International Business Management

Final Term Project

Product Name: Genius Air Purifier

Case Instructor: Mohammad Shadab Khalil

Content

1. Firm Detail
• Firm Name
• Product name
• Firm Description
• Home Country
• Host country
• Product Introduction

What is Air Purifier

Why selling air purifier in india?

2. Economic Factor
3. Trade Agreement
4. Political/legal Environment
5. Culture Environment
6. Segmentation
7. Market for foreign exchange
8. Factor the influence foreign exchange
9. Strategies for marketing
10. Evaluation of countries for operation
11. Mode of trading
12. Reference
International business project:

1. Firm Details
• Firm name: SmartBio Inc
• Product name: Air Purifier
• Firm Introduction:
• SmartBio Inc is an Air Purifier Industry with headquarters in Korea. It is considered
one of the biggest Air Purifier services companies in Korea, with US$1.87 billion in
revenue and more than 42,000 employees.
• Home Market: Korea
• Target/Host Market: India (Mumbai and New Delhi)
• Product Description:
Genius Air Cleaner is a smart Air Purifier that can control the air purifier from a distance
and long range. Genius Air Cleaner can be compatible with google home, Amazon Alexa.
Genius Air Cleaner also can be controlled by using touch panel that can turn on and off the air
purifier manually, change the fan speed, sleeping mode button, and lock button to lock the
touch input so children cannot play with the button. Genius air cleaner have multi-layer HEPA
filter, that can reduce 99% of dust and virus until PM2.5 size air particles, and this air purifier
can be set auto mode so it can adjust the fan speed automatically and it have big impact to
decrease the consumption of the electricity. Genius Air cleaner also has Sleep mode, where
Genius Air Cleaner can clean the air with more quiet blower sound. Genius Air Cleaner can
analyze the air quality and the result can be shown in the application. There is also the report
chart for seeing the air quality in a day, month, and year report in the application. For easy
control the air purifier has AI that powers the air purifier and AI will assist the user, user can
choose 2 mode of AI, Helper mode and assist mode. Helper mode is mode that AI have control
over the air purifier, but user can override it, while Assist mode user get notified to change the
setting because of the air condition changes. This air purifier also can become an IR blaster
device, where there are 360 degrees IR blaster device that attach to the top of the air purifier.
For fun purposes, the air purifier also has speakers that can entertain the user, so they don’t just
buy a smart air purifier but they also can be entertained by the speaker feature in the air purifier.
The speaker also can be used as notification from AI if the user wants to activate it.
• What is an air purifier?
Air purifiers are machines that filter the air in a room to remove airborne contaminants
such as pollen, mold spores, bacteria, viruses, and smoke. They are fundamentally simple
machines, consisting of little more than a fan and a filter. While smart air purifier in general is
regular air purifier that integrated with internet and user can control it by application.
• Why selling air purifier in India
As we know that India faces serious problem with the air pollution, it is the major health
risk for Indian, which can cause respiratory disease, asthma, and some other lungs disease.
Using an Air purifiers devices can aid them to filter the indoor air and remove harmful
pollutants, such as particulate matter (PM), nitrogen dioxide (NO2), ozone (O3). They can
improve the air quality and provide a healthier and more comfortable environment for the users.
Air purifiers are also gaining more awareness and popularity among the Indian consumers, as
they are becoming more conscious of the health benefits and the environmental impact of clean
air. The demand for air purifiers is expected to grow further in the coming years, as the air
pollution situation worsens, and the disposable income rises. One anti-pollution segment that
has seen a phenomenal rise in recent years is air purifiers. According to estimates from the
London-based market research firm Euromonitor, the category is expected to grow at a
compounded annual rate of 14.5% till 2022, estimates Euromonitor.

2. Economic factors
Our company analyzed that India is the most valuable market for Genius Air Purifier,
these are some of the economic factors that motivate our company to choose India as our host
market:
• Korea has a free trade agreement (FTA) with India, which reduces the tariff and non-
tariff barriers for Korean exports to India and provides preferential access to the Indian
market.
• India has a potential market for our products and services, especially in the fields of
electronics, energy, and environment. Companies in India are spending a lot of money
on promotional activities like advertising, cashbacks, and discounts to attract potential
customers in the residential sector.
• India has a favorable demographic profile, with a large and young population, a rising
middle class, and a growing urbanization rate, which create more opportunities for air
purifier sales and consumption.

3. Trade Agreements
The trade agreements between these two countries have helped boost the trade and
economic relations between India and South Korea, which have set a bilateral trade target of
USD 50 billion before 2030
• The Asia-Pacific Trade Agreement (APTA), which is a regional trade agreement that
involves India, Korea, Bangladesh, China, Laos, Mongolia, and Sri Lanka. It was
formerly known as the Bangkok Agreement and was signed in 1975. It covers tariff
preferences on 10,677 items, of which 4,270 are from India and 2,836 are from Korea
• The Comprehensive Economic Partnership Agreement (CEPA), which is a free
trade agreement that was signed in 2009 and came into effect in 2010. It covers trade
in goods, services, investment, intellectual property rights, and other areas. It also
provides tariff concessions on 11 product lines, such as chemicals, textiles, and
machinery.

