Marketing practices in less-development countries

This paper presents a symmetric analysis of the approaches used in the study of marketing practices in less-development countries, and develops another approach which has substantial promise. The proposed approach is composed of two stages. The first stage groups LDCs into specific categories followed by a matrix treatment to determine research priorities in studying marketing practices in LDCs.     

Better marketing to developing countries: Why and how

Managers have long understood the rationale for investing in new products. Now, however, they face an even more compelling need: to invest in targeting new markets, specifically those in less developed countries (LDCs). The argument presented in this article, for initiating or increasing marketing efforts in these nations, makes two related points. First, a healthy world economy requires consumers in developing nations—particularly China—to spend more, because trade imbalances between the United States and LDCs cannot be sustained. Second, in order to foster consumption in LDCs and to profit from it, marketing expertise in the developed world must refocus. Success will require devising, promoting, and distributing products that will overcome economic constraints in some markets, and in others will overcome an understandable reluctance to spend rather than save. We suggest that lessons may be gleaned from examples regarding recent efforts targeting LDCs by a pharmaceutical company (Pfizer) and a food supplement marketer (Procter & Gamble), as well as efforts pioneered in less developed countries themselves (including low-cost private schools and $2,500 automobiles).     

Remanufacturing Marketing Strategies and Developing Countries

Remanufacturing is a means of production which systematically restores existing equipment to like-new condition. It offers an ecologically sound and economical means of production which offers LDCs a host of benefits. Distinct from mere ad hoc repairing, remanufacturing couples the benefits of employing cheap, used machines, with an efficient means of production. Most of the existing literature on remanufacturing is technical and production orientated; such research is reviewed. In addition, an array of marketing and distribution issues are analyzed. Since most failures of remanufacturing stem from marketing problems, this discussion is especially useful to policy makers and development specialists. If thoughtfully employed, remanufacturing offers LDCs greater self-sufficiency using relatively cheap "light" industry manned by unskilled and semi-skilled labor.     

Applying the marketing concept to design new products

This article is an empirical application of the marketing concept in the design of new product offerings in the area of religious instructional materials. The general approach and methodology of this research should be appropriate for many types of consumer products and organizations. The marketing concept was applied to the design of religious instructional materials in this study through an empirical investigation of the values, attitudes, and perceived needs of key market populations. The study consisted of determination of perceived needs for alternative topics, identification of educational themes around which specific topics could be integrated into instructional packages, and assessment of the importance of these themes across alternative market segments. A total of 1161 respondents (464 pastors and 697 lay members) completed a mail questionnaire which solicited their perceptions of themselves and the domain of the church in their lives. Respondents also indicated the level of importance they placed on alternative instructional topics. The data were analyzed through the use of multivariate techniques to provide understanding and interpretation of the perceived needs of alternative market segments. Results of the analyses were very useful in determining which instructional packages to develop and the target markets for each package.     

Ethical beliefs and personal values of top level executives

Do business executives sell their souls to the corporation? Is the organization a “paramour” in an executive's life? Is backstabbing the only way to climb the corporate ladder? The basic purpose of this study was to provide answers to these questions by surveying Fortune 500 corporate executives in the marketing, finance, and production areas. The findings are interesting as various executives exhibited different behavior regarding three types of ethical concern.     

Differences among exporting firms based on their degree of internationalization

An overwhelming majority of the investigations of company export behavior have utilized data obtained from all types of firms in a sample. An alternative approach would involve disaggregating the sample into some meaningful groups and contrasting company characteristics across the subsamples of firms. This study attempts to delineate differences among exporting firms when firms are classified by their degree of internationalization. Three types of exporters are identified in light of the internationalization hypothesis: experimental exporters, active exporters, and committed exporters. These firms are then contrasted with each other with respect to measurable company characteristics, domestic market environment, nature of international business involvement, marketing policy aspects, and export market research practices. The analysis in the paper is based upon data gathered through personal interviews with the executives of 70 midwestern manufacturers. The study reveals significant differences among the three types of exporters and provides further insights into the export marketing behavior of firms.     

Communicating Environmental Information: Are Marketing Claims on Packaging Misleading?

The increased usage of questionable environmental marketing claims has become an issue of concern for academics, policy makers and consumers. Much of the research to date, has focused on the accuracy of environmental claims in advertisements, with the information on product packaging being largely ignored. This study uses a content analysis to examine the environmental information on packaging. More specifically it examines the packaging of the population of dishwashing liquid bottles available in grocery stores in a large city in Australia. Evaluation criteria are developed to classify the various types of information and the degree to which the information is "misleading". Seven different informational categories and four accuracy categories are developed. These criteria are developed based on the existing environmental advertising literature and environmental marketing regulations in the U.S. and Australia. It was found that a majority of the packaging information can be classified as being not accurate.     

