UNIVERSTIY OF NEUCHATELINTERNATIONALIZATION OF AUDIOTEKA: INDIAN PERSPECTIVE Case Study By Binayak Malla & Abhinayak Malla Séminaire de Synthèse–MSc International Business Development Case study and teaching notes prepared under the supervision of Professor Sam Blili Professor Michal Zdziarski, Dr. Katarzyna Jagodzinska and Philippe Lamb Submission date: 29th May 2013 SPRING SEMESTER 2013 University of Neuchatel – Faculty of Economic and Business – Enterprise institute. Table of Contents Synopsis of case ..........................................................................................................................3 PART I: Introduction of Audioteka .............................................................................................5 Background of Audioteka: .......................................................................................................5 Investment in Audioteka ............................................................................................................6 Defining market .........................................................................................................................6 Competitor’s analysis ................................................................................................................7 Internationalization in Europe .................................................................................................7 PART II: Introduction to India ..................................................................................................10 Publication industry Audiobook market in India ................................................................11 Challenges in India ..................................................................................................................12 Cultural dimension of India ...................................................................................................14 Part III: Closing Paragraph .......................................................................................................16 PART IV: Assignment questions ...............................................................................................18 Bibliography and References ......................................................................................................19 Appendix .......................................................................................................................................20 2 jugging etc. 3 . cooking. It could be used in mobile devices. Within five years of Audioteka’s establishment. His vision was to make Audioteka a global company by presenting his idea of selling book in an audio format. Success in home market and Czech Republic provided Marcin confident in launching aggressive internationalization strategy to other European Market. added more support for rapid expansion. So there was a belief that technologically innovative products should be accessible as soon as possible to the general people for the company to maximize its profit potential and expand its growth. Marcin believed that his company was destined to have success. He planned to launch Audioteka in 12-15 European countries before the end of 2013. The best part of audio book was its compatibility on most of the electronic devices. Audio books user could carry as many audio books as they wish just in their portable devices and use them whenever they felt like. people could now sit. going on a walk. People could listen to it when they were doing their regular activities such as driving. It was quite natural for a technology-based company to be very aggressive in internationalization and to expand their reach as far as possible before new technology arrived or new competitor entered the market. audio book did not require readers to totally concentrate on reading. a young Polish entrepreneur Mr. it was the biggest producer of book recoding in Poland and the biggest distribution platform of audio books in Poland and Czech Republic. Also the fact that technology was changing very rapidly and products associated with it had shorter lifespan provided great threat to the company. Also they shouldn’t worry much about weight and space required to carry a book. laptops and any other audio devices capable of downloading audio files. Because of these amazing features. Investment made by Giza Venture Capital worth 0.5 million also provided support for his campaign. Unlike paper books. Marcin Beme established Audioteka in 2008. and so it did. computers. the fact that core idea behind production of technology-based product could easily be transferred and it didn’t require much of capital to establish an office in new location.Audioteka Synopsis of case With a very simple concept of providing digital audio book. Also. relax and even close their eyes and listen to the story presented in the book narrated by the voice of celebrities and famous radio speakers. With audio book. political and economical) about it? India is not just a country. supported by favorable government policies for foreign investor.2 billion population (1. Most of the people living in it associated themselves strongly with religion.5 time more than whole Europe) providing huge market opportunities. was the company matured enough to initiate such a big move? Did they have enough resources (capital. The questions associated with it could be. Complexity. Cultural and religious aspect (about which very little was known to western world) played very influential role in doing business in India. difference in business environment. 