4. Political and Legal Environment in India

For legalities, there are no separate laws that regulate joint venture. For equity-based
Join venture in India is regulated by Companies act 2013 because it form a new
company either public or private sector. Joint venture in India also follows several law
that is:
1. Competition Act, 2002.
 2. Foreign Trade (Development and Regulation) Act, 1992.
3. Industrial Policy and Procedure Policy for Foreign Investment Contract Act. Foreign
Exchange Management Act.
4. 1999 SEBI Guidelines, Regulations, Notifications & Circulars.
5. Reserve Bank of India (RBI) Guidelines, Regulations, Notifications & Circulars.
By political side both country India and Korea are democratic countries, which have
similarities of their political system where, they have an independent judiciary, which is the
guardian of the constitution and the rule of law. The judiciary consists of a supreme court, high
courts, and subordinate courts, which deal with various types of cases, such as civil, criminal,
constitutional, and administrative, India has a multi-party system and a parliamentary form of
government, where the Prime Minister is the head of the executive branch, and the President is
the head of the state. Other side Korea also has a multi-party system, where several political
parties compete for power and representation. The parties often form coalitions or alliances to
form a government or an opposition, and both countries have a president who is the head of
the state and the commander-in-chief of the armed forces but has limited powers compared to
the prime minister.

5. Cultural environment
Korea has different culture with India, the culture different can impact to all aspect of
business. From communication to the local custom, it is different. Not all products can
be accepted on the market, it is because every country has different styles and different
customs. Language also becomes one of the concerns because it is one of the most
important things because it is the way to communicate and understand with the
corporation or the product itself. India and Korea have distinct cultural environments.
According to Hofstede Insights, India has a higher score in the Power Distance
dimension, which means that Indian society is more hierarchical and accepts unequal
distribution of power. On the other hand, Korea has a lower score in the Power Distance
dimension, which means that Korean society is more egalitarian and values equality
(Sharma, 2023). However, Asian Community News reports that Koreans are the
biggest business expat community in India, and their cultural diversity enriches the
local community and promotes cross-cultural learning. From that cross culture
learning from Asian Community News we can see that Korean product can be sold in
India, and because of India current condition where air quality bad for health, Air
purifier can fit to the market, based on The Korea Herald, air purifier demand increase,
and Korean consumer on air purifier want to use it because in in 2017 they have problem
with air condition because of fine and yellow dust. India could use air purifier so they
can clean the air from the air problem from pollution that happened in India.

Hofstede Insight Between South Korea and India

 6. Opportunities:
India air pollution rate of PM2.5 is considered high, especially the capital city New
Delhi, it is the most population in India. New Delhi air is wrapped with thick layer of toxic
haze, as a result the school ordered to closed (Tanvi Mehta, 2023). Mumbai also has the same
condition as New Delhi where in the first 3 weeks of October Mumbai had a problem with air
pollution (Suresh, 2023).
Source: https://www.reuters.com/world/india/air-pollution-indias-new-delhi-turns-
severe-some-schools-shut-2023-11-03/

Air Pollution from industrial complex and traffic have great impact to the air quality of
the environment, air purifier can help to clean the air of the surrounding, and it has bad
impact for our health (India State-Level Disease Burden Initiative Air Pollution
Collaborators , 2020). Using air purifier can make the air cleaner and the air quality that
we breath doesn’t have bad impact to health. Using an air purifier can help to make
improvements to the room air quality. The opportunity of this product to the market is:
The opportunity of this product to the market is:
1. Pollution from industrial complex and traffic have a great impact on the air quality.
2. Because the demographic in India is mostly full fill with youth, that why smart air
purifier is going to suit for Indian market, because youth more prefer to use hi-tech
product to ease their life.
 3. The demographic of people with range of 15-64 in every year fills more than 60%
in each year.

Source: https://www.statista.com/statistics/271315/age-distribution-in-india/
4. The primary customer that we targeted is youth because youth are more likely to
use high tech gadgets that can ease their life. Youth more likely to use high tech Air
Purifie because they can remotely control the air purifier (Jianxin Cheng, 2016).
5. The secondary customer that we target is Indian senior or professional worker, the
product can ease their life, since IOT for smart home especially for air purifier
improve the quality of the environment and ease them (Leong Yee Rock, 2022).
6. They can ease the user, where they can turn on the air purifier from a far or in their
office before, they come home.

