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Global Marketing Management Emerging Markets

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Global Marketing Management Emerging Markets

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    1. Global Marketing Management Emerging Markets MKGT 3215-001 Fall 2010 Mrs. Tamara L. Cohen

    2. Emerging Markets Reading for this class: The World is Flat chapters 1 & 2 Homework: Summarize key concepts in The World is Flat chapters 1 & 2

    3. The World is Flat Thomas Friedman Suggests world is flat as metaphor for level playing field Globalization has leveled playing fields between industrial and emerging market countries Thomas Friedmans 10 flatteners level the playing field: Collapse of Berlin Wall (11/9/89): end of Cold War + Eastern European people joined economic mainstream Netscape (8/9/95): with Web broadened audience for Internet Workflow software: ability of machines to talk to other machines without human involvement Uploading: communities uploading and collaborating on online projects Outsourcing: companies spilt service and manufacturing activities in to more efficient components Offshoring: Internal relocation of manufacturing etc to foreign land to take advantage of cheaper costs there Supply-chaining: using technology to streamline item sales e.g. Wal-Mart Insourcing: Companys employees perform services beyond shipping for another company, e.g. UPS repairs Toshiba computers In-forming: using search engines to gather your own information, e.g. Google The Steroids: personal digital devices e.g. cell phones, iPods, IM, PDAs, VoIP. Thomas Friedmans 10 flatteners level the playing field: Collapse of Berlin Wall (11/9/89): end of Cold War + Eastern European people joined economic mainstream Netscape (8/9/95): with Web broadened audience for Internet Workflow software: ability of machines to talk to other machines without human involvement Uploading: communities uploading and collaborating on online projects Outsourcing: companies spilt service and manufacturing activities in to more efficient components Offshoring: Internal relocation of manufacturing etc to foreign land to take advantage of cheaper costs there Supply-chaining: using technology to streamline item sales e.g. Wal-Mart Insourcing: Companys employees perform services beyond shipping for another company, e.g. UPS repairs Toshiba computers In-forming: using search engines to gather your own information, e.g. Google The Steroids: personal digital devices e.g. cell phones, iPods, IM, PDAs, VoIP.

    4. Terms & Definitions Economic Development = increase in national production that results in increase in average per capita GDP Newly Industrialized Countries (NICs) experiencing rapid economic expansion & industrialization e.g. Chile, Brazil, Mexico, South Korea, Singapore, Taiwan Big Emerging Markets (BEMs) 10 fast track countries expected to grow rapidly Bottom-Of-the-Pyramid Markets (BOPMs) - clusters of markets defined by pockets of poverty, usually in LDCs & LLDCs; relatively ignored by marketers due to misconceptions about resources & appropriate products GDP = Gross DOMESTIC Product = measure of market value of all goods & services produced within boundaries of a nation; excludes receipts from operations in foreign countries In 1993 the U.S. Commerce Department crafted the United States National Export Plan focusing on what were identified as the Ten Big Emerging Markets (BEMs): Asia: China, Indonesia, India, South Korea. America: Mexico, Argentina, Brazil. Africa: South Africa Europe: Poland and Turkey The Department of Commerce estimated that the 10 BEMs would be largest growing markets on the globe well into the 22nd century, and projected they would triple the value of their imports (to 27% of the total world value) by 2010 providing > 75% of the worlds economic growth for the next 20 years. (This 20-year period finishes in 2013.) BOPM coined by C K Prahalad, The Fortune at the Bottom of the Pyramid, Wharton, 2005 GDP = Gross DOMESTIC Product = measure of market value of all goods & services produced within boundaries of a nation; excludes receipts from operations in foreign countries In 1993 the U.S. Commerce Department crafted the United States National Export Plan focusing on what were identified as the Ten Big Emerging Markets (BEMs): Asia: China, Indonesia, India, South Korea. America: Mexico, Argentina, Brazil. Africa: South Africa Europe: Poland and Turkey The Department of Commerce estimated that the 10 BEMs would be largest growing markets on the globe well into the 22nd century, and projected they would triple the value of their imports (to 27% of the total world value) by 2010 providing > 75% of the worlds economic growth for the next 20 years. (This 20-year period finishes in 2013.) BOPM coined by C K Prahalad, The Fortune at the Bottom of the Pyramid, Wharton, 2005

    5. In static economies, consumption patterns become rigid, and marketing is typically nothing more than a supply effort. In a dynamic economy, consumption patterns change rapidly. Marketing is constantly faced with the challenge of detecting and providing for new levels of consumption, and marketing efforts must be matched with ever-changing market needs and wants. In static economies, consumption patterns become rigid, and marketing is typically nothing more than a supply effort. In a dynamic economy, consumption patterns change rapidly. Marketing is constantly faced with the challenge of detecting and providing for new levels of consumption, and marketing efforts must be matched with ever-changing market needs and wants.

    6. Marketing & Economic Development Stage of economic growth affects attitudes toward foreign business activity demand for goods distribution systems within country entire marketing process Economic development increases GDP implies widespread distribution of increased income The economic level of a country is the single most important environmental element to which the foreign marketer must adjust the marketing task. The stage of economic growth within a country affects the attitudes toward foreign business activity, the demand for goods, the distribution systems found within a country, and the entire marketing process. Economic development is generally understood to mean an increase in national production that results in an increase in the average per capita gross domestic product (GDP). Besides an increase in average per capita GDP, most interpretations of the concept also imply a widespread distribution of the increased income Economic development presents a two-sided challenge. 1. a study of the general aspects of economic development is necessary to gain empathy regarding the economic climate within developing countries. 2. the state of economic development must be studied with respect to market potential, including the present economic level and the economys growth potential. . The economic level of a country is the single most important environmental element to which the foreign marketer must adjust the marketing task. The stage of economic growth within a country affects the attitudes toward foreign business activity, the demand for goods, the distribution systems found within a country, and the entire marketing process. Economic development is generally understood to mean an increase in national production that results in an increase in the average per capita gross domestic product (GDP). Besides an increase in average per capita GDP, most interpretations of the concept also imply a widespread distribution of the increased income Economic development presents a two-sided challenge. 1. a study of the general aspects of economic development is necessary to gain empathy regarding the economic climate within developing countries. 2. the state of economic development must be studied with respect to market potential, including the present economic level and the economys growth potential. .