Parental influence upon children's diet: the issue of category

Food and drink are distributed via corporate institutions in categories, such as ready meals or carbonated drinks. Within these categories, a minority of brands advertise, capitalizing upon the popularity of the categories. The issue of childhood obesity and health has led to a focus upon these advertised brands in terms of their being targeted at children, but nothing has been done about the categories they represent. Furthermore, parents have an influence upon their children's diet, as their expenditure accounts for the majority of their children's consumption. This paper accounts for UK children's perceptions of the effect of advertising and marketing of food and drink upon their parents, and concludes that the children see advertising as having very little influence. Rather, they see that their parents' involvement with certain categories have become, over time, their norm. Children do not see that the regulation of advertising of food and drink to them will have any significant effect upon their diet, as their parents will continue to consume from within the categories supplied by the retail sector, which in their view constitutes the most influential aspect of food and drink marketing. Given the international focus upon the advertising of food brands, this paper draws attention to other, potentially more influential issues.     

The effect of product visibility upon the relationship between price and quality

Previous studies have suggested that the relationship between price and quality for certain types of consumer goods often is not positive. Investigators have hypothesized that the experience of value, or the relationship between quality and price, may be less relevant for product categories in which a consumer's self-worth may be elevated through the act of purchase. Brands within such product categories would appear to be particularly susceptible to image building strategies involving the use of premium pricing to infer high quality. This study examined the relationship between price and objective quality from 1961 through 1978 for 878 brands of 54 products within three broad product categories of toilet articles, cosmetics, and clothing. Generally, the relationship for products within these categories was weak which suggests that marketing managers of some brands may well be basing prices on intangible as well as tangible values.     

Chances for Africa’s trade in farm products

African LDCs are hard-hit by the decline in the world’s agricultural trade but there are still fair chances for increasing African farm produce exports. Yet instead of relying on commodity agreements and preferential tariffs, the countries of Africa ought to apply an offensive marketing strategy to certain products and improve trade in their home markets.     

Forms of exports for LDCs

Development aid of the industrialized nations has taken as its focal point the promotion of nontraditional exports by LDCs. An important part of this endeavour is the spreading of enlightenment among LDCs about the possibility of finding marketing outlets for their direct and indirect exports.     

Measuring consumer vulnerability to perceived product-similarity problems and its consequences

Abstract

The brand clutter in many product categories and increasing numbers of similar products, some of which are deliberate look-alikes, make it more difficult for consumers to distinguish between brands, which can lead to more mistaken and misinformed purchases. Moreover, increasing brand similarity is likely to influence important consumer outcomes. To examine this phenomenon, a perceived product-similarity scale developed in Germany was administered to 220 consumers in the United Kingdom. Following the formulation of testable hypotheses and assessments of the scale's reliability and validity, the scale was used to measure perceived product similarity (PPS) across three different product categories, while examining the impact of PPS on brand loyalty and word of mouth. Structural equation modelling revealed that PPS significantly affects word of mouth but not brand loyalty. In addition, cluster analysis identified three meaningful and distinct PPS groups. Implications for marketing managers, consumer policy makers, and marketing research are discussed.     

Should retailers adjust their micro-marketing strategies to type of outlet? An application to location-based store space allocation in limited and full-service grocery stores

Many retailers today operate strategically different types of sites: ‘limited-service’ stores—that offer all core products/services but only a shallow assortment of non-core services—and ‘full-service’ sites with deep lines of both core and non-core services. An important question for these retailers is whether and how to adopt a micro-marketing strategy in each of these formats. In a micro-marketing strategy, retailers tailor their marketing mix to the characteristics of the local market in which each store outlet operates—a central issue being whether the allocation of store space across product categories should be location-specific. This paper (i) examines the conditions for such micro-marketing to be beneficial, and (ii) in particular—how these benefits depend on store format. It also (iii) indicates how the pattern of space adjustments to local conditions should differ between formats. The propositions are tested in a grocery retail setting, for a retail chain operating limited-service supermarkets and full-service hypermarkets. Our results suggest that micro-marketing is beneficial in both types of format. Yet, the appropriate way of localizing space allocation patterns is format-specific. While supermarkets should primarily adjust the space shares of food (core) categories, hypermarkets should primarily adapt the space shares of non-food (non-core) categories to local market conditions. The outcomes of the study have conceptual as well as managerial relevance and may prove useful for multi-format retailers in a wide range of settings.     

Country-of-Destination and Export Marketing Strategy:

As changes in the economic and political environment in many developing countries bring opportunities for multinational corporations, many U.S. and other MNCs find that they have little experience with marketing and exporting to such countries, having focused mainly on developed-country markets. In addition, there has been little research which has investigated issues relating to marketing in LDCs. This study explored these issues and found that different marketing strategies are used by U.S. companies which export to developing countries as opposed to those which market to developed countries, thereby highlighting the importance of taking the country-of-destination into account when planning export marketing strategies. In addition, a separate analysis of firms which export mainly to developing-countries revealed that direct distribution, the number of countries exported to, product standardization, and a focus on price are negatively associated with market share. The implications of these findings are discussed.     

