Harvard Case - InMobi: An Indian Internet Company Cracking China
"InMobi: An Indian Internet Company Cracking China" Harvard business case study is written by Shameen Prashantham, Zhijing Cao. It deals with the challenges in the field of Entrepreneurship. The case study is 15 page(s) long and it was first published on : Jun 29, 2021
At Fern Fort University, we recommend that InMobi pursue a strategic approach to expanding its presence in the Chinese market, leveraging its existing strengths in mobile advertising and technology while adapting to the unique local landscape. This strategy should prioritize building strong partnerships, localizing its product offerings, and developing a robust marketing strategy tailored to Chinese consumers.
2. Background
InMobi, founded in 2007, is an Indian mobile advertising platform that has achieved significant success in emerging markets. The company?s core business is connecting advertisers with mobile users through its network of publishers and apps. In 2012, InMobi set its sights on China, a market with immense potential but also presents unique challenges due to its highly competitive landscape and complex regulatory environment.
The case study focuses on InMobi?s efforts to establish itself in China and the key decisions faced by its leadership team. The main protagonists are Naveen Tewari, InMobi?s founder and CEO, and the company?s China team, tasked with navigating the complexities of the market.
3. Analysis of the Case Study
To analyze InMobi?s situation in China, we can utilize the Porter Five Forces framework:
- Threat of New Entrants: High - The Chinese mobile advertising market is highly fragmented, with numerous local players and global giants vying for market share.
- Bargaining Power of Buyers (Advertisers): Moderate - Advertisers have multiple options, but InMobi?s technology and reach offer value.
- Bargaining Power of Suppliers (Publishers): Moderate - Publishers have options, but InMobi?s platform offers access to a wider audience.
- Threat of Substitute Products: High - Other advertising channels, such as social media and online video platforms, compete for ad budgets.
- Competitive Rivalry: Intense - The Chinese market is highly competitive, with established local players and global giants like Google and Facebook.
InMobi?s competitive advantage lies in its:
- Technology and Analytics: InMobi?s platform leverages advanced technology and data analytics to deliver targeted and effective mobile advertising campaigns.
- Global Reach: InMobi operates in over 165 countries, providing advertisers with access to a global audience.
- Entrepreneurial Culture: InMobi?s culture of innovation and agility has been instrumental in its success.
However, InMobi faces challenges in China:
- Local Competition: Chinese mobile advertising companies have a deep understanding of the local market and consumer behavior.
- Regulatory Environment: China?s regulatory environment is complex and evolving, requiring careful navigation.
- Cultural Differences: Understanding Chinese consumer preferences and cultural nuances is crucial for successful marketing.
4. Recommendations
InMobi should adopt a multi-pronged strategy to succeed in China:
1. Strategic Partnerships:
- Joint Ventures: Partner with local Chinese companies to leverage their market expertise and access to distribution channels.
- Technology Alliances: Collaborate with Chinese technology giants to integrate InMobi?s platform with their services.
- Government Relations: Build strong relationships with relevant government agencies to understand and navigate regulatory requirements.
2. Product Localization:
- Language and Culture: Adapt InMobi?s platform and advertising campaigns to cater to Chinese language and cultural preferences.
- Local Content: Partner with Chinese content creators and publishers to deliver relevant and engaging advertising experiences.
- Payment Options: Integrate popular Chinese payment methods, such as Alipay and WeChat Pay, for seamless transactions.
3. Targeted Marketing:
- Local Marketing Channels: Utilize popular Chinese social media platforms, search engines, and online advertising networks.
- Influencer Marketing: Partner with influential figures in the Chinese digital space to reach target audiences.
- Data-Driven Campaigns: Leverage data analytics to understand Chinese consumer behavior and tailor marketing messages accordingly.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies: Leveraging InMobi?s technology and analytics expertise while adapting to local market conditions.
- External Customers: Meeting the needs of Chinese advertisers and publishers by providing a tailored and effective advertising platform.
- Competitors: Differentiating InMobi?s offerings by focusing on strategic partnerships, product localization, and targeted marketing.
- Attractiveness: The Chinese mobile advertising market offers significant growth potential, justifying the investment required for successful expansion.
6. Conclusion
InMobi has the potential to become a major player in the Chinese mobile advertising market. By adopting a strategic approach that prioritizes partnerships, localization, and targeted marketing, InMobi can overcome the challenges and capitalize on the opportunities presented by this dynamic market.
7. Discussion
Other alternatives not selected include:
- Organic Growth: Relying solely on organic growth through advertising and content marketing. This approach is likely to be slow and inefficient in a highly competitive market.
- Acquisition: Acquiring a leading Chinese mobile advertising company. This approach could be expensive and risky, requiring significant capital investment and integration challenges.
Key assumptions of our recommendations include:
- Government Regulations: The Chinese regulatory environment will remain relatively stable and predictable.
- Market Growth: The Chinese mobile advertising market will continue to grow at a healthy pace.
- Partnerships: InMobi will be able to successfully establish strategic partnerships with Chinese companies.
8. Next Steps
InMobi should implement the following steps to achieve success in China:
- Phase 1 (Short-Term): Establish key partnerships, localize product offerings, and launch targeted marketing campaigns.
- Phase 2 (Mid-Term): Expand market share, build brand awareness, and optimize operations.
- Phase 3 (Long-Term): Become a leading player in the Chinese mobile advertising market, leveraging its global reach and technological expertise.
By following these recommendations and adapting to the evolving market landscape, InMobi can achieve sustainable growth and success in China.
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Case Description
The case describes the process of entering the China market undertaken by InMobi, an Indian Internet Company that provides a mobile advertising platform and value-added services for brands. InMobi was intentionally developed as an international venture by its founders. After opening offices in South Africa, Europe, and North America, the board had a long discussion and eventually decided to enter the China market. The case describes how, under the leadership of Jessie Yang, InMobi China successfully adapted to the unique ecosystem of China's internet industry. In 2019 InMobi's China revenue exceeded $100 million for the first time, accounting for over one-quarter of its parent company's global revenue, and next only to the US market. The case ends by noting the expansion of the Beijing office by inviting InMobi technologists from India and also plans for spinning off InMobi China as an independent company. After achieving the aspiring milestone, Yang also faced the business growth challenges. How could she strengthen InMobi's first-mover advantage in the China mobile advertising market and maintain good relations with headquarters to gain autonomy and trust?
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