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Marketing In Emerging Countries


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Marketing In Emerging Countries

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