Market Entry Strategies Adopted by Multinational Smartphone Companies in Kenya: a Case Study of Tecno Mobile

Abstract

The choice of market entry strategy is very important in the entrant’s future decisions and performance in foreign markets due to complex, continual change and dynamic business environment. Most firms have adopted entry strategies that will preposition them to take advantage of the chances in the economy in a manner that is bearable. This made it important to find out how those strategies have been adopted in organisations. The study therefore sought to establish the market entry strategies adopted by multinational smartphone companies in Kenya, with specific focus to Tecno Mobile. The findings of this research might help scholars undertaking studies on entry strategies used by multi-nationals companies when entering the Kenyan Market. A case study research design was used to collect primary data through interview guide from heads of department at Tecno Mobile Kenya. Content exploration method was employed in scrutinizing the data collected. The findings revealed that several factors such as returns on investment, exit costs, risk exposure, the degree of adaptation of smarthphones, marketing and transportation costs were the factors that influenced Tecno’s choice of a market entry strategy. Indirect exporting strategy was the key market entry strategies Tecno used to establish its presence in the Kenyan market. Indirect exporting involves selling of goods or services to or through an intermediary and it’s a relatively cheap and straightforward way to enter a new market. Licensing strategy was used in making high technology co-operation in the world while the local parties resort to strategic alliances. Therefore, licensing agreement provides accessibility to foreign markets from end-to-end foreign production devoid of the obligation of investing in the foreign location. Another strategy employed by the company to enter Kenya market was Innovation. This strategy focuses on firms innovating products that appear different from their competitors and is aimed at making them earn a competitive advantage over others. The study found that fierce competition from counterfeit phones, poor infrastructures, availability and cost of electricity as some of the challenges the company face in using the market entry strategies. The study recommended that Tecno Company expand to other African markets using the same strategies it employed in entering the Kenyan Market. The study further recommended that, to stay ahead of the competition, Tecno Company will need to produce tailored products to target specific needs of different market segments.