Marketing in Developing Countries (RLE Marketing)

G. Kindra

• Publisher: Routledge
• Year: 2014
• Print ISBN: 9781138792531
• eBook ISBN: 9781317646693
• Edition: 1
• Topic: Business
• Subtopic: Business generale
• Index: Business

The articles in this collection discuss the role of marketing in development, and include case studies from various developing countries. They consider state enterprises, marketing education, birth control and comparative marketing models.

1	INTRODUCTION: MARKETING IN DEVELOPING COUNTRIES G.S. Kindra

In this introductory chapter we attempt to establish the rationale for this book, and provide summaries of the various chapters.

In the world of the 1980s the developing nations aspire, more than ever, for economic growth and better standards of living. Although economic development is normally associated with increases in per capita income, for the purpose of this book it includes social advancements as well. Emphasis on intrinsic and aesthetic values, the existence of (relative) leisure, the elimination of drudgery, and a marked reduction in interreligious, interethnic and intercaste friction are some outcomes envisaged within the realm of development.

In most less developed countries (LDCs) today there is a general dissatisfaction with growth models based on capital formation and productivity improvements. An increasing number of such nations are tacitly recognizing the link between marketing and development. More importantly, perhaps, international aid organizations are actively encouraging programs based on demand-manipulation. This appears to be done under the assumption that increased consumption will lead to higher employment and thus aggregate incomes – resulting in further increases in consumption as well as investment. (The desired level of savings and investment could be finetuned by employing marketing or demarketing.) The Canadian International Development Agency (CIDA) and the Agency for International Aid have funded a number of such research and training programs in several countries. Sri Lanka, the small island-nation of South Asia is currently benefiting from one such program sponsored by CIDA. The editor, during a recent assignment in that country, found a keen awareness among the senior managers in the private and public sectors, of the potential role of marketing in the development of their key industries.

Chapters 2, 3 and 4 shed light on the validity of assumptions underlying demand-manipulation aid programs. In doing so, these chapters have explored in depth the link between marketing and economic development.

In Chapter 2 Dr Nikhilesh Dholakia presents the reader with a broad, analytic view of the future of marketing in LDCs and its impact on the world system as a whole. The purpose of his article is to highlight the alternative developmental options available to LDCs and to analyze the nature of the marketing system under each development strategy. Dholakia’s argument is organized along the following steps:

(1) The LDCs of the Future
(2) The Future of the LDCs
(3) Marketing in the LDCs
(4) Future of Marketing in LDCs
(5) Implications for the World System

Arguing that LDCs are contemporaneous with the developed world (and not at a lower ‘stage’ of development), Dholakia suggests that LDCs are not forever playing ‘catch up’ with the marketing system of the developed world – even though selected indicators may be interpreted in this way. It means that LDC marketing systems face challenges and problems that will not be resolved by economic growth alone. Whichever model of development a country follows – be it miracle export, autonomous growth, or the minor world model – fresh perspective will be needed to foster appropriate marketing systems for LDCs.

In Chapter 3 Dr Hamid Etemad starts by examining the reasons as to why marketing remains badly neglected in the development process. He suggests that marketing has a potent role to play in economic development, and puts forward a process of organizing for more efficient and accelerated development in which user’s satisfaction and value play a central role.

Etemad argues that if the evolutionary path of marketing management practices in the highly developed countries has any bearing on the problem of economic development, it must be the movement from supply-side orientation to demand and marketing orientation, and finally to a strategic orientation which combines all influential elements including demand and supply. In short, the outmoded supply-and-production oriented, inward-directed model of economic development should be combined selectively, and eventually replaced by outward, strategic, and demand-manipulation oriented strategies. A model for economic development with the latter orientations is proposed and its policy implications examined.

Chapter 4 attempts to build bridges between marketing and the emerging meanings and strategies of development. This chapter is structured into the following major sections:

(1) Aspects of Marketing Marketing broken down into component aspects for the purpose of relating these to development.
(2) Views of Development Exploration of the alternative meanings and concepts of development.
(3) Theories of Development Examination of theories as to what causes development or underdevelopment.
(4) Agent of Development The question of which agency should play what role in the process of development.