1. could Audioteka be able to adapt to these new kinds of environment and establish them in Indian market was the big question to be answered. The country had 22 regional and more than 100 locally spoken languages. Growing economy. associated with establishing business and operating it were very high. 4 . made it very challenging for foreign company to establish well in India. culture and social setting of the country compared to European market. social-culture. So. However. but it is a different world on its own. human and technical) and business information (market.For Marcin being aggressive in expanding its reach within Europe was quite understandable but thinking of something much bigger and planning to enter giant Indian market was a subject to be scrutinized in more appropriate way. His aim was to make every Pole listen to audio book at least once in their lifetime. Marcin Beme established Audioteka with a dream to make it one of the first Polish company to be successful worldwide. The exponential growth continued in the year 2011with over 2. HTC. the company employed country manager for Poland. IT specialists. They altogether downloaded approximately 50’000 audiobooks. instead of spending time and effort in reading. The concept of audio book came to his mind when he was traveling with his brother on trip to Polish seaside. So.5 million users and 300’000 audiobooks. In 2009 more than 1 million users visited Audioteka’s websites. and directors preparing services for Scandinavian countries.Part 1: Introduction of the company: Background of Audioteka: After completing three university (MA) degree – in mathematics. which was IT based platform that enabled to play recordings on any mobile and audio device produced in the world. Apple. Samsung. Renault. His brother had some experience as a manger in multinational company. Marcin had a very simple objective of serving Polish people with ‘audiobook’. Spain and Portugal. In addition to Marcin as the CEO. The trip was boring so they started talking with each other and one of them mentioned that it would be great if we could listen to some books on such trip. Sony. or Satchi & Satchi and was in conversation with several others to start a project in joint 5 . Audioteka employed six full time persons as their core staff. a graphic designer. UK content and France. economics at the University of Warsaw and in computer science at the Faculty of Technical Physics and Applied Mathematics of Warsaw University. Rapid expansion of mobile technologies and the increasing sales of smart phones triggered additional sales of audio books. Android.a book that can be listened to. So. Nokia. Reason of its success came from its strength. Deutsche Telecom. then the idea clicked on Marcin’s mind (who was already a young entrepreneur). They were willing to look for agents and partners who could facilitate the expansion into other markets but were not willing to add more staff. Blackberry. The company cooperates with many well-known global corporations including Amazon. Audioteka cooperates with more than 300 publishers and its services offered more than 3’000 recordings. These numbers were respectively close to 2 million users and over 100’000 audiobooks in 2010. Huaiwei. marketing director. He knew that not everyone would become a client of Audioteka but thought all should know about audio book. Orange. and more than 5’000 were being prepared for sales. At the early stage of establishment. they decided to work together on it. and 27% of Polish students. Investment also came from Giza Venture Capital1. magazines. 1 2 http://antyweb. Defining market: In February 2011 the National Library of Poland and TNS OBOP research group presented an annual survey on reading trends in Poland2 which stated "As many as 20% of Poles with academic degrees. Many of the customers. a guide.bn. and introduction of new means of entertainment presented in internet such as social media sites.org. The sale of the Nokia model with Cohelo audio book was much higher compared to other comparable phones from competitive companies. In 2010 only 44% of responders declared any kind of reading of a book.pl/aktualnosci/230-z-czytelnictwem-nadal-zle---raport-z-badan-biblioteki-narodowej. These projects varied from the simple marketing projects to more enduring partnerships on joint distribution and promotion. These facts indicated that the readership of books and magazines was vanishing in recent time. They were also engaged in Audioteka development from the early stage by providing non-executive advises and IT support. online videos and news sites etc. The first such project was agreed with Nokia. did not read any text longer than three pages in the last month.collaboration. This investment made the valuation of the company at the level of 2.bn. Investment in Audioteka Audioteka initial funding was provided from the owner investment