Marketing for Growth in Developing Economies

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Dr. H. Kwame Afaglo (PhD, MBA, BSc) ©2010

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Despite developing economies producing significant resources that caters for the improved livelihood in the world, they hardly determine the form, price, place of sale and distribution of their produce. Hence, for growth in developing economies to match its producing capacity, marketing and specifically sophisticated marketing must be understood and implemented.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Salient issues arising from the earlier assertion of marketing are: Buyer (Consumer) Marketing Form of product Price Place of transaction Distribution Complex yet understandable

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Consumer – It is imperative that individual or group(s) or establishment(s) must initially have a desire, need or want for product(s) before marketing can occur. Therefore the consumer is the focus of marketing, centre of which industrial production revolves around and the engine of growth. It is been observed that in some developing economies, marketers and sellers handle prospective consumers with contempt. Couple of us might have experienced small shops owners in Ghana telling us off for enquiring about price differentials between shops.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies This is counter marketing and needs to be rectified with immediate cultural changes that perceives consumers as the centre of trade. Consumers at one time or the other must have a desire or lack of a commodity or service of which an intelligent individual or organisation upon identifying can satisfy at the cost to the consumer and a benefit to the provider.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies The ability to gain an intelligent insight into a consumers need, wish list and devising an acceptable approach that is permissible for transaction to occur between the buyer and seller is one of the responsibilities of a marketer. In order to gain an intelligent insight into consumers need and wish list, the most scientifically proven tool that marketers employ is research.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Inasmuch as converting the wish list of a consumer into reality is closing a sale, marketers seek a continuous buying-and-selling relationship. The later condition is beneficial to both parties (buyer and seller), the buyer gains satisfaction from the product and that of seller’s reward is profit. Continuous functional buyer-seller relation is healthy and hence translate a consumer into a loyal customer and the seller or product(s) an essential (must-have) product and an acceptable brand.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Just as every individual is unique, so it is expected that producers and marketers need to have good knowledge of customer’s buying ability and behaviour so as to tailor products to meet the unique individual’s needs and desires. Marketing firms have segmented consumers by virtue of their disposable income. It is been observed that, the higher the disposable income the higher the chances of impulsive buying and the relative ease of satisfying one’s desires and needs. The reverse is to a large extent is factual.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Buyers in advanced economies as: United States of America (US), Japan and Europe have relatively high disposable income, hence producers and marketers categorise these nations as major operating zone. Because producers through marketers are continuously seeking for the attention and consumption of their produce by about the same number of consumers who have high

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies disposable income, it leads to: competition among products (alternatives and substitutes), increase innovation in goods and services, lower prices of goods and services, improves standards of produce, encourages choice.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Firm’s that operate the customisation of product for customer include, Burton for formal clothes, Wasabi for Japanese meals and Dell computers for computers. There are various taxonomies for segmenting and labelling consumers as: yopps - young person with plenty money to spend hipps - high income person with plenty money to spend lipse - low income person who spends on basics upas - unemployed person and yet showy mifo - middle income with family orientation

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Another is scale type of segmenting the market as indicated below, A 5 High Income 1 10 B 4 Middle Income 1 8 3 Working class C 1 9 4 Low income D 1

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Marketers use either one of the classifications or combination of segmentation forms to target consumers. Say, Apple laptops are sold to the middle class to high income earners, Sony laptops for working to middle income class and Dell and other emerging Chinese crone computers for the lower income consumers. Interestingly, with the introduction of the free open source software known as; Open office, Ubuntu etc, that is competing with Microsoft and Apple, the prices of computers are eventually going to take a down turn. The drop in prices of computers will come with improved functionalities, accessories, etc.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Marketing research helps in identifying consumer needs and some firm’s use reward schemes as loyalty cards or membership cards and bonus schemes to understand customer behaviour. Some notable examples of loyalty cards (in the form of plastic cards) used in understanding consumer behaviour include:

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies retail firms as Tesco, Sainsbury, ADSA (Wal-Mart), Co-operative use loyalty and credit cards, chemist as Boots have the ‘Advantage card’, that gives discount upon a pre-determined volume of purchases In the airline industry, British Airways has in place the loyalty card known as: ‘Air Miles card’.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Consumer’s expectations Just as marketers keep using effective investigative tools in understanding consumer behaviour, so does consumers knowledge and expectations of goods and services also keep increasing to satisfy their sophisticated desires and want. Also, today’s consumers are said to be impatient. So, a mobile phone advertisement claim ‘Impatience is a virtue’