Market Power vs. Marketing Prowess as Determinants of Company Performance in LDCs:

Marketing scholars have argued that marketing has the potential to considerably increase productivity and quality of goods and services delivered by developing nations' marketing systems. But in order for this to occur it must be in the self-interest of entrepeneurs to adopt modern marketing practices. This need not be the case in the highly oligopolistic business structures of import substituting LDCs, where market power may be a more important determinant of success. The article tests this hypothesis in the context of Venezuela. The results suggest that market structures in LDCs offer limited incentive to the adoption of marketing, at least to the extent that self-interest is a crucial reason for adopting the marketing concept.     

Does Online Information Drive Offline Revenues?: Only for Specific Products and Consumer Segments!

While many offline retailers have developed informational websites that offer information on products and prices, the key question for such informational websites is whether they can increase revenues via web-to-store shopping. The current paper draws on the information search literature to specify and test hypotheses regarding the offline revenue impact of adding an informational website. Explicitly considering marketing efforts, a latent class model distinguishes consumer segments with different short-term revenue effects, while a Vector Autoregressive model on these segments reveals different long-term marketing response.We find that the offline revenue impact of the informational website critically depends on the product category and customer segment. The lower online search costs are especially beneficial for sensory products and for customers distant from the store. Moreover, offline revenues increase most for customers with high web visit frequency. We find that customers in some segments buy more and more expensive products, suggesting that online search and offline purchases are complements. In contrast, customers in a particular segment reduce their shopping trips, suggesting their online activities partially substitute for experiential shopping in the physical store. Hence, offline retailers should use specific online activities to target specific product categories and customer segments.     

Multinational Strategic Planning for Third World Markets

There are compelling reasons why multinational corporations (MNCs) must improve their marketing performance in less developed countries (LDCs). A solution to better performance may be creation of a separate strategic business unit, known as the SBU (LDC), to be responsible for all third world operations. A strategic planning model for the SBU(LDC) is presented; it parallels the typical corporate strategic plan but differs in significant respects. Planning steps discussed include mission and objectives, market opportunity analysis, target market evaluation, product strategy, entry strategy, marketing program, and impact analysis. Key issues involved in implementing the SBU (LDC) within the corporate framework are discussed.     

Perceived Export Problems and Export Involvement:

A relatively limited amount of empirical research has focused on problems and issues pertaining to exporting from countries not associated with an advanced level of economic development. This paper reports on a systematic study of problems experienced by Greek exporting manufacturers in their trading activities with overseas distributors based in European Community (EC). In this context, an attempt is made, firstly, to investigate the underlying structure of exporting problems, and secondly, to examine the extent to which there are significant differences in perceptions of exporting problems based upon the degree of export involvement. A number of significant differences are found to exist in perceived export problems between different exporter categories in terms of export involvement. The implications of the study for business practitioners and public policy makers are highlighted, and future research directions are identified and discussed.     

The role of taxonomic and goal‐derived product categorization in,within, and across category judgments

Consumers can face two types of judgment and choice situations: They may be considering products that are classified in a single product category, or products that may belong to several different product categories. This article compares these within‐ and across‐category judgments on the basis of the distinction between taxonomic and goal‐derived categorization. The first study examines how products that belong to taxonomic and goal‐derived categories are represented in memory. The findings support the view that taxonomic categories differ from goal‐derived categories in terms of the ease with which the features shared between members of the category are accessible and the type of features that are used to represent the members. In turn, these differences influence consumer beliefs, judgments, and choice sets when consumers make within‐ and across‐category product comparisons. A second study examines how consumers' familiarity with consumption situations influences the construction of choice sets. Results indicate that as familiarity with consumption situations increases, consumers construct more narrowly defined, within‐category choice sets, whereas in less‐familiar situations consumers construct broader, across‐category choice sets. The implication of these findings on marketing action is discussed. © 2001 John Wiley & Sons, Inc.     

The relationship between purchase regularity and propensity to accelerate

Identifying random and regular-buying household segments and relating them to demographic and shopping characteristics has been the focus of many marketing studies. Missing from the marketing literature, however, is a study that relates purchase regularity to marketing mix sensitivities. Such study could provide substantive implications since it would explore a practical dimension of a segmentation scheme based on purchase regularity. In this article, we investigate the relationship between purchase regularity and propensity to accelerate through the use of a mixture Weibull model of purchase timing. Applying this perspective to purchase timing data on four product categories (ketchup, sugar, bathroom tissue, margarine), we show that in the frequently purchased categories of bathroom tissue and margarine, random buyers do not exhibit any propensity to accelerate while regular buyers do. In the occasionally purchased categories of ketchup and sugar on the other hand, random buyers exhibit at least as much propensity to accelerate their purchases as regular buyers do. Our rationale for these results is based on information-theoretic arguments suggesting that propensity to accelerate depends on the frequency at which a product category is purchased.