Universality or Differences in Marketing Elasticities in Emerging versus Developed Markets? The Moderating Role of Brand Equity

Hannes Datta, H.J. van Heerde, Marnik Dekimpe, J.E.B.M. Steenkamp

Research output: Working paper › Other research output

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Abstract

Consumption in emerging markets is growing much faster than in developed markets. Accordingly, many global brand manufacturers venture into emerging markets, where they battle vigorously for market share. At the same time, emerging-market brands increasingly expand to more developed markets. While most firms have considerable expertise competing in similar markets, they lack insights on how consumers respond to marketing activities in economically dissimilar markets. Therefore, this paper quantifies the market-share elasticities of (i) three key marketing-mix instruments (price, distribution and line length), for (ii) 1,600+ international and domestic brands, across (iii) 14 durable categories (covering more recent categories like smartphones and mature ones like refrigerators), in (iv) 7 emerging and 7 developed markets from Asia and Australasia, for (v) up to 11 years. The findings suggest that differences in marketing elasticities between emerging and developed markets depend not only on the type of marketing variable (strongest difference for distribution), but also on brand equity (which affects elasticities more favorably in emerging markets than in developed markets). The paper discusses implications for marketing theory and practice.
Original languageEnglish
Publication statusPublished - 13 Sep 2019

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Elasticity
Brand equity
Marketing
Universality
Emerging markets
Market share
Marketing mix
Asia
Durables
Marketing practices
Marketing theory
Venture
Marketing activities
Expertise
Global brands
Price distribution

Cite this

Datta, Hannes ; van Heerde, H.J. ; Dekimpe, Marnik ; Steenkamp, J.E.B.M. / Universality or Differences in Marketing Elasticities in Emerging versus Developed Markets? The Moderating Role of Brand Equity. 2019.
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abstract = "Consumption in emerging markets is growing much faster than in developed markets. Accordingly, many global brand manufacturers venture into emerging markets, where they battle vigorously for market share. At the same time, emerging-market brands increasingly expand to more developed markets. While most firms have considerable expertise competing in similar markets, they lack insights on how consumers respond to marketing activities in economically dissimilar markets. Therefore, this paper quantifies the market-share elasticities of (i) three key marketing-mix instruments (price, distribution and line length), for (ii) 1,600+ international and domestic brands, across (iii) 14 durable categories (covering more recent categories like smartphones and mature ones like refrigerators), in (iv) 7 emerging and 7 developed markets from Asia and Australasia, for (v) up to 11 years. The findings suggest that differences in marketing elasticities between emerging and developed markets depend not only on the type of marketing variable (strongest difference for distribution), but also on brand equity (which affects elasticities more favorably in emerging markets than in developed markets). The paper discusses implications for marketing theory and practice.",
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