Emerging-Market Strategy

Emerging-Market Strategy
Introduction
Creating an effective market strategy has become one of the top priorities of most multinational companies. With this strategy, emerging markets are expected to contribute greatly to product categories which are more effective in developed countries. Due to the increasing variation in diversity of developing economies, it is necessary for multinationals to develop approaches that allow them to focus resources on most profitable submarkets, (Khanna & Palepu 90). This article gives a summary of city cluster approach that concentrates on homogenous, fast-growing cities in China. It also looks at ways of gaining market coverage at low cost while in Brazil; it gives a summary of how growth is becoming geographically distributed and its implication for growth strategies.
Summary of the article
In China, it is recommended that cities be clustered according to such characteristics that enable them to be considered one market for strategic decision making. This allows companies address viable opportunities in attractive smaller cities at low cost rather than in clusters. It also recommends concentrating coverage on cluster size rather than city size. This reduces the cost of distance coverage from one city to another. It is also recommended that the multinationals look beyond historical growth rates. This is because consumer spending habits alter as the wealth rises or reduces. Another recommendation does not believe on generalities. This is because certain regions go well beyond the already significant economic variance. Consequently, marketing activities need to be localized, (Yuval, Kertesz, and Vittal: “Is your emerging market-strategy local enough?”, Strategy Practice).
In India, it is recommended that companies abandon averages and develop more granular approach. This can also be achieved by focusing on a few states, an approach that was successfully used by a retailer that was initially aiming at attaining national footprint. This allows multinationals to gets out of the belief that consumers are not ready for its products. It also allows a company to challenge a competitor and remain on top of the market. In Brazil, this article recommends seizing new regional opportunities. This is because, as the economy of Brazil expands, and geographical cities have becom...