.1   About  getAbstract .................................................................................................................. 1  1.2   Reasoning  for  Edmonton,  Alberta,  Canada ................................................................... 1  

2   Market Environment / Cultural Analysis ................................................................................... 1  2.1   Screen  Country ....................................................................................................................... 1  Preliminary  screening...................................................................................................................................1  

Relative  Competitive  Strength ..................................................................................................... 3  2.2   Economic  Environment ....................................................................................................... 3  2.3   Political  /  Legal  Environment............................................................................................ 4  2.4   Sociocultural  Environment................................................................................................. 5  2.5   Psychic  Distance..................................................................................................................... 5  

3   Initiation of Internationalization................................................................................................... 6  3.1   Initiation  Motives................................................................................................................... 6  3.2   Internationalization  barriers/risks ................................................................................ 6  General  market  risks .....................................................................................................................................6  Commercial  risks.............................................................................................................................................7  Political  risks.....................................................................................................................................................7  

4   International Competitiveness....................................................................................................... 8  Porter’s  Five  Forces ......................................................................................................................... 8  Market  Competitors .......................................................................................................................................8  Suppliers .............................................................................................................................................................9  Buyers ..................................................................................................................................................................9  Substitutes....................................................................................................................................................... 10  New  entrants.................................................................................................................................................. 10  

5   Market Entry Strategy ..................................................................................................................11  Internal  Factors............................................................................................................................................. 11  External  Factors............................................................................................................................................ 12  Desired  Mode  Characteristics................................................................................................................. 12  Transaction-­‐specific  factors .................................................................................................................... 12  

6   International Customer Relationship ........................................................................................13  

7   Marketing Mix ................................................................................................................................13  7.1   Product ....................................................................................................................................14  7.2   Price .........................................................................................................................................14  7.3   Place .........................................................................................................................................15  7.4   Promotion ..............................................................................................................................15  

8   Marketing Budget...........................................................................................................................16  

9   Conclusion ........................................................................................................................................17  

10   Reference List .................................................................................................................................18  

11   Appendix ..........................................................................................................................................18  

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1 Introduction

1.1 About getAbstract

Caught in the constant hustle and bustle of life, many business people find it difficult to find time

to cook, clean, and read. GetAbstract has surely identified one of these needs. Founded in 1999,

getAbstract writes business book summaries for those of us who are too busy to simply read a

book. The summaries are available online in several different formats, from PDFs to audios, some

summaries are free and some require a subscription. Many of the world’s largest firms provide

their employees with full access to the getAbstract library. The Lucerne based SME employs 120

writers and has more than 400 publishing partners; among having reputable customers like

Microsoft and PricewaterhouseCoopers.

1.2 Reasoning for Edmonton, Alberta, Canada

In early 2010 Amber Dubinsky, the Marketing Director for getAbstract and part-time student, met

Brandy Visscher a Canadian student who was on exchange in Switzerland. Dubinsky and

Visscher formed a great friendship. Visscher had a particular interest in getAbstract and often

asked Dubinsky about the company. Visscher saw the potential success of getAbstract in

Canada’s market. She often expressed how much she would value having access to summaries of

these books because she too found little or no time to read. This is what prompted Dubinsky to

hire Visscher as the International Marketing Director where she could assist in the

internationalization of getAbstract to the Canadian Market. Dubinsky and Visscher were now

business partners. After some discussion they decided that although there is demand for these

summaries all across the Canadian market it is simpler to begin marketing it to a more specific

market like the City of Edmonton in the province of Alberta.

2 Market Environment / Cultural Analysis

2.1 Screen Country

Preliminary screening

Edmonton offers getAbstract a large market share with more than 1 million people and a

growth rate faster than the rest of Canada (Labour Force, n.d.). GetAbstract also has the potential

to gain an even larger market through our plans of expanding to the rest of Canada within the first

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year of marketing in this foreign market. Edmonton has one of the strongest labour markets in

Canada which increased by 12.3 % from 2003-2008 (Labour Force, n.d.). Edmonton is home to

10 post secondary schools, as well as, many SME’s and many large corporations’ headquarters.

With a growing labour force, many educated people, and many businesses, getAbstract should be

able to obtain a large market share in Edmonton and expand quickly throughout Canada.

