Editor's note: Tim Grainey is the founder and managing member of Strategic Research Initiatives, Queen Creek, Ariz.
For over 50 years, Cuba has effectively been closed to American businesses due to the U.S. government’s longstanding embargo. Relations between the two nations are thawing, opening connections for business, cultural and non-governmental organizations (NGO) activities. A key decision facing American businesses is whether Cuba is a new El Dorado or if it is an illusion and they should focus on other markets. Marketing research agencies can assist their clients with market-entry investigations and subsequent market-launch activities.
When companies are deciding whether to expand into a country, they typically conduct market-entry research, which identifies: competitors in the market; current brand imagery; infrastructure needs to support their products/services; distribution and sales channels; realistic product/services price points; financial projections (including prospective currency exchange rates); cultural (local market) considerations; and legal considerations.
One automotive company has asked our firm, Strategic Research Initiatives, for guidance in entering the market. Cuba is unique on the transportation side, with 1940s and 1950s restored American models – including Studebakers, old Russian-made Ladas and Moskvitchs as well as new-model Kias from Korea and Geelys from China. China is a primary supplier of newer buses, cars and trucks. One particular concern for domestic-based automotive companies is residual versus current brand imagery since many Cubans’ impressions of Buick, Chevrolet, Chrysler and other makes are based off of vehicles from the 1950s; brand impressions based off of current models may differ drastically. Currently, sales of new automobiles are through the Cuban government (fleet sales) for official use and rental car fleets. In the past, automotive companies...