    7. Standards of Living for Selected Countries Exhibit 9.1 (Cateora, Gilly & Graham) shows 2008 data regarding the standards of living in a variety of countries across the spectrum of development. You will notice that those at the lowest levels of development often do not collect or report data suitable for international resources such as Euromonitor International or the World Bank. It is also interesting to note the differences in consumer spending among the Latin American countries and the United States. GDP/Capita* - at purchasing power parity. PPP is the amount of a certain basket of basic goods which can be bought in the given country with the money it produces. PPP basis is arguably more useful when comparing differences in living standards on the whole between nations because PPP takes into account the relative cost of living and the inflation rates of different countries.Exhibit 9.1 (Cateora, Gilly & Graham) shows 2008 data regarding the standards of living in a variety of countries across the spectrum of development. You will notice that those at the lowest levels of development often do not collect or report data suitable for international resources such as Euromonitor International or the World Bank. It is also interesting to note the differences in consumer spending among the Latin American countries and the United States. GDP/Capita* - at purchasing power parity. PPP is the amount of a certain basket of basic goods which can be bought in the given country with the money it produces. PPP basis is arguably more useful when comparing differences in living standards on the whole between nations because PPP takes into account the relative cost of living and the inflation rates of different countries.

    8. Global Perspective of Emerging Markets New patterns of consumer behavior emerging countries prosper people exposed to new ideas and behavior patterns via global communication networks old stereotypes, traditions, and habits cast aside or changed (new software for the mind) pattern of economic growth and global trade will extend well into 21st century Traditionally 3 multinational market regions (trading blocs) Europe, Asia, Americas what about Africa? As countries prosper and their people are exposed to new ideas and behavior patterns via global communications networks, old stereotypes, traditions, and habits are cast aside or tempered, and new patterns of consumer behavior emerge. A pattern of economic growth and global trade that will extend well into the 21st century appears to be emerging. It consists of 3 multinational market regions that comprise major trading blocs: Europe, Asia, and the Americas. Within each trading bloc are fully industrialized countries, as typified by Germany, Japan, and the United States; rapidly industrializing countries such as Mexico, Poland, and South Korea that are close on the heels of the fully industrialized; and other countries that are achieving economic development but at more modest rates. As countries prosper and their people are exposed to new ideas and behavior patterns via global communications networks, old stereotypes, traditions, and habits are cast aside or tempered, and new patterns of consumer behavior emerge. A pattern of economic growth and global trade that will extend well into the 21st century appears to be emerging. It consists of 3 multinational market regions that comprise major trading blocs: Europe, Asia, and the Americas. Within each trading bloc are fully industrialized countries, as typified by Germany, Japan, and the United States; rapidly industrializing countries such as Mexico, Poland, and South Korea that are close on the heels of the fully industrialized; and other countries that are achieving economic development but at more modest rates.

    9. Recipe for economic growth of Newly Industrialized Countries (NICs) Political stability in policies affecting development Economic & legal reforms Entrepreneurship Planning Outward orientation Factors of production Strategic industries targeted for growth Incentives to save & update infrastructure Privatization of state-owned enterprises Newly Industrialized Countries (NICs) experiencing rapid economic expansion & industrialization e.g. Chile, Brazil, Mexico, South Korea, Singapore, Taiwan Political stability in policies affecting development Economic & legal reforms. Poorly defined &/or weakly enforced contract and property rights are features poorest countries have in common. Entrepreneurship. Free enterprise in hands of self-employed was seed of new economic growth. Planning. Central plan with observable and measurable development goals linked to specific policies was in place. Outward orientation. Focus on production for domestic market & export markets with increases in efficiencies and continual differentiation. Factors of production. Deficient factors (land, raw materials, labor, capital, management, technology) brought from outside. Industries targeted for growth. Strategic industrial & international trade policies created to identify sectors where opportunity existed. Key industries encouraged. Incentives to force high domestic rate of savings & to direct capital to update infrastructure, transportation, housing, education, training. Privatization of state-owned enterprises - stop drain on national budgets, release immediate capital to invest in strategic areas. Often new investors modernize, creating economic growth. Newly Industrialized Countries (NICs) experiencing rapid economic expansion & industrialization e.g. Chile, Brazil, Mexico, South Korea, Singapore, Taiwan Political stability in policies affecting development Economic & legal reforms. Poorly defined &/or weakly enforced contract and property rights are features poorest countries have in common. Entrepreneurship. Free enterprise in hands of self-employed was seed of new economic growth. Planning. Central plan with observable and measurable development goals linked to specific policies was in place. Outward orientation. Focus on production for domestic market & export markets with increases in efficiencies and continual differentiation. Factors of production. Deficient factors (land, raw materials, labor, capital, management, technology) brought from outside. Industries targeted for growth. Strategic industrial & international trade policies created to identify sectors where opportunity existed. Key industries encouraged. Incentives to force high domestic rate of savings & to direct capital to update infrastructure, transportation, housing, education, training. Privatization of state-owned enterprises - stop drain on national budgets, release immediate capital to invest in strategic areas. Often new investors modernize, creating economic growth.

    10. BEMs = Big Emerging Markets have worlds population have industrial worlds GDP (1/2 world GDP by 2010) all geographically large significant populations represent sizeable markets for wide range of products strong growth rates or potential growth rates significant economic reforms major regional political importance regional economic drivers stimulate expansion in neighboring markets e.g. India, China, Brazil, Mexico, South Africa, Poland, Turkey Up-and-coming BEMs = Egypt, Colombia, Venezuela

    11. Big Emerging Markets (BEMs) Exhibit 9.6 Although these criteria are general and each country does not meet all the criteria, the Department of Commerce has identified those countries listed in Exhibit 9.6 as Big Emerging Markets (BEMs.) Other countries such as Egypt, Venezuela, and Colombia may warrant inclusion in the near future. The list is fluid because some countries will drop off while others will be added as economic conditions change. Inducements for those doing business in BEMs include Export-Import Bank loans and political-risk insurance channeled into these areas. The BEMs differ from other developing countries in that they import more than smaller markets and more than economies of similar size. As they embark on economic development, demand increases for capital goods to build their manufacturing base and develop infrastructure. Increased economic activity means more jobs and more income to spend on products not yet produced locally. Thus, as their economies expand, there is an accelerated growth in demand for goods and services, much of which must be imported. BEM merchandise imports are expected to be nearly $1 trillion higher than they were in 1990; if services are added, the amount jumps beyond the trillion-dollar mark. Although these criteria are general and each country does not meet all the criteria, the Department of Commerce has identified those countries listed in Exhibit 9.6 as Big Emerging Markets (BEMs.) Other countries such as Egypt, Venezuela, and Colombia may warrant inclusion in the near future. The list is fluid because some countries will drop off while others will be added as economic conditions change. Inducements for those doing business in BEMs include Export-Import Bank loans and political-risk insurance channeled into these areas. The BEMs differ from other developing countries in that they import more than smaller markets and more than economies of similar size. As they embark on economic development, demand increases for capital goods to build their manufacturing base and develop infrastructure. Increased economic activity means more jobs and more income to spend on products not yet produced locally. Thus, as their economies expand, there is an accelerated growth in demand for goods and services, much of which must be imported. BEM merchandise imports are expected to be nearly $1 trillion higher than they were in 1990; if services are added, the amount jumps beyond the trillion-dollar mark.

