Marketing Cases from Emerging Markets

The term emerging markets was used for the first time in 1981 by economists at the international Finance Corporation (IFC). However, there is still no clear definition of the term. As the Economist points out, there can be more than one definition of the term “emerging markets” depending on who defined it.

Any international marketer faces many challenges and one of the biggest challenges is dealing with socio-cultural factors and their influence on buying behaviour in the international environment. Hence any decisions relating to product design and usage, marketing communications, and making products available are all, to some extent affected by these factors.

Faced with a declining home beer market, many UK brewers are casting their eyes to growing overseas markets in order to increase sales and satisfy shareholder demands. The attraction of the Indian market is obvious from a population point of view—in 2012 the population was 1.2 billion people according to Euromonitor (2012), however the Indian market is not an obvious one when it comes to alcoholic beverages. In the UK, drinking alcoholic drinks down the pub and in bars is a deeply embedded into the British culture. But will the consumer demand for beer in India be the same as UK, given the official intolerance of alcoholic drinks on religious grounds? Will a relatively small niche brand such as Mongoose, positioned deliberately as an ‘Indian’ brand and consumed in Indian restaurants in UK, work in the ‘real’ Indian market? Can Mongoose overcome the cultural issues? Can the brand position of Mongoose be maintained in the Indian market?

In China, Yum! Brands, the parent company of Kentucky Fried Chicken (KFC), are opening a KFC store every day. Utilising a different strategy compared to other Western fast service counterparts, KFC has become the largest restaurant company in mainland China. KFC outpaced its nearest competitor, McDonald’s, by more than 1,000 restaurants in China and is outpacing its development by a roughly three to one. The US chicken giant adapts its Western business model in Chinese market through acknowledging the social and cultural differences. KFC realised that the US fast food model needs to be adapted because China’s culture is not individualistic which is the characteristic of the US culture. Therefore, it is necessary to combine the US fast food business model and adapted them to serve the needs of Chinese consumers.

In 2005, IKEA Malaysia faced one of their most serious challenges since they started operations in the country, when their restaurants were raided by government officials on suspicion that food served there did not comply with the strict religious dietary regulations in the country.

Despite the fact that there are so many empirical studies on marketing orientation, the evidence from literature indicates several perspectives of this concept.

Bodyguard, a 2011 Bollywood blockbuster earned a record Rs 22 crore net (US$3.7million) as first day collections. The movie boasts of popular Indian stars, Salman Khan and Kareena Kapoor. However, they are not the only co-stars. The film also offers screen time to a number of brands such as the Audi Q7 car, Tupperware, Blackberry and Sony Vaio notebook.

On February 02, 2012, Amazon.com announced the launch of its much awaited Indian website called Junglee.com (Junglee means “wild” in Hindi). Speaking on this occasion, Mr. Amit Agarwal (Amit), VP, Amazon.com commented that, “We are excited to give customers in India a single online starting point where they can shop a wide selection of products sold by local and global retailers, and make informed purchasing decisions.” True to the promise, Junglee.com was comprised of a selection of a wide variety of Indian and global brands. Another unique feature of Junglee.com was that the customers had access to both online and offline buying options, including Amazon.com, in 1 place. At the time of launch Junglee.com included 10.2 million products with the option of buying from hundreds of online and offline retailers, which included well known Indian retailers like Homeshop18, UniverCell, FabIndia. The current selection on Junglee consists of around 9 million books, and products worth more than US$ 3 million from approximately 14,000 Indian and global brands. The site has more than 25 product categories, including consumer durables, books, music and jewellery.

Though Indonesia has been successful in growing the value of its fisheries sector, there are issues and constraints which make further growth more difficult to achieve. Some of these factors are external factors which affect both Indonesia and its main competitors; others are specific issues relating to the industry within Indonesia. There are, for example, barriers to increasing trade with particular countries (which might represent high export growth potential) due to technical barriers to trade (TBT) and SPS (Sanitary and Phytosanitary) standards/regulations. This case study examines the challenges of moving from a predominantly product/quality centred focus to adopting a marketing orientation.

In the fourth edition of the Indian Premier League (IPL), held in 2011, the Kolkata Knight Riders (KKR) decided to revamp the team by changing the entire set of players. Even, Sourav Ganguly, the team’s icon player for the first three editions of the IPL was dropped from the team. Instead, Gautam Gambhir (worth $2.4 million) was purchased by KKR to handle the responsibility of captaining the side in the absence of Ganguly.

Baseball was invented by James Naismith in Springfield, Massachusetts, USA, in 1891.The sports popularity grew with the first professional competition in 1896 at a Young Men’s Christian Association (YMCA) event in Trenton, New Jersey. A number of leagues were formed in the late part of the nineteenth and early twentieth century operating with varying degrees of success. The NBA was formed as the Basketball Association of America (BAA) in 1946. It emerged as the strongest league in 1949 with 17 teams, following its merger with the National Basketball League (NBL). Since then it has consolidated its position in North America. Currently the league has 30 teams; 29 in the USA and one in Canada; they play at least 82 games a season (the regular season). This usually runs from late October until April. However, a dispute between players and management meant the 2011/12 season start was delayed until December. The eight best performing teams then proceed to the play offs which run until the Final in mid June.

