Emerging Market Economy

Marketing in Emerging Markets:

Marketing is one of the most complex, yet consequential, areas of business
administration that requires a wealth of expertise to succeed with. Marketing incorporates
virtually everything that happens in the marketplace between a company and its clientele
(PESTLEanalysis Contributor, 2014). Any business’ success depends on its marketing strategy and
marketing activities. Moreover, the complexity and dependency of marketing to the success of
business becomes more significant when the business newly enters an international market such
as an emerging market where managers are not familiar with the business environment in terms
of consumer preferences and consumer behavior.
This is the reason why marketing studies must be taken seriously by any managers and would-be
managers aspiring to operate in emerging markets. Emerging market communication styles and
norms tend to differ from those in dissimilar societies (Hsieh, 2011). With the dissimilarity
between emerging markets marketing terrain and those of developed markets and because most
marketing theories are developed from researching the developed markets, marketing managers
entering the emerging markets face lots of challenges (Sharma, Luk, Cardinali, & Ogasavara,
2018). Therefore, it is imperative that managers rethink their marketing programs as they enter
emerging markets (Dawar & Chattopadhyay, 2002).
This brief essay is an attempt to highlight some basic areas of marketing that should not be
overlooked by corporations entering the emerging markets. It does so by summarizing some of
the most important marketing aspects of emerging markets encountered in this module of the
course. While the focus of this essay is on the analysis of the external environment of emerging
markets in relation to marketing, managers would find it useful to have a thorough and hands-
on comprehension of other aspects of marketing such as the marketing mix (Borden, 1964) and
how they correlate with the aspects ofemerging market marketingdiscussed in this paper.
Anextensiveresearchon such aspects as the marketing mix is important given that theevolving
st
marketplace of the 21 century isnecessitatingmodifications toexisting marketingtheories
asconsumerpreferences andbehaviorevolve(Constantinides, 2006).
Marketing and the Emerging Market Environment:
Our world is changing; people arechanging theirideas, tastes,andthe way they perceive
information. Knowledge of ethical businessconduct is not the same anymore.
Particularly,theemerging marketenvironment and its consumers are evolving fast and
steadily.For this reason, to conductmarketing successfully in any international market,
emergingmarkets particularly,requires that the marketer conducts a thorough analysis of the
market. Such an analysis mustbeconducted to understand the preferences and behaviorof
consumers in the markets. Thus, foremergingmarkets, it must includeessentialelementssuch as
thoseconducted by Marinov(2005)on the Latin American emerging markets, viz.;historical
background, market environment, market characteristics and consumerbehavior.
With the understanding thatthe middle class dominates all emergingmarkets, a marketanalysis
should aim at understanding themiddle market segment.To this end, managers
imperativelyneed a deeperknowledgeofconsumers and businessesin themiddle market
segment ofemerging markets. After conducting theanalysis, theMNCmustthen alter
itsmarketing strategytofit themiddle class of the specific market it enters.If an MNC,
afterentering an emerging market, fails to adjustitsmarketingmodeltobetter serve the
middlemarket segment’spreferences,it risks losingthemarket share to local competitors.(Zou &
Fu, 2011). However, understanding consumer preferences in emerging markets is not as easily
done as it is said. Due to the complex and unfamiliar political social and cultural environment
of the market, many different factors must be considered, and these factors should be
continuously altered to match the speedy variation of the emerging market environment
conditions as continuous reforms are being made. In China, for instance, while the disposable
income level remains low and one would expect low priced strategy to be attractive to a
majority of consumers, the irony is that consumers in many parts of this market tend to be
trendy brand followers (Wang & Yang, 2011) and the demand for luxury brands tends to be
higher than in developed markets (Rajsingh, 2011).
As has been found through marketing research, brand building as a marketing technique results
to preference of the branded products by consumers (Kasemsap, 2015). This strategy is valid for
developed markets with high disposable income for the middle class. Most emerging markets are
characterized by abnormal characteristics that include weak institutional structures, weak and
shallow home country advantage, and political instability (Cassia & Magno, 2015). Thus, “building
a global brand based on leading technology … may not be a feasible strategy for emerging market
firms to adopt or follow” (Zou & Fu, 2011, p. xiii).
However, in the biggest emerging markets such as China, consumer behaviour studies find a
mirror neuron effect where consumers follow and imitate other consumers of higher status in
the quest for prestige—a face-saving phenomenon also called mianzi— in the society (Cardon &
Scott, 2003), leading to a greater value being placed on luxury and branded products (Rajsingh,
2011). With such consumer behavior, marketing programs in the market must not be the same
as in other emerging markets but require that the marketers commence their marketing
programs before entry into the market and incorporates improvements as theygain a
betterunderstanding of consumerbehaviorsin the market(Jiang, Luk, & Cardinali, 2017).
The PESTLE Analysisfor Emerging Markets:
Toconclude this essay, it is important to note one important external environmentanalysis
toolformarketers and how it may be usefulmarkets in theemerging markets—thePESTLE
analysis.In this subsection, I briefly describe how thepreconceptions ofemerging marketsmay
guidePESTLEanalysis of the emerging market to enter.

The PESTLE analysis evaluates the external environment ofa company in relation to how it may
affect business in that environment. Theanalysisprovidesthe reliable data to use formarketing
decisions. In tandemwith theacronymPESTLE,the analysis provides information about the
political, economic, socio-cultural, technological, legal, and environmental factors ofthe market
that may affect thecompany’s businesssuccess in the market.Originally, the analysishad only
included the first four factors(PEST) but after undergoing multiple modifications, theultimate
external environment strategic driver of a business’smarketing programs settled tothePESTLE,
whichisrearranged into the PESTELin otherliteratures(Yüksel, 2012). Astartofanalyzingemerging
markets using the PESTLEentails formulating whatsub-factorsconstituteeach factorin the PESTLE
framework(See for instance;PESTLEanalysis Contributor, 2014).