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Sharma et al (2001) join in by stating that in the present times, value has shifted from mass-market solutions to segment-based solutions. Buyers are willing to pay more for “business-solutions” developed specifically for their needs. This shift in value generation led to a number of changes in marketing thought and practice. Also, Morgan, N.A (1991) in “professional service marketing” point out that from the client’s point of view, the benefit of purchasing a professional service is primarily a reduction of the uncertainty surrounding the problem. And Not only is the client likely to be uncertain about the problem itself but also about how to chose an efficient professional service provider to solve the problem.

Morgan (1991, ch.3) also declares that there are 7 steps for organizational client to make buying decision (original model by Wind and Thomas (1981)):

1. 
   Problem awareness
   
2. 
   Estimation of parameters
   
3. 
   Search for solution sources at this stage, the image and perceived positioning and name awareness of PSF is very important.
   
4. 
   Establish problem and set solution criteria
   
5. 
   Evaluate alternative solution
   
6. 
   Negotiate and purchase  the face to face negotiation and purchase is an excellent opportunity for customization of the professional service offering.
   
7. 
   Use and evaluate
   

Over the recent years, internet has been providing limitless opportunities to international business and communication by creating a borderless trade opportunity with minimum initial investment. Realeyes has mostly delivered web-usability testing services via its eye-tracking, to clients. Most of its clients in the UK have used the web as marketing/business communication channel, amongst online businesses Lovefilm.com, PriceRunner or swiftcover.com. In Australia, 2006-07, the proportion of larger-sized (>200 employees) businesses with web-presence grew to 95% in 2006-07 (Australian-Bureau-of-Statistics website). UK and Australia are psychically very close and both countries had exposure to eye-tracking services and its applications, especially for web-usability testing. Hence we decided to hypothesize that:

The evaluation of hypothesis H1 is done in section 9.2.4 under Segmentation chapter.

Ojala and Tyrväinen (2007) suggest that Firms first enter countries with a low psychic or cultural distance and then develop their operations in countries with a greater cultural distance.

This argument could be useful to establish that cultural psychic distance matters while deciding to internationalize and also examine the feasibility of selection of Australia as a potential new market.

Realeyes might need to think about commonalities and subtleties in cultural aspects of marketing in Australia.

While coming up with a suitable entry-mode strategy, Kirby and Kaiser (2003) state that Joint Ventures can be a successful market entry strategy, particularly for small and medium-sized enterprises with limited resources and knowledge of the local market… joint venture is primarily a device to gain access to resources embedded in other organisations and is particularly favoured in situations, such as China, where national governments are attempting to restrict foreign ownership and where local expertise and connections are seen to be important in facilitating market entry. But as we have heard from the company, Realeyes’ analytical technology (software) is unique and sensitive. Hence, the Company may need to be able to retain enough control to save its competitive edge of service provision (protect its niche) from being exploited by weaknesses in strategic alliance with local partner or franchising. Realeyes may need to continue its analysis (core service) process onshore in the UK, and need to maintain walling sensitive eye-tracking analytical technology that it possesses, which has been its current effort.

In identifying a suitable Joint venture partner for Realeyes in Australia, Trust and the level of commitment must be taken into account. Both Realeyes and its potential partner must identify their complementary strengths and properly plan where they can add value to each other’s businesses.

Paliwoda and Thomas (1998) are of the opinion that, ‘There is no one, single universal best foreign market entry strategy. The firm should consider all possible channel strategies. The best strategy will be the one which is the situational best, optimal in that it is often a satisfying strategy which takes into consideration market competition, perceived risk and established corporate policy...’ Ekeledo and Sivakumar (2004) consider the selection of an appropriate entry mode in a foreign market to have significant and far-reaching consequences on a firm’s performance and survival.