Market Attractiveness Model

1 2 3 4 5 Very Poor

Poor Medium Good Very Good

% Weight Factor

Result (grading X weight)

Market Size 3 25 75 Market Growth

5 25 125

Buying Structure

5 5 25

Prices 4 10 40 Buying Power 4 10 40

Market Access

5 15 75

Competitive Intensity

3 5 15

Political/ Economic Risks

5 5 25

Total 100 420

Evaluation of market attractiveness for getAbstract (Hollensen, 2008, p. 172)

Market Size: Mid-sized market in Edmonton, but room for expansion to the rest of Canada (2.1)

Market Growth: Edmonton a booming city, potential expansion to the rest of Canada (2.1)

Buying Structure: Easy to access, since an online subscription is all it takes (7.1)

Prices: Since the markets are rather similar, same prices can be set also in Edmonton (7.2)

Buying Power: Less than in Swiss market, but still attainable (2.2)

Market Access: The summaries are online and therefore from everywhere accessible (7.1)

Competitive Intensity: There is one quite large competitor located in the United States (4.1)

Political/Economic Risks: Stable economy, great trade relations (2.3)

The numbers in brackets refer to the relevant chapter of the report.

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Relative Competitive Strength

1 2 3 4 5 Very Poor

Poor Medium Good Very Good

% Weight Factor

Result (grading X weight)

Products fit to Market Demands

4 25 100

Prices and Conditions 4 25 100

Marketing 5 15 75

Communication 3 10 30

Obtainable Market Share 5 20 100 Financial Results 5 5 25 Total 100 430

Evaluation of competitive strength for getAbstract (Hollensen, 2008, p.172)

Product fit to Market Demands: The market survey conveys a large market demand.

Prices and Conditions: There is still potential for other offers to attract more customers.

Market Presence: We will communicate a clear and simple message to attract customers.

Marketing: Our marketing plan should raise big awareness and demand in Edmonton.

Communication: Good communication can be made feasible through virtual communication.

Obtainable Market Share: Many businesses and schools, knowledge seekers.

Financial Results: We expect to acquire many new customers that will reflect in revenues.

These questionnaires are effective when evaluating a foreign country’s market attractiveness and

competitive strength. After analysing each of these models and all of the factors within them, we

can be positive that Edmonton is a good choice for getAbstract’s market expansion.

2.2 Economic Environment

According to The CIA Factbook (2010) Canada is an affluent, high-tech industrial society with a

market-oriented economic system and high living standards which is similar to Switzerland’s

standards. More specifically Western Canada has a growing economy. The two most western

provinces, British Columbia, and Alberta are the economic leaders in the country (Western

Canada’s Economic Environment, 2008). Canada’s strong economic environment makes Canada

a desirable market for getAbstract to enter.

Hollensen (2008, p. 126) says with regards to tertiary economic activities that as average family

income increases the percentage spent on services activities will increase. Statistics Canada

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(2010) found that average family income is on the rise of approximately $1000 each year from

2004-2008. This is another positive for getAbstract because people will likely be more eager to

educate themselves and willing to subscribe for the book summary service. It appears that the

growth of getAbstract in Edmonton, Alberta will increase based on Canada’s growing economy.

Canada has a stable exchange rate along with Switzerland. This is also a favourable factor when

getAbstract is doing business in Canada because a stable exchange rate improves accuracy of

financial planning. Although there are methods to insure against potentially volatile exchange

rates these methods are often too expensive for SME’s like getAbstract.

The Canadian GDP Per Capita was an estimated $38,200 in 2009 which ranks 26th in comparison

to the rest of the world (CIA Factbook, 2010). Switzerland’s GDP Per Capita was an estimated

$41,200 in 2009 and ranked 17th (CIA, Factbook, 2010). GDP per capita is a measure of a

nation’s income per person and is based on the degree of industrialization within the country

(Hollensen, 2008, p. 129). Based on our findings regarding GDP per capita it appears that

Switzerland is slightly more industrialized and Swiss people likely have higher incomes than their

Canadian counterparts. GetAbstract may need to consider offering the subscriptions at a slightly

lower cost because of this income gap.

2.3 Political / Legal Environment

After conducting market research we have found that getAbstract should not face many political

or legal issues when entering the Canadian Market. Canada and Switzerland have been bilaterally

conducting business together since 1855. “The first Bilateral Friendship, Trade and Establishment

Agreement was concluded in 1855,” (State Secretariat of Economic Affairs (SECO), 2008, p. 12).

