Market research and marketing strategy for Quorn in China 1

MGTM27

International Marketing

Market research and marketing strategy for Quorn in China

Karen Wharton

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 Market research and marketing strategy for Quorn in China 2

Table of Contents
Executive Summary.........................................................................................................3

Introduction......................................................................................................................4

Part 1: Market Analysis...................................................................................................4

Historical development................................................................................................4

People/ culture..............................................................................................................5

Government..................................................................................................................6

Geography.....................................................................................................................7

Market size and potential.............................................................................................8

Market research recommendations............................................................................8

Part 2: Business Report..................................................................................................8

Entry Mode selection...................................................................................................8

Target Market..............................................................................................................10

Marketing Objective...................................................................................................12

Marketing Strategies to reach marketing objectives: marketing mix

Recommendation.......................................................................................................13

Reference........................................................................................................................16
 Market research and marketing strategy for Quorn in China 3

Executive Summary

This reports highlights a comprehensive market analysis of the Chinese Market and
gives a detailed marketing mix recommendation on how Quorn can launch some of its
meat products into the Chinese Market. The Chinese Market is becoming well known for
its increased importation, consumption, and production of meat products. Its cultural
values impact its national identity and psychology. Part one of the report will briefly
discuss China's pertinent historical developments, people/culture, government,
geography, Market and size potential, and recommendations on assuming relevant
market research. Ultimately, part two of the report focuses on entry mode selection,
target market, marketing objectives, and marketing strategies to reach marketing
objectives: marketing mix recommendations.
 Market research and marketing strategy for Quorn in China 4

Introduction

This paper focuses on analyzing the Chinese Market and developing an

international marketing strategy to launch Quorn meat products in the Chinese Market.
China has been selected as a priority in the International Market to launch Quorn's meat
products. This is because the Country has assumed the spot as the world's largest meat
consumer, importer, and consumer. Meat consumption in the Country accounted for
approximately twenty-eight percent of the international meat supply in 2021. In 2021 the
Country also had the highest meat imports at thirty billion dollars, with only Brazil being
the topmost supplier. As a result, China presents a great opportunity in the international
Market for Quorn to launch some of its meat products to boost its revenue growth.

Part 1: Market Analysis

Historical development

Civilization within China draws back to 1766 B. C. E. as well as the Shang

Dynasty. In 1059 B.C.E, the Shang were beaten by the Zhou who went on to rule to
Country for almost a thousand years. The Country was known to be an outdated nation
until the Lord of Qin brought together various lords, becoming the chief emperor in 221
B.C.E. The Qin dynasty continued for only three years. The Han dynasty began from
206 B.C.E up to 220 C.E, leading to the establishment of numerous elements that later
formed the features of society in China, comprising the imperial examination scheme
that enabled persons to engage in public service based on merit instead of birth. Such a
system remains in place up to the start of the twentieth century. The Han dynasty saw a
period of disagreement for a long time. At the time, the nation was divided into regions
governed by the Mongols and other northern tribes. This resulted in the introduction of
Buddhism. The Sui Dynasty came to rule in 581, lining the South and the North through
the Grand Canal's construction.

The Tang dynasty came to power and lasted between 618 and 907, whose era
led to the emergence of art and poetry. It was an era of expansion, with the Country
increasing its region in the north and west. The era of five dynasties came to be seeing
the split within the empire. The Song dynasty followed between 960 and 1279,
 Market research and marketing strategy for Quorn in China 5

composed of an artistically prolific period. The Mongols invaded the Song under Kublai
Khan's leadership, resulting in the establishment of the Yuan dynasty, which also led to
the establishment of Beijing as the capital. The Ming came to power in 1368, ruling for
almost three hundred years and saw the continued expansion of trade. The Qing
dynasty governed from 1644 up to 1911, witnessing China's growth into Mongolia and
Tibet. Particularly in its last years, the Qing brought in strict isolation, finally leading to
their fall because their military technology could not be at par with those of the Western
influences. This saw overseas dealers getting into the Nation through the sea, carrying
with them opium which saw the Qing dynasty ban opium. The trade led to disunity and
weakened the Nation, paving the way for two divergent political parties with a distinct
vision of a contemporary unified country. Mao Zedong established the Chinese
Communist Party at Beijing University, with the Kuomintang, the opposing party
founded by Chiang Kaishek. In 1949, Mao Zedong, the Chinese Communist Party's
chairperson, declared the formation of the People's Republic of China.

