It is natural to expect that Spain is a consumer society given its Iberian root. Moreover, imported products are universally accepted so there should not be many hindrances entering the Spanish market as a multinational company. However, the way to enter shall be valued greatly. For example, Spanish consumers pay extra attention to the price performance ratio due to its level of unemployment and setbacks from previous economic crisis. The ease of payment is another factor they consider when making a purchase as they are more inclined to pay in full quickly to avoid the potential long-term troubles. In addition, responsible consumption is gaining popularity across Spain. Growing concerns for environment set a higher entry barrier for multinational businesses. Lastly, products with traits of Spanish culture are more popular so a deliberate design of the packaging could make a difference.
Another favourable business element is the solid base of Spanish internet users (38 million out of 46 million) and hence an estimated increase of ecommerce revenues by 13.8 percent shall be expected.
There can be some less desired business conditions in Spain. To start with, the purchasing power in Spain dropped by 3.9 percent from 2010 to 2016 and stayed the same until now. Wage growth not being able to catch up with the increase of prices together with a comparatively less indulgent national consumption habit might hinder further development of Spain’s consumer society. Additionally, debit card payments still prevail at the moment although the use of credit card is gradually growing. Without too much potential to expand the existing markets, multinational businesses might face greater competition in the saturated Spanish market with local and international players.
What is more, Spaniards do not focus too much on brand name. This might be a natural disadvantage for multinationals who are expert in making use of their brand popularity to attract consumers. Young consumers are not loyal to a specific brand and embrace new brands readily. However, multinational business can still succeed using its financial resources to develop the products with the highest price performance ratio and new brands that easily catch attention. Besides, they can even seek external assistance from key opinion leaders through collaboration as the word of mouth and opinion of an influence still plays a pivotal role in deciding what to buy.
Another setback a multinational company face might be the vast concern for privacy and personal data protection of Spanish consumers. It is even more unfavourable for an Eastern information technology company without a much diversified workplace.
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