Other trade and business practice arrangements include:

• Arrangement on Trade and Economic Cooperation (1997)

• Agreement on Double Taxation (1998)

• Memorandum of Understanding on Good Manufacturing Practices (1998)- strengthened

the framework for business practises

• Mutual Recognition Agreement (MRA) (1999)-covers pharmaceuticals, medical devices,

information technology and transmitter, electromagnetic compatibility, electronic

products and sports boats, providing easier access to conformity assessment procedures

(SECO, 2008)

Economic ties were significantly strengthened again in 2008 when Canada and Switzerland

signed a Free Trade Agreement.

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2.4 Sociocultural Environment

As you can see in figure 1 Canada and Switzerland’s cultural dimensions according to Hofstede

are quite similar. Switzerland is a slightly more masculine culture. One can interpret that the

Canadian culture is less competitive driven, more intuitive and there are fewer differences in roles

between men and women. Therefore, Canadians will likely buy the summaries for their own

personal desire for knowledge as opposed to attaining this knowledge to compete with their

colleagues. Because there are fewer differences in gender roles

getAbstract may find that Canada’s market might include more

women than those in Switzerland, as a result of Switzerland’s

more masculine culture. The other main difference between the

two cultures is within individualism. Canada is slightly more

individualistic than Switzerland. This will likely mean that

getAbstract will attract more personal subscriptions than

corporate because they are less collectivist and are in business

more for their own benefit.

Hofstede’s Cultural Dimensions (1976-2009, section comparison.)

2.5 Psychic Distance

Although the geographic distance between Canada and Switzerland is large, the psychic distance

is actually quite small. There is a small language barrier between the two countries. In

Switzerland the most commonly spoken language is German –spoken by 63.7% of the population

(CIA Factbook, 2010). In Canada the most commonly spoken language is English which accounts

for 58.8% of the population (CIA Factbook, 2010). Because “English dominates the worlds of

business, commerce and finance” (English Language, n.d.) the summaries are already available in

English. This will help the summaries reach the majority of the Canadian population and more

specifically Edmonton. There is a small percentage of French speaking Canadians as outlined in

section 2.2, however this is more commonly spoken in Eastern Canada.

We also recognize in section 2.4 that culturally Canada and Switzerland are fairly similar. Lastly,

the political and legal environment appears to be quite supportive of business between the two

countries. This translates to a small psychic distance. Having an employee who is familiar with

both countries will help with identifying any potential issues.

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3 Initiation of Internationalization

3.1 Initiation Motives

GetAbstract follows a proactive initiation motive when deciding to enter the Canadian

market. The decision to go abroad was based on an internal trigger or managerial urge. Dubinsky

saw the potential growth and success of getAbstract in expanding to Canadian after meeting

Visscher. Dubinsky saw that getAbstract could offer a unique product to the Canadian market and

realized that Canadians would value this product. This realization caused the internal trigger of

the company to hire Visscher as their International Marketing Director. Because Canada is such a

large country they have decided to market the product initially in Edmonton, Alberta.

Hollensen (2008, p. 45) states that information and knowledge are the most critical factors in the

initiation of internationalization process in the SME. Therefore, having Visscher work with

getAbstract in the expansion to Canada will greatly reduce the severity of this factor. She will be

able to provide information and knowledge with regards to the Canadian market and discuss and

identify possible problems.

GetAbstract has a large advantage to gaining this information and knowledge from Visscher. Not

only is she knowledgeable of the Canadian market, but she also speaks fluent English, which will

make the further information research much easier for getAbstract to cope with.

3.2 Internationalization barriers/risks

General market risks

Market distance is a general market risk that getAbstract will face. Canada and Switzerland are

about 8000 km away from each other, which is approximately 10 hours of flying time. Luckily,

because the summaries are online there are no transportation costs that will incur. The only

problem with market distance is meetings between the Canadian counterpart and the Swiss head

office. This problem can be alleviated through the use of virtual meetings and online

communication.

As identified in section 2.5 there will be some cultural differences during the expansion to

Canada. There will be a small language barrier because of the considerable percentage 22.7%

(CIA Factbook, 2010) of the Canadian population who speaks French. One way to overcome this

barrier is for getAbstract to offer the book summaries in French. Offering the summaries in

French would also expand getAbstract to the French market in Switzerland. It would be relatively

easy for getAbstract to hire a French speaker who can translate the most popular summaries to

begin with.

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Commercial risks Fluctuations in the exchange rate between the Swiss franc and Canadian dollar is a commercial

risk that getAbstract will face. Although there is no way to avoid this, the risk is rather low

because the Swiss franc and Canadian dollar are quite stable currencies. The franc and Canadian

dollar are quite close to par with each other, for example on November 21, 2010 the exchange

rate was $1.02 per 1 Sfr. Looking at historical trends also the volatility is quite low between both

currencies.