    12. China + emerging markets will account for 75% of worlds total growth in next 10 years and beyond. - US Dept of Commerce Cateora, Gilly & Graham (ch.9): According to U.S. Department of Commerce estimates, China and other emerging markets throughout the world will account for 75% of the worlds total growth in the next decade and beyond. Cateora, Gilly & Graham (ch.9): According to U.S. Department of Commerce estimates, China and other emerging markets throughout the world will account for 75% of the worlds total growth in the next decade and beyond.

    13. Latin America Most countries moved from military dictatorships to democratically elected govts Trend toward privatization of state-owned enterprises followed period when govts dominated economic life for most of 20th century Today many Latin American countries are at roughly same stage of liberalization that launched dynamic growth in Asia during 1980s and 1990s In a positive response to these reforms, investors have invested billions of dollars A political and economic revolution has been taking place in Latin America over the last two decades. Most of the countries have moved from military dictatorships to democratically elected governments, and sweeping economic and trade liberalization is replacing the economic model most Latin American countries followed for decades. We say this despite the most recent backsliding of a few countries in the region such as Venezuela. Privatization of state-owned enterprises and other economic, monetary, and trade policy reforms show a broad shift away from the inward-looking policies of import substitution (that is, manufacturing products at home rather than importing them) and protectionism so prevalent earlier. The trend toward privatization of state-owned enterprises in the Americas followed a period in which governments dominated economic life for most of the 20th century. State ownership was once considered the ideal engine for economic growth. Today many Latin American countries are at roughly the same stage of liberalization that launched the dynamic growth in Asia during the 1980s and 1990s. In a positive response to these reforms, investors have invested billions of dollars in manufacturing plants, airlines, banks, public works, and telecommunications systems. Because of its size and resource base, the Latin American market has always been considered to have great economic and market possibilities. The population of nearly 460 million is one-half greater than that of the United States and 100 million more than the European Community.A political and economic revolution has been taking place in Latin America over the last two decades. Most of the countries have moved from military dictatorships to democratically elected governments, and sweeping economic and trade liberalization is replacing the economic model most Latin American countries followed for decades. We say this despite the most recent backsliding of a few countries in the region such as Venezuela. Privatization of state-owned enterprises and other economic, monetary, and trade policy reforms show a broad shift away from the inward-looking policies of import substitution (that is, manufacturing products at home rather than importing them) and protectionism so prevalent earlier. The trend toward privatization of state-owned enterprises in the Americas followed a period in which governments dominated economic life for most of the 20th century. State ownership was once considered the ideal engine for economic growth. Today many Latin American countries are at roughly the same stage of liberalization that launched the dynamic growth in Asia during the 1980s and 1990s. In a positive response to these reforms, investors have invested billions of dollars in manufacturing plants, airlines, banks, public works, and telecommunications systems. Because of its size and resource base, the Latin American market has always been considered to have great economic and market possibilities. The population of nearly 460 million is one-half greater than that of the United States and 100 million more than the European Community.

    15. Eastern Europe and the Baltic States Countries that rapidly instituted broadest free- market policies + implemented most radical reforms prospered most Eastern Europe privatizing state-owned enterprises establishing free market pricing systems relaxing import controls wrestling with inflation The Baltic States = Estonia, Latvia, & Lithuania all started off with roughly same legacy of inefficient industry and Soviet-style command economics all are WTO members and EU members (as of 2004) Eastern Europe and the Baltic states, satellite nations of the former Soviet Union, have moved steadily toward establishing post-communist market reforms. New business opportunities are emerging almost daily, and the region is described as anywhere from chaotic with big risks to an exciting place with untold opportunities. Those countries that rapidly instituted the broadest free market policies and implemented the most radical reforms (such as extensive privatization of small and medium-size enterprises and banking reforms) have prospered most in the long run. Rapid liberalization of trade combined with their macroeconomic stabilization policies and broad institutional reforms created a supportive environment for the expansion and reorientation of their trade. Most eastern European countries are privatizing state-owned enterprises, establishing free market pricing systems, relaxing import controls, and wrestling with inflation. The Baltic states Estonia, Latvia, and Lithuania are a good example of the difference that the right policies can make. All three countries started off with roughly the same legacy of inefficient industry and Soviet-style command economies. Although Latvia and Lithuania have made steady progress, government bureaucracy, corruption, and organized crime common problems found in the countries of the former Soviet Union continue. The governments and all major political parties support a free market system, yet traces of the Soviet methodology and regulatory traditions at the lower levels of bureaucracy remain visible. All three Baltic countries are WTO members and as of 2004, EU members.Eastern Europe and the Baltic states, satellite nations of the former Soviet Union, have moved steadily toward establishing post-communist market reforms. New business opportunities are emerging almost daily, and the region is described as anywhere from chaotic with big risks to an exciting place with untold opportunities. Those countries that rapidly instituted the broadest free market policies and implemented the most radical reforms (such as extensive privatization of small and medium-size enterprises and banking reforms) have prospered most in the long run. Rapid liberalization of trade combined with their macroeconomic stabilization policies and broad institutional reforms created a supportive environment for the expansion and reorientation of their trade. Most eastern European countries are privatizing state-owned enterprises, establishing free market pricing systems, relaxing import controls, and wrestling with inflation. The Baltic states Estonia, Latvia, and Lithuania are a good example of the difference that the right policies can make. All three countries started off with roughly the same legacy of inefficient industry and Soviet-style command economies. Although Latvia and Lithuania have made steady progress, government bureaucracy, corruption, and organized crime common problems found in the countries of the former Soviet Union continue. The governments and all major political parties support a free market system, yet traces of the Soviet methodology and regulatory traditions at the lower levels of bureaucracy remain visible. All three Baltic countries are WTO members and as of 2004, EU members.

