Do you believe that adherence to the “marketing concept” is the right way to approach international markets? Why, or why not?
Here is what netMBA.com defines as the marketing concept “The marketing concept is the philosophy that firms should analyze the needs of their customers and then make decisions to satisfy those needs, better than the competition.” For US companies venturing into international markets, following this rule is absolutely critical if they want any sort of success. International markets are so diverse that reuse of existing market strategies may not be effective in delivering results that have been achieved in domestic strategies.
Asia is considered by many companies to be an opportunity market. However, aggregating the most populous region of the globe into one segment is a grave error. The diversity of each country, and even the cultural differences within regions and sub-regions of countries can demand a different marketing strategy to connect with that area’s consumer. Although the name of the article suggests otherwise, “In Asia Marketing 101 Doesn’t Work,” it talks about getting to know the consumers in differing areas “better than the locals.” This is psychographic marketing if I’ve ever heard of it. Just as stated in the AE Article “Three Dimensional” each country has nuances that are unique to itself. For example, Samsung, understanding that due to the small living quarters in Japan, small, multi-function devices garner higher value to the Japanese consumer.
In addition to physical constraints of each of these countries, political and social differences permeate differently. China has had a long history of Communism and therefore has a much more communal sense of each other rather than an individualistic approach that would be commonly used in a western marketing strategy. The HBR article refers to this effect as “Tapping the communal mindset.” To market effectively companies should start with a clean slate and build a strategy from the ground up. This does not mean ignore principals of demographics and segmentation, it does however, mean that this is an entirely new game and the rules are very different. In an article from the Association for Consumer Research I found a prime example of specific segmentation for a single city in China. The abstract is a psychographic segmentation of Beijing Adults and Food Consumption. Here is an excerpt:
“The people of the PRC have been through considerable and rapid social, political, and economic changes during the last 50 years, They have experienced changes from Confucianism to Communism and then Consumerism. These rapid and enforced changes (by the government) have had substantial impact upon the values system and lifestyles of the people in the PRC. Some of these changes have caused alterations to the basic structure of the PRC society.”
The article continues into great detail on the Beijing consumer. It is uses Beijing as an analogue for the rest of the country’s larger cities because it is the capital city. Even this may be to generalized to hold up over time.
In conclusion, the “Marketing Concept” should be followed. The basic principals it drives at are crucial to any successful foray into marketing to any consumer. The catch is that every market is different and a savvy marketer should not underestimate the minute differences in geographic regions. Asia is, or could certainly be the economic engine for the next century, but if you fail to understand the uniqueness of its various pieces you will most certainly fail.
McGraw-Hill Companies, Annual Editions, Marketing 09/10