InternationalEmerging ThemesUnit 1 DiscussionJack Cullinane As outlined to us in the discussion question, it isestimated that nine groups of urban consumers (especially the below mentionedthree) will generate nearly 75% of urban consumption growth from 2015 to 2030.
These three groups are:1. Retiring and Elderly in developed countries(Western Europe, North East Asia)2. China’s working age population (expanding to 20%by 2030)3. North America’s working age population (becomingmore ethnically diverse) Group 1: Known as the Baby Boomers, this cohort of consumers has alarge disposable income due to their “low-cost mortgage schemes, income andinexpensive healthcare plans” (ULAW).As a generation of people that are now in their 70’s, more than 50% of peopleabove 60 years of age, suffer from chronic medical conditions, according to (Hariprasad et al.
,2013). As theirstrength and mobility weakens, creating a product to help with routine tasks isof great interest. As seen in the McKinsey report, they already spend 38% oftheir household expenditure on housing and utilities.Introducing technology, that can open doors, windows, drawcurtains, turn light switches on and off and operate electrical appliances withthe touch of a button, could prove to be very successful.
A standard, inexpensiveand durable Bluetooth remote control, that can operate a modem is all that isnecessary. According to (Gollub andJavitz,1989), “psychology, socioeconomics, and health are the keys tounderstanding how older adults want to live”, and therefore, a product createdthat meets this need, should attract the interests of elderly consumers. Group 2: Asian markets are rapidly growing according to (Samiee et al., 2004). One area forpotential investment is the retail market, a very localised sector, “where thetop four retailers in China had combined sales of just over two billion dollars”,as claimed by (Fortune, 2002).
Competitionis quite low and introducing a new clothing retail chain is promising,as we look to expand and penetrate the market. In Kate Williams’ article, “A More Western China”, she believes a higherstandard of living and decreased interest in homegrown brands is a gateway forinvestors. This creates customer polarisation, where consumers can capitalise ona greater range of “products, customised to their needs”. Consumer goods introduced to the Chinese market can exploitthis “saturated home-market” and need for consumer diversification. As seen inthe McKinsey report, they spend approximately 17% of household expenditure onclothing and apparel. Foreign investment is relatively low, with Walmart andCarrefour, having only 30 and 40 outlets respectively. Supply chain managementincreases awareness of Chinese culture. We gain knowledge of how we market ourgoods, to a cohort of consumers concerned with mortgages and family, throughcreation of trade agreements and alliances, like Tesco joining forces with TingHsin (Guerrera and Voyle, 2004).
Introducinga product that will keep these expenses in mind and not be too steep on theiralready high budget parameters is key. Group 3:North America has an increasing number of diversesubcultures, as ethnic minorities compromise nearly 25% of the population (Patterson, 2001). “Firms that reachethnic minorities with the right message have a comparative advantage overtheir competitors”, (Cui and Choudhury,2002). Targeted marketing is recommended by (Williams and Qualls, 1989) to reach various ethnic consumer groups,especially with regards to cultural identities such as cuisine, religion,traditions and clothing.
However, market segmentation for the sake of it, canbecome too complex.The working population dedicate 46% of household expenditureto maintaining house and utilities. Demanding careers of working long hours, tofeed their children, make big ticket purchases and save for their family’s futureis difficult. Introducing a product that is value for money and durable willattract this cohort of consumers. Quality yet inexpensive home exerciseequipment will allow for this generation of workers to maintain a healthylifestyle and give them a greater sense of independence, a priority for many cultures.One form of advertising that can appeal to diverse markets,is a universal advertisement that incorporates broad cultural values on TVchannels, radio and newspapers dedicated to specific ethnic groups.
“Advertising through ethnic-oriented newspapers, radio and cable television costsonly a fraction of that of general media and is an area often neglected by mostmarketers”, (Cui and Choudhury, 2002).Instead of using culture specific advertisements, use a marketing campaign thatisolates each group through utilisation of multi-cultural media that is alreadyin place. In conclusion, it is clear to see that even in such diversemarkets it is possible to sell a product based on specific marketingtechniques. Be it a baby boomer, generation x or any other target audience,applying marketing strategies that incorporate specific consumer attitudes andbuying patterns will allow for success. Refernces:Cui, Geng. andChoudhury, Pravat (2002) “Marketplace diversityand cost?effective marketing strategies”Journal of Consumer Marketing, Vol. 19 Issue: 1, pp.
54-73 Fortune (2002)”China’s 100 largest companies”Fortune, Vol. 145 No. 2, pp. 72-6 Gollub, J. and Javitz, H. (1989)”Six ways to age”American Demographics, June, pp. 28-35; 56-7 Guerrera, F. and Voyle, S.
(2004), “Tesco in talks withTing Hsin Retailing”Financial Times, March 4, p. 19. Hariprasad, G.
, Hariprasad,R., Kumar, L., Srinivasan, A.
, Kola, S. and Kaushik, A. (2013). “Apolipoprotein A1 as a potential biomarker inthe ascitic fluid for the differentiation of advanced ovarian cancers” Biomarkers, 18(6),pp.532-541.Patterson, O.
(2001)”Race by Numbers”New York Times, May 8, pp 27 McKinsey Report”Exhibit 9″Saeed Samiee, Leslie S.C. Yip, Sherriff T.K.
Luk, (2004) “Internationalmarketing in Southeast Asia: Retailing trends and opportunities in China”International Marketing Review, Vol. 21 Issue: 3, pp.247-254 Williams, J. and Qualls, W.
(1989). “Middle-class black consumers and intensity ofethnic identification”Psychology and Marketing,6(4), pp.263-286