Transcript Estonia

Estonia
Ksenia Molchanova
Yang Ke (Eric)
Bennett Gackle
Demographics
• 1,307,605 people
• Growth rate of -0.632 percent
• The average age in Estonia is 39.6 years
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Romania = 36.1 years
Germany = 43.4 years
Finland = 41.8 years
United States = 36.7 years
• 69 percent of the population is living in urban
areas.
Government
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Very stable.
Parliamentary republic
Gained its independence on August 21, 1991
Joined the European Union in 2004.
Rated 17th in the world for ease of doing
business.
• No social unrest in the political structure.
Government (cont’d)
• Economic trade barriers are low.
• Huge openness to foreign direct investments.
• Many investment banks from foreign nations
elect to set up firms within the countries
borders.
• Analysts believe the Euro will not be adopted
until 2011.
– 1 United States Dollar = 11.4795 Estonian Krooni
– 1 Euro = 15.6466 Estonian Krooni.
Economics
Economics (cont’d)
• GDP = $29.35 billion (in US Dollars) at
purchasing power parity
• Growth rate = 7.1 percent per year
• GDP per capita in US Dollars is $21,100 per a
2007 estimate
• Inflation rate = 6.6 percent
• Unemployment rate = 4.7 percent
Economics (cont’d)
• Tourism is currently on the rise
• Growth in alternative sources for energy
• Growing disparity between Talinn and the rest
of the country
• Incomes of Talinn are significantly higher than
the rest of the nation
Economics (cont’d)
• Inflation rate must be reduced to 3 percent
before the Euro can be introduced
• Apart of the World Trade Organization
• Tariffs were put in place to protect agricultural
businesses
Economics (cont’d)
Physical Infrastructure
• Shipping goods by sea from the United States
to Estonia is relatively easy and available.
• Gateway country to Russia and the city of St.
Petersburg.
• The M-box can get a lot of exposure to both
the Tallinn and Helsinki markets ports of both
countries.
Physical Infrastructure (cont’d)
• 968 kilometers of railway stretch across
Estonia.
• 56,856 kilometers of roadways in Estonia
– 13,000 kilometers are paved
– 99 kilometers paved as expressways
• 19 airports are scattered throughout the
country (CIA Factbook).
– 12 of these airports have paved runways
– 7 have unpaved runways (CIA Factbook).
Communications Infrastructure
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Programmers designed the program Skype
382 phone lines per 1000 people.
1,236 cell phones per 1000 people.
483 computers per 1,000 people.
Communication Infrastructure (cont’d)
• 760,000 internet users
• Many bars, cafés, restaurants, and lounges
offer Wi-Fi access
• 3 broadcast stations
• 93 percent of households own a television
Market Assessment
• The video game industry over the next five
years will be explosive growth.
• In 2005, the global video game market
revenue of 29 billion U.S. dollars,
• By 2011, global video game market will reach
revenues of 44,billion U.S. dollars.
Market Assessment (cont’d)
• Sony PS3 and strong growth as well as the
Nintendo Wii game consoles
• But our M-BOX shall become the most
important competitor in the future global
video game market
• Our M-BOX can be aimed at Europe and the
South African markets
Market Assessment (cont’d)
• X-box game consoles market share = 17%.
• Sony Playstation market share = 68% by the
end of 2004
• Nintendo's market share = 15%.
• U.S. video game market sales of 179 billion
U.S. dollars in 2006 increased by 43%.
Market Assessment (cont’d)
• Sony's PS3 game console sales of 16.71 million
units.
• Nintendo's Wii console sold 36.00 million
units.
• Xbox 360 game consoles sold 22.55 million
units.
Global Markets
Finland
• Borders with Norway, Sweden , and Russia.
• Finland's population is 5,300,000.
• Most of the population is living in the
southern part of a more moderate climate
• GDP in 2002 is 139,700,000,000 Euros, per
capita GDP is 26,800 Euros.
Global Markets (cont’d)
• Finland, "the world's most competitive
countries."
• Finland developed economy, per capita
income, which is easily accessible, welldeveloped of network, the most important
thing is our target market Estonia across the
sea, to facilitate exchanges.
Global Markets (cont’d)
• Today, Finland is not only an economically
developed country, but also a high-tech and
well-developed information society and the
world-famous.
• Finland adjusted their economic and
technological development strategies, making
them a world leader.
• Finland's information industry is in
development
Global Markets (cont’d)
Russia
• World economic power.
• GDP reached 1.1356 trillion U.S. dollars, ranking tenth
in the world.
• Rich in natural resources for agricultural and industrial
development.
• Computer industry, aerospace aviation industry, the
rapid rise of high-tech industries, as well as a strong
defense industry.
• Therefore, Russia will be another important M-BOX
market.
Market Entry Strategies
• FDI
• Pricing Strategy
• Developing a home or “domestic” market
within the country.
• Strong Marketing Strategy.
• European Markets—”fair game”.
• Gateway to Russia
Future Outlook/Potential
• Convert from the Estonia kroon to the Euro.
• More investments coming from Russia and
Spain.
• Solid Investments from Sweden and Finland.
• Tense oil relations with Russia.
• Slumped sales, but will recover in the future.
Recommendations
Short-term
• Translate manuals and console menus into
Russian, Estonian, and English.
• Price below PS3 and Xbox 360.
• Improve advertising.
• Develop Distribution channels.
• Establish tech support specialists.
Recommendations
Long-term
• Take advantage of future growth.
• Offer a wireless console.
• Integrate Skype software.
• Expand into Russia and Finland.
• Improve manufacturing efficiency.