    16. Asia Asian-Pacific Rim fastest-growing area in world for past 30 years Four Tigers (Hong Kong, South Korea, Singapore, Taiwan) 1st countries in Asia to move from status of developing countries to Newly Industrialized Countries (NICs) China After USA, most important single market is China 2 major events in 2000 having profound effect on Chinas economy Admission to WTO U.S. granting China normal trade relations on a permanent basis Asia has been the fastest-growing area in the world for the past three decades, and the prospects for continued economic growth over the long run are excellent. Despite this economic adjustment, the 1993 estimates by the International Monetary Fund (IMF) that Asian economies would have 29 percent of the global output by the year 2000 were on target. Both as sources of new products and technology and as vast consumer markets, the countries of Asia particularly those along the Pacific Rim are just beginning to gain their stride. The most rapidly growing economies in this region are the group sometimes referred to as the Four Tigers (or Four Dragons): Hong Kong, South Korea, Singapore, and Taiwan. Often described as the East Asian miracle, they were the first countries in Asia, besides Japan, to move from a status of developing countries to newly industrialized countries. Outside from the United States and Japan, there is no more important single market than China. The economic and social changes occurring in China since it began actively seeking economic ties with the industrialized world have been dramatic. Two major events that occurred in 2000 are having a profound effect on Chinas economy: admission to the World Trade Organization and the United States granting China normal trade relations (NTR) on a permanent basis (PNTR). PNTR and Chinas entry to the WTO cut import barriers currently imposed on American products and services. The United States is obligated to maintain the market access policies that it already applies to China, and has for over 20 years, and to make its normal trade relation status permanent.Asia has been the fastest-growing area in the world for the past three decades, and the prospects for continued economic growth over the long run are excellent. Despite this economic adjustment, the 1993 estimates by the International Monetary Fund (IMF) that Asian economies would have 29 percent of the global output by the year 2000 were on target. Both as sources of new products and technology and as vast consumer markets, the countries of Asia particularly those along the Pacific Rim are just beginning to gain their stride. The most rapidly growing economies in this region are the group sometimes referred to as the Four Tigers (or Four Dragons): Hong Kong, South Korea, Singapore, and Taiwan. Often described as the East Asian miracle, they were the first countries in Asia, besides Japan, to move from a status of developing countries to newly industrialized countries. Outside from the United States and Japan, there is no more important single market than China. The economic and social changes occurring in China since it began actively seeking economic ties with the industrialized world have been dramatic. Two major events that occurred in 2000 are having a profound effect on Chinas economy: admission to the World Trade Organization and the United States granting China normal trade relations (NTR) on a permanent basis (PNTR). PNTR and Chinas entry to the WTO cut import barriers currently imposed on American products and services. The United States is obligated to maintain the market access policies that it already applies to China, and has for over 20 years, and to make its normal trade relation status permanent.

    17. Asia - Hong Kong 1997: Hong Kong reverted to China - became a special administrative region (SAR) of Peoples Republic of China Hong Kong govt negotiates bilateral agreements and makes major economic decisions on its own

    18. Asia - Hong Kong Keys to Hong Kongs economic success: free market philosophy entrepreneurial drive no trade barriers well-established rule of law low and predictable taxes transparent regulations complete freedom of capital movement After 155 years of British rule, Hong Kong reverted to China in 1997 when it became a special administrative region (SAR) of the Peoples Republic of China. The Basic Law of the Hong Kong SAR forms the legal basis for Chinas one country, two systems agreement that guarantees Hong Kong a high degree of autonomy. The social and economic systems, lifestyle, and rights and freedoms enjoyed by the people of Hong Kong prior to the turnover were to remain unchanged for at least 50 years. The Hong Kong government negotiates bilateral agreements (which are then confirmed by Beijing) and makes major economic decisions on its own. The central government in Beijing is responsible only for foreign affairs and defense of the SAR. The keys to Hong Kongs economic success its free market philosophy, entrepreneurial drive, absence of trade barriers, well-established rule of law, low and predictable taxes, transparent regulations, and complete freedom of capital movement all remain intact.After 155 years of British rule, Hong Kong reverted to China in 1997 when it became a special administrative region (SAR) of the Peoples Republic of China. The Basic Law of the Hong Kong SAR forms the legal basis for Chinas one country, two systems agreement that guarantees Hong Kong a high degree of autonomy. The social and economic systems, lifestyle, and rights and freedoms enjoyed by the people of Hong Kong prior to the turnover were to remain unchanged for at least 50 years. The Hong Kong government negotiates bilateral agreements (which are then confirmed by Beijing) and makes major economic decisions on its own. The central government in Beijing is responsible only for foreign affairs and defense of the SAR. The keys to Hong Kongs economic success its free market philosophy, entrepreneurial drive, absence of trade barriers, well-established rule of law, low and predictable taxes, transparent regulations, and complete freedom of capital movement all remain intact.

    19. Asia - Taiwan Mainland-Taiwan economic ties approaching crossroads as both countries enter WTO Three direct links must be faced because each country joined WTO and rules insist members communicate over trade disputes and other issues Mainland Taiwan economic ties are approaching a crossroads as both countries enter the World Trade Organization. As both sides implement WTO provisions, they will have to end many restrictions and implement direct trade not that they have not been trading. The three direct links issue must be faced because each country has joined the WTO, and the rules insist that members should communicate over trade disputes and other issues. Trade fits well with both countries needs. Taiwanese companies face rising costs at home; China offers a nearly limitless pool of cheap labor and engineering talent. Taiwans tech powerhouses also crave access to Chinas market. Mainland Taiwan economic ties are approaching a crossroads as both countries enter the World Trade Organization. As both sides implement WTO provisions, they will have to end many restrictions and implement direct trade not that they have not been trading. The three direct links issue must be faced because each country has joined the WTO, and the rules insist that members should communicate over trade disputes and other issues. Trade fits well with both countries needs. Taiwanese companies face rising costs at home; China offers a nearly limitless pool of cheap labor and engineering talent. Taiwans tech powerhouses also crave access to Chinas market.

    20. Three Direct Links Between 1949 and 1979 there was military conflict across the Taiwan Straits, between mainland China and island of Taiwan. People-to-people contacts and direct links in mail, transport and trade were suspended completely. In 1979 China initiated an effort to link mail, transport and trade (the Three Direct Links) across the Straits. In 1987 Taiwan began allowing people-to-people contact (visits). Economic and cultural contacts have since developed. Gist of the Foreword of a document issued in 2003 by the Chinese Embassy in USA, titled "Actively and Realistically Promote 'Three Direct Links' Across the Taiwan Straits by Reliance on the People and in the Interests of the People.Gist of the Foreword of a document issued in 2003 by the Chinese Embassy in USA, titled "Actively and Realistically Promote 'Three Direct Links' Across the Taiwan Straits by Reliance on the People and in the Interests of the People.

