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Marketing In Emerging Countries
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Marketing In Emerging Countries

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  • 1. Marketing in Emerging Countries A General Marketing Knowledge
  • 2. Emerging Markets
    • Emerging Markets refer to countries in Eastern Europe – Russia, Poland, Baltic States, China and India
    • Marketing in these countries faces special problems
      • Markets are not as developed as in US
      • Infrastructure bottlenecks exists
      • Market segmentation is not clearly defined
      • Middle Class in Emerging countries are not the same as middle class in US & Europe
  • 3. Market Segmentation
    • Market Segmentation based on income levels and geographic location & demographics
    • Consumers have more sophisticated tastes and preferences than what appears on the surface
    • Poor Income levels must not be mistaken for having lower aspirations on quality and performance
    • Lower Income levels does not correlate with low priced durable goods
    • Upscale & Premium positioning targeted at the high income market segment works
  • 4. Product Positioning
    • Mass market for basic needs tends to be price sensitive
    • Choice of domestic alternatives for basic tends to be limited in rural areas – this is changing rapidly as we speak
    • Products developed specifically for the local markets have a higher success rate
    • Products with Premium positioning has its markets limited to large urban cities
  • 5. Pricing
    • Pricing in emerging countries is a balance between affordability and upper-end positioning
    • MNC’s tend to adapt skimming price – to ensure a quick payback
    • Lower penetration price ensures affordability but requires large volume of sales
    • Smaller sized package, store credit & liberal credit terms are used to increase affordability
      • E.g: Sachet sized shampoo
  • 6. Distribution
    • Distribution network beyond the urban centers is severely constrained
    • Large geographic distances and lack of land transportation facilities are a major challenge
    • Poor communication infrastructure in rural areas
    • Lack of storage facilities, small & fragmented retail sector demands bi-weekly supply by manufacturer
  • 7. Promotion
    • Promotion channels were once very limited
    • Rapid changes has made promotional channels on par with the developed world
    • TV, Print, Radio as a mass communication channel is very effective
    • Educational promotion campaign is necessary to educate rural customers
    • Demonstration of utility and use has a big impact on consumer behavior
  • 8. Closing Thoughts
    • Emerging Markets like Russia, India and China offer huge potential
    • Market conditions are a lot different in these countries when compared to developed world
    • Upper end markets in emerging countries are similar to developed world
    • Middle class want latest quality products and dislike old technology or inferior products
    • Distribution challenges must be overcome