The authors suggest that in the years to come development is likely to become the top item on the global agenda – not because of the Malthusian spectre of hungry teeming millions, as was once widely believed – but because of the realization that the problems of development – stagnation, poverty, environmental decay, alienation, cultural homogenization, inequity, unresponsive institutions, etc. – are not just problems of the Third World alone. Within this context, marketing people should evolve alternative marketing concepts suitable for the variety of development trajectories found in the world of today.

Today countries like India, China, Egypt and Brazil are gaining cognizance of the fact that marketing has a key role to play in the advancement of social programs relating to family planning, adult education, hygiene, etc. However, trained personnel are lacking, and the very idea of how marketing can help needs to be communicated to the various responsible groups and individuals. (China has recently concluded a long-term agreement with Canada on the transfer of knowledge in various areas, including marketing.)

The trading field is generally recognized as the breeding ground for entrepreneurs. In the West these risk-takers played an important role in the creation of necessary conditions for the industrial revolution. Also, studies of industrialists in LDCs indicate that a large majority of them moved from various trading occupations (Moyer and Hutt, 1978). But this move is the result of a general dislike of the trading class in many LDCs. Therefore, although marketing helps create the necessary entrepreneur class, the educators in LDCs are constantly faced with the difficult task of eliminating the stigma and misconceptions related to marketing, and of training potential risk-takers to direct the transition from agriculture to industry.

In the second section of the book five chapters provide suggestions, examples and models for marketing action in the Third World. In Chapter 5 Professors Mahmoud and Rice discuss the problems of marketing in Egypt and focus on selected environmental issues such as economic conditions, bureaucratic problems, demographic characteristics, the infrastructure and the socio-cultural context. While Egypt is typical of many developing countries and is therefore usefully employed as an example, the paper indicates the idiosyncrasies in Egypt’s environment that are of particular interest to marketers. The authors also provide an extensive list of possible solutions to various problems encountered by multinational marketers in Egypt. They conclude that the difficulty of marketing in Egypt is in recognizing the problems; dealing with the problems is an easier task. The success of the multinational marketer, therefore, will be measured by his/her ability to appreciate environmental differences and to adopt geocentric policies.

In Chapter 6 Professor Hung provides the reader with a fascinating example of how history, geography, topography, demography, government policies and political conditions interact to shape the marketing environment of a country. The first section of this chapter provides a brief historical account of the Hong Kong economy and its industrialization in the postwar years; and this is followed by an examination of the present industrial structure. The last part of the chapter deals with a survey of the marketing-related perceptions of foreign manufacturers operating in Hong Kong and a discussion of the important market characteristics.

Professor Hung also delves into the future of the economic miracle of Hong Kong, and suggests that although Britain may retain Victoria Island and the Kowloon Peninsula, the possible loss of the New Territories after 1997 will have far reaching implications.

Chapter 7, by Professor Françoise Simon-Miller, looks at the African market, and develops the idea of syncretic marketing practices which incorporate some Western-type products without using them as perfect substitutes for local African goods. Focusing on Ivory Coast and Nigeria, the author provides several examples of how present marketing practices of local as well as foreign-owned firms, might be modified to ensure a balanced Afro-centric approach that leads to psychocultural compatibility. Artificial market-control methods should be gradually abandoned in favor of decentralized development which would lead to better integration of the dual African economy. Simon-Miller goes on to point out that widespread dysfunctions in the present consumption patterns will be minimized through increased flexibility and efficiency in price, product and promotional planning.

Dr Ruby Roy Dholakia, in Chapter 8, looks at the alternate views of man for designing strategies that seek to influence and control human behavior. The various assumptions of program designers reflect their belief about why individuals should conform, and how they can be made to conform. She suggests that the view of man as Homo consumens can be used to explain consumption-enhancing activities of traditional marketing programs.

While relevant research is sparse, it is possible to identify five models of man that can be used to develop family-planning programs. The author has assembled these models from a consideration of individual, social and cultural influences on family-planning behavior. Labelled the macro, social, rational, risk-aversive, and psychoanalytic model of man, each of these views differ on their reasons for holding a particular position on family planning. While there can be considerable overlap in the traditional socio-economic characteristics of these models, their interaction creates a set of motivations that determine family-planning behavior.

