GRAY MARKETS: THREAT OR OPPORTUNITY? THE CASE OF HERMAN MILLER v. ASAL GmbH

Abstract

Market entry strategies range from foreign direct investment to licensing with varying levels of commitment, risk and opportunity. Exporting products or services is one of the most common of the intermediate market entry strategies. It is typically accomplished through authorized international channels of distribution. However, when significant price differences exist between markets, alternative, parallel channels of distribution are almost certain to arise. These parallel channels, often referred to as gray marketing, are generally legal but unauthorized distribution channels that create an alternative export market entry. After a review of the literature, a case study highlights these complex issues from the perspective of both manufacturer and parallel marketer. The case study provides a tool for evaluating theory and a basis for discussing this important alternative mode of market entry. The case and the discussion which follows also highlight the role of international trade shows as an important element of the marketing mix for entering many foreign markets.

Citation

Mullen, M.R., Sashi, C.M. and Doney, P.M. (2003), "GRAY MARKETS: THREAT OR OPPORTUNITY? THE CASE OF HERMAN MILLER v. ASAL GmbH", Li, T. (Ed.) Reviving Traditions in Research on International Market Entry (Advances in International Marketing, Vol. 14), Emerald Group Publishing Limited, Leeds, pp. 77-105. https://doi.org/10.1016/S1474-7979(03)14005-7