People/ culture

China is the most populous nation in the entire world. Most people are of Han
descent comprising ninety-two percent, with the eight percent being of Zhuang, Uyhgur,
Hui, Yi, Tibetan, Miao, Manchu, Mongol, Buyi, Korean, along with other nationalities.
Regarding gender roles, statuses, and the labor division by gender, women were mainly
associated with the domestic realm before the twentieth century. In contrast, men
dominated other societal aspects (Advameg Inc., 2023)—the only exclusion comprised
agriculture, in which women's work was widely defined. Influences from the West
started infiltrating the nation within the nineteenth century when ministers began
constructing girls' conservatories. Prospects escalated with the modernization of the
Country, and under communism, women were inspired to work outer of their homes.

In contemporary society, women work in different fields or areas such as

business, sciences, arts, sports, and education. Men still dominate the upper
government and business levels and appear to have better-paying jobs. In terms of
inheritance, generally, the estate is passed to the eldest son, even though in the case of
powerful and wealthy men, most of the individual possessions they have are
 Market research and marketing strategy for Quorn in China 6

traditionally buried with them. Since the emergence of communism in 1949, women
have started inheriting property (Advameg Inc., 2023). The extended family is very
important in the Country, and members of the family, even distant relatives, have value
compared to outsiders. Passing on the family name is greatly important in Chinese
culture.

The Country's cultural values impact its national identity and psychology. The
values and public opinion of the citizens are conveyed to different state leaders through
informational channels and media, both indirectly and directly impacting foreign policy
decisions. The traditional cultural values influencing the Chinese people's psyche
consist of courtesy, honesty, wisdom, loyalty, filial piety, righteousness, and
benevolence.

Government

As a communist republic, China's chief of state is the president elected through

the National People's Congress for a five-year term. Nonetheless, the president
accedes to the National People's Congress leadership and decisions. The National
People's Congress has the responsibility of writing policy and laws, allotting power, and
overseeing other sections of the administration. Within the government’s executive
branch, the highest level is the state council consisting of premier, ministers, vice
premier, and councillors. The States Council takes care of internal politics, culture,
education, and defence concerns. The members are chosen and can be dismissed by a
decree from the president. The country has twenty-three provinces, four municipalities,
and five independent areas, with Taiwan being the twenty-third province. They locally
elected deputies to serve within the local people's congress, which consists of a smaller
version of the national party with the responsibility of leading the area and reporting to
the States council.

Regarding political officials and leadership, The Chinese Communist Party is the
Country's most effective and the only political party. The Chinese Communist Party
controls eight registered small parties. The Country has no significant opposition
groups, but there are two, the China Democracy Party and the Falun Gong sect, which
 Market research and marketing strategy for Quorn in China 7

the government deems a potential threat. The Country has an intricate legal system that
constitutes statutes and tradition. Since 1987, the Country has had a rudimentary civil
code and a novel legal code since 1980. China constantly strives to enhance its
administrative, commercial, civil, and criminal laws (Advameg Inc., 2023). The Supreme
People's Court is the land's highest court, tasked with supervising lower courts,
elaborating national laws, and hearing appeals. There is a rising crime rate in the
Country, with petty theft and pickpocketing being the most offences, and there are
escalating numbers of violent crimes. Moreover, drug use and prostitution seem to grow
in the Country.

Geography

The land area in China is 3,691,502 square miles; thus, it is the third-largest
Country in the world. China borders thirteen nations, namely Mongolia and Russia. To
the north, to the southwest, there is India, and to the South, there is Vietnam, Myanmar,
and Laos. The Country borders the South China Sea, the Yellow Sea, and the East
China Sea to the east. China's very varied climate ranges from hot to subarctic in the
South. Within the west, its land-primarily comprises deserts, mountains, and high
plateaus. The features of the eastern region contain hills, plains, and deltas. Mount
Everest is the highest point, bordering Nepal and Tibet, and is known to be the world's
tallest mountain.

The Country's longest river is the Yangtze, which forms the formal separating line
amid South and North China. At times, the Yangtze brings about deluges, same as the
Yellow River located in the north, which as a result of the destruction it causes, is
referred to as "China's sorrow." China is separated into binary areas, Outer and Inner
China, which have been factually separated. The Great Wall, constructed in the fifteenth
century to act as a protective barrier of the Country against invasions by a foreign
military, marks the separation. Whereas the two regions' areas are roughly equal,
ninety-five percent of the population resides within Inner China. China is home to
numerous rare species comprising the golden monkey, the panda, numerous tiger
species, the red-crowned crane, and the Yangtze alligator. Outside agencies, namely
the World Wildlife Fund, have made strides in saving endangered species.
 Market research and marketing strategy for Quorn in China 8

