Building Brands in Emerging Economies: A Consumer-Oriented Approach

Building Brands In Emerging Markets

Scant research exists on building brands in emerging markets; in fact, the available research mostly discusses how global brands (from developed countries) enter emerging markets and how they are perceived. For example, Kapferer (2008) focused on brands of developed countries entering emerging markets. He noted how, in emerging markets, companies prefer to enter with new brands rather than using existing ones in order to avoid the risk of decreasing brand capital. He also cautioned about the naming of the brands, which may cause trouble based on connotations in another region or language; the translation might also be perceived as a counterfeit of the “real” product. In another study, Akram, Merunka, and Shakaib Akram (2011) found that, in emerging markets, perceived brand globalness positively affects both perceived brand quality and perceived brand prestige; these relationships are moderated by consumer ethnocentrism.

Sheth (2011) presented five key issues from emerging markets that are very different from industrialized markets: market heterogeneity, sociopolitical governance, chronic shortage of resources, unbranded competition, and inadequate infrastructure. Market heterogeneity refers to the fragmentation of the market. Sociopolitical governance is the dominance of institutions such as religion, government, nongovernmental organizations, business groups, and local communities. It also refers to the presence of mono- or oligopolies. A chronic shortage of resources could refer to power, raw materials, or skilled labor. In terms of unbranded competition, Sheth argued that the prevalence of unbranded products might be a result of poor infrastructure or because of self-produced goods. Finally, an inadequate infrastructure can refer not only to a lack of roads or a poor maintenance state, but also a lack of or inefficient communication technologies.