and a seed capital from K2 Internet SA . To promote the launch of a new model of mobile phone. a newspaper in audio format Audioteka was been able to create new market suitable for their products.. the Israeli fund which decided to invest EUR 0. who bought Nokia with the initial audio book. young people paid lesser attention in reading books.advancement in technology. In comparable studies carried out in the Czech Republic and France these numbers were 83 and 69% respectively. By digitizing reading materials such as books. taking up to 20% of its shares.pl/aktualnosci/230-z-czytelnictwem-nadal-zle---raport-z-badan-biblioteki-narodowej. Nokia wished to have a new book by Paolo Cohelo installed in it.5 million in Audioteka’s development. come back after few months to downloaded audio book directly from Audioteka.html website visited on 05/20/2013 6 .org.a local Polish interactive marketing agency. including any web content". an album or Internet content. A supportive argument could be presented by stating .5 million Euros.html 2 http://www.pl/giza-polish-ventures-inwestuje-w-audioteka-pl-2-miliony-zlotych/ website visited on 05/20/2013 http://www. Sales values of a single audio book varied. the prices of audio-recorded books were similar to the prices of printed. In 2012 the company produces about 25 new audio books monthly. had become an absolute blockbuster.com/2008/07/10/audible-announces-fourth-quarter-2007-results/ website visited on 05/20/2013 7 . For the purchase of audio books. It had been a benchmark for Audioteka that closely follows the news on new concepts. which increased to more than 2000 within three years. France. with earnings above average. Internationalization in Europe After successfully launching Audioteka in France.usatoday. Audible was already present in the United States. a legendary Apple’s leader. At the end of 2007. A post mortal biography of Steve Jobs. had 457’000 registered users. paper versions. travelled a lot and wanted to make use of new opportunities created by technology.audible.00. In 2012 the company produced about 25 new audio books monthly. Its sales in an audio version exceeded the level of 1’000 copies in the first month after it had been released. The company was a trendsetter in the industry. they didn’t have larger scope in terms of population. a global leader and pioneer in the audio-book industry was the main competitor of Audioteka. but rarely exceeded EUR 25. USD 110 million. and more than 450 collaborating entities – publishers and content distributors. The Audioteka service started with an offer of 200 audio books. the company generated profit of approx. the positive aspects however were the price of audio book 3 http://www.Core market for audio book was based on entertainment business. the company was planning to enter Scandinavian countries and aimed to open its subsidiary by the first half of 2013. Germany and Great Britain in 2011.4 Audible introduces to the market about 1000 new titles per year. The company had a view that these countries were potentially less lucrative market. In 2008. who were mobile.htm website visited on 05/20/2013 4 http://about.3 The company offered 80’000 audio books and magazines at that time. In Poland audio books were usually purchased by men in their thirties.com/tech/techinvestor/industry/2008-01-31-amazon-audible_N. customers were billed through the mobile phone operators in exchange of small share of revenues.00 new users registered with Audioteka. The average price of a recording was about EUR 8. Amazon for USD 300 million bought Audible. They amount to 70% of all buyers. Since November 2008 until the end of 2011. Although. In Poland. In 2011 less than 3% of its profit was generated from markets other than the American. Audible was among the first companies delivering applications (apps) for Apple. Competitor’s analysis: Audible. 150. lack of maturity in dealing with international issues etc. Audioteka was still very aggressive in its approach of internationalization because it was a technology-based company and since technology was changing rapidly. among its management team without which company could lose its direction while aggressively moving forward in the path of internationalization. With the exception of Chez-republic where company created a joint venture. India and Turkey. The main reason behind it was the fact that opening a subsidiary would provide more control and helped in collaborating with many publishers. the company was always willing to take first move advantage 8 . company aimed on going to big nations such as Russia. limitation of infrastructures. in Scandinavian country. they believed that doing so would limit the number of publisher with whom they could collaborate. Audioteka had opened its subsidiary in all the other countries where it entered and was planning to do so for the new countries in the list. As a part of near future plan. the audio book for children were not popular because people thought that it was more important for kids to have valuable personal contact rather than engaging them with audio contents. Those people who believed that audio book was helping to spread illiteracy among the people by discouraging them to read made criticism about