Global Marketing Management: The Case of New Balance (Business & Marketing Essay)

GLOBAL MARKETING MANAGEMENT
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Global Marketing Management: The Case of New Balance
Since its inception in 1906, New Balance has taken a careful approach, especially while entering new markets. Currently, the sports footwear and apparel brand sells its products in about 120 countries. However, in some markets, the organization has limited entry, which means there is room for growth. In Africa, for example, New Balance is only operational in South Africa. While South Africa does present a lucrative deal regarding its market, limiting operations in South Africa limits the organization’s growth considering it could expand and take advantage of the fast-growing economies of Africa. Several factors in Africa make it one of the most attractive destinations for companies right now. For example, according to Leke and Signe (2019), more than 400 companies register revenues of more than $1 billion annually. Also, Africa boasted of 6 of the 10 countries with the fastest-growing economies as well as “five of the 10 most improved countries” (Leke and Signe, 2019). With such factors, New Balance should consider investing or expanding to other African countries and taking advantage of the continent’s changing economic landscape.
Appraise Market Conditions Suitable for Entry to International Markets
With a special focus on Africa, there are a few factors or aspects that New Balance should consider before thinking of expanding to other African countries. These factors should offer the final word on whether it makes business sense to expand to other parts of Africa.
Population Growth
Population growth is indeed a crucial factor to consider while assessing a new market. According to Leke and Signe (2019), Africa’s population is “projected to reach 1.7 billion by 2030.” Also, the authors continue to write that this population growth will mainly happen in the cities. The above statement implies that Africa will transform or become more urbanized. Another aspect or factor that is influenced by population growth is expenditure. Leke and Signe (2019) note that African businesses and consumers' spending is expected to rise and “reach $6.66 trillion by 2030, up from $4 trillion in 2015.” There is room for companies like New Balance to expand their growth and grow as Africa grows with such numbers.
Rising Middle Class
Another factor that also touches on population growth is the rising middle class. As the continent is growing economically, people are getting richer and consuming more. Signe (2019) notes that by the end of this decade, “one in five of the world’s consumers will live in Africa.” This growth is expected to come with demand changes as people will ask for niche, high-quality, and foreign-produced goods (Signe, 2019). For New Balance, this is a business opportunity that needs to be explored. With a rising middle class, choice brands will indeed want to take advantage. It makes financial sense for New Balance to want to be a part of this growth. A rising middle class comes with promise since GDP growth per capita translates to higher purchasing power for the members of the middle class.
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