Political risks As mentioned in section 2.3 Canada and Switzerland have a Free Trade Agreement which will

help ease any political risks. According to SECO (2008, p.16) the Canadian embassy provides a

wide range of advice and assistance to Swiss companies who are or who are planning to export to

Canada. The embassy will provide current information on the Canadian market, information on

trade shows, and supports local events promoting Swiss products and services (SECO, 2008

p.16). Therefore, the political risk for getAbstract will likely be quite seamless based on the

assistance programs and cooperation from the Canadian Embassy.

Below is a SWOT Analysis that getAbstract has conducted. The SWOT analysis is effective in

finding the right match between the internal and external analysis (Hollensen, 2008, p. 6). This

SWOT analysis will help with the further development of getAbstract’s expansion to Canada. It

also shows the strengths, and more importantly, the weaknesses and threats to look out for. Those

will assist getAbstract to improve and spruce up its business for entering the new market.

SWOT Analysis

Strengths Weaknesses Opportunities Threats

Knowledgeable employees in both countries

No French speaking employees

Build the database and offer more summaries

Publishing companies denying the summary approval

Multiple formats: PDF, Smartphone, Kindle and audio

Time lag for summary approval from publishes

Offer summaries in more languages

Idea can be replicated quite easily

World’s largest library - offering over 5000 summaries

Head office located in Switzerland & U.S, but not Canada

Expand product range and other features (see 7.1)

Competition: Summary.com- a book summary website (Chapter 4)

Good and many contacts to publishers worldwide

Can easily be expanded to other geographic markets i.e. China

Increasing number of websites that summarize books with no charge

  8

4 International Competitiveness

Porter’s Five Forces

There has already been light shed on the advantages and rationales why getAbstract

should expand to Edmonton. The mentioned reasons however were more of internal and personal

nature, rather than business. To assure that Edmonton is a beneficial location to expand to, also in

regard to competition, we have analyzed the Porter’s five forces, one of the most useful

frameworks for evaluating the competitive structure. According to Porter the state of competition

depends upon five basic competitive forces (Hollensen, 2008, p. 78-81), which will now be

discussed.

Market Competitors After a thorough Internet research we can state that there is one competitor in the market to be

taken seriously and that should be monitored closely. It is “Soundview – Executive Book

Summaries” (www.summary.com), based in the United States. We can assume that in terms of

firm size, cost structure and strategy the companies have parallels. Soundview offers a similar

range of business books and identical downloadable formats. Their focus however, only lies on

business related topics, whereas getAbstract also offers a number 8-page summaries of classic

literature categories in German language such as opera, philosophy, history and politics, religion,

science and many more. Further advantages of getAbstract we see in the design of the website,

the number of summaries and the languages offered. The Soundview website is somewhat

unstructured and difficult in terms of orientation. The getAbstract website is designed in a more

user friendly and simple way. Furthermore, getAbstract is the biggest summary library worldwide

–with over 5’000 books summarized, whereas Soundview offers merely 560 summaries. Also, it

is noteworthy that getAbstract offers summaries in German, English, Russian, Spanish and

Chinese. These additional three languages cover an enormous geographical area, meaning their

customer segment is spread by the manifold. The differences in terms of the actual summaries are

in length and design, where we again think, that Soundview’s design is too loud and chaotic. The

length is a matter of taste. The summaries of Soundview contain 8 pages, whereas getAbstract

business summaries contain 5 pages. Another difference worth mentioning is that Soundview

allows the purchase of single summaries. This is not possible with getAbstract, where it is

required to have a subscription. This feature can be seen as an advantage for Soundview and may

be considered by getAbstract to replicate.

  9

Suppliers For getAbstract the suppliers can be seen as the publishing houses of books in the market. There

have been special copyright agreements formed and generally speaking, it is in the author’s

interest to have a summary written on his book. A summary can raise awareness and give the user

an incentive to purchase the book, when he is interested to gain more in-depth knowledge in the

field concerned. Also, getAbstract profits from a privileged position in terms of time. Usually

getAbstract receives a PDF or the hardcopy of a newly published book as soon as the publisher

gives the approval, which in the most cases takes about one month after the launching date. It is

comprehensible that the publisher first wants to promote the purchase of hardcopies, as this yields

the highest revenue, and only a little while later allows online summaries. As already mentioned,

summaries can put book sales forward, but can also have the opposite effect. However,

getAbstract is in negotiations with a few of its most important publishers to reduce this time span

for the approval, as this would be seen as a major advantage.