the technology. These challenges came in the form of cultural difference. criticism about the technology. Internationalization of Audioteka was filled with different challenges. This perception was due to difference in culture. For an entrepreneurial company like Audioteka. For example. good managerial skills and operational excellence. Joint venture was not considered by the company to be a good option because. Internationalization has created large stress on the company as they did not have much exposure and experience in dealing with different these types of issues. to be able to transform the company into mid-sized global business required global experience. The other criticized by saying these kinds of products were more for blind and disabled people who had problem in reading and should not be encouraged among general people. as it would make them avoid reading habits. Rapid expansion possessed lots of risk on infrastructure side as the company had little finance and limited number of core employee working in the company. Company also planned to open new subsidiary in Spain and Portugal by the end of 2013 and approximately 8-10 European country with possible inclusion of UK. Opening a subsidiary would make them independent and make them appear neutral in the eye of competing publishers.could be set about four times more expensive than Poland and most probably two times higher than in France. Despite of all these challenges in European market. making decision on how and when to enter Indian market was a big strategic question for Marcin to be answered. So.to take the leadership position in the market. Country so big in size with stable political and economic environment and immense market potential were its key features of attraction and Audioteka was interested in capitalizing them. 9 . India had always been in its list. the challenges that the country could possess would possibly be much bigger than what they had anticipated. Audioteka was accessing all the possible opportunities in different market to introduce its product. So. It wanted to be in large market before the competition emerges or new technology was introduced. However. In terms of social settings.8% and 6. India has multicultural ethnic foundation.Part II: Introduction of India Just like many foreign companies who were attracted by huge market potential of India. China. Around 65% of the population is aged 15 to 65. 8 https://www. political and economical structure.gov/library/publications/the-world-factbook/geos/in.3% per year. Economic growth of 10. and freedom of the media. which accounted for more than 50% of its output.9 in the same year. 6. With over 1.2 billion people and the population growth rate of 1. The country is separated from Sri Lanka by a narrow channel of sea formed by the Palk Strait and the Gulf of Mannar. so this large working age population is expected to provide sustained momentum to economic growth in the country. Except China.5% was one of the brightest aspects of India economy over the last three year (2010.html website visited on 11/05/2013 7 Voice and accountability measures the extent to which a country’s citizens are able to participate in selecting their government as well as freedom of expression. with the freedom to follow any religion. The country had 30% of urban population (2010) and the rate of urbanization was 2. The country also proved to be strategically best for entering South Asian market because it is bordering with seven countries5 and India plays a key influential role in economic welfare of the region. India enjoyed being the biggest and very stable democratic country in the world.4% (2010-15)6.html website visited on 11/05/2013 10 .3%.cia. and Audioteka was eager to take the opportunity.cia.gov/library/publications/the-world-factbook/geos/in. Myanmar and Bangladesh. 2011 and 2012)8.2 percentile in voice and accountability7 in 2010. Stable political situation supported by strong economic growth rate and worldwide reorganization in technological sector made the county very attractive market for Audioteka. and maintained uniformity in secular ideas. Success in India ensured easy access to these countries. 6 https://www. in comparison. They represent as a South Asian Countries and have lot of similarities in terms of soci-cultural. Even when the world economy was facing one of the biggest financial and economic crises of recent time. Bhutan. As per World Bank’s worldwide governance indices. Nepal. freedom of association. India has a fast growing urban English-speaking 5 India has border with Afghanistan. India ranked in the 59. which added more value for Audioteka because most of their successes in Europe were based on urban population. India on its own could be bigger market than whole of Europe for Audioteka. which indicated very positive signs for investment. Pakistan. In terms of political ideology. Significance of this growth rate became even higher when compared with American and European economy at the same period of time. Audioteka was also willing to enter the market to maximize its potential. Indian economy was growing on a steady phase mainly driven by its services sector.2 and 20. all the other countries are part of South Asian Association for Regional Cooperation (SAARC). China and Russia scored percentile ranks of 5. Vodafone. 