How can managers increase the profitability and profit growth of their organisations? This is a central marketing challenge and drives the strategic marketing thinking of many firms. In recent years, economic uncertainty, rising costs and saturated domestic markets are coercing managers to look to untapped and undeveloped overseas markets, which, if approached appropriately, could offer potential solutions for organisations seeking greater financial returns.

February 2010 saw the acquisition of Cadbury, one of the two major confectionary players in the world, by USA-based Kraft Foods Inc.. Analysts believe that the acquisition of Cadbury was the final step in a strategy designed to enable Kraft to be restructured and split into two companies by the end of 2012: a grocery business worth around $16bn; and a global snacks business worth approximately $32bn global. Cadbury was pivotal in providing the scale that Kraft needed to strengthen its snacks business, providing it with the sought-after foothold in emerging markets, defined here as Latin America, Middle East, Africa, Eastern Europe and Asia Pacific. But how was Cadbury able to do this?

For a lot of people, the name of McDonald’s instantly brings a smile. It is known for its crispy burgers and its wide network of outlets. The company started its business operations in India in 1996 as a 50:50 joint venture partnership between the two businessmen Amit Jatia (Jatia) and Vikram Bakshi (Bakshi). India was a challenging market, given local dietary preferences for vegetarian dishes. Tim Fenton pointed out that India’s eat out market was about $128 billion a year compared with $132 billion in China, but was growing faster than that of China.

In the past two decades, brands from emerging markets have made significant inroads into developed markets, including those in the tourism industry. Brands from emerging countries increasingly market their brands with the ambition of positioning them as global brands. This case study illustrates the expansion of the Shangri-La hotel group as a good example of emerging markets’ brands expanding to the Western markets. The Shangri-La group was a Hong-Kong based hotel group, focusing on luxury hotels. This case study pointed out the market entry challenges the Shangri-La group faced when it entered its first non-Asian market in Australia. As the case study illustrated, one of the biggest challenges faced by the Shangri-La group was preserving its Asian brand identify while adapting to the cultural differences in a new market. This case study also showed some possible challenges an emerging market brand might face before reaching cultural integration in a new market.

In April 2006, a U.S non-profit organisation approached the Indian government with a proposal to purchase their device with an offered price of US$ 100 (approximately £65) device. The device was similar to a laptop but with less functionally and specially designed to target underprivileged school children. In a developing country like India, where 75 % of the people live on less than $2 a day, the offered price was a big question in a sense of affordability.

Marketing Communications, referred to as the “voice” of the company and its brand, is one of the four principles of marketing, which strives to engage the consumers in a dialogue to build brand equity and relationships among consumers.

With the tag line “Now everybody can fly” AirAsia has revolutionised air travel in the Asian region by offering incredibly low fares and innovative marketing techniques. The airline is one of the most innovative companies in the World, which has successfully deployed and expanded on the latest marketing/promotion practices. From August to December 2010, the airline ran their ‘Real People, Real Stories’ campaign where customers were encouraged to share their experiences on social media for a chance to win free tickets.

Emerging markets are equally important to the tourism industry. In 2010, the UN World Tourism Organisation reported that international tourist arrivals grew by more than 7 % in the first 4 months driven partly by a strong rise in numbers in key emerging markets despite the challenging conditions as the world recovers the global economic crisis in 2009. The real growth opportunities can be found in the BRIC economies—Brazil, Russia, India and China—as well as the GCC nations such as the UAE and Saudi Arabia where emerging middle classes have desires to travel and hence they are the future of the travel and tourism industry.

Consumers are adopting increasingly active roles in co-creating marketing content with companies and their respective brands. In turn, companies are looking to online social media and campaigns in an effort to reach consumers where they ‘live’ online. However, the challenge facing many companies is that although they recognise the need to be active in social media, they do not truly understand how to do it effectively. This case study highlights a best-practice organisation and its successful efforts to leverage social media in reaching an important audience of business consumers. Specifically, this case study explains Cathay Pacific Airways, a Hong-Kong based airline, used LinkedIn successfully for brand building and it points out how companies can maximise the potential of social media to better meet customers’ needs.

It was felt that the teaching materials utilised by Western educators, lacks real case studies related to marketing and business contexts in these markets. These 16 case studies cover a wide range of marketing topics, from product development to social media marketing. We have grouped the cases broadly into four chapters depending on the particular area of marketing the authors are considering. Several cases cover different areas of marketing. For example, Junglee.com: Amazon’s Entry in India is placed in the ‘Market Orientation and Brand Strategies’ chapter but could well come under ‘Product Development and Market entry’ as well. Moreover, the cases cover the whole spectrum of industries, ranging from the fast food sector (KFC and McDonalds) and beauty creams (Lakme Pure Defense) to airlines (AirAsia) and sports (NBA in China and Kolkata Knight Riders). The cases also highlight the need to understand the interplay of the strategic three Cs of Marketing namely, the customers, the competition and the corporation. A sustainable competitive advantage can only emerge by integrating these three forces. The cases highlight the unique issues and challenges as well as some success stories. The importance of understanding your customers, of proper targeting and positioning of your brand, is highlighted in a number of the cases.