Market size and potential

The Chinese economy is on an upward trajectory and is seen to overtake that of

the United States as the topmost in the world within a few decades. This is attributed to
the breathtaking economic and social transformation in the late 1970s. The estimated
economic growth in 2019 was 6.3 percent, likely close to six percent, with the effects of
the trade war between the United States and China (Morrison, 2019). Looking at media
in China, the Chinese Communist Party strictly controls the media in the Country, with
the primary agency overseeing the Country's media being the Chinese Communist
Party's Central Propaganda Department. The largest media organizations comprise
China Central Television, the Xinhua News Agency, and the People's Daily, all under
the control of the Chinese Communist Party. Technologically, China boasts as one of
the most advanced technological hubs in the world, with different existing and emerging
technologies in different sectors.

Market research recommendations

For this report, the Quorn marketing team can conduct market research on
various areas such as campaign effectiveness, competitor research, consumer
research, customer segmentation research, product development, and usability testing.

Part 2: Business Report

Entry Mode selection

The meat sector in China is increasingly fragmented, with an extensive number

of small and medium-sized players that operate along with various dominant firms.
According to reports, over five hundred thousand businesses were involved in
producing, processing, and distributing meat and its products in China in 2021
(Interesse, 2023). The industry appears to be highly competitive, with minimal barriers
to entry. However, numerous challenges may be faced in terms of operation due to the
outbreak of various diseases, increasing costs of production, as well as regulatory
scrutiny.
 Market research and marketing strategy for Quorn in China 9

Among the large firms in China operating within the meat industry, the top three
pork producers in China comprise W.H. Group, New Hope Group, and Muyuan Foods,
which accounts for nearly forty percent of the general pork production in the Country
(Interesse, 2023). Apart from the large companies, various small and medium-sized
processors and producers operate all over the Country, specifically within rural areas.
Many of these firms are owned by different families and have operated for generations.
Such firms encounter limited capital access, inadequate technical expertise, and
hardships complying with highly stringent food safety and environmental regulations.

International corporations in the Chinese meat industry include J.B.S., Cargill,

and Tyson Foods. Such firms have formed joint ventures or acquired local meat
companies in China to get into the Market in China. For instance, Tyson Foods and
Shandong Xinchang Group, one of China's largest poultry producers, have joint
ventures (Interesse, 2023). In 2018, it acquired Keystone Foods, a forefront supplier of
fish, beef, and fish products within the Asian-Pacific region. Cargill and New Hope
Group also have joint ventures. In contrast, J.B.S. acquired numerous local meat
processing and producing companies, comprising a controlling stake in Huizhou Fudi
Food Co. and Moy Park, a United Kingdom poultry producer operating in the Chinese
Market.

Based on the above case studies, it seems suitable that Quorn can purposely get
into the Chinese Market to sell its products by engaging in joint ventures with other local
and international companies already in the Chinese Market. Joint Quorn will focus on
minimizing the risk of entering an international market by creating joint ventures with
other firms planning to sell within the global Market (Killing, 2017). Because joint
ventures frequently function as large, autonomous firms instead of a combination of
smaller firms, they can earn more revenue than individual companies. Such a market
strategy has the risk of an imbalance in firm involvement; however, the two companies
forming the joint venture can work together to establish fair processes and assist in the
prevention of such concerns.
 Market research and marketing strategy for Quorn in China 10

Another entry mode selection for Quorn into the Chinese Market is through
acquisition. This would mean that Quorn will purchase all or most of another Chinese
local firm's shares to gain control of the firm. Buying more than fifty percent of the local
Chinese firm's stocks and other assets will allow Quorn to make decisions regarding the
assets it has newly acquired with no approval from the shareholders of the local
company (Greve and Man Zhang, 2017). By acquiring a local Chinese firm in the meat
industry, Quorn will expand its operations in China, and this would be the easiest way of
gaining entry into the Chinese Market. The purchased local firm will already have its
workforce, a brand name, and other intangible assets, which could assist Quorn in
starting within a novel market with a robust and solid base.

Target Market

The meat market within China appears to be the second largest industry within
the retail food market in the Country, trailing behind the fresh vegetable industry.
Nonetheless, it also appears to be one of the last to be impacted by the new retail
development. Much of the meat and meat products sold within the retail outlets are sold
at traditional wet markets, mostly in open-air markets or streets. Such markets offer a
platform where consumers can buy live poultry or freshly slaughtered meat directly from
local farmers (Leonidivna and Pylypivna, 2017). Nonetheless, it seems such markets
are gradually being done away with within the cities, merging into hypermarkets and
supermarkets. This means that currently, supermarkets and hypermarkets appear to be
forefront in distributing meat and meat products to consumers.