9 Country analysis report India. Information on publishing industry in India. Data monitor . which made it a preferred investment destination for information technology and outsourcing services9. having such a well-set infrastructure could make it easier for company to establish itself in India. German book office 11 There were 22 major languages recognized by the constitution of India of which Hindi was the official language spoken by 41% of the people and English enjoyed the status of subsidiary official languages. and IT-enabled services sectors. 25% of books that are sold were based in Hindi11 language and 20% of sales volume came from English language books. Because of these reasons. BSNL. GBO New Delhi. Creating partnership with one of these big telecom service providers. Government policy on technology was prodevelopment. Reliance communication. Idea Cellular. Around one third of young population identify themselves as book readers. There were 13 major operators providing services among which Airtel had the maximum subscriber (December 2012) followed by. It ranked 2 in terms of mobile phone users after China for the same year. This information related to telecom market provided more encouragement for Audioteka because their success in Europe depended a lot on availability and accessibility of mobile phone users. India has emerged as one of the world fastest growing telecom markets because of recent deregulation and liberalization of telecommunication laws and policies. IT. Publication industry10 and Audio book market in India: To produce an audio book. There are around 19. So.685 million main line telephone subscriber and 89. In India. publication date.862 million of mobile cellular phone subscriber for the year 2011. India was a host for 32. India made strong progress and received global recognition in areas such as the telecoms. with a significantly higher allocation for the development of the technological knowledge base and industries. October 2011 Frankfurter B. In-depth PESTLE insights. Besides these there 10 11 . company could gain access to millions of subscribers who could possibly be their potential customer.000 publishers in the country with only around 12’400 having ISBN’s and it is estimated that about 90’000 titles were published every year which includes books across all genres.middle class. For the year 2011. it was also important for the company to tie up with book publication companies because they were the one who had the ownership and copyright of books. publishing industry was growing at an impressive pace and it was one of the few places in the world where there is still growth in both print and digital publishing and the value of it is estimated to be $2 billion with a growth rate of around 15% for the year 2012. tele-density was roughly 75% and subscribership was growing more than 20 million per month. The other encouraging factor for Audioteka was the study conducted by Professor Philip M. October 2011 12 They have more than 90 publishers as their clients and distribute books in all major and local book shops in major city of India.E. latent demand for audio books in India was estimated to be $363.com) 12 . (Appendix 1) presents list of stats with latent demand in dollars and percentage of share in Indian were 844 different dialects that were spoken in various parts of the country. 14 Philip M. They also have alliance with 10. infiBean and Amazon. pricing could be very important factor for their success because as pointed out earlier. Market share for different types of books are classified as 40% for academic books. Maharashtra was the largest market with $49. publication date. Prices quoted for audio book in Europe were far more than average for Indian consumer to buy it. France 2008. INSEAD Singapore and Fontainebleau. Also India is a developing country and books are allowed to be printed in ‘low price edition’ could add more pressure on lowering the price of audio book. The market for eBooks in India has been miniscule because of high price associated with it.7 million in 2009. Audioteka should be able to price their book in a very appropriate manner.6%) and the Gujarat with $29. Based on the study. it is representative for around 50 national/ international book publishers. consumers were still not willing to pay for expensive eBooks in India.6% of total market) followed by Uttar Pradesh with $ 42. Growth in publication industry provided opportunity for the company to create a new market segment for audio book.23%). Retailers for online distributions were flipkart.9 million (8. therefore.) or total revenues (not profit) if India is served in an efficient manner. Audioteka considered this information to be very positive for entering Indian market. These top three regions covered almost 33.which made the country as the third largest market for English books consumption after US and UK market.source of information: Country analysis report India. It is a measure.I. 15 Economists commonly define the term Latent demand: as the industry earnings of a market when that market becomes accessible and attractive to serve by competing firms.2 million (11. The 2009-2014 outlook for Audio books in India. it has its center in most of the major cities in India.5 million (13. US and other part of world. (Source www. Parker14 on audio book market in India. It is typically expressed as the total revenues potentially extracted by firms.icongrouponline. The report presented latent demand15 (in million of USD) or Potential Industry Earning (PIE) for estimated 5’100 cities across the country. 