International Marketing

1.0 Executive Summary

Saturation of Walkers Snack Foods home market in the UK has encouraged the company’s Executive Directors to examine the option of launching internationally. After analysing the internal and external environment, the decision was taken to launch the Walkers’ brand into East China. China was identified as a significant growth market for foreign branded snack foods. Walkers has put in place a plan to enter the market through Foreign Direct Investment with the establishment of a wholly owned subsidiary. In order to coordinate Walkers’ operations in China, a series of marketing objectives have been established. These objectives will be achieved through the implementation of a tactical Marketing Mix, which has been adapted for local market conditions. Implementation of set marketing objectives will be monitored by control mechanisms, with adjustments initiated where necessary. Walkers’ investment into the Chinese market provides good short-term opportunities with a long term potential for growth throughout East Asia.

2.0 Introduction

2.1 Context and Reasons for the Firms Internationalisation Decision

Walkers Snack Foods Ltd. , originally Walkers Ltd., launched its first brand of crisps in 1948. Since the early days Walkers has grown dramatically in size, today employing more than 4,000 people in fifteen locations around the UK. It is estimated that 11 million people in the UK eat a Walkers product everyday. Walkers Snack Foods Ltd. is now a wholly owned subsidiary of PepsiCo Inc , but still has control over its own operations.

Despite a number of new product launches and a variety of innovative marketing techniques, Walkers is beginning to see saturation of the UK snack foods market. Walkers’ current market share in the UK stands at 44.5%, based on 2002 figures. Walkers has had great success in the UK, but there has been no attempt to internationalize the brand. PepsiCo, Walkers parent company, are currently looking to grow their presence in Asia. PepsiCo’s snack food division, FritoLay, is currently selling a number of products into China, Hong Kong and Japan. In each country, FritoLay has established a growing presence, but is still facing strong competition from other firms operating in the area. The Asian market for snack foods is a strong growth market, set in the background of a developing economy.

The Walkers Crisps brand has a number of distinctive features that makes it a viable choice for launch into markets in Asia. Amongst the distinctive features are the wide range of flavours, the style of the crisps and the traditional British brand image. With an international launch Walkers could escape the saturation of the home market and at the same time gain the support of PepsiCo, a company who are keen to earn an early market leader