Enhanced choices originate from huge enhancements within distribution

networks in China, credited to the expansion of transportation networks that have
assisted in developing more regional trade in processed and fresh meats. Therefore,
more produce is getting to the consumers in less populated areas. Processed meat
products are majorly sold through new retail formats, namely hypermarkets and
supermarkets (Yurun, 2020). Such suits the highly advanced and demanding need of
urban fresh-food shoppers with increasing incomes; people are currently capable of
purchasing more expensive meat products than easier, resulting in huge demand for
 Market research and marketing strategy for Quorn in China 11

quality and variety of produce. External hypermarkets such as Costco, Walmart, and
ALDI have been hugely benefiting from the growing meat market in China.

In addition, the popularity of online shopping has increased in the Country,

paralleled by the increasingly emerging e-commerce market. Supermarket and
hypermarket chains are currently sinking towards providing seamless online-to-offline
shopping experiences to most consumers. Alibaba's grocery chain, Hema Fresh,
appears to be the forefront food retailers offering mobile applications for online orders,
in-store catering, and offline shopping.

Based on these distribution and e-commerce channels of availing meat products

to the consumers, Quorn ay focuses on identifying its target market based on
consumers' income level. The priority target market for Quorn to purchase its organic
meat and meat products comprise consumers with high-income levels and families with
children. Potential consumers of Quorn meat products in the Chinese Market may be
categorized into high-income households, medium-income households, caterers, and
restaurants. Quorn market segmentation for its meat products and meat may be
founded on the particular market opportunity within the Chinese Market.

Whereas low-income households appear content with buying the meat options at
local grocery stores, supermarkets, and hypermarkets, households with more
disposable income tend to be more interested in expanding their home-cooked meats or
meat products. Moreover, such households host events within their homes more
frequently than low-income households and prefer offering their guests rare or high-
quality meat options. High-income households, as well as medium-income households,
can be the first and main target market for Quorn for their Chinese Market. Such target
markets have the disposable income to comfortably handle the distributing channels
such as hypermarkets, supermarkets, and online retailers when purchasing their meat
products and meat from Quorn.

Most of these consumers have been known to be major pork consumers

compared to other meat products within the Chinese Market. Many consumers of meat
in the Chinese Market eat pork available in their five meals daily or weekly. This means
 Market research and marketing strategy for Quorn in China 12

that the demand for meat products for such a Market is high and that it will mean that
Quorn can specifically target high-income and medium-income households for its
economical and high-end meat products to compete with most of its competitors
effectively. Additionally, most consumers are shifting to beef products that they deem to
be healthier than pork products that come with safety and health issues. As a result,
targeting the high and medium income Households in the Chinese Market means that
such consumers will be willing to purchase the beef products that will be in high demand
and at fair and affordable prices as set by Quorn based on market research on prices.

Marketing Objective

Marketing objectives constitute a set of goals that the managers at Quorn will
establish in advance for a marketing campaign in the Chinese Market. The marketing
objective for Quorn will act as a way of measuring marketing efforts through the key
performance indicators, contrary to merely advertising a novel product for a set time
frame with minimal regard for the outcome of the campaign. For Quorn, the Chinese
Market's marketing objectives will majorly emphasize a marketing campaign, unifying it
around an explicit purpose and a measure to see if such a campaign will be effective. If
the campaign accomplishes the set benchmarks as part of Quorn's marketing objective,
the marketing team will see it as a success. Quorn's marketing department will
brainstorm options if the marketing campaign does not generate the projected
outcomes.

As the International Marketing Executive for Quorn, one of the primary marketing
objectives is to conduct market research on the new Chinese international Market for
Quorn. Before beginning to sell any of its products, conducting market research is
important in determining the new market trends for Quorn's meat products within the
Chinese Market. The market research will mainly comprise different research such as
brand research, consumer research, customer segmentation research, product
development, and competitor research for the company. Conducting market research
for Quorn may substantially assist the firm's marketing strategy since it offers critical
information and insights into the business. It may further offer in-depth comprehension
of the competitors and consumers within the Chinese Market and help comprehend the
 Market research and marketing strategy for Quorn in China 13

potential customers who will buy the firm's products in the new Market. At the same, by
carrying out our market research on the newly found Chinese Market, the company will
be able to comprehend the extensive market environment, which will assist in identifying
novel opportunities for the business.