13 They are one of the largest distributors of books and magazines in India. estimate of how the PIE grows over time was also presented in the study. so to make the product attractive to the Indian consumer. In-depth PESTLE insights. However. Data monitor .000 international publishers in the UK. For each state or union territory. Major book distributors in India are a) International book house12 b) India book House13 c) India Book Distributors.come. of potential industry earnings (P..43% of the latent demand for audio book in India. 30% for children’s book and 30% for trade publishing. Despite Indian government effort in supporting FDI the Ease of doing business ranking for the country was very poor compared to an average ranking of countries from South Asian Region and European Union. Because of liberalized government policies. This is because of the fact that there exist huge complexities in terms of ease of doing business in India for foreign companies. Reflecting on to these figures. Poor implementation of patent laws and the appreciating Indian currency (rupee) were the key risks associated with IT-based companies. Even though India seems to be very attractive market. Even though the country is one of the fastest growing economies in the world. Even if Audioteka were able to fulfill the latent demand for two major cities (Delhi and Mumbai) the company would make $27. Mumbai (major city of Maharashtra region) was with 13 million populations was ranked number 1 with latent demand of $ 14. According to World Bank and IFC’s report on ‘Ease of Doing business in India’ the country ranked 132nd position out of 185 countries (Appendix 3). Among the cities. Corruption and Terrorism had been two major factors causing problems in the political system of the country. in recent time we have seen may international organization entering Indian market but still they are struggling to establish themselves well.143. it was quite obvious that success in the Indian market were very likely once the company started their operation. followed by Delhi (Delhi state) with 12 million population and $9. India was still a developing nation very different from most of the developed countries of Europe.817 million latent demand. Kolkata and Chennai followed the list with latent demand worth $6. It was placed 119th out of 169 countries in terms of human development.856. Economic growth and investment has crippled by poor infrastructure and widespread corruption. not many international organizations had been able to successfully capitalize its market potential.338 million (Appendix 2). $5.45 million.45 million. there exists a huge gap between rich and poor people and India is among one of the countries having highest numbers of individuals living below the poverty line. India’s poor performance on social indicators was reflected in its 2010 Human Development Index ranking.market). it can be seen how different variables contributed in the overall ranking of the country and also what were the respective ranks for the same variable in other regions. 13 . Challenges in India Despite being such an attractive market. $5. Its low rank was mainly attributed to poor healthcare and educational infrastructure. Similarly Ahmedabad. In Table number 1. Table 1: India ranking South Asia European Union a) Starting a Business in India: 86 72 Construction 182 111 69 c) Getting Electricity 105 128 74 d) Registering Property 94 121 62 e) Getting Credit: 23 96 54 f) Protecting Investors 49 82 68 g) Paying Taxes 152 115 62 h) Trading across the boarder 127 131 36 i) Enforcing Contracts 184 136 47 j) Resolving Insolvency 116 103 36 OVERALL RANKING 132 121 40 b) Dealing with 173 Permits Country ranking16 for most of the European countries is below 60 with Scandinavian country being on the top of the list and country like Poland and Switzerland having raking of 55 and 28 respectively. “Culture is the collective programming of the mind distinguishing the members of one group or category of people from other”17. conducted most comprehensive studies 16 17 Source: http://www. has different social and cultural settings than most of European countries. it was very important to understand cultural dimension of society before entering into new market.org/rankings website visited on 13/05/2013 Source: http://geert-hofstede.doingbusiness. Huge difference in ranking between Indian and most of the European countries (including Poland) shows the complexity associated with establishing business in India. it should be able to better understand cultural values and social settings of that place.com/national-culture. So. Cultural dimension of India For a business to establish itself well in any country or region. Values in work place were greatly influenced by culture. with its background of 5000 years