Multinational Companies In Emerging Markets

Multinational companies entering the emerging markets are very different and more challenging from the developed markets where they are used to do business. Thus, the demand for these companies products is growing and despite the various challenges these multinationals swimming in strange waters, they maintain a competitive advantage in the market.
On another hand, the same is true for companies operating in emerging markets outside their home market, who tend to oversimplify the differences between consumers of emerging and developed markets.
Here are some similarities about emerging markets consumers and whether they hold true or not.
• Importance of Price
In emerging markets, multinational companies give to much importance to price and

Companies in this case often prioritize cost leadership over the product innovation and development; they offer cheaper product version and compromising valuable features and functionality in the proces. However, there is no reason to think that those consumers do not value the state of art technology but on the contrary. Studies by Boston Consulting Group found that emerging markets consumers gain more utility from state of the art features where as consumers in developed markets focus on whether features solve their problems if the features are ground breaking or not is not important (relatively

Size/Quantity
This is a dilemmas that companies mainly balance differently in emerging markets. For no other reason but the illusion of low prices sensivity that applies to all of the market. As we already mentionned, its is true that some of the items are considered more luxurious in the emerging markets due to the low power of spending. Nevertheless it’s often much better to accommodate this by offering smaller sizes.
Lower quantity but the same quality.
Due to small budgets that emerging consumers have, there is no demand for high quantities. Therefore, it is better to maintain quality and price but lowering the quantities, rather than compromising the quality and lowering the prices. An entirely different set of rules applies to the emerging markets.
But the principles that are behind a buisness success in developed countries still apply. If a new product is launched in a new market, even in developed countries, it will have to adjust to the market; but in emerging markets the adjustments are simply greater, and they require continuous attention.
Emerging markets are very challenging and doing buisness there is very different – but don’t loose common