    21. Asia - India 5-point agenda Improving investment climate Developing a comprehensive WTO strategy Reforming agriculture, food processing and small scale industry Eliminating red-tape Instituting better corporate government The wave of change that has been washing away restricted trade, controlled economies, closed markets, and hostility to foreign investment in most developing countries has finally reached India. A five-point agenda that includes improving the investment climate; developing a comprehensive WTO strategy; reforming agriculture, food processing, and small-scale industry; eliminating red tape; and instituting better corporate governance has been announced. Although India has overthrown the restrictions of earlier governments, reforms meet resistance from bureaucrats, union members, and farmers, as well as from some industrialists who have lived comfortably behind protective tariff walls that excluded competition. India has the capacity to be one of the more prosperous nations in Asia if allowed to develop and live up to its potential. The wave of change that has been washing away restricted trade, controlled economies, closed markets, and hostility to foreign investment in most developing countries has finally reached India. A five-point agenda that includes improving the investment climate; developing a comprehensive WTO strategy; reforming agriculture, food processing, and small-scale industry; eliminating red tape; and instituting better corporate governance has been announced. Although India has overthrown the restrictions of earlier governments, reforms meet resistance from bureaucrats, union members, and farmers, as well as from some industrialists who have lived comfortably behind protective tariff walls that excluded competition. India has the capacity to be one of the more prosperous nations in Asia if allowed to develop and live up to its potential.

    22. NEWEST Emerging Markets U.S. decision to lift embargo against Vietnam If Vietnam follows same pattern of development as other SE Asian countries, could become another Asian Tiger UN lifting of embargo against South Africa South Africa has industrial base that can help propel it into rapid economic growth South African market also has developed infrastructure Vietnam and South Africas future development depend on govt action + external investment by other govts and multinational firms The United States decision to lift the embargo against Vietnam and the United Nations lifting of the embargo against South Africa resulted in the rapid expansion of these economies. Because of their growth and potential, the U.S. Department of Commerce designated both as BEMs. If Vietnam follows the same pattern of development as other Southeast Asian countries, it could become another Asian Tiger. Many of the ingredients are there: the population is educated and highly motivated, and the government is committed to economic growth. South Africas economic growth has increased significantly now that apartheid is officially over and the United Nations has lifted the economic embargo that isolated that nation from much of the industrialized world. Unlike Vietnam, South Africa has an industrial base that will help propel it into rapid economic growth, with the possibility of doubling its GNP in as few as 10 years. The South African market also has a developed infrastructure of airports, railways, highways, and telecommunications that makes it important as a base for serving nearby African markets that are too small to be considered individually, but viable when coupled with South Africa. Vietnam and South Africa have the potential to become the newest emerging markets, but their future development will depend on government action and external investment by other governments and multinational firms. In varying degrees, foreign investors are leading the way by making sizable investments.The United States decision to lift the embargo against Vietnam and the United Nations lifting of the embargo against South Africa resulted in the rapid expansion of these economies. Because of their growth and potential, the U.S. Department of Commerce designated both as BEMs. If Vietnam follows the same pattern of development as other Southeast Asian countries, it could become another Asian Tiger. Many of the ingredients are there: the population is educated and highly motivated, and the government is committed to economic growth. South Africas economic growth has increased significantly now that apartheid is officially over and the United Nations has lifted the economic embargo that isolated that nation from much of the industrialized world. Unlike Vietnam, South Africa has an industrial base that will help propel it into rapid economic growth, with the possibility of doubling its GNP in as few as 10 years. The South African market also has a developed infrastructure of airports, railways, highways, and telecommunications that makes it important as a base for serving nearby African markets that are too small to be considered individually, but viable when coupled with South Africa. Vietnam and South Africa have the potential to become the newest emerging markets, but their future development will depend on government action and external investment by other governments and multinational firms. In varying degrees, foreign investors are leading the way by making sizable investments.

    23. Objectives of Developing Countries Industrialization is fundamental objective of most developing countries Economic growth is seen as achievement of social as well as economic goals better education better and more effective government elimination of many social inequities improvements in moral and ethical responsibilities Privatization currently a major economic phenomenon in industrialized and in developing countries A thorough assessment of economic development and marketing should begin with a brief review of the basic facts and objectives of economic development. Industrialization is the fundamental objective of most developing countries. Most countries see in economic growth the achievement of social as well as economic goals. Better education, better and more effective government, elimination of many social inequities, and improvements in moral and ethical responsibilities are some of the expectations of developing countries. Thus economic growth is measured not solely in economic goals but also in social achievements. Experience with state-owned businesses proved to be a disappointment to most governments. Instead of being engines for accelerated economic growth, state-owned enterprises were mismanaged, inefficient drains on state treasuries. Many countries have deregulated industry, opened their doors to foreign investment, lowered trade barriers, and begun privatizing SOEs. The trend toward privatization is currently a major economic phenomenon in industrialized as well as in developing countries.A thorough assessment of economic development and marketing should begin with a brief review of the basic facts and objectives of economic development. Industrialization is the fundamental objective of most developing countries. Most countries see in economic growth the achievement of social as well as economic goals. Better education, better and more effective government, elimination of many social inequities, and improvements in moral and ethical responsibilities are some of the expectations of developing countries. Thus economic growth is measured not solely in economic goals but also in social achievements. Experience with state-owned businesses proved to be a disappointment to most governments. Instead of being engines for accelerated economic growth, state-owned enterprises were mismanaged, inefficient drains on state treasuries. Many countries have deregulated industry, opened their doors to foreign investment, lowered trade barriers, and begun privatizing SOEs. The trend toward privatization is currently a major economic phenomenon in industrialized as well as in developing countries.

    24. Infrastructure & Development Infrastructure represents those types of capital goods that serve activities of many industries Quality of infrastructure directly affects a countrys economic growth potential and ability of an enterprise to engage effectively in business Less developed a country is - less adequate the infrastructure for conducting business Countries begin to lose economic development ground when their infrastructure cannot support expanding population and economy One indicator of economic development is the extent of social overhead capital, or infrastructure, within the economy. Infrastructure represents those types of capital goods that serve the activities of many industries. Included in a countrys infrastructure are paved roads, railroads, seaports, communications networks, financial networks, and energy supplies all necessary to support production and marketing. The quality of an infrastructure directly affects a countrys economic growth potential and the ability of an enterprise to engage effectively in business. Generally speaking, the less developed a country is, the less adequate the infrastructure is for conducting business. Companies do market in less-developed countries, but often they must modify offerings and augment existing levels of infrastructure. Countries begin to lose economic development ground when their infrastructure cannot support an expanding population and economy. A country that has the ability to produce commodities for export may be unable to export them because of an inadequate infrastructure. For example, Mexicos economy has been throttled by its archaic transport system. Roads and seaports are inadequate, and the railroad system has seen little modernization since the 1910 revolution.One indicator of economic development is the extent of social overhead capital, or infrastructure, within the economy. Infrastructure represents those types of capital goods that serve the activities of many industries. Included in a countrys infrastructure are paved roads, railroads, seaports, communications networks, financial networks, and energy supplies all necessary to support production and marketing. The quality of an infrastructure directly affects a countrys economic growth potential and the ability of an enterprise to engage effectively in business. Generally speaking, the less developed a country is, the less adequate the infrastructure is for conducting business. Companies do market in less-developed countries, but often they must modify offerings and augment existing levels of infrastructure. Countries begin to lose economic development ground when their infrastructure cannot support an expanding population and economy. A country that has the ability to produce commodities for export may be unable to export them because of an inadequate infrastructure. For example, Mexicos economy has been throttled by its archaic transport system. Roads and seaports are inadequate, and the railroad system has seen little modernization since the 1910 revolution.