old civilization.html visited on 13/05/2013 14 . India. a Dutch social psychologist. Professor Geert Hofstede. was widely practiced. In terms of Power distance18 India has a score of 77 out of 100. India is considered to be a masculine society20. Audioteka had a strategy of opening subsidiary as a part of internationalization strategy. so this information could help them understand the behavior of their employee if they opened a subsidiary in India. For more information also see http://geerthofstede. The score provided for each of the traits can define culture of India. Hofstede five cultural dimension traits could provide the best way to explain culture. In more Masculine countries the focus is on success and achievements.com/india. India is very masculine in terms of visual display of success and power.html visited on 13/05/2013. A feminine society is one where quality of life is the sign of success and standing out from the crowd is not admirable. which meant power was centralized. The employees expected clear direction of work from the managers. The employer/employee relationship was one of expectations based on expectations – Loyalty by the employee and almost familial protection by the employer.com/india. What makes India so different was its culture. Communication flowed in top down manner. The fundamental issue here is what motivates people. 18 Power distance is defined as the extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally. and the glamour that went with advertising one’s success. wanting to be the best (masculine) or liking what you do (feminine). and managers count on the obedience of their team members.on cultural and provided five dimensions on the basis of which we could understand behavior of individual and their value system at workplace. which were the key to everything in a Collectivist society. achievement and success. 20 A high score (masculine) on this dimension indicates that the society will be driven by competition. Understanding culture could help Audioteka to know the difference and adapt to Indian business environment based on which they could make decisions. 19 Higher value in this dimension means people were more individualist. Hiring and promotion decisions were often made based on relationships. with success being defined by the winner / best in field – a value system that starts in school and continues throughout organizational behavior.html (visited on 13/05/2013) 15 . The designer brand label. India has a score of 48 and was a collective society with high preference for belonging to a larger social framework in which individuals were expected to act in accordance to the greater good of group or society. In terms of Individualism19. source: http://geert-hofstede. associating themselves more in terms of their personal need and benefits where as lower value indicates collectivists who are more willing to do things that are based on group values. validated by material gains. This information could help Audioteka for advertising its product and positioning itself well in the market. With a score of 56 in Masculine dimension. which typically score low on this dimension. 16 . pragmatic culture. 21 The dimension Uncertainty Avoidance has to do with the way that a society deals with the fact that the future can never be known: should we try to control the future or just let it happen? This ambiguity brings with it anxiety and different cultures have learnt to deal with this anxiety in different ways. It could also help in determining international strategies for Audioteka while entering Indian market.com/india.com/india. Societies that have a high score on Long Term Orientation.com/definition/english/karma karma is defined as ‘The sum of a person’s actions in this and previous states of existence. In India the concept of “karma”23 dominates religious and philosophical thought. Power distance is higher in India than Poland. the extent to which a society shows a pragmatic future-oriented perspective rather than a conventional historical short-term point of view. a changing game plan based on changing reality and a general comfort with discovering the fated path. Poland is highly uncertainty avoidance where as India is more acceptable to uncertainty and India is long term oriented where as Poland is short term oriented. the figure showed that both the country had huge difference in terms of cultural traits. making it a long term. As presented in (Appendix 4). India is collectivist society where as Poland is more individualist. For more information also see http://geerthofstede.India scores 40 in Uncertainty avoidance21 dimension and has a medium low preference for avoiding uncertainty. and thus not as important as to western societies. viewed as deciding their fate in future existences’. A word used often was “adjust” and means a wide range of things. In terms of Long-term orientation22 India score is 61. Acceptance for uncertainty among the people neither made them believe that nothing had to be perfect nor had to go exactly as planned. Such information could play important role in understanding differences in culture between two countries and help Audioteka to understand the behavior of Indian consumer. Tolerance for the