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Estonia
Ksenia MolchanovaYang Ke (Eric)
Bennett Gackle
Demographics
• 1,307,605 people • Growth rate of -0.632 percent • The average age in Estonia is 39.6 years – 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
• 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
• 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, well-developed 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.