Product differentiation and populistic entry strategies in a mortgage market with Bertrand competition

PurposeThe purpose of this paper is to analyse the interaction between a profit maximising mortgagor and a newcomer to a mortgage market with Bertrand competition where the newcomer has a populistic entry strategy and undercuts mortgage market rates. The intention of the paper is to relate the populistic entry strategy to mortgage market characteristics and the strategic market position of both the established mortgagor and the newcomer in question.Design/methodology/approachThe paper analyses a mortgage market by combining the behaviour of a profit maximising mortgagor with that of a newcomer to the mortgage market which has a populistic entry strategy and does not maximise profits. The short-run market solution provides comparative statics on the strategic market position of both the established mortgagor and the newcomer to the mortgage market during the entry phase both related to product differentiation and to price mirroring and undercutting of mortgage rates.FindingsThe model finds a mortgage market solution where a lower mortgage rate helps the newcomer gain a customer base. As the newcomer's strategy to mirror prices makes it unable to pass-through funding cost to its mortgage rate, the strategy is unsustainable over time. The established mortgagor has a strategically beneficial position as the mortgage market rates only relate to its funding cost. Unless the newcomer has a funding cost advantage, the established mortgagor has a higher interest rate margin. Differentiation impacts the newcomers’ interest rate margin positively. If the newcomer lacks a funding cost advantage, there is a critical mirroring rate that ensures it a higher interest rate margin. The higher the newcomers’ own funding cost, the higher is the upper bound for price mirroring, relating market entry to a small undercutting of mortgage rates and a mortgage market with weak competition. The funding cost of the established mortgagor pulls pricing in the opposite direction, allowing for a lower mirroring rate and tougher mortgage market competition during entry.Originality/valueThe paper aims to contribute to the understanding of market equilibrium in the absence of profit maximising behaviour. Framing a mortgage market in terms of a duopoly where a newcomer enters with a populistic entry strategy offering a lower mortgage rate and a mortgage product with a different loan-to-value (LTV) ratio, a novel mortgage market case comes about. The populistic entry strategy produces an augmented reaction curve, crucial for the mortgage market rates.

The Effects of Foreign Market Entry Strategies on Financial Performance of Listed Multinational Firms in Kenya

The objective of this study was to establish the effects of foreign market entry strategies on the financial performance of listed multinational firms in Kenya. Internationalization theory was used as the theoretical foundation of the study. Empirical studies reviewed revealed that several studies had been done on the direct relationship between performance of multinational firms and their modes of entry into foreign firms. However, none of these studies focused on the financial performance of listed multinational firms. The study utilised a cross-sectional descriptive design. Secondary data collected from firms’ annual reports and financial statements for a period of four years (2014 to 2017) was used. The firms’ financial indicators of Sales Growth, Return on Equity, Return on Assets and Return on Capital Employed were employed to measure their performance. Franchising, exporting, wholly owned subsidiary and acquisitions were assessed as the entry strategies used by multinational firms. Data was collected from all the 62 listed multinational companies in Kenya and analysed using quantitative methods. This analysis was most preferred for data collected was quantitative in nature. The relationship between the independent and the dependent variable was tested using simple linear regression. The results show that the performance of multinational firms operating through franchises and as wholly owned subsidiaries as well as acquisitions was lower than the performance of multinationals operating as export companies. The study concludes that the mode of entry into foreign markets chosen by a firm significantly affected its financial performance in the said market. It is therefore recommended that multinational firms wishing to expand their operations globally to come up with long term strategies that have gone through rigorous scrutiny for the benefit of the firm. The study gave a contextual understanding of the internationalization theory. The theory managed to emphasize on reasons why multinational firms should expand their operations beyond their national boundaries. Actual ingredients for policy makers to undertake a well thought through policy formulation to fully understand the importance of choosing the right entry strategy was provided for in the results. Recommendations of the study are that a thorough marketing evaluation of the country of interest should be undertaken to ensure that proper measures are put in place for the selection of an entry strategy that will address the goals and objectives of a firm. The study also recommends that employees of a firm who are at the forefront in the internationalization process should be well informed and trained ahead of the firm’s plans. Policy makers and advisories in countries are advised to streamline the processes of foreign firms’ registration so to attract foreign investors.

