Explain how one of Ansoff’s generic strategies might be applied to Taco Bell’s decision to enter the Brazilian market.
- Edexcel - A-Level Business - Question 2 - 2022 - Paper 1
Question 2
Explain how one of Ansoff’s generic strategies might be applied to Taco Bell’s decision to enter the Brazilian market.
Worked Solution & Example Answer:Explain how one of Ansoff’s generic strategies might be applied to Taco Bell’s decision to enter the Brazilian market.
- Edexcel - A-Level Business - Question 2 - 2022 - Paper 1
Step 1
Knowledge of Ansoff’s Strategies
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Answer
Ansoff's generic strategies include Market Development, Market Penetration, Product Development, and Diversification. For Taco Bell, the focus will be on Market Development as it seeks to enter Brazil, a new market.
Step 2
Application to Taco Bell
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Answer
Taco Bell is entering the Brazilian market, which is a new geographical area for its operations. The company aims to leverage its existing Tex-Mex product offerings, which are already popular in the USA, to attract local customers.
Step 3
Analysis of Risk
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Answer
Entering a new market, such as Brazil, poses higher risks compared to simply increasing sales within an existing market. Taco Bell faces the challenge of unfamiliar consumer preferences and competition. Thus, while selling familiar products, the risks associated with Market Development are greater than those encountered with Market Penetration.
