Fragmentation Challenges in North America: Implications for Michael Hill's Market Entry
Task: How do competitiveness, regulatory compliance, cultural differences, recognized brand dynamics, and operational challenges impact Michael Hill's entry into the fragmented North American jewelry market?
The main identification of key issues associated with the fragmentation of the North America market is Competitiveness, Regulatory Compliance, Difference in Culture, Operational Challenges, and Recognized Brands. To achieve sustainable success and growth, or to looking to enter in market as a newcomer must analyse these issues.
1. Competitiveness: Michael hill found it difficult to make a name for himself in this area and increase his share of the market due to fierce competition because of several foreign and local competitors striving in the market share, the North American jewellery market is fragmented.
2. Regulatory Compliance: North America has a complicated legal and regulatory system with diverse rules and regulations shifting from state to state (Mead, 2019). It can be expensive and time consuming to comply with rules, which makes it difficult for newcomers like Michael Hill. To ensure that diamonds are sourced regulatory standards for the jewellery sector, including a commitment to the Kimberly Process Certification Scheme.
3. Difference in Culture: To be successful in the region, Michael Hill must comprehend and accommodate with cultural distinctions because the market in North America is very diversified, with various regional and cultural tastes (Gómez-Ullate et al., 2020).
4. Recognized Brand: In New Zealand and Australia, Michael Hill is a famous brand, while in North America it is not extremely popular. Because they have been there for a long period of time and have a larger presence, established brands in the area are more difficult for the other brand to compete against.
5. Operational Challenges: To make sure a seamless experience for customers, Michael Hill needs to invest in creating a supply chain, setting up a network of distribution centres, and training its employees because a large financial investment and operational resources are needed when entering a new market. Operating costs are higher in North America that any other countries in the world. Higher taxes, labour cost, real estate costs are some of the causes of these.
Gómez-Ullate, M., Rieutort, L., Kamara, A., Santos, A. S., Pirra, A., & Solís, M. G. (2020). Demographic challenges in rural Europe and cases of resilience based on cultural heritage management. A comparative analysis in Mediterranean countries inner regions. European Countryside, 12(3), 408-431.https://sciendo.com/pdf/10.2478/euco-2020-0022
Mead, A. (2019). Legal and regulatory issues governing cannabis and cannabis-derived products in the United States. Frontiers in plant science, 10, 697.https://www.frontiersin.org/articles/10.3389/fpls.2019.00697/full