U.S. Firms in Developing Nationsations Essay

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Marketing Practices Used By U.S. Firms in Developing Nations Should Differ From Practices Used In the Developed World
Introduction
There are significant differences among nations that influence consumer behavior and marketing, depending on the environment. This affects demand creation, demand activation, or demand generation, influencing market trends or behaviors. Many experts argue that, marketing practices used by U.S firms in developing nations should be different from the practices used by developing nations considering facts like economic, legal, political, and cultural differences. This essay illustrates the four different factors that affect the attitude, values, consumer behavior and market efficiency across different nations, elucidating the need for different marketing practices for different countries (Tarun, Krishan & Jayant, 87).
Marketing Strategies in the U.S
In any marketing practice, understanding the target population, their expectation and how to approach them is of significant importance. Consequences of not doing so is likely to generate resistance, eventually reducing the benefits expected. However, marketing practices that are developed based on the existing factors receive warm reception and can extensively be effective if adopted. Contrary to this, many countries rely heavily on U.S. marketing practices, which seem to have conquered the world. Many people believe that U.S. marketing practices are ‘a one size fits all,’ because for decades, American firms have been considered to be the best managed firms globally. For example, Apple, IBM, McDonalds, and Wal-Mart among others, are among the many icons in business worldwide. Their managers are top ranked due to their marketing skills that are considered exemplary to other firms with similar visions of succeeding within their market niches (Tarun, Krishan &Jayant, 2005). Owing to their global performance, it can be misinterpreted to mean that marketing practices used by such firms, mostly based in U.S, can equally be used anywhere including developing nations. Many firms have started thinking globally, similarly adopting global best practices in managing business operations. Multinational firms are eyeing markets in East Europe, Latin America, and Africa.
Due to globalization, accelerated by technological advancement, such markets have experienced favorable conditions encouraging firms to pursue greater profits. Exports in these markets are flourishing because of the four factors pertaining to economic, legal, political, and cultural aspects. Firms have taken advantage of these factors to make adjustment in coming up with marketing strategies. This was not witnessed before because global markets were initially restricted to Western businesses. U.S firms, in developing countries, are catching up with this trend. There has been increased need to develop different strategies in marketing; different from the ones they use back home. U.S firms have recognized the difference in such markets. For example, Levis products are found all over the world, but there representation is different in different regions. In the U.S, Levis products are marketed as practical products while Levis in Africa, they represent some class, and lavishness .This is to suit the different environment for the product to thrive (Tarun, Krishan &Jayant, 92). This calls for U.S firms, targeting markets in developing countries to work on a fundamental belief of applying different strategies that fits specific markets.
Factors to Be Considered In Marketing
Economic Factors
It is important to consider that many developing countries are usually vulnerable to changes especially, in the international environment than developed countries like the U.S due to varied economic structures. The economic status of any country has a direct impact on its market growth. Developed and developing countries have different experiences with fluctuation of foreign exchange rates, as a result of unpredictable demands and supply distress imposed on the economy owing to stiff competition. Developing countries experience frequent fluctuations in foreign exchange rates more than the developed countries. Stiff competition in global markets has resulted to decline in primary commodity prices in these countries. With increased levels on market uncertainty, mostly in developing countries these regions have experienced low economic growth constantly. This should send a message that consumers are reducing their spending, and firms shying away from investing, making such markets less attractive. When marketing in such situations, much thought should be on how best to tap into the low economic situation (Bloom, Schweiger, &Van Reenen, 45).
Most of the developing countries are yet to realize significant economic growth because they are not active in free trade zones and customs union; they face serious obstacles like stiff competition in accessing international markets. Therefore, marketing in such environment should be reviewed to understand the overall economic situation that might affect the desired outcomes. This can be done by analyzing the GDP of these countries to provide a comprehensive report of their economic performance .GDP serve as an indicator to inform investors of the general health of an economy. When there is growth in GDP, it means the economy is performing well; therefore, more money will be circulating, as companies will be willing to invest in such countries. Developing countries’ GDP is different from that of U.S, and this might affect the marketing strategies because low GDP will mean less economic outcomes (Bloom, Schweiger, & Van Reenen, 31).
Infrastructure and Unskilled Labor
Issues of poor infrastructure and unskilled labor in developing countries are common phenomena yet they relate directly to marketing. Multinational firms will find it difficult to operate in such environment if they use the same marketing strategies of U.S in regards to these two barriers. The above points are confirmation that makes developing countries be considered volatile because it is difficult to anticipate future market trend (Bloom, Schweiger, & Van Reenen, 89).
Cultural Factors
Culture is a key factor in distinguishing the success or failure of marketing plans. It is obvious that Western multinational firms cannot import their business culture in the developing countries. Problems might arise because of consumer behavior. Consumer behavior is a dominant factor in developing marketing strategies, which is greatly influenced by culture (Shaw, 37). To have successful marketing strategies, companies needs to consider the role of culture of a particular society where the new product is expected to compete with other existing ones. It is a fact that most people decide to purchase products based on cultural factors. For example, in America people purchase products in relation to personal inclination as compared to Japan where purchasing leans towards the welfare of a family (Shaw, 38). When developing marketing strategies in such countries, advertisements should focus on collective acceptable values of the family if the firm is to operate in a country like Japan. The firm also needs to consider the use of local language; it plays an important role in influencing and reaching out to potential buyers, even if some foreign language has been adopted in developing countries. Local language acts as a cultural pride to many, therefore, marketing strategies that incorporate the local language may be more successful than the o...