Concluding the power of suppliers, we can state that the suppliers do not represent a threatening

force to getAbstract due to the reasons mentioned and also due to the good relationship

getAbstract maintains with all their publishers.

Buyers The buyers of getAbstract products can be distinguished between two groups –private and

corporate buyers. In regard to the buyer’s purchasing power, getAbstract benefits from a good

position for the following reasons.

As the product is sold online only, the buyers are geographically widely spread, which decreases

their bargaining power. GetAbstract offers a rather differentiated product that cannot be found in

that form anywhere else. A further advantage getAbstract has is that prices cannot be clearly

determined and therefore allow for higher margins. The customers do not only buy the product

itself, but additional customer services such as audio format possibilities and good reliable quality

summaries. These services are all included in one subscription fee, which is not determined on

the amount of usage. For the reason of not being able to clearly measure the outcome and

individual use, customers will more likely be willing to simply pay the fixed subscription fee.

However, prices for corporations are not preset and vary regarding number of employees. An

issue to take into consideration when looking at pricing is to offer the possibility to purchase

single summaries, without having to pay the subscription fee. This could potentially increase

revenue but would have to be further analyzed by sound market research.

  10

Substitutes Having substituting companies in the market could bring a reduction in attractiveness and

profitability due to price level constraints. If business in that field is highly profitable it attracts

further competing companies to the market. This could possibly apply to the book summary

market that getAbstract is in.

However, looking for possibilities to substitute book summaries, we had troubles to come up with

any. There are websites that summarize and also interpret renowned books, as for example

Wikipedia does. However, this only holds for well-known books and usually not books in the

field of business. Most recent published books on business cannot be found on Wikipedia. There

are other websites, most of them free of charge, that summarize selected books. However, one is

required to search for every book, the according website, and the summaries vary greatly in

length, style and quality.

Again, we were able to detect an advantage getAbstract has. As it is required to have a minimum

subscription for a half of a year, the substitution would cause switching costs for customers,

meaning that they would have to pay double for a similar product.

New entrants Profitable markets that yield high returns will attract new firms. This leads to new entrants, which

eventually will decrease profitability for all firms in the industry. The number of new entrants

depends largely on the extent to which barriers to entry exist. GetAbstract cannot be seen as the

incumbent player of the market, as competitors, such as Soundview, already have entered the

market. The reason for only coming across one other competitor is because barriers to entry exist

in different forms.

One potential threat to look out for is the geographical factor, as business is solely conducted

online. Therefore, the hurdles of expanding to other countries are mainly of legal nature and

language differences. Translating books into a foreign language, such as French for instance, (as

also spoken in Canada) would bear the risk that these efforts and costs invested would not return

any gains. However, we are talking about financially rather insignificant investments, when

comparing to investments of non-online companies as setting up new plants for example. These

barriers do fortunately not apply to the online summary business field.

This means that getAbstract could maintain and further establish the entry barriers by

differentiating the product range, remain the largest summary providers, and advance customer

relations in order to increase customer loyalty.

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Having thoroughly analyzed the position of getAbstract in the industry, the five forces have

highlighted the critical strengths and weaknesses. Certain areas such as branding, product

expansion, customer relationships and alternative pricing have shown that there is still

unexploited potential. Nevertheless, after having detected these fields, we can also note that

getAbstract has a good market position due to the already existing multinational clients, many of

them having their headquarters in the United States.

These advantageous factors disclose that there is additional potential profit to be made. However,

getAbstract must put all efforts and energy to continue pursuing a gainful position in the market

of book summaries and monitoring the market continuously in order to counteract to any new

upcoming threats.

5 Market Entry Strategy

Looking at the assortment of entry modes when entering a new market, there are different

degrees of control, risk, and flexibility associated with each of the entry modes (Hollensen, p.

201). There are several factors to take into account when deciding which mode to chose.

Hollensen (p.206) mentions different aspects affecting the foreign market entry mode decision.

For getAbstract some factors are irrelevant, as the product is available online and does not require

specific production. The relevant factors for getAbstract to choose the most appropriate entry

mode will be discussed.

Internal Factors GetAbstract’s firm size can be seen as quite large with many available resources around the

world, especially in Switzerland and the United States, where both the headquarters are located.

