New Market Expansion
As Godin mentioned in his book “This is Marketing”: “It’s easier to make products and services for the customers you seek to serve than it is to find customers for your products and services”. This is very true in our world today as many companies are shifting their focus to a healthier lifestyle to satisfy customers’ needs and wants. One of the hottest new sectors that appeals to consumers is plant-based meat. And Beyond Meat is one of the biggest trendy new companies in the United States. It is located in Los Angeles and it is producing plant-based meat substitutes. Its products simulate the taste of chicken, beef and pork. And recently the company started expanding its presence in Asia, into the Chinese market. And this product is part of a global consumer market, which is expected to increase to $140 billion over the next 10 years. As Kerin and Hartley state in their book “Marketing: The Core”: “Global consumers consist of consumer groups living in many countries or regions of the world who have similar needs or seek similar features and benefits from products or services. Evidence suggests the presence of a global middle-income class, a youth market, and an elite segment, each consuming or using a common assortment of products and services, regardless of geographic location”. Based on the articles of Richa Naidu of Reuters “Exclusive: Beyond Meat eyes production in Asia before the end of 2020” and of Thomas Hale of the Financial Times “Beyond Meat is increasing its presence in China” the company has both opportunities and challenges in its expansion plan. Beyond Meat had several opportunities to move into the Chinese market because they already sold their products in Taiwan, Singapore, and Hong Kong. The challenge was to create a production capability and a viable supply chain. Beyond Meat is building a production facility in China and has partnered with a supermarket chain to commence the sale process, which will accommodate people’s comfort. Kerin mentioned that “Place or distribution is a major factor in developing a service marketing strategy because of the inseparability of services from the producer”.
As it was stated by Kerin and Hartley: these global companies face three major environmental variables “cultural, economic, and political regulatory — that affect global marketing practices in strikingly different ways than those in domestic markets”. In the case of Beyond Meat, I think the cultural aspect is favorable because pork is part of the Chinese culture, but as this meat becomes more scarce the consumer can enjoy the taste without eating the real meat. The company has been facing economic challenges due to the coronavirus pandemic, which included the delay in opening of its new plant in China. The political climate has deteriorated in the aftermath of the trade war between the USA and China, which saw retaliatory tariffs placed on each countries goods and services. As per Kerin “Tariffs, which are a government tax on products or services entering a country, primarily serve to raise prices on imports”.
In conclusion, Beyond Meat is moving in the correct direction and looks like it will be successful in its efforts. If there is anything they could have done better I think it would have been to have decided to move more quickly to enter the Chinese market, perhaps even up to a year earlier before the pandemic disrupted their timetable.
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