7. Segmentation/Target Market:
Segmentation:
• Demographic segmentation: This product demographic segmentation is based
on the Education level of the user, and the occupation of the user, because this
product has feature that can full fill user that have less time to rest or to do
something out of working stuff.
• Geographic segmentation: India’s ranking as a country to 5th place. Dust and
construction contribute about 59% to the air pollution in this country. With air
purifier, it clean the air in indoor room from dust and air pollution.
Targeting:
• Primary Target Audience: People who suffer respiratory disease, who live in
large, polluted cities. Air purifier can be a solution for them because it can
 change the air quality and help those people to prevent or make them better by
using air purifier.
• Secondary Target Audience: People who are interested in IOT products and
smart devices with multifunction uses, and people who are concerned about the
spread of infectious diseases that happened because of the air condition or it is
infected from air.
Positioning:
• Smart air purifiers can be positioned as a solution to improve indoor air quality
and reduce the risk of respiratory problems, with feature added for helping the
user to ease their activity in indoor room, like the use of AI to ease their life
because AI help them to set the air purifier automatically.
8. Foreign Market Analysis
✓ Rationale Joint Venture:

According to Chambers and Partners, joint ventures are a popular way for multinationals
looking to set up in India. The rationale for doing a joint venture in India can be many.
According to ASA, joint ventures are a popular way for multinationals looking to set up in
India. Joint ventures can help companies access new markets, enlarge their audience, increase
capacity, share risks and costs on a wide surface basis, and access new knowledge and expertise
in business which includes specialized staffing necessity. According to Chambers and
Partners there are a lot of advantage doing Joint Venture”.
• Joint ventures can help companies access new markets, enlarge their audience, increase
capacity, share risks and costs on a wide surface basis, and access new knowledge and
expertise in business which includes specialized staffing necessity.
• It can help companies achieve strategic and economic success metrics, such as market
share, innovation, and speed to market.
• Joint ventures can also help companies share costs associated with marketing, product
development, and other expenses, reducing their financial burden.
✓ Rationale Targeted Foreign Market
• Devising the right international expansion strategy is key to ensuring that companies
are targeting the most promising and profitable countries.
The trade between Korean won to Indian Rupee is 15.74 KRW (South Korean Won) for
buy 1 INR (Indian Rupee), or about 0.06 INR to buy 1 KRW. The INR/KRW rate is
up +1.29% in 2023. This means the Indian Rupee increased in value compared to the Korean
Won. For foreign exchange dealer in India to support the trade, which has AD Category I entity
is HDFC Bank. We choose HDFC Bank because this bank has AD Category I that is
requirement for choosing bank to support the trade.
9. Strategy of Marketing

The strategy that uses is a marketing mix, the product that we sell will be mass produce
it. The price of the product is 7000 INR per product. To market Genius Smart Air purifier,
the marketing strategy by using TV advertising, billboard advertising, Personal selling,
public relation, and social media marketing. This product will be sell and distribute by using
online store platform and customer can buy it online so the distribution can be done in all
city in India.
 10. Group Members:
Name Student ID
1 Dillon Christano 611235204
2 Nurdhina Arifa 6112233010

Reference
https://www.statista.com/statistics/271315/age-distribution-in-india/
Leong Yee Rock, F. P. (2022). Usage and impact of the internetofthingsbased smart home
technology: a qualityoflife perspective. Universal Access in the Information Society.
Jianxin Cheng, Y. W. (2016). Human-Computer Interaction. Novel User Experiences.
International Conference on Human-Computer Interaction, 483–493.
India State-Level Disease Burden Initiative Air Pollution Collaborators . (2020). Health and
economic impact of air pollution in the states of India: the Global Burden of Disease Study
2019. The Lancet Planetary Health, 25-38.
Suresh, N. (2023, October 31). Why Mumbai Had Poor Air Quality In October. Retrieved from
IndiaSpend: https://www.indiaspend.com/pollution/why-mumbai-had-poor-air-quality-in-
october-880329
Tanvi Mehta, M. K. (2023, November 4). India's New Delhi blanketed by toxic haze, world's most
polluted city again. Retrieved from Reuters: https://www.reuters.com/world/india/air-
pollution-indias-new-delhi-turns-severe-some-schools-shut-2023-11-03/
Sharma, P. (2023). Comparative Studies between Korean and Indian. International
Journal for Multidisciplinary Research.

https://www.koreaherald.com/view.php?ud=20170322000624

Asia-Pacific Trade Agreement - Wikipedia

Asia-Pacific Trade Agreement (APTA) | ESCAP (unescap.org)

Country comparison tool (hofstede-insights.com)

https://www.asiancommunitynews.com/ At 17,000 plus and counting, Koreans emerge

as biggest biz expats community in India - Asian Community News

https://legalserviceindia.com/legal/article-7598-joint-venture-creation-and-legal-
liabilities.html#:~:text=Law%20governing%20the%20Joint%20Ventures,separate%20Legal%20
Entity%20is%20formed.