Currently getAbstract has more than 400 publishing partners and employs 120 writers. Because

getAbstract is considered to be a medium enterprise, the company size factor would recommend

an intermediate entry mode.

International experience is given in many ways. The Swiss Co-founder and Chairman Rolf

Dobelli has worked in several countries such as the United States, China, Australia and

Switzerland and can influence the company’s culture with his experience. The employees also

originate from different parts of the world and speak many languages. This international

experience reduces the cost and uncertainty of serving a foreign market, and therefore,

internationalization might be the most suitable mode.

Another internal factor to be taken into account is the product itself. Book summaries are not

complex in their creation because they can be written from different places, are not perishable,

  12

and only allow limited differentiation possibilities. All of the factors mentioned go hand in hand

with the hierarchical mode requirements.

External Factors The external factors have been discussed in detail in chapter 2, when assessing the Canadian

market environment. The factors will not be elaborated on again, but we can state that the

external factors advocate an entry mode that is mostly internalized, allowing high control but

contrariwise high risk and low flexibility.

Desired Mode Characteristics The preferential degree of risk averseness is difficult to determine. However, getAbstract has an

advantage by selling the products solely online. No costly construction or logistics are required,

which substantially reduces the risk of losing money when expanding.

The quality control is a manageable task. All of the composed summarizes, no matter where they

were written, are already currently being sent to either the headquarters in Switzerland or the

United States. The summaries are being controlled in terms of quality, style and congruence.

There are still some factors where management will have less control, as for instance the choice

of books being summarized in foreign markets. However, the internet can overcome nearly all

information asymmetries. Furthermore, this reflects a high amount of flexibility, as the

management can intervene anytime. Since expanding to Edmonton will not cause any financial

distress concerning new infrastructure, the flexibility in terms of equity is ensured as well.

Transaction-specific factors The last factor that affects the foreign market entry mode decision is the transaction cost analysis.

Even though getAbstract has to remain a certain standard and consistency, there is no danger of

encountering difficulties in terms of tacit knowledge. Taking great care when assessing and

recruiting skilled writers will mitigate the eventuality of insufficient quality.

Considering all of the mentioned factors we believe that a hierarchical mode would be most

suitable for getAbstract’s intention to expand to Edmonton. To be more precise getAbstract

should position Visscher as a resident sales representative in Edmonton. The actual performance

of the sales function is transferred to the foreign market. This would display a great customer

commitment because she would be the sales manager located in Edmonton to work on customer

acquisition and loyalty. Visscher would then be responsible to observe the book market in North

  13

America and inform the headquarters about new trends. The writers, either located in Switzerland

or Canada, will summarize the book and after having been checked in terms of quality, upload it

onto getAbstract’s website. Having Visscher present in Edmonton provides getAbstract with a

high degree of control and a rather low degree of risk, as there is no commitment of heavy

resources in the foreign market required. High flexibility is ensured due to the possible

intervention of management.

6 International Customer Relationship

The overall goal of building up solid customer relations is first to find, attract, and win

over new clients, secondly to nurture and retain the existing customers and finally, to entice

former clients back into the fold. This needs to be done while reducing marketing and client

service costs.

For getAbstract solid and stable customer relationships are crucial. The possibility of a customer

to subscribe for a half or an entire year, downloads all summarises he wishes to and then does not

renew the subscription, is a threat getAbstract has to be aware of. The goal is to have the

customers bound to the company and remaining a customer over time.

GetAbstract already takes actions in this regard. Customers weekly receive a summary by email,

fitting their profile of interest and listing the newly published summaries. Customers can rate the

choice of summary and share their opinion.

This way getAbstract remains in the minds of the customers. However, this is a passive, one-

sided way to build up a relationship.

We seized to see potential when it comes to involving the customer. Interaction with the customer

will strongly support a continuous customer relationship. One possible approach is to give the

customer the possibility to suggest books to getAbstract that in his view should be summarized.

GetAbstract’s library comprises over 5’000 summaries, nonetheless, there are valuable books that

have not been summarized yet. Most of getAbstract’s customers are knowledgeable and erudite

and might know of a book that is still missing in getAbstract’s library.

7 Marketing Mix In order to meet the consumers’ needs effectively getAbstract must consider the marketing mix. It

is the combination of product, price, place and promotion, where no element is more important

than another. Each element can be modified to establish an overall brand image. Every “P” will

now be elaborated on.

