Emerging Marketing in China - Coursework Example

?Emerging Marketing in China Introduction Marketing is the creation of consumer satisfaction by the creation of products, distribution, pricing and promotion of the product. Marketing is a common activity in the current world where most products are marketed to get the attention of the customers or the consumers. Advertising, which is currently used in marketing, has had changes and it has become free with only advertisers trying to come up with strategies to stay on top of the competition. Marketing has to be considered by the companies selling products or services because consumers or customers have become scarce resources. This has lead innovation in the variety ways of availing resources to the customers through advertisement. In addition, businesses around the world are experiencing changes due to increasing number of emerging markets and there is also stiff competition in those emerging markets. Furthermore, the innovation of new ways of marketing with the use of high-tech machines and information technology (IT) has made the world a global village. This paper will focus on emerging markets in China. China has been considered by most businesses to be hard to achieve the best marketing strategies. This is because companies in China have grown for decades adopting sophisticated ways in their business performance. This has posed challenges to any company wanting to tap or consider starting a business in China. Companies, especially the western companies, have been faced with challenges but sometimes they have got opportunities to tap into emerging markets in China (Czinkota & Ronkainen 2009). China has grown to be the best economic country since inception of marketing reforms in 1978. The marketing reforms moved the country from a central governing style to a market defined economy. Changes have been felt in the country, for example, more that 500 million people have been salvaged out of poverty making the country achieve their targets. China is currently the second biggest economy after the US, and the economy of Chinese is still growing, which is one of the best achievements in the world’s most populated country of 1.3 billion people. Chinese products had high demand during the 2008 financial crisis when most countries in the world were hit by inflation and high prices of goods. The cheaper products from China were demanded by many customers. This was after the country made changes by the implementation of a $586 billion stimulus package which saw increases in leading rates by many institutions to their customers for the improvement of businesses (Dorn 2011). Despite the achievements of the Chinese government, the countries still has a high number of people living below the poverty line. China has a high number of poor people in the world and it ranks in the second position after India. World Bank numbers show that the gross national income per capita in China is $6091, and because of this, average income of persons per day is 1.8 dollars making the country to be ranked at the 90th income per capita position. Despite the high economic growth that China is undergoing, a number of challenges are faced by the country, for example, an increased rate of inequality is experience in the country. China is attributed to be losing a lot due to environmental challenges. According to Zhang (2012), estimation caused by environmental challenges in the economy is 10.51% of the gross national income. This is based on a 2008 review by the World Bank. The main focus in China is to sort the challenges they are facing with more attention on environmental and social challenges. The issue the country is facing is addressed in a 5-year plan which is taking place between 2011 and 2015. Characteristics and Challenges of Emerging Marketing in China The characteristics of emerging marketing China are mostly shared by most Asians countries like Japan, South Korea and China. The Asians countries have the same styles of marketing which makes them to be accepted in their continent as compared to emerging markets of Western Europe and US. Adaptability is one of the characteristics of emerging markets in China. Chinese products are customized in such a way that their tastes are adapted locally, which makes them different from marketing styles adopted by other nations especially the U.S. and European countries which maintain their previous make or originality, for example Chinese car companies and most of the Asians car companies make cars that adapt to economic changes. This makes them to be the leading companies in marketing and achieve high demand of their products. The other characteristics of Chinese emerging marketing are innovation and imitation. The characteristic is based on the products made by the companies in the country. They imitate the products of western countries, but make innovation on their products to remove similarity of the products with the western products. In addition, the products manufactured by Chinese companies are based on the quality and the cost of the product; the higher the price, the more the quality the product. Marketing research is one of the challenges faced by emerging marketing. Most of the marketers have to research on the products available on the customer’s side or the products which customers can produce. Customers have adopted ways of producing their own products in China making them to be regarded as prosumers to mean that they can produce products themselves for consumption. The product and the product design are another challenge to emerging markets because most Chinese people design their own products based on their needs. This has called for customer participation in designing of the product. For example, a marketing company will have to take in customers details about the product they need and they can achieve this by creating database for customer’s details on the product (Kotler, 1986). Social factors The economy of China has grown to be the biggest since 1979 with an estimation that the country’s economy is growing by 8% every year. The growth achieved by the country has led to social factors affecting businesses and the economy of the country. The rapid growth in economic activity has led to an increase in income inequality. Zhang et al (2003) shows that there are about 120 million people still living in poverty. This number has effects on business and more on emerging marketing. Poor people have low purchasing power, and this affects the performance of businesses. Additionally, social unrests caused by environmental challenges to the population have led to violent protest in places where farmers feel that factories discharge pollutants to their crops. The health condition of the public has also been attributed to higher economic growth contributed to by business in China. Many farmers in China are facing challenges of health condition because of the use of contaminated water. Most of them are facing health challenges like cancer, kidney failure and other pollutant caused diseases. Conversely Chinese people perform their jobs in teams. Because of this, business development would have to regard team work if is has to venture into China for startups. Ideological