eThesis - School of Business electronic theses

This thesis studies internationalization of Finnish mobile gaming companies in the context of market entry to Japan. The study aims to discover why Finnish mobile games developers attempt to enter the Japanese markets via partnering or direct investment, when they have access to direct distribution in Japan via application stores even if all their operations are located in Finland. Another primary research objective is to investigate what type of entry mode strategies these firms employ. A secondary research goal is to find out how these firms gain intelligence of the Japanese market prior to market entry in order to prepare.

The study is founded upon a review of international business literature focused on internationalization theories and market entry modes. Research on born global companies and international new ventures is studied to gain an understanding of the type of organizations this thesis is focused on, and the main branches of internationalization theory - stages model, OLI paradigm, and network theory - are discussed from the perspective of born globals. A secondary angle is included by reviewing studies on managerial cognition and decision-making, and possible influence of those factors on born global firms' internationalization.

The empirical portion of this thesis was conducted as a multiple case study, with empirical data collected via interviews of the case company's managers and other employees, who are or have been involved in the firms' business development regarding Japan. An interpretivist approach is assumed in order to represent the case companies' experiences as their own perspectives, and thus facilitate deeper understanding and avoid inappropriate generalizations. The purpose is to offer the reader insight into how each of the case companies approaches the subject, and subsequently find similarities and differences between their approaches.

The findings of this thesis explain that before committing to a market entry, firms must conduct a comprehensive scenario analysis where they evaluate their own capabilities, potential risks involved in entering the Japanese market, and achievable rewards. To be able to complete this in a meaningful manner, market intelligence must be collected via the firm's networks or third party providers such as App Annie. Understanding the firm's current situation allows the setting on realistic business goals for Japan, and selecting a local partner can be based on these goals. Main discoveries from this research are that the primary motivator for the case companies is revenue potential. Other motivators include increased firm valuation and enhanced organizational capabilities. The case companies recommend entering the market with a partner, not independently. In order to learn about the market, the firms utilize their networks extensively.