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Consumers expect to get full value for their monies worth. Consumers expect marketers to be truthful in introducing their products to them. Significant number of consumers are green oriented (environmentally conscious) and buying into environmentally friendly goods and services. Consumers abhor hidden sales clauses or clauses that are in small and not legible prints of contracts.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Further, consumers want marketer’s to maintain confidentiality of their personal data. Feedback is another growing method of referencing used by consumers as a condition of purchase. Returns policy is highly sort after by consumers. There is creeping compulsory insurance of products that forms part of pricing. After sales services is another component of pricing of products, of which interest customers.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Business consumers Besides individuals, business are also at one point or the other serve as consumers. Most companies buy some part of the ingredients or component form other business entities. E.g. Sony LCD TV has some LG components. Business-to-Business (B2B) transactions have become common knowledge and intensified with the proliferation of outsourcing.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Outsourcing has to do mostly with B2B transactions, of which one firm can contract part of its task to another firm in another geographical location. In the early twenty first century, a significant number of banks did outsource their call centres to India. This include HSBC, Halifax building society, Citigroup, NatWest and many more. However , few of them have relocated to their country of origin due to lack of effective communication between the banks customers and the call centres in India.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Outsourcing has extended from call centres through health data storage, airline booking, hospitality reservations, manufacturing to accounting. E.G. Dell computers is a US firm but it is assembled in India and mailed to customer in any part of the world. Automobile industries have sited their assemble plants in China and they ship to the rest of the world.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies The internet has hasten the B2B revolution and a growing number of market places are available for B2B, B2C and C2C transactions irrespective of geographical location. Among the notable online firms are: http://www.alibaba.com/ [B2B] http://www.amazone.com/ [B2B, B2C] http://www.ebay.com/ [B2B, B2C, C2C] http://www.ashime.biz/ [B2B, B2C, C2C]

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Besides the growing online B2B transactions and platforms, there are also some shops that specialise in only B2B transactions. B2B transactions opts for bulk purchases at significantly reduced pricing or factory pricing. PC World Business is a B2B enterprise for electronic equipments and Makro in the United Kingdom who deal in household and groceries among others. B2B transactions are heavily built on consumer behaviour, credit facility and growth of partners.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Marketing Inferring from the afore-discussed, marketing is the process of identifying and satisfying the desires and needs of consumers with the intent of building a continuous relationship on a mutually beneficial bases. Most organisations have a marketing department, so as to achieve organisational goals and for profit purposes.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies It can be observed that not-for-profit organisations also do have a marketing department or carry out marketing activity to enable stakeholders to buy into the firm or product(s). Often than not one hears politicians claiming they prefer to front a candidate who is marketable so they can win votes. Therefore, marketing runs through all departments with the thought that the consumer is the centre of the firm.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Role of Marketing Marketing is said to pervade most of human activities, hence it comes with the following benefits to society. Ability to intelligently identify needs and desires of individuals. Develop goods and services that satisfy consumers’ need. It improves quality of life by providing appropriate goods and services to society.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies iv. Using techniques as advertisement and promotion to generate the desire for products, that contributes to job creation. Creating variety of products ,of which leads to choice for consumers and competition for producers, that eventually lowers prices to the benefit of the consumer. Ability to change societal behaviour through propaganda and advertising techniques. Encourage the spread of products irrespective of geographical location and offering a broad platform for transactions to occur.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Marketing critique Make-believe – marketing creates a make-believe condition in the form advertisement and propaganda that leads buyers to purchase items they really do not need or desire. A portion of people have bought items that they have not found use for and are idea in a store. Children easily get hooked to products that are advertised on cartoon TV channels, hence they force their parents to acquire it for them. So Children end up having loads of unused toys in their rooms and boxes.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies ii. Exaggeration – marketing is often accused of over exaggerating the potency or functionality of products. This is relatively common in economies where there are no independent regulatory bodies for marketing and advertisements. Sometime in 2005 L'Oreal was asked by the regulatory commission in UK to withdraw and apologies for exaggerating the claims of their anti-wriggle facial cream. This was based on the lack of enough scientific evidence, of which L’Oreal obliged.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies iii. Confidentiality of consumer data – It is common place knowledge in these times that consumers database can be purchased off the online shelf as any commodity, though an infringement on the privacy rights consumers. Marketing firms have built-in sophisticated software programmes that latently captures consumers data and online buying behaviour without the express permission of the consumer or his or her knowledge. E.g. Adware.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Waste and environmentally friendly products- Marketing has fallen foul of excessive packaging, of which forms a substantive part of price and profit margins. With a section of the consumers who are environmentally friendly and abhor waste, it will be prudent if wastage is reduced from packaging. Fair trading – Developing economies who supply a significant portion of the world’s goods and services deserve fair price for the produce. Currently, marketing is only using

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies the phrase ‘fair trade’ to maximise profit for themselves, whiles maintaining the price fixing determining authority and at an unfair low for the products that do not supply. Issues as backward integration where a Transnational Corporation identifies and gives credit to the producer of mostly raw materials to facilitate production for a period of time or hedge, is said to be good but it is not sufficient to accelerate growth.

Marketing for Growth in Developing Economies : 

Marketing for Growth in Developing Economies Part of the remedial approaches to lifting; marketing standards high and the reputation of marketing, is to ensure the ethics of its practice is adhere to. In conclusion, developing economies must orient their perception of the over three billon consumer base they have and emphasis customer driven marketing. Thank you