factors Ideology has an influence in the Chinese government mostly on the socioeconomic development. There has been a struggle between the government of China and the people with various religious beliefs. Cao (2012) argues that the disagreement between the government and the believers of various religions has led to a slow down of the economy, rise in social instability and environmental degradation. The author explains further that the misunderstanding of ideological factors by the government can affect the socio-economic structure despite the fact that the Chinese government has developed economically since 1979. Various religious beliefs such as Buddhism, Taoism and theism have been there for a long time but government’s ideology has been opposing such religious groups. Religious beliefs which the government of China has been opposing contribute a lot to socio-economic boom. Additionally, belief in the existence of God and gods has helped a lot of cases where there are disasters in China. Most of the temples for believers have been used as centers to provide safety. For example, there was an earthquake which happened in 2010 causing a lot of destruction of shelters. Religious places such as temples were used as shelters after monks offered them to individuals displaced by the earthquake. The divinity groups encourage the helping of poor people by providing them with food, shelter and medical facilities. This is the work of the government under the new ideology. Most of the people to be provided with basic facilities are the rural people. Despite the government taking over such responsibilities, poverty has increased in rural places. Urban populations have access to facilities provided by the government. Because of this, there is an increase in the average income gap between rural and urban persons since 1952. Chinese ideological factors in relation to emerging marketing shows that marketing should be based more on the religious belief ideology. This should encourage emerging markets because religious beliefs have positive effects on socioeconomic growth (Cao 2012). Economic Factors China’s economic growth makes it the best opportunity for business. The country has huge a huge labour force which can save on labour costs. China’s economy has grown since the year 2002 at an average rate of 14.5% annually. This makes the country ahead of the US which is currently the biggest economic country. The country’s economy when compared to the United States in terms of purchasing power parity is seen to be bigger. The Chinese government is hoping that its economy will be four times the current economy by 2020. The high growth of industrialization and invention of technological advancement has been the main contributor to economic growth. Additionally, there has been increase in foreign investment in the country and an increase in productivity contributed to by industrialization. The main contributor to economic growth is the reforms made by the government of China in 1978, which allowed trade activities with foreigners and also allowed private ownership of property. The relation of China’s economic factors with the emerging marketing is that because of an increase in foreign direct investments in China, many countries are investing in the country with about 190 countries and 400 to 500 companies making the investments. This number is a creation of new marketing based on the competition of the companies. China is currently one of the members of the World Trade organization (WTO) which has rendered the country be one of the most competitive in trade. China does a lot of exports in materials like magnesium, molybdenum, tungsten, antimony, tin, mercury, manganese and other materials. With this opportunity as the largest player in the trade market, China creates high competition in the economy. With the high competition, emerging marketing arises because companies would want to get more customers than other companies (Lippit 2010). Political Factors China is one of the G-20 member countries with the biggest economy in the world and is also one of the communist party lead nations and is the leading country in the G-20 countries. The country is led by the Chinese Communist Party (CCP) which has been leading since 1949. Chinese political stability has promoted a lot of economic activity, for example, there has been an increase in Foreign Direct Investment in the country which is one of the contributors to national tax and foreign trade. Political factors present in the country affect businesses positively hence increase on the economy of the country like what the Chinese is positioned. In relation to emerging marketing, political factors will have positive and negative effects on marketing. With references to the political stability of China, emerging marketing is increased by political stability which creates high economy due to increase of Foreign Direct Investments (FDI). Conversely, political instability has been reported in some parts of China. Some unrests, like strikes or rioting by small groups demanding their rights. Such political unrest are small and do not have an effect on business. This shows that despite political unrests, businesses can still perform hence emerging marketing (Collins 2013). Conclusion From the discussion above, it is clear that marketing is vital to every organization and individual in the world. Additionally, it has been seen that emerging marketing is due to high competition from various companies trying to be in position in various emerging markets. The discussion was based on China which has been seen to be the fastest growing economy with various companies investing there. China’s economic boom is seen to have been the face of many challenges, more on the income inequality. There is a wid gap between the rich and poor people. Additionally, other challenges facing the country include social challenges whereby people are demonstrating and rioting. Despite that, the country is politically stable and business can do well encouraging emerging marketing. References Cao, S, 2012, ‘Socioeconomic value of religion and the impacts of ideological change in China,’ Journal of Economic modeling, vol. 29, pp. 2621-2626. Collins, S 2013, Political Stability in China Comes with Little Transparency, Business Insurance, viewed 20 October 2013, Czinkota Michael and Ronkainen IIkka, 2009, Emerging Trends, Threats and Opportunities in International Marketing: What Executives Need to Know, New York: Business Expert Press. Dorn, J.A. 2011, "Interpreting China's Economy", Cato Journal, vol. 31, no. 2, pp. 398-403. Kotler Philip (1986),"The Prosumer Movement: A New Challenge For Marketers", in NA - Advances in Consumer Research Volume 13, Eds. Richard J. Lutz, Provo, UT : Association for Consumer Research, Pages: 510-513. Lippit, V.D. 2010, "China's Great Economic Transformation", Pacific Affairs, vol. 82, no. 4, pp. 701-703. Zhang Junjie, 2012, Delivering Environmentally Sustainable Economic Growth: The Case of China, Asia Society. Zhang, L, Huang, J and Rozelle, S 2003, ‘China’s War on Poverty: Assessing Targeting and the Growth Impacts of Poverty Programs,’ Journal of Chinese Economic and Business Studies, Vol. 1, No. 3, pp. 301–317. Read More