Ultimately, market research for the firm will enable the firm to determine the
changes in the Market and also continuously establish ways in which it can enhance the
base of consumer shifting preferences as well as the dynamics of the Market. Through
continuous research on the Chinese Market, the marketing team from Quorn will be
able to identify novel services and products for their new consumers. This will also
enable the team to establish key issues with developing some products and avoid
underlying problems. Additionally, it will allow the marketing team to track competitors
and be ahead of them by learning what they are doing differently and developing
strategies to counter those of the competitors.

Another marketing objective of the Quorn marketing team would be to increase

Quorn's brand awareness in the Chinese Market. One of the marketing initiatives that
will focus on is building general brand awareness among the firm's potential consumers
within the target market. This will comprise search engine optimization to increase
visitors to the consumer's websites. The marketing team may also conduct this by
increasing content marketing, mainly by creating podcasts, blog posts, and video
content that may boost website traffic. Social media marketing is also important in
creating brand awareness in the Chinese Market for Quorn.

Marketing Strategies to reach marketing objectives: marketing mix

Recommendation

A marketing mix constitutes a set of categories a marketing strategy emphasizes.

Quorn's marketing strategy will primarily emphasize product, price, place, promotion,
packaging, positioning, and people. For product, it will be the center of Quorn's
marketing mix, critical to its success in marketing within the Chinese Market. Quorn in
the Chinese Market will mainly focus on providing fresh and quality meat products for its
high and medium-income consumers within the Chinese Market (Chandrasekaran and
 Market research and marketing strategy for Quorn in China 14

Tellis, 2017). Fresh and quality meat products will be available in the Market in different
distribution channels such as supermarkets and hypermarkets. They will be able to
compete fairly with other products from potential competitors such as domestic players
such as W.H. Group, New Hope Group, and Muyuan Foods and foreign players such as
J.B.S., Cargill, and Tyson Foods, among other competitors. With Quorn's meat
products, most Chinese consumers consume a lot of pork products, followed by poultry
and beef. Due to consumers' emphasis on the importance of health, many are trying to
shift to beef instead of pork as they consider it healthier. As a result, since Quorn would
focus on high and medium-income households as the target market since they are
willing to pay more for quality and healthier meat products, the meat products the
company will produce will be more beef as opposed to pork to meet the preferences of
the consumers.

Regarding price, Quorn will emphasize available, affordable products in the

Chinese Market to ensure that the prices are favourable for their customers. The prices
of the products will be determined after closely examining those offered by other
Chinese players in the Market to have an overview of how much the target audience is
willing to pay for the meat products (Ferrell et al. 2021). Quorn will also consider the
value of its products. Based on this, Quorn will mainly deal in economic and high-end
meat products from its High and medium-income household consumers. Quorn will
mainly set reasonable and economical prices for its consumers.

Looking at the place, Quorn intends to make its products readily available to its
target customers. These will mainly be in supermarkets, hypermarkets, and online. As a
result, this will make it easy for Quorn to market its products and brand to consumers
easily. Since most of the products will be located in supermarkets, hypermarkets, and
online, the business will be consumer-focused as the products will be sold directly. As a
result, Quorn will emphasize locating its products in supermarkets, hypermarkets, and
online.

In terms of promotion, Quorn will primarily focus on promoting its products to high
and medium-income households as its primary consumers. This means that Quorn in
 Market research and marketing strategy for Quorn in China 15

the Chinese Market will emphasize reaching as many consumers and target audiences
as possible (Ferrell et al. 2021). Therefore, there will be billboards, television
advertisements, social advertisements, and sponsorship deals and events featuring
Quorn and its products to achieve this.

Ultimately, Quorn will focus on maintaining a clean and simple packaging design
for most of its meat products, increasing the sensory experience for its target
consumers. The packaging will also bear the company's branding and visual appeal to
consumers (Ferrell et al. 2021). In terms of positioning, Quorn will position itself in the
Chinese Market as one of the leading players in providing healthy, quality, and
affordable meat products for its high and medium-income household consumers.
Finally, in terms of people, Quorn will emphasize targeting people within high-income
and medium-income households as its central target audience for its meat products.
 Market research and marketing strategy for Quorn in China 16

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Advameg, Inc. 2023. China. https://www.everyculture.com/Bo-Co/China.html

Chandrasekaran, D. and Tellis, G.J., 2017. A critical review of marketing research on

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Ferrell, O.C., Hartline, M. and Hochstein, B.W., 2021. Marketing strategy. Cengage

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Greve, H.R. and Man Zhang, C., 2017. Institutional logics and power sources: Merger
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Granthaalayah, 4(6), pp.25-37.

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