Master´s Program in International Marketing Enhancing Swedish Large MNEs’ Strategies in Chinese Market -By Analyzing the Perspectives of Consumers in Sweden and China Cheng Han 910227-4611 Xiaojing Gu 930311-T208 Business Administration and International Marketing, 15 Credits Supervisor: Svante Andersson Date: 20160525 Acknowledgment The authors would like to convey the deepest gratitude to supervisor Svante Andersson, professor at University of Halmstad, who gave the valuable advises and supports. Further, the authors would like to express gratitude to all the respondents who helped the authors collecting relevant data, which contributed voluminously. The authors also would like to thank to the opponents, Niclas Wikström, Anders Laurenius, Mayara Critine Wandall and Matthias Hoffmann, who proposed suggestions and assisted this research. Halmstad University, Sweden 25th of May, 2016 Cheng Han Xiaojing Gu 910227-4611 930311-T208 1 Abstract Title: Enhancing Swedish Large MNEs’ Strategies in Chinese Market -By Analyzing the Perspectives of Consumers in Sweden and China Authors: Cheng Han and Xiaojing Gu Supervisor: Svante Andersson Level: Master Dissertation in International Marketing, 15 credits Keywords: Consumer behavior, Multinational enterprise, Marketing strategy, Swedish and Chinese market Background: With the trend of globalization, multinational enterprises noticed the potential market in China. Base on previous research, researchers indicated consumer behaviors have a sort of relationship and influence on MNEs’ strategies. Purpose: Investigate the distinctions between Swedish and Chinese consumer behaviors, due to the distinction, explore the way to enhance MNEs’ strategies in Chinese market. Research Questions: Q1: What are the differences between Chinese consumers and Swedish consumers evaluating same enterprises? Q2: How Swedish large MNEs develop their strategies for adapting the distinctions of Chinese consumers? Theoretical Framework: The theoretical framework includes theories regarding what factors of consumer behaviors are considered as influencing on enterprises’ strategies and the theories of general enterprise strategies. Methodology: This dissertation is a quantitative study accompany with case study. Empirical Framework: The empirical framework presents case descriptions and statistics. Analysis: The five hypotheses are analyzed and critical examined. Conclusion: Since consumers from different countries have different consumer behaviors, enterprises need to alter their strategies by adapting the distinctions of consumers. 2 Table of contents 1. Introduction ................................................................................................................ 6 1.1 Background ....................................................................................................... 6 1.2 Problem ............................................................................................................. 7 1.3 Purpose .............................................................................................................. 8 1.4 Research questions ............................................................................................ 9 1.5 Delimitation ...................................................................................................... 9 2. Theories .................................................................................................................... 10 2.1 Key concepts of consumer behavior ............................................................... 10 2.1.1 Definition of consumer ......................................................................... 10 2.1.2 Definition of consumer behaviors ......................................................... 10 2.1.3 Consumers’ purchasing decision making behavior .............................. 11 2.2 Factors affecting consumer behavior .............................................................. 12 2.2.1 External cultural factors ........................................................................ 13 2.2.2 Internal factors ...................................................................................... 14 2.3 The importance of consumer behavior ........................................................... 17 2.4 Multinational large enterprise in internationalization ..................................... 17 2.4.1 Multinational enterprise ........................................................................ 17 2.4.2 Large enterprise .................................................................................... 18 2.4.3 Drive force on Large MNEs in internationalization process ................ 18 2.5 The four Ps of the marketing mix ................................................................... 20 2.6 The implementation of marketing strategies in internationalization .............. 21 2.7 Interaction between MNEs and consumers ..................................................... 25 2.8 Conceptual model ........................................................................................... 25 2.9 Hypotheses ...................................................................................................... 26 3. Methodology ............................................................................................................ 28 3.1 Research strategy ............................................................................................ 28 3.2 Research approach .......................................................................................... 29 3.3 Research design .............................................................................................. 29 3.4 Data collection ................................................................................................ 29 3.4.1 Primary data .......................................................................................... 30 3.4.2 Secondary data ...................................................................................... 30 3.5 Data analysis ................................................................................................... 30 3.6 Validity and reliability .................................................................................... 31 4. Empirical data .......................................................................................................... 32 4.1 Case description .............................................................................................. 32 4.1.1 IKEA in Sweden ................................................................................... 32 4.1.2 IKEA in China ...................................................................................... 34 4.1.3 Volvo in Sweden ................................................................................... 38 4.1.4 Volvo in China ...................................................................................... 39 4.1.5 H&M in Sweden ................................................................................... 40 4.1.6 H&M in China ...................................................................................... 42 4.2 Survey results and statistics ............................................................................ 44 3 4.2.1 General and knowledge based questions .............................................. 44 4.2.2 Theoretical questions ............................................................................ 47 5. Analysis.................................................................................................................... 54 5.1 Individual case analysis .................................................................................. 54 5.1.1 IKEA ..................................................................................................... 54 5.1.2 Volvo..................................................................................................... 59 5.1.3 H&M ..................................................................................................... 63 5.2 Cross analysis.................................................................................................. 68 6. Conclusion and further research .............................................................................. 71 6.1 Conclusion ...................................................................................................... 71 6.2 Limitation ........................................................................................................ 73 6.3 Further implication.......................................................................................... 73 6.4 Further research .............................................................................................. 74 Reference List .............................................................................................................. 75 Appendix 1 ................................................................................................................... 86 Appendix 2 ................................................................................................................... 92 4 Figures and tables Figure 2.1 Involvement in purchase decision..........................................................................................11 Figure 2.2 The various individual and environmental factors influencing purchase decisions………...13 Figure 2.3 Ansoff Growth Matrix………………………………………………………………............20 Figure 2.4 Geographic development of MNE…………………………………………………………..21