    25. Infrastructure of Selected Countries Exhibit 9.2 (Cateora, Gilly & Graham) compares the infrastructure among countries at different levels of economic development. e.g. If it were not for Mexicos highway system (although it, too, is in poor condition), the economy would have come to a halt; Mexicos highways have consistently carried more freight than its railroads. Conditions in other Latin American countries are no better. Shallow harbors and inadequate port equipment make a container filled with computers about $1,000 more expensive to ship from Miami to San Antonio, Chile (about 3,900 miles), than the same container shipped from Yokohama, Japan, to Miami (8,900 miles).Exhibit 9.2 (Cateora, Gilly & Graham) compares the infrastructure among countries at different levels of economic development. e.g. If it were not for Mexicos highway system (although it, too, is in poor condition), the economy would have come to a halt; Mexicos highways have consistently carried more freight than its railroads. Conditions in other Latin American countries are no better. Shallow harbors and inadequate port equipment make a container filled with computers about $1,000 more expensive to ship from Miami to San Antonio, Chile (about 3,900 miles), than the same container shipped from Yokohama, Japan, to Miami (8,900 miles).

    26. Map showing developing countries 1st world 2nd world 3rd world Wikimedia: Traditional location of "First World", "Second World" and "Third World" countries during the Cold War: Blue: First World (Developed countries) Red: Second World (Current and/or former Communist countries. Not as common a term; many of these countries are now considered first or third world) Green: Third World (Developing countries) Wikimedia: Traditional location of "First World", "Second World" and "Third World" countries during the Cold War: Blue: First World (Developed countries) Red: Second World (Current and/or former Communist countries. Not as common a term; many of these countries are now considered first or third world) Green: Third World (Developing countries)

    27. 3 distinct kinds of markets: Traditional rural/agricultural sector Modern urban/high-income sector Transitional sector usually represented by low-income urban slums (Slumdog Millionaire) New markets mean marketer has to help educate the consumer Tomorrows markets will include: expansion in industrialized countries, & development of transitional and traditional sectors of less-developed nations Companies that will benefit most are ones that invest when challenging and initially unprofitable. Demand in a Developing Country Tomorrows markets will include expansion in industrialized countries and the development of the transitional and traditional sectors of less-developed nations, as well as continued expansion of the modern sectors of such countries. The traditional sector offers the greatest long-range potential, but profits come only with a willingness to invest time and effort for longer periods. Market investment today is necessary to produce profits tomorrow. The companies that will benefit in the future from emerging markets in Eastern Europe, China, Latin America, and elsewhere are the ones that invest when it is difficult and initially unprofitable. In some of the less-developed countries, the marketer will institute the very foundations of a modern market system, thereby gaining a foothold in an economy that will someday be highly profitable. The price paid for entering in the early stages of development may be a lower initial return on investment, but the price paid for waiting until the market becomes profitable may be a blocked market with no opportunity for entry. C. K. Prahalad and his associates introduced a new concept into the discussion of developing countries and markets bottom-of-the-pyramid markets (BOPMs) consisting of the 4 billion people across the globe with annual incomes of less than $1,200. These markets are not necessarily defined by national borders, but rather the pockets of poverty across countries. These 4 billion consumers are, of course, most often concentrated in the LDCs and LLDCs, as defined in the aforementioned UN classification scheme.Tomorrows markets will include expansion in industrialized countries and the development of the transitional and traditional sectors of less-developed nations, as well as continued expansion of the modern sectors of such countries. The traditional sector offers the greatest long-range potential, but profits come only with a willingness to invest time and effort for longer periods. Market investment today is necessary to produce profits tomorrow. The companies that will benefit in the future from emerging markets in Eastern Europe, China, Latin America, and elsewhere are the ones that invest when it is difficult and initially unprofitable. In some of the less-developed countries, the marketer will institute the very foundations of a modern market system, thereby gaining a foothold in an economy that will someday be highly profitable. The price paid for entering in the early stages of development may be a lower initial return on investment, but the price paid for waiting until the market becomes profitable may be a blocked market with no opportunity for entry. C. K. Prahalad and his associates introduced a new concept into the discussion of developing countries and markets bottom-of-the-pyramid markets (BOPMs) consisting of the 4 billion people across the globe with annual incomes of less than $1,200. These markets are not necessarily defined by national borders, but rather the pockets of poverty across countries. These 4 billion consumers are, of course, most often concentrated in the LDCs and LLDCs, as defined in the aforementioned UN classification scheme.

    28. Consumption Patterns in Selected Countries Exhibit 9.4 (Cateora, Gilly & Graham) provides market indicators for selected countries and the data represents the diversity of consumption patterns across types of countries. Notice the higher percentages of expenditures for food in the developing countries, while the costs of housing are more important in the affluent countries. Also, notice the high costs of health goods and medical services associated with the mostly private sector healthcare system of the United States. This table also illustrates the percentage of household income spent on various classes of goods and services. More household money goes for food in emerging markets than in developed markets, but the next category of high expenditure for emerging and developed countries alike is appliances and other durable goods. Spending by the new rich, however, is a different story. The new rich want to display their new status; they want to wear status symbols such as Rolex watches, the high-end Swiss watch that costs more than $1,000. Exhibit 9.4 (Cateora, Gilly & Graham) provides market indicators for selected countries and the data represents the diversity of consumption patterns across types of countries. Notice the higher percentages of expenditures for food in the developing countries, while the costs of housing are more important in the affluent countries. Also, notice the high costs of health goods and medical services associated with the mostly private sector healthcare system of the United States. This table also illustrates the percentage of household income spent on various classes of goods and services. More household money goes for food in emerging markets than in developed markets, but the next category of high expenditure for emerging and developed countries alike is appliances and other durable goods. Spending by the new rich, however, is a different story. The new rich want to display their new status; they want to wear status symbols such as Rolex watches, the high-end Swiss watch that costs more than $1,000.

