Perceptions of Foreign UK Retail

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.

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.

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, p. 133).

Marks & Spencer is currently met with a wide array of challenges, among which the emergence of the internationalized economic crisis which reduces the buying powers of the individuals, but also the incremental pressures for sustainable development. As the rest of the retailers, Marks & Spencer promotes its development through high levels of consumption, but given the unstable state of the environment, the governments militate for sustainable and limited consumption (Jones, Comfort and Hillier, 2007).

Another challenge is constituted by the need to adapt to the cultural values in the regions into which it expands and opens new stores (Amine and Smith, 2009). Also, the organization deal with financial and legal challenges derived from the international feature of business, such as the competition with local purveyors or the ability to combine and centralize the losses and profits of its international subsidiaries (Graetz and Warren, 2006).

2.5. Perceptions of Thai consumers over Marks & Spencer

The specialized literature on the particularities of Thai customers' perceptions and acceptance of Marks & Spencer in their country is fairly limited. This limitation virtually points towards the necessity and use of the future study which would explain an unexplored territory. In spite of this lack of sources nevertheless, valid information can be collected from informal sources, such as internet pages and forums, where the Thai consumers interact and reveal their perceptions of the British retailer.

An analysis of these secondary sources of information leads to the following findings:

Marks & Spencer does not operate large retail facilities in Thailand, but has focused on operating small outlets, strategically spread throughout the cities.

The customers look forward to purchasing from the British company as they appreciate its variety and different sense of style. The customers for instance complain about the limited choices which are offered by the local stores and look at Marks & Spencer for variety. One customer pointed out: "I am looking forward to the shopping as I think the clothes shops in NZ are awful!! After shopping in South Africa this place is seriously limited for choice" (Trip Advisor, 2008).

The Thai customers perceive Marks & Spencer as a source of good quality products, which serves a wide array of individual purposes. They nevertheless complain about the small size of the outlets, which reduces the offer and as such the choice opportunities for the customers. The customers estimate that the Marks & Spencer stores in Thailand sell about 20 to 30 per cent of what they sell in the United Kingdom.

The customers also complain that the prices Marks & Spencer implements in the Thai outlets are higher than the prices they implement in the UK stores. One particular customer argued that he observed a pair of boxers in the UK being sold for £5, whereas in Bangkok, the same pair of boxers was sold for £10. It is generally assumed that the higher price is due to excessive taxations by the Thai government (Thai Visa, 2010).

3. The research methodology

The methodology at the basis of the future research endeavor is a combination of qualitative research and quantitative research. Qualitative research has the advantage of assessing the population thoroughly, but the disadvantage of integrating the personal bias of the researcher. Quantitative research on the other hand implies tedious work, but conclusions which can be extrapolated as they rely on factual data. Bart L. Weathington, Christopher J.L. Cunningham, David J. Pittenger (2010, p.526) argue: "Whereas quantitative research is designed to empirically identify the presence and magnitude of differences between individuals and/or groups of individuals, qualitative research is typically more focused on sense-making in a purer sense."

The qualitative research stage would be completed throughout the analysis of various secondary data. The quantitative research stage would be completed with the construction and issuing of a questionnaire. The combination of qualitative and quantitative research methodologies -- generically know as triangulation (Downs, 1999) -- is a highly common practice within the academic community and the reasons for this popularity are given by the ability of the combination to maximize the advantages of the two different methods, while also minimizing their limitations. At a theoretical level, the triangulation of qualitative and quantitative research methodologies ensures interpretative validity and data trustworthiness (Maree, Maree and van der Westhuizen, 2009).

3.1. Secondary data

As it has been previously mentioned, the secondary sources constitute the qualitative research stage of the future research endeavor. At a primary level, qualitative research is constituted by the analysis of the population researched. The analysis and observation of the Thai consumers' population would be conducted with the aid of a wide variety secondary sources, including internet pages, previous research papers, books or articles. Each of these sources reveals its own benefits and limitations, but -- similar to triangulation -- their combination constructs data relevance and reliability through the maximization of the benefits and the limitation of the disadvantages.

One example of secondary sources benefits and limitations refers to the internet pages, such as forums, which have the main advantage of revealing the direct and uncensored opinions of the Thai consumers, but also reveal the disadvantage of human bias. Then, the books reveal the advantage of being highly documented and researched, retrieving as such reliable findings. They are however often outdated and unable to present the issues of today. Journal articles and previous research endeavors reveal the main advantages of being peer reviewed and as such highly reliable, and also dealing with more novel topics than the books. They do however focus on specific pieces of information related to the research topic and they might not always be relevant to the reader.