Burgell and Murray (2000) suggest that entry mode decision is necessarily a trade-off between resources available and the support requirements of a customer. On the other hand, Anderson and Gatignon (1986) propose that entry-mode is a trade-off between control and the cost of resource commitment. They also add that preserving flexibility should be one of the key considerations while making this trade-off. A full-control mode requires a high commitment of company resources and involves high risk but also allows the highest return on investment. In contrast, a shared-control mode requires low-to-moderate commitment of resources and is associated with low-to-moderate business risk which leads to low-to-moderate return of investment (Douglas and Craig, 1995). Please refer to the following table for more details:

Table 2 - Control and Commitment requirements in different entry modes (Anderson and Gatignon, 1986)

Sharma et al (2006) classify services into hard and soft services. In soft services, production and consumption occurs simultaneously like in hotels and hospitals. Hard services are those where production and consumption can be decoupled. For example, in software services the output can be transferred in a tangible medium like a compact disk. They suggest that local presence with high control in a new market is more important for soft services as compared to a firm providng hard service. When one considers Realeyes, it can be classified as hard service. Generally, their output is delivered in a report or PowerPoint presentation.

Ekeledo and Sivakumar (2004) observe that small firms often lack the knowledge and financial resources to successfully handle the costs and risks of international expansion through wholly-owned subsidiaries; therefore, such firms should rely on collaborative modes of operation in foreign markets. Small often firms often ally themselves with entities that provide complementary skills such as market specific sales expertise, and easy access to local resources. On similar line, Baume et al (2009) propose that small technology firms should enter international markets with strategic alliances. Moen et al (2004) suggest the partners to be such that the firm’s product constitutes a part of a complete package sold by the partner. At the same time, one needs to remember that most of the clients of Realeyes require the data collection to be done locally. Also, Realeyes has a very unique yet cost-effective way of collecting data in public places with large sample sizes when compared to the other rival companies in Australia. This means that they might not be very comfortable outsourcing their data collection to outsiders.

Moen et al (2004) also highlight the importance of having contracts and relationships with other firms in order to sell the products. They also emphasize that local presence in a market gives the firm an opportunity to be more proactive. While entering a new market, one should seek people with the right experience and a good network to start a local office.

Most papers discuss one or more of the four popular theories of internationalisation: Uppsala model (incremental growth), Eclectic Model (lower transaction costs), Industrial networks (build relationships) and Business strategy (resource based competence). Please refer to following table for their comparison:

Table 3 - Comparison of 4 theories of Internationalisation

Industrial or market factors influence globalization strategy. In some cases company are naturally international due to, for example, its supply chain. Company factors also affect, e.g. CEO's ambition or company strategy.

Authors such as Beard and Easingwood (1996) reason that producers who cannot use “safe bet” option can use an image of exclusivity instead. The execution of tactics is likely to accelerate if there is alignment between market strategy and segments targeted. Beard has indeed given a full picture of the literature for tactics adoption, thus leading us to be concerned with communicating the company’s vision and its services’ benefits more often than focusing on the nature of the technology.

In Current state, Realeyes has been providing eye-tracking analyses with its stated uniqueness of data-collection quickly and accurately in large samples in any location (http://www.realeyes.it/en/services). In Australia, eye-tracking technology is not new since Tobii (for whom Realeyes is a data-collection partner) has been well-established in Australia through a reseller (CeBIT website). However, this does not mean that Realeyes cannot enter the market. A firm can position itself apart and create superior value to customer by demanding a lower price for its ‘standard product’ (eye-tracking), or a higher price by using a differentiating technique (Dobson, Richard and Starkey, 2005). Since Realeyes currently does not provide consulting service, and an added service that can “potentially” demand a premium from clients, we thus hypothesize,

H2: Positioning: Realeyes’ success in Australia is positively influenced if it could position itself as a good-quality data services-provider with its retained competences while being on the low-price end for eye-tracking.

H2 is evaluated in Section 9.3.4 under ‘Positioning’ topic.

Realeyes’ pricing of services depends on the positioning of Realeyes. If it could continue to contain its operational costs and keep at minimum overhead costs, while fully utilising the resources available to it, then it would be striving toward cost-leadership and “would achieve superior profitability from an above average price-cost margin” (Dobson, Richard and Starkey, 2005). Hence, we would hypothesize as follows:

The evaluation of hypothesis H3 is done in section 11.1.2 under ‘Pricing’ (Marketing Mix).

Figure 5 - : The sequence of launch tactic development (Beard and Easingwood, 1996))

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