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Denmark - Potential Market for Australian Firms - Marketing Case

Essay by   •  December 5, 2012  •  Research Paper  •  1,142 Words (5 Pages)  •  1,324 Views

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1. Introduction

Denmark has a potential market for Australian firms to expand their business into a foreign country. It has a major north European power. Denmark has evolved into a modern, prosperous nation that is participating in the general political and economic integration of Europe (Central Intelligence Agency). And it also plays a significant role in environmental protection which hosted the United Nations Climate Change Conference in Copenhagen in December 2009. In this essay, it will analyze three marketing environment, namely social, potential and economic forces for organizations to understand its external environment and the implications of changes taking place, for its current and future profitability (Oldroyd, 2007).

2. Discussions

2.1 Social environment

2.1.1 Social environment definition

It includes changes in population characteristics, educational standards, culture, lifestyle, attitudes and beliefs. The way we think, live and behave is the outcome of complex cultural conditioning by family, friends, school, church, work and the various media (Oldroyd, 2007).

2.1.2 Social environment facts and impacts

The population in Denmark mainly distributes in metropolitan area, "Urbanization is expected to continue, with the result that at the end of the forecast period around 90% of the Danish population will live in urban areas." said Peter Willisch (2012). Based upon this high density of population in urban area which account for 21.8% of total population, the major targeting market in Denmark tend to be the consumers who live in urban area or near the downtown by Australia companies. In relation to this, commercial markets can be centralized in particular sales territory. It will not only reduce the cost of transportation or delivery services which may result in higher price of products or lower profit of selling, but also become easier to provide services for consumers, such as local advertising or door-to-door services. Furthermore, consideration should also be given to the transport fee, by comparing with transporting between the suburbs and urban, the single area transportation can spare extra money to fix up the requirement of other sectors, for instance been used to upgrade the product along with the advancement of science.

2.2 Political environment

2.2.1 Political environment definition

The political environment includes government monetary, fiscal policies, import-export policies, customer duties and legislations restrict individuals or organizations in the society (Hundekar, 2010).

2.2.2 Political environment facts and impacts

As a member of the Europe Union, Denmark is a key actor on international climate policy. Green growth is at the top of the agenda across the globe, and there will be massive need for private investment in sustainable solutions in years to come (Mortensen, 2010), thus it supports stringent environment regulation at the EU level on trade policy (Central Intelligence Agency). Therefore in order to enhance Danish status to promote a responsible, green and safe Europe, the product should follow the strict requirement of the Danish government. Packaging design for example, must be environmentally friendly; to be specific, plastic and heavy metals should be restricted and taken place by easily recycled materials. What is more, packaging should also be able to reuse to minimize the impact on the environment of packaging waste. However, concerned about the high technologies and researches are involved, it must lead to an increase in sales caused by higher cost in shaping a positive quality of products. With these considerations, it is significant that the company should target right costumers who have reasonable income to afford the high pricing product.

Furthermore, Denmark and Australia signed an Agreement for the Avoidance of Double Taxation to prevent incidences of double taxation on income in 1981 (Sharkey & Bain, 2011). By eliminating the double taxation, it brings down the barriers to the international trade which is thought to contribute to price descending of the product; this will consequently enlarge the range of costumes and increase the potential market



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