  14

7.1 Product

The core products sold by getAbstract are book summaries. Most of the summaries concern a

variety of business topics. GetAbstract also has a wide range of other categories such as religion,

ecology, opera and many more. However, the classical library so far is only available in the

German language. The form of the summary is standardized, meaning that they all contain five

A4 pages and follow the same layout and structure.

On the top there is the title of the book and an image of the cover with all of the relevant author,

publisher and book details (see appendix for an example).

The “Focus” section shows what categories the book belongs to. The “Take-Aways” briefly

summarize the key learning points in precise bullet points. GetAbstract furthermore rates the

book. Customers have the possibility to give their own rating on the getAbstract website, or share

their views and opinions on the blog. The next part “Relevance”, states what will be taught in the

article and reasons why the summary should be read. Then, the book is summarized in the

“Abstract” section, where catching quotes can be found on the left margin.

GetAbstract offers supplementary services to the core product. Several summarizes are available

as audio files. Also, getAbstract emails a weekly customized summary to its customers. The

fields of interest can be chosen and getAbstract will email summaries of those categories.

We detected product potential in two areas when expanding to Edmonton. We think that the

classical literature library should be expanded to world literature and translated into English. That

way an immense new segment could be targeted. A further possible product differentiation could

be to offer an additional length of summary, such as a 15-page summary. This would allow

readers to gather some more in-depth knowledge about the book and topic.

7.2 Price

It is only possible to purchase a summary with a subscription. There are personal and corporation

subscriptions available. Corporate subscriptions allow for companies to provide their employees

with getAbstract summaries. The subscription range varies from 6 to 12 months and from a

limited amount of accessible summaries to unlimited. The most inexpensive is the “Silver

Subscription” costing €89. This allows downloading 30 business book summaries a year and a

biweekly personalized summary based on the customers profile. The “Gold Subscription”

includes a one year unlimited access to the entire book library and a weekly personalized

summary based on the profile, costing €299.

Corporate solutions are very popular among multinationals such as Boeing, Microsoft, UBS or

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Novartis to only mention a few. The price for getAbstract access differs depending on the

company size and usage and is negotiated on according to these factors.

Looking at the competitor’s prices of Soundview they are quite similar in price and product. One

difference worth mentioning is the single summary purchase possibility that Soundview offers,

with one summary costing $8.50.

With regard to the price setting in Edmonton we believe that the prices can be similar or the same

in the long term as they are in Switzerland. However, having a reduced offering price when

expanding, to increase attractiveness might help the launch in another country. Furthermore, we

believe that offering individual summaries might be an option to take into consideration, also

because Soundview, the US competitor, provides this possibility. Even though a market survey

was conducted with the focus on the willingness to pay, it is difficult to fully rely on that data.

Therefore, getAbstract has to be aware of possible required price adjustments depending on the

Canadian customers actual willingness to pay.

7.3 Place

Online distribution has a remarkable advantage over traditional production. There are no

intermediates or agents that require a slice of the profit. Another advantage is the time factor. As

soon as getAbstract receives the rights to summarize a newly published book, the summary will

be worldwide and online without any time lags.

Regarding the expansion to Canada there will be a focus on Edmonton, however, as for the

factors mentioned, the product already is available worldwide.

7.4 Promotion

When expanding to Edmonton, promotion will be one of the core activities of getAbstract. As the

product is online and therefore already available, promotion will have to kick in. There are

several ways getAbstract wants to tackle it.

There will be an e-mailing to all of the SMEs and multinationals in Canada, with a special

emphasis on Edmonton informing them about getAbstract and its concept. Visscher furthermore

will meet with managers of large firms in Edmonton to explain the costs and benefits of the book

summaries.

There are a number of business fairs in Edmonton where we are planning to set up a stand,

presenting getAbstract summaries to attract many new customers. This allows initial personal

contact with Visscher, which is of importance when trying to gain customer’s interest and trust.

Another important point is our pre-existing publisher network, also in North America. We will

make every endeavour to be written about in business magazines, if possible free of charge. A

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few renowned magazines have already been contacted and getAbstract seems to fall on

sympathetic ears.

The impact of word of mouth can be immense and it is getAbstract’s goal to profit from it. To

promote and manage word of mouth communications, getAbstract will use publicity techniques

as well as, viral marketing methods to achieve the desired behavioural response.

Another promotion tool we want to apply in Edmonton is to enclose weekly a getAbstract

summary in physical booklet form to the business newspaper, The Edmonton Journal. This has

been done in Switzerland to the Neue Zürcher Zeitung (NZZ) with immense success (see

appendix for an example).