The qualitative analysis has already been approached through the literature review section. Basically, the qualitative analysis is represented by the assessment of the available literature and the centralization of the most relevant findings. It has to be noted that the literature review presented throughout the previous section constitutes only the starting point of the future research endeavor. While the review integrated in this proposal would represent the backbone of the future research endeavor, one particular element has to be noted. Specifically, as the research process develops, new sources of important information could be uncovered. This virtually means that additional relevant information could be added to the paper, generating as such modifications in the structure of the secondary sources used in the construction of the research findings.

3.2. Primary data

The collection and analysis of data from primary sources of information constitutes the quantitative aspect of the research endeavor. It specifically refers to the construction and issuing of a questionnaire. The starting point in the construction of the questionnaire is constituted by the previous review of the available literature. Similar to this, the questionnaire could suffer future modification as new pieces of information are identified and integrated. At an initial level however, the questionnaire would be divided into two sections. The first section would collect demographic information on the respondents, whereas the second section would collect information particular to the research question. At this level, the questionnaire would be revealed as follows:

Question 1: Please state your gender:

a) Male

b) Female

Question 2: Please state the age category to which you belong:

a) Below 20 years

b) Between 20 and 35

c) Between 35 and 50

d) Over 50

Question 3: Please state the last level of education you completed:

a) Less than high school

b) High school

c) College

d) Master's, doctoral or more

Question 4: Please state the income category to which you belong:

a) Below average income

b) Average income

c) Above average income

Question 5: Please state the number of times you went outside of Thailand.

a) Once or less

b) Between 2 and 5 times

c) Between 5 and 10 times

d) Over 10 times

Question 6: How do you feel about the changes impacting Thailand's economy and society?

a) They are positive changes supporting the development of the Thai community

b) They are negative changes stifling the Thai traditions

c) I do not know / care

Question 7: How do you feel about the increasing presence of international retailers in Thailand?

a) They generate positive change and development within the economy and the society

b) They only seek for personal profits

c) They lead to the demise of local retailers

d) I do not know / care

Question 8: Have you ever shopped in a Marks & Spencer store?

a) Yes

b) No

c) I do not remember

Question 9: How do you feel about the small outlets strategy implemented by Marks & Spencer in Thailand?

a) it is useful as it creates easy access to the stores

b) it is inefficient as it reduces product variety and diversity

c) I do not know / care

Question 10: What is your opinion regarding the affordability of the Marks & Spencer products?

a) They are highly affordable

b) They are somewhat affordable

c) They are too expensive and unaffordable

Question 11: What do you think about the quality of the Marks & Spencer products?

a) it is a high quality

b) it is an average quality

c) it is a poor quality

Question 12: How do you perceive the tradeoff between the price and the quality of the Marks & Spencer items?

a) a positive tradeoff

b) a negative tradeoff as the prices are too high

c) a negative tradeoff as the quality is too poor

Question 13: How do you feel about the variety in the Marks & Spencer stores in Thailand?

a) it is increased comparative to other local offers

b) it is acceptable

c) it is poorer than other Marks & Spencer stores in other global regions

Question 14: How committed are you to the Marks & Spencer brand?

a) I am a big fan and a loyal customer

b) I sometimes buy from them, but I'm not always loyal

c) I do not care for the brands, I just buy the products which serve my needs

Question 15: Which Marks & Spencer stores do you prefer? The local ones or the ones in the United Kingdom?

a) the local ones due to easy access

b) the British ones due to product diversity

c) I do not know / care

4. Conclusions

The modern day economic climate allows economic agents to transcend boundaries and benefit from the comparative advantages of other global regions. One particular application of Ricardo's theory revolves around the increased ability to access wider consumer markets and as such support the growth and expansion of the business. Marks & Spencer is one of the firms which became involved in such practices and the objective of the future research endeavor is that of assessing the means in which Thai consumers perceive Marks & Spencer.

The organization represents one of the strongest British and international brands and it offers a wide array of products and services. It has constructed its reputation and brand strength through the emphasis on high quality at affordable prices, and by as such generating consumer trust. The literature review conducted has revealed that consumers are generally welcoming of the UK company, but several complaints still exist. In order to offer a more in depth look, the future research endeavor would be structured onto two sets of research methodologies. At a first level, a qualitative methodology would revolve around the analysis of the available literature. At a secondary level, the methodology would revolve around the collection of primary information with the aid of a survey. The combination of the two research methodologies leads to the maximization of their benefits and the minimization of their limitations. The current research proposal and the future research endeavor fully comply with the codes of research ethics, as will be explained throughout the following and final section.

5. Ethics

The current proposal and the future research endeavor are constructed in the manner to respect the highest standards of research ethics. They for instance present relevant information as it arises in the specialized literature, striving to minimize the personal bias of the individual researcher. Additionally, they adequately quote all ideas or statements as they have been issued by other authors. They do not collect data from illicit, unapproved or otherwise inadequate sources. They respect all specifications of the sources used and they do not violate the integrity of the sources or their authors.