Managing Business Activities in Lower-End Consumer Segments in Emerging Markets

Kuester, Sabine ; Janda, Sergej von ; Schuhmacher, Monika C.

Document Type: Working paper
Year of publication: 2013
The title of a journal, publication series: IMU Research Insights
Volume: 015
Place of publication: Mannheim
Publishing house: Institut für Marktorientierte Unternehmensführung, Universität Mannheim
Publication language: English
Institution: Außerfakultäre Einrichtungen > Institut für Marktorientierte Unternehmensführung (IMU)
Business School > Marketing & Innovation (Kuester 2005-)
Subject: 330 Economics
Abstract: Relevance of topic: While traditional, developed markets become more and more saturated, emerging markets and their rising middle classes experience increasing importance as drivers of global growth. Managers need to be aware of and prepared for the distinct requirements of these high-potential target markets. Investigated industries: Textiles/sportswear, automotive, health care, FMCG, renewable energies, agriculture, and telecommunications Aim: To identify the key success factors for multinational corporations that seek to do business with lower-end consumer segments in emerging markets Methodology: Semi-structured expert interviews with managers with 2-20 years of emerging market experience Key learnings and implications: - The ‘lower’ the target segment in the consumer pyramid, the higher the need to adapt – respectively localize – product, price and distribution strategy - Universal need of adaptation of promotion activities across all consumer segments - Emerging markets require a decentralization of marketing and R&D functions in combination with high degrees of internal embeddedness characterized by intensive intra-organizational information- and communication flow - ‘Acentric’ organizational orientation leverage each market subsidiaries’ resources - Offerings characterized by favorable price-performance ratios, modular design, simplicity and high degrees of novelty or radicalness on the one hand unlock the great potential of lower-end consumer segments in emerging markets and on the other hand entail opportunities for reverse innovation.

Dieser Eintrag ist Teil der Universitätsbibliographie.

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