unexpected was high even welcomed as a break from repetitiveness. For more information also see http://geerthofstede.html (visited on 13/05/2013) 22 The long term orientation dimension is closely related to the teachings of Confucius and can be interpreted as dealing with society’s search for virtue. from turning a blind eye to rules being disregarded to finding a unique solution to a seemingly impossible problem. typically forgive lack of punctuality.html (visited on 13/05/2013) 23 According to online Oxford dictionary http://oxforddictionaries. Comparing India and Poland in terms of these dimensions could help in understanding difference between culture and value system of people living in both the countries. Time is not linear. India has a great tolerance for religious beliefs. both the countries are masculine but Poland is more masculine than India. For example. Audioteka should be very clear in its approach on whether to target urban population or rural population in India. He wondered with excitement and a bit of nervousness about how his business journey to India would be like. 17 . Average middle class Indian consumer is very price sensitive and the purchase decision made by them is highly influenced by the price of product. urban population of India could be served with audio books related with entertainment (best sellers books of India) where as the rural population would be better served by audio books related to education and religion. However. Without much effort. India in one hand is the country filled with opportunities and huge market potential and on the other hand it is a mysterious land with very different business environment. growth in publication industry. For Marcin. higher percentage of young people who are very supportive of technological products. Both sets of population have different demand for audio book. Answers to questions like. high latent demand for audio book in urban cities are few of many factors that made the country very attractive market for Audioteka. higher urbanization rate with increasing trend of accepting western culture. Audioteka could directly apply its current business model of internationalization to enter Indian market and hope for its success. As in Europe. since more than 80% of people living in the country are Hindu. audio book related with religious book could possibly be very attractive product. Launching audio book at that period of festival seasons could be best timing because being a collective society people like to give gifts to their friends and family. Favorable economic growth supported by liberalized government policies and well set democratic norms. Many small cultural factors could play big influential role in success of Audioteka in India. These risk factors could be different cultural factors that have very high influence in the market place or it could be associated with various components essential to establish a business in the country. and they have strong faith in the religion.Part III: Closing Paragraph Success in European market had given Marcin lot of confident and he believes he could repeat his success story in India. one that he had never experienced in Europe. doing so it would ignore different risk factors those could possibly hinder in the path of success. which type of audio book should be launched in India? When would be the right timing for launching it? Who could possibly be the target customer? How much are they willing to pay for the product? could come from socio-cultural factors. lack of proper infrastructure etc. complexity related with business operation. belief system. work ethics.PART IV: Assignment questions: • Will Audioteka be able to achieve success in India? What according to you could be the key success factor or reason for failure of the company? Based on SWOT analysis of the company present your point of view? • What according to you should be the internationalization strategy for technology-based company like Audioteka.) or b) Cultural environment (difference in language. social values etc. reflect your answer based on mode of entry and ease of doing business? • What could possibly be the most challenging factor for Audioteka while entering Indian market a) Business environment (business laws.)? • Do you think Audioteka has the potential of accomplishing its objective and becoming a Global company? What is your prediction about its future and what suggestions would you like to give to Marcin for becoming successful worldwide? 18 . France 2008. H. H. International marketing: a global perspective (3rd edition) Thomson learning. Data monitor. Information on publishing industry in India. (2006)..Bibliography and References: Mühlbacher.org/data/exploreeconomies/india/ http://geert-hofstede. October 2011 Frankfurter B. publication date.com/national-culture.. Scholes K. GBO New Delhi. L. FT Prentice Hall. & Dahringer.. Country analysis report India. German book office Philip M. Leihs. Exploring Corporate strategy (8th edition).html 19 . In-depth PESTLE insights. INSEAD Singapore and Fontainebleau.doingbusiness.. Whittington R (2005). Johnson G. http://www. The 2009-2014 outlook for Audio books in India. Appendix 1: 20 . Appendix 2: 21 . Appendix 3: 22 . Appendix 4: \ 23 .