    29. The Paradox of Africa = people mostly desperately poor + some land extraordinarily rich opposite to Asia in terms of resources, but Asia has boomed over last few decades in 1950s several African countries at same income level as many East Asian countries - why did they not prosper in similar ways? Why did Africa get left behind? Why have NICs (Newly Industrialized Countries) grown while other underdeveloped nations have not? Cultural values? Better climate? More energetic population? Cheap labor? East Asia enjoyed some cultural and historical advantages, but economic boom relied on other factors that have been replicated elsewhere but absent in Africa. Formula for success in East Asia was an outward-oriented, market-based economic policy coupled with emphasis on education and health care. Most NICs have followed this model, more or less. What is a PARADOX? A statement that contradicts itself. Why did Africa get left behind? Why have NICs (Newly Industrialized Countries) grown while other underdeveloped nations have not? Cultural values? Better climate? More energetic population? Cheap labor? East Asia enjoyed some cultural and historical advantages, but economic boom relied on other factors that have been replicated elsewhere but absent in Africa. Formula for success in East Asia was an outward-oriented, market-based economic policy coupled with emphasis on education and health care. Most NICs have followed this model, more or less. What is a PARADOX? A statement that contradicts itself.

    30. What just happened in Africa? Rate of return on foreign investment > in Africa than in any other developing region real GDP growth = 4.9% p.a. (2000 to 2008) collective GDP = $1.6 trillion (2008) Africas growth widespread across sectors 2002 - 2007 Africa nearly as urbanized as China As many cities of one million people as Europe Trade growth with other developing regions: China Brazil India Middle East Europe McKinsey Global Institute JUNE 2010 Acha Leke, Susan Lund, Charles Roxburgh, and Arend van Wamelen Whats driving Africas growth The rate of return on foreign investment is higher in Africa than in any other developing region. Global executives and investors must pay heed. Real GDP grew by 4.9% per year from 2000-2008. This is more than twice the rate of the 1980s & 1990s. To be sure, many of Africas 50-plus individual economies face serious challenges, including poverty, disease, and high infant mortality. Yet Africas collective GDP, at $1.6 trillion in 2008, is now roughly equal to Brazils or Russias, and the continent is among the worlds most rapidly growing economic regions. Soaring prices for oil, minerals, and other commodities have helped lift GDP since 2000. Forthcoming research from the McKinsey Global Institute shows that resources accounted for only about a third of the newfound growth. The rest resulted from internal structural changes that have spurred the broader domestic economy. Wars, natural disasters, or poor government policies could halt or even reverse these gains in any individual country. But in the long term, internal and external trends indicate that Africas economic prospects are strong. A critical question is whether Africas surge represents a one-time event or an economic take-off. Africa boasts an abundance of riches Africa now conducts half its trade with developing economic regions (SouthSouth exchanges). From 1990 - 2008, Asias share of African trade doubled, to 28%, while Western Europes portion shrank, to 28%, from 51%. This geographic shift has given rise to new forms of economic relationships, in which governments strike multiple long-term deals at once. China, for example, has bid for access to ten million tons of copper and two million tons of cobalt in the Democratic Republic of the Congo in exchange for a $6 billion package of infrastructure investments, 3 including mine improvements, roads, rail, hospitals, and schools. India, Brazil, and Middle East economies are also forging new broad-based investment partnerships in Africa. Global executives and investors cannot afford to ignore this. A strategy for Africa must be part of their long-term planning. McKinsey Global Institute JUNE 2010 Acha Leke, Susan Lund, Charles Roxburgh, and Arend van Wamelen Whats driving Africas growth The rate of return on foreign investment is higher in Africa than in any other developing region. Global executives and investors must pay heed. Real GDP grew by 4.9% per year from 2000-2008. This is more than twice the rate of the 1980s & 1990s. To be sure, many of Africas 50-plus individual economies face serious challenges, including poverty, disease, and high infant mortality. Yet Africas collective GDP, at $1.6 trillion in 2008, is now roughly equal to Brazils or Russias, and the continent is among the worlds most rapidly growing economic regions. Soaring prices for oil, minerals, and other commodities have helped lift GDP since 2000. Forthcoming research from the McKinsey Global Institute shows that resources accounted for only about a third of the newfound growth. The rest resulted from internal structural changes that have spurred the broader domestic economy. Wars, natural disasters, or poor government policies could halt or even reverse these gains in any individual country. But in the long term, internal and external trends indicate that Africas economic prospects are strong. A critical question is whether Africas surge represents a one-time event or an economic take-off. Africa boasts an abundance of riches Africa now conducts half its trade with developing economic regions (SouthSouth exchanges). From 1990 - 2008, Asias share of African trade doubled, to 28%, while Western Europes portion shrank, to 28%, from 51%. This geographic shift has given rise to new forms of economic relationships, in which governments strike multiple long-term deals at once. China, for example, has bid for access to ten million tons of copper and two million tons of cobalt in the Democratic Republic of the Congo in exchange for a $6 billion package of infrastructure investments, 3 including mine improvements, roads, rail, hospitals, and schools. India, Brazil, and Middle East economies are also forging new broad-based investment partnerships in Africa. Global executives and investors cannot afford to ignore this. A strategy for Africa must be part of their long-term planning.

