Marketing in Developing Countries

Whoever uses marketing, at whatever level and wherever in the world, the marketing environment in which he is operating must be understood. There is an intimate relationship between the organisation (whether public, private, commerical or non-commercial) and its ever-changing environment. To be successful the marketer must understand the basic issues, especially the external uncontrollable ones, anticipate development and respond to them.

Marketing research is particularly important in a developing country context in order to understand the consumer who is operating within an extremely complex and versatile marketing environment. At the same time, the successful undertaking of marketing research in developing countries is usually particularly hazardous too, so that whilst there is an obvious need for more good research, there are also enormous barriers to achieving it.

The marketing mix, like marketing research, needs more careful consideration in a developing country context. Not only is the external environment more difficult, but also the internal constraints which affect the formulation of the marketing mix are likely to be more numerous and harder to overcome.

Marketing by the state is generally poor or even non-existent in many economies. At the same time it has a fundamental role to play, for, as noted earlier, the state intervenes in the economy to a much greater extent than in developed countries. In order that a country’s resources can be used optimally, marketing must be effectively understood and applied.

Industrial planning has generally received more emphasis than agricultural planning in most developing countries, since the assumption has been that the Western world’s model of economic development based on industrial revolution must be followed. Obviously there is a need to switch from dependence on agricultural commodities where prices have tended to decrease dramatically on world markets in relation to those of manufactured goods.

The growth of multinational activity in developing countries in the last 30 years has been unprecedented. Seen by host governments as an indispensable means of speeding economic development, multinationals have been encouraged to locate in developing countries, rather than simply exporting manufactured goods to them or extracting their raw materials. At the same time there has been a rationalisation of economic activities on a world scale. The enterprise, which once simply produced for domestic and export markets has been replaced, since the 1950s, by diversified corporations or conglomerates which buy, produce and sell in many countries world-wide. And such companies no longer emanate solely from the Western developed world.

In Chapter 1 it was noted that there are relatively few indigenous marketers in developing countries if a ‘marketer’ is defined as someone who understands and applies marketing in order to create, build and maintain beneficial relationships with target markets. Conditions such as a sellers’ market, poor distribution, constraining cultural factors, lack of marketing expertise and finance tend to encourage limited horizons. Yet there is a need for such people to become more creative at national and international levels, and governments are giving increasing emphasis to stimulating the private sector generally.

In Chapter 2 it was noted that the interrelationship between the organisation (whether public, private, commercial or non-commercial) and its ever-changing environment may be summed up by using an ecosystem analogy. On a broader scale it is possible to take this analogy further and look at the relationship between individual countries and groups of nations in a world system. But, although the concept of an interdependent world system had been postulated for some time earlier on a theoretical level, by such academics as Wroe Alderson (1968) in his functional approach, it was not really acknowledged by political leaders until the 1970s.

In addition to the issues in the global economic crisis on the macro level, there are other force at work which are likely to have a significant impact on individual countries. It has been claimed that ‘the Third World’s obsession with the Western way of life has perverted development and is rapidly destroying good and bad in traditional cultures’ (Harrison, 1980). Earlier chapters have made reference to the development of global products and lifestyles and the multinational’s encouragement of these. It may well be that consumer tastes may converge even more in the future. But there are also some divergent tendencies in existence. The most extreme is perhaps the emergence of Islamic fundamentalism as a possible alternative to both Western capitalism and Eastern socialism. A more form of divergence may be witnessed through host countries’ attempts to control multinationals by insisisting on some form of ownership and deciding the production process to be used and the products to be produced.