A Comparative Analysis of Environmental Effects on Marketing Activity in Developing Countries

By Ojah, Kalu; Han, Dongchul | Multinational Business Review, Fall 1997 | Go to article overview

A Comparative Analysis of Environmental Effects on Marketing Activity in Developing Countries


Ojah, Kalu, Han, Dongchul, Multinational Business Review


When a marketer is about to enter a new market, he must first evaluate the environment of the target market, especially when it is a distant and unfamiliar one. Second, the marketer should devise a means to ensure success once in the target market. This study points to a vital requisite for sustainable international marketing success in unfamiliar markets such as those of Sub-Saharan Africa. A survey of the expectations of environmental effects on marketing activity from managers in four countries is used to show similarities and differences in market environmentalism between African and Asian markets and how such knowledge can be instructive for international marketing strategy. We find that marketing activity in emerging markets is highly susceptible to environmental effects, and that there are no clear differences in market environmentalism between African and Asian markets. Further, we document results which suggest that a similar marketing plan employed in the more familiar market of the Philippines can be used in the little known market of Kenya.

INTRODUCTION

The 1980s witnessed one of the most phenomenal shifts in international production and specialization in modern history from developed market economies to developing economies (Plasschaert and Van Den Bulcke, 1991; Dicken, 1992; and Ojah and Ueng, 1995). With these shifts has come an increased movement of firms into foreign countries for marketing (exporting) purposes. Some of the international marketing activities are done in developing countries by firms based in both developed and newly industrializing countries (NICs) (Lall, 1983; Lecraw, 1993; and Li, 1994). The success or failure of these international marketers depends on the extent to which they understand the environmental nuances of the new and alien markets into which they choose to expand (Peterson, 1990; and Cateora, 1990). Among the potentially alluring markets of developing economies, Sub-Saharan African markets have received the least attention. However, given the current pace of business globalization, it is not far-fetched to suppose that African markets will soon begin to receive increased attention, at least, as product markets. Therefore, prospective international marketers to this long-neglected region of the world's markets need some knowledge of the region's market environment. And such knowledge can be more insightful when viewed in the context of a onceneglected region of the world's markets--i.e., a comparison of the Sub-Saharan African market environmentalism with East Asia's.

In addition to the need for understanding business environments of a target market, some knowledge of the vagaries of those environments is necessary for a sustainable marketing success in the target market. This knowledge is crucial mainly because marketing activities are quite susceptible to the vagaries of environmental factors. It has been documented, for instance, that governmental policies have a significant relationship to changes in business environments, especially in developing countries (Cho, 1992; and Han and Ojah, 1995). Thus, this study uses local marketing managers' perceptions of governmental policy effects on their business environments as a proxy for the potential fluctuation in business environment(s) that can affect marketing activities of firms. Specifically, this study reports on a survey of one NIC and three developing countries with respect to business environments that affect marketing in these countries. Hence, the objectives of the survey analysis are (1) to revisit market environmentalism in the context of developing countries, with a focus on local marketers' expectations of how government policy would affect their business environments; and (2) to compare two representative "neglected" SubSaharan African markets, Kenya and Malawi, with two representative Asian markets, Hong Kong and the Philippines, that were once neglected, with a goal of gaining useful insights into the unknown via the known. …

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