    31. Whats driving Africas growth? Macro + micro reforms Privatization Open trade Regulatory & legal systems Critical infrastructure Free trade agreements Corporate taxes Inflation Foreign debt Budget deficits Armed conflict Trade Economic growth Urbanization Expanding labor force Middle class African consumer McKinsey Global Institute: Whats Driving Africas growth June 2010 Diversified economies: Africas growth engines The continents 4 most advanced economiesEgypt, Morocco, South Africa, and Tunisiaare already broadly diversified. Manufacturing and services together total 83 % of their combined GDP. Domestic services, such as construction, banking, telecom, and retailing, have accounted for more than 70 % of their growth since 2000. They are among the continents richest economies and have the least volatile GDP growth. With all the necessary ingredients for further expansion, they stand to benefit greatly from increasing ties to the global economy. Oil exporters: Enhancing growth through diversification Africas oil and gas exporters have the continents highest GDP per capita but also the least diversified economies. This groupAlgeria, Angola, Chad, Congo, Equatorial Guinea, Gabon, Libya, and Nigeriacomprises both countries that have exported oil for many years and some relative newcomers. Rising oil prices have lifted their export revenues significantly; the three largest producers (Algeria, Angola, Nigeria) earned $1 trillion from petroleum exports from 2000 through 2008, compared with just $300 billion in the 1990s. For the most part, Africas oil and gas exporters used this revenue well, to reduce budget deficits, fund investments, and build foreign-exchange reserves. Transition economies: Building on current gains Africas transition economiesCameroon, Ghana, Kenya, Mozambique, Senegal, Tanzania, Uganda, and Zambiahave lower GDP per capita than the countries in the first two groups but have begun the process of diversifying their sources of growth. Pre-transition economies: Strengthening the basics The economies in the pre-transition segmentthe Democratic Republic of the Congo, Ethiopia, Mali, and Sierra Leoneare still very poor, with GDP per capita of just $353one-tenth that of the diversified countries. McKinsey Global Institute: Whats Driving Africas growth June 2010 Diversified economies: Africas growth engines The continents 4 most advanced economiesEgypt, Morocco, South Africa, and Tunisiaare already broadly diversified. Manufacturing and services together total 83 % of their combined GDP. Domestic services, such as construction, banking, telecom, and retailing, have accounted for more than 70 % of their growth since 2000. They are among the continents richest economies and have the least volatile GDP growth. With all the necessary ingredients for further expansion, they stand to benefit greatly from increasing ties to the global economy. Oil exporters: Enhancing growth through diversification Africas oil and gas exporters have the continents highest GDP per capita but also the least diversified economies. This groupAlgeria, Angola, Chad, Congo, Equatorial Guinea, Gabon, Libya, and Nigeriacomprises both countries that have exported oil for many years and some relative newcomers. Rising oil prices have lifted their export revenues significantly; the three largest producers (Algeria, Angola, Nigeria) earned $1 trillion from petroleum exports from 2000 through 2008, compared with just $300 billion in the 1990s. For the most part, Africas oil and gas exporters used this revenue well, to reduce budget deficits, fund investments, and build foreign-exchange reserves. Transition economies: Building on current gains Africas transition economiesCameroon, Ghana, Kenya, Mozambique, Senegal, Tanzania, Uganda, and Zambiahave lower GDP per capita than the countries in the first two groups but have begun the process of diversifying their sources of growth. Pre-transition economies: Strengthening the basics The economies in the pre-transition segmentthe Democratic Republic of the Congo, Ethiopia, Mali, and Sierra Leoneare still very poor, with GDP per capita of just $353one-tenth that of the diversified countries.

    32. BOPMs = Bottom-Of-the-Pyramid Markets 4 billion people across the globe with annual income < $1,200 BOPM = 60% of world population Ignored by international marketers because of misconceptions re lack of resources ($ & tech) and lack of appropriate products & services. Industries & markets can be created in BOPMs INDUSTRY CLUSTERS evolve; can be supported by outside investments from commercial & govt concerns Craftspeople network + collaborate [ efficiencies in production + distribution + other marketing activities Most often concentrated in LDCs & LLDCs C K Prahalad, The Fortune at the Bottom of the Pyramid, Wharton, 2005 C K Prahalad and his associates introduced a new concept into the discussion of developing countries and markets bottom-of-the-pyramid markets (BOPMs) consisting of the 4 billion people across the globe with annual incomes of less than $1,200. These markets are not necessarily defined by national borders, but rather the pockets of poverty across countries. These 4 billion consumers are, of course, most often concentrated in the LDCs and LLDCs, as defined in the aforementioned UN classification scheme. Population of world: 6,692,030,277 - 2008 Source: World Bank, World Development Indicators Entrepreneurial activities that are networked appear to be perhaps the best way to stimulate economic development and growth from within developing countries. Marketing is key. Also MICROFINANCING. C K Prahalad, The Fortune at the Bottom of the Pyramid, Wharton, 2005 C K Prahalad and his associates introduced a new concept into the discussion of developing countries and markets bottom-of-the-pyramid markets (BOPMs) consisting of the 4 billion people across the globe with annual incomes of less than $1,200. These markets are not necessarily defined by national borders, but rather the pockets of poverty across countries. These 4 billion consumers are, of course, most often concentrated in the LDCs and LLDCs, as defined in the aforementioned UN classification scheme. Population of world: 6,692,030,277 - 2008Source: World Bank, World Development Indicators Entrepreneurial activities that are networked appear to be perhaps the best way to stimulate economic development and growth from within developing countries. Marketing is key. Also MICROFINANCING.

    33. Whats important for global marketers in Emerging Markets? Anticipate new trends within constantly evolving market segments. (Trends may not have existed as recently as last year.) As nations develop their productive capacity, all segments of their economies will feel pressure to improve. Impact of political, social & economic trends will continue to be felt throughout the world. IT will speed up economic growth in every country. Design plans to respond to each level of economic development. BEMs may present special problems, but they are promising markets for broad range of products now & in future. Emerging Markets create new marketing opportunities for MNCs as new market segments evolve. NIC growth factors and their role in economic development. Marketing's contribution to the growth and development of a country's economy.

    34. Next class (Oct.5): Family Dollar visit Homework: Visit the Family Dollar web site www.familydollar.com Send me an e-mail telling me something you learned from the site or from an associated news article. Why are we interested in Family Dollar, which has retail outlets in the USA and not abroad? Like most retailers, the company sources its merchandise globally.Why are we interested in Family Dollar, which has retail outlets in the USA and not abroad? Like most retailers, the company sources its merchandise globally.

    35. Next-next class (Oct. 7): Market Entry Strategies Preparation: Read Cateora, Gilly & Graham, ch. 11: pp 309-311; 318-325 Homework: Visit the Ikea store near campus: What is unique about Ikea? How does it differ from most American furniture/warehouse stores? Cateora, Gilly & Graham pages in chapter 11: pp 309-311: starts with The Nestl Way: Evolution Not Revolution; goes until Planning for Global Markets pp 318-325: starts with Alternative Market Entry Strategies; goes until International Joint ventures IKEA: 8300 Ikea Blvd, Charlotte, NC 28262 (at exit 43 off I-85) Store hours: Mon-Sat 10 am - 9 pm; Sun 10 am - 7 pm Write no more than ONE page on your impressions of Ikea (double-spaced, 12-point type). Please put your name in the TOP RIGHT corner of your page.Cateora, Gilly & Graham pages in chapter 11: pp 309-311: starts with The Nestl Way: Evolution Not Revolution; goes until Planning for Global Markets pp 318-325: starts with Alternative Market Entry Strategies; goes until International Joint ventures IKEA: 8300 Ikea Blvd, Charlotte, NC 28262 (at exit 43 off I-85) Store hours: Mon-Sat 10 am - 9 pm; Sun 10 am - 7 pm Write no more than ONE page on your impressions of Ikea (double-spaced, 12-point type). Please put your name in the TOP RIGHT corner of your page.

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