Concluding the outcomes of the marketing mix, we believe that getAbstract is prepared to expand

to Edmonton even tough there is potential for improvement and expansion in all the four Ps.

Essential is promotion, as getAbstract needs to raise awareness in Edmonton and Canada as a

whole in order to acquire new customers. However, the required means to reach our goals are

given, especially with Visscher being on location.

8 Marketing Budget

GetAbstract has prepared a brief marketing budget of our book summaries. Because getAbstract

is an online service and product they have chosen not to market through billboards and mail outs

because it goes against their online attitude. We also feel that when someone sees a billboard they

will forget the website by the time they are on computer to access the website. After researching

the costs and success of pamphlet mail outs we have decided not to use this marketing technique.

Through this research it appears that most people find mail out pamphlets annoying and throw

them away before they actually look at them.

GetAbstract will advertise in the local newspaper, The Edmonton Journal, which is read by most

business people either online or in print. To run the ad costs $37.50 per 1000 impressions online.

To reach large corporations getAbstract’s initial idea of marketing to them was through pamphlet

mail outs. After more consideration we realized that it would be more cost effective and personal

to have Visscher meet with managers of large firms in Edmonton to explain the costs and benefits

of the book summaries.

Lastly, we are hopeful that getAbstract will market itself through word of mouth marketing after

it has been used by some people and corporations and is the most cost efficient method there is.

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9 Conclusion The internal trigger for getAbstract to hire Visscher as our International Marketing Director has

resulted in the desire to expand to the Canadian market. After conducting market research with

regards to purchasing power and demand we feel that getAbstract will be a huge success. We also

found through our research that the Canadian market entry will be relatively seamless because of

the Free Trade Agreement between Canada and Switzerland. The fact that the Canadian Embassy

is so helpful in providing Swiss SME’s with information and encouraging their entry into Canada

will also ease the pressures of entering this foreign market.

After we researched the potential risks and opportunities of this new market we began a business

analysis on the competitiveness of that market, our market entry strategy as well as an analysis of

the 4 P’s. Companies doing business, especially when abroad, have to monitor the market at all

times in a broad and systemic way. GetAbstract is aware of this necessity and is doing its duty

with various control measures. The sales will be assessed thoroughly, market research is being

conducted in a regular manner, quality controls are being done, budgets being controlled and

surveys on customers’ satisfaction will be conducted as well. For the moment, however, there are

not too many threats on the horizon and it seems that getAbstract will be able to prosper and reap

the gains of its comparative advantages it has, in Edmonton and then gradually in whole of

Canada. The chosen entry mode should support our objectives by making the first steps as

smoothly as possible. We are convinced that our product together with the realized expansion

ideas, will be highly demanded –by private and corporate buyers. One of getAbstract’s priorities

is to promote its internationalization and raise awareness by different marketing techniques.

We would also like to mention at this point that we appreciate the benefits that have arisen

through the partnership between Dubinsky and Visscher. We will stay in close contact and

maintain a trusting relationship.

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10 Reference List

English Language, (n.d.). English Language in Switzerland. Retrieved November 30, 2010, from

source

http://www.isyours.com/e/countries/uk/language.html

Federal Department of Foreign Affairs. (2001) Business and Trade Canada-Switzerland.

Retrieved November 3, 2010 from source

http://www.eda.admin.ch/eda/en/home/reps/nameri/vcan/ref_bufor/buscan.html

Hofstede, G., (1976 – 2009). Cultural Dimensions, comparing Canada with Switzerland.

Retrieved November 12, 2010 from source

http://www.geert-hofstede.com/hofstede_dimensions.php?culture1=87&culture2=14#compare

Hollensen, S., (2008). Essentials of Global Marketing. Harlow, England. Prentice Hall

Labour Force (n.d.). Labour Force. Retrieved November 3, 2010 from source

http://www.edmonton.ca/business/economic_demographic/demographic_profiles/labour-

force.aspx

State Secretariat of Economic Affairs (SECO). (2008), EFTA-Canada Free Trade Agreement:

Opportunities for Swiss Businesses. Schweizerische Eidgenossenschaft

Western Canada’s Economic Environment. (2008). Retrieved November 14, 2010 from source

http://www.wd.gc.ca/eng/10263.asp.

11 Appendix

- Power Point Presentation

- Example of getAbstract summary

- Example of Soundview summary

- Booklet of a NZZ-summary