Perceptions of Foreign UK Retail Brands by Thai Consumers on Marks and Spencer Research Proposal

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Perceptions of foreign UK retail brand's by Thai consumers on marks&spencer

Perceptions of foreign UK retail brands by Thai consumers on Marks & Spencer

The modern day economic climate represents the final embodiment of the desires of classic economists such as David Ricardo or Adam Smith. While Smith's theory of the invisible hand has yet to be fully adopted, Ricardo's theory of the comparative advantage is more obvious now than it has ever been. And this is due to the incremental forces of globalization which allow economic agents to transcend boundaries and benefit from the comparative advantages of other states.

At a primary level, economic agents transcend boundaries to benefit from the cost efficient labor force available in the destination country. Aside from cheap workforce however, they also move to other global regions for comparative advantages such as skilled labor force or an abundance of natural resources. More recently, the economic agents have also comprehended the ability of foreign markets to support organizational sales goals. As a parenthesis, in today's economic, the organizational entities have reached a situation in which they most intensely compete for market shares. And this, competition is made even more so dramatic as the markets are generally saturated and, while the number of economic agents increases, the number of consumers remains rather constant. In this context then, globalization allows economic agents to transcend boundaries and gain new market shares.

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The territorial expansion through globalization has generically been called Americanization, meaning that the American economic agents and values would transcend boundaries in order to impact other global regions and benefit from their comparative advantages. And while this phenomenon cannot entire be denied, fact remains that economic agents from other countries as well have transcended boundaries and set up operations in various global regions. One example in this sense is constituted by major British retailer Marks & Spencer.

Research Proposal on Perceptions of Foreign UK Retail Brands by Thai Consumers on Marks and Spencer Assignment

The scope of this current endeavor is that of setting the theoretical context for a future research project which would explore the attitudes Thai consumers reveal towards the foreign UK brand. The research question could as such be formulated as follows:

In light of globalization and the expansion of economic operations to various global regions, how is the British monolith retailer Marks & Spencer perceived and welcomed in Thailand?

The stated objective of the research endeavor is that of conducting gradual analyses on both primary as well as secondary sources in order to provide a relevant and meaningful answer to the previously posed research question.

The research paper would be constructed on a series of other research endeavors, each dealing with specific topics relevant for the current research questions. Specifically, the background to the study is constituted by a wide array of previous studies on three main topics:

The strength and global importance of British retail brands

The incremental forces of globalization and the impacts they have generated within foreign communities, and the perceptions and reactions of Thai consumers regarding the elements brought about by the modern day society, such as their reactions towards foreign coffee or environmentally friendly products.

The current endeavor as such represents the research proposal to sit at the basis of the future study and it details a series of practical aspects, such as the literature which constitutes the starting point, the methodology which would be used in retrieving an answer to the posed research question or ethical implications.

2. Literature review

2.1. The retail industry in Thailand

The retail industry in Thailand is faced with the challenges of globalization and it strives to cope with them by developing alongside with the rest of the international communities. At a general look, the Thai retail industry is supported by massive foreign investments, which are now being introduced at higher rates. "The automotive and electrical goods industries were the main forces behind the sector's 45% contribution to GDP in 2007. Food processing and agro-industry are also important, as Thailand is a top producer of natural rubber, rise and sugar" (the Oxford Business Group, 2009, p. 9).

The Thai retail industry has been presented with growth stages throughout the past decade and these developments have been due to increased incomes for the Thai consumers, and as such increased consumer spending. The increasing sales volumes have materialized in increasing product varieties, expansions into new markets and moves towards private labels. The economic crisis which hit the entire globe has however set these developments back and it is yet unsure as to how they would revive given the still unstable economy (Euromonitor International, 2010).

The 2009 report by the Euromonitor International revealed the following about the Thai retail industry:

The industry continued to develop despite the declining state of the international economy

The growth rates were however decreased and this was materialized also in sales volumes, sizes of retail facilities or the numbers of outlet stores across the country

The unemployment in the industry increased and the number of tourist customers has also decreased

Retailers make excessive use of the internet to promote their products and services

The largest Thai retail chains continue to expand outside the country

A move is obvious towards one stop stores, yet these are still emergent

The forecasts for the industry are positive (Euromonitor International 2010).

2.2. Thailand acceptance of foreign businesses

Thailand is the relevant example of a country striving to combine both tradition as well as modernity. The country is fairly accepting of the foreign retailers and the biggest supporters of the trend are represented by the younger consumers. The older consumers are more traditional and safeguard the local values, whereas the regulators and the federal institutions limit the powers of foreign businesses by imposing high taxes (Arize, Chooekawong and Prasanpanich, 2000). The federal resistance to foreign business is also due to the experience of the 1997 Asian financial crisis, in the aftermath of which the governments in the countries in the Asian region strived to decrease the domestic interest in foreign products and to stimulate the demand for local products and businesses in the support of the national economy (Chang, Liu and Thompson, 2002).

In 2002, the largest foreign brands in Thailand were: Tesco Lotus, Big C, Carrefour, Marko, Tops, Food Lion, Central, Boots, Watsons, 7-eleven and Family-mart (Amazing Thailand, 2010). The variety and combination of various brands and business from several global locations indicates a high tolerance and acceptance of international businesses by the Thai consumers.

2.3. Success of UK brands

As the previous section has indicated, Tesco -- originating from the United Kingdom -- is the largest foreign business in Thailand. The British brands are generally strong brands, recognized and valued across the globe. The strength of the UK brands is attributed to a series of forces, such as the stability and strength of the UK currency (the Great British pound), the development and implementation of a series of prudential legislations, the use of the latest technologies in the manufacturing and distribution processes or the respect shown to the various categories of stakeholders, including individuals and groups such as the consumers, the employees, the business partners, the general public and so on.

The most important and strongest British brands -- both at a national level as well as internationally recognized -- belong to three main sectors: telecommunications, finance and retail. And even more so, in spite of the economic crisis which has impacted the entire global community and due to which banking institutions declared bankrupt, six banks in England added more value to their brands.

The three strongest brands in the United Kingdom are represented by Vodafone, HSBC and Tesco. The table below reveals the 50 strongest UK brands with their adjacent enterprise value and brand value for consecutive years 2009 and 2010.

Source: Marketing Week, 2010

2.4. Marks & Spencer

As the table above has pointed out, the Marks & Spencer brand is valued as the 21st strongest brand in the United Kingdom. Marks & Spencer has established its brand in relationship to the sale of high quality apparel and has built on the perception of high quality products and affordable retail prices in order to further develop its products and services, and adjacently promote its brand. The brand strategy has been focused on high quality and generated trust, and with its aid, the company has been able to successfully move into other sectors -- such as foods or financial services -- and further expand the brand (Ellwood, 2002).

Regarding the Marks & Spencer brand, Belinda Isaac mentions:

"In the United Kingdom, the brand name Marks & Spencer, originally associated with the retail sale of clothing, has been successfully extended over the years to encompass not only the retail sale of food and furniture but also financial services including the provision of pensions, units trusts and life insurance. The company has been able to stretch the brand name successfully into these different areas by relying upon the consumers' perception of the brand as a mark of high quality, value for money and a name that can be trusted" (Isaac, 2000,… [END OF PREVIEW] . . . READ MORE

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