Pengaruh Disiplin Kerja, Pengalaman Kerja, Kepuasan Kerja dan Etos Kerja Terhadap Produktivitas Kerja Pegawai Pada Kantor Balai Benih Ikan (BBI) Pengujan

This study discusses the role of extension agents and how marketing strategies are thought to affect the sales volume of the fishermen group in Tanjung Pinang village. In this study the role of instructor variables is seen from performance and competency indicators; marketing strategy seen from indicators of market segmentation, market positioning, market entry strategy, marketing mix; and sales volume of profit and sales indicators. This study uses the SPSS.V.24 program application, showing that partially the Sales Strategy has a positive and significant effect on Sales Volume and the Extension Role has a positive and significant effect on Sales Volume. Simultaneously the Extension Role and Sales Strategy have a positive and significant effect on Sales Volume

Peran Penyuluh Dan Strategi Pemasaran Dalam Meningkatkan Volume Penjualan Kelompok Nelayan Desa Madong Tanjungpinang

This study discusses the role of extension agents and how marketing strategies are thought to affect the sales volume of the fishermen group in Tanjung Pinang village. In this study the role of instructor variables is seen from performance and competency indicators; marketing strategy seen from indicators of market segmentation, market positioning, market entry strategy, marketing mix; and sales volume of profit and sales indicators. This study uses the SPSS.V.24 program application, showing that partially the Sales Strategy has a positive and significant effect on Sales Volume and the Extension Role has a positive and significant effect on Sales Volume. Simultaneously the Extension Role and Sales Strategy have a positive and significant effect on Sales Volume

Going Abroad, Friends on Board: Cross-Border Venture Capital and Syndication Strategy in China

Cross-border venture capitals (CBVCs) are increasingly prevailing in recent decades, inter alia in emerging markets like China. The venture capital (VC) firms investing outside their home countries are faced with foreignness which is broadly regarded as liability. The primary aim of this article is to contribute to our understanding how foreignness affects VC’s strategy when entering emerging markets, particularly with respect to the foreignness originated from cultural distance. The data consist of over 5,000 CBVC deals taking place in China mainland from 1988 to 2016. Our empirical study shows that, with foreignness growing, it turns from liability into advantage in the context of CBVCs. We find an inverse U-shape relationship between foreignness and syndication, with VC firm’s reputation as the moderator. Besides, foreign VC firms establish local subsidiary when faced with foreignness, which serves as alternative to syndication. The key contribution of this article is that foreignness turns from liability into advantage in emerging markets, which exerts a curvilinear impact on the entry strategy of VC firms. This study advances the knowledge of foreignness and VC strategy, and sheds new light on entrepreneurial activities in emerging markets.

ANALISIS PENERAPAN STRATEGI MARKETING PRODUK E- MONEY PADA PT.BANK MANDIRI (Persero) Tbk. KANTOR WILAYAH REGION X SULAWESI DAN MALUKU

Penelitian ini berjudul tentang Analisis Penerapan Strategi Marketing Produk E-money Pada PT. Bank Mandiri (persero) Tbk. Kantor wilayah Region X Sulawesi Dan Maluku. Dengan Stujuan untuk mengetahui dan menganalisis Strategi Marketing yang diterapkan PT. Bank Mandiri (Persero) Tbk. Kantor wilayah Region X Sulawesi Dan Maluku. Metode analisis yang digunakan dalam penelitian ini yaitu metode penelitian deskriptif kualitatif. Pokok bahasan penelitian adalah penerapan Strategi Marketing yang diterapkan PT. Bank Mandiri (persero) Tbk. Kantor wilayah Region X Sulawesi Dan Maluku.Hasil penelitian menunjukkan bahwa penerapan strategi marketing untuk menarik konsumen menggunakan produk e-money pada PT. Bank Mandiri (persero) Tbk. Kantor Wilayah Region X Sulawesi dan Maluku diterapkan adalah Strategi Marketing dengan 5 (lima) Indikator, yaitu : a) Segmentasi pasar, b) Market positioning, c) Market Entry Strategy, d) Market Mix Strategy dan d) Timing strategy.