Drawing on the models of man approach in Chapter 9, Kindra, Dholakia and Pangotra further explore the process of marketing birth control in LDCs, and shed light on the possible role of the public sector in the process. They suggest that six courses of action are open to any LDC in response to its population problems: (1) to do nothing; (2) to employ a mass-communication strategy; (3) to provide services directly; (4) to manipulate the balances of incentives and disincentives; (5) to shift the weight of social institutions and opportunities; and (6) to coerce behavior-modification through various forms of direct sanctions. Looking specifically at the family-planning program in India, the authors provide insight into some of the reasons for the relatively disappointing performance of the program. By focusing on India, where the public sector has been involved with the largest and the oldest family-planning program in the world, various conflicts and problems common to most LDCs are brought out. Kindra et al. suggest that a marketing-management approach to the task of family planning is necessary for improvements in program performance. One approach to the management of birth-control marketing is discussed under the so-called Sketch Plan framework. This approach is based on the recognition that acceptance of a small family norm is interwoven with the freedom to make that choice. This is an important point because even though segments of the LDC population will accept the small-family concept, they are often deprived of the means and objective motivation for accomplishing the same. The suggested framework for planning the marketing of birth control in LDCs emphasizes that strategies be aimed at the three-dimensional goal of increasing the population’s desire, ability and capability toward acceptance of the small-family norm and the practice of birth control. It is also implied that, in consideration of the wide geographical variations in population growth, per capita income and the level of development in general programs should be designed in a segmented manner to suit the nature of each group.

It is estimated that in India, while the Green Revolution has produced a grain surplus, up to 10 percent of the output is lost to rodents and spoilage, while the consumer often spends 50 percent of his income on food. A fully developed system of distribution that efficiently matches consumer needs with production should eventually lower costs and thus the price paid by the consumer – thereby freeing more discretionary income for pursuits like education, hygiene, and even leisure.

The development of an efficient distribution system, by necessity, will bring about a more reliable communication system, which in turn will facilitate social intercourse and efficient exchange of views among the geographically dispersed channel members. This is the starting point of a developmental process whereby interreligious, intercaste and interethnic frictions will give way to a dialogue of mutual interest and understanding.

A well-developed macro-marketing system also instills a sense of purpose and ethics. In many LDCs it is fairly common practice for small businessmen – be it a clothing merchant, fruitseller or any street hawker – to cheat in relation to quality, quantity and price standard. The editor encountered a reticent fishmonger in Sri Lanka who, upon being discovered in tipping the scales variously with his arm and toes, simply refused to conduct a fair exchange. Any economy needs standards of ethics and integrity if it is to thrive. In an environment where humanity is too preoccupied with daily existence to worry about workmanship, marketing can create a sense of business norms and the rightness and wrongness of commercial actions.

Chapters 10 to 14 make up the third and final section, and this part of the book is more analytical in nature – with implications for government planners, business educators and operating multinationals. Chapter 10 discusses the critical task of marketing education in the Third World, stresses the need for modifications of marketing-course content, and makes recommendations to the educators. Highlighting the fallacy of the assumption that essentially North American marketing ideas can be readily transplanted into the LDC environment, Professors Ross and McTavish suggest that the ‘similar path’ model of development is a misrepresentation of reality, based as it is on the questionable assumption that LDCs are evolving and will continue to evolve in the same manner as developed countries.

The three important dimensions of marketing are micro/macro, profit sector/non-profit sector, and positive/normative. From the viewpoint of the Third World marketing educator, it will be useful to know how and to what extent each element of the three-dimensional model of marketing applies. Are the macro-marketing concerns bro...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Original Title Page
• Original Copyright Page
• Table of Contents
• List of Figures
• List of Tables
• Dedication
• Foreword
• Preface
• 1. Introduction: Marketing in Developing Countries
• 2. Marketing in Less Developed Countries: Its Nature and Prospects
• 3. Is Marketing the Catalyst in the Economic Development Process?
• 4. Missing Links: Marketing and the Newer Theories of Development
• 5. Marketing Problems in LDCs: The Case of Egypt
• 6. Economic and Market Environment: The Case of Hong Kong
• 7. African Marketing: The Next Frontier
• 8. Models-of-Man Approach to Family Planning
• 9. The Public Sector and the Marketing of Birth Control in LDCs
• 10. The Marketing-education Task in Third World Countries
• 11. Market Imperfections and Organizational Structure: The LDC Perspective
• 12. A Generalized Model of Comparative Marketing: Formal Development, Methodological Implications and Examples
• 13. State Enterprises: A Marketing Perspective
• 14. Marketing-Research Techniques and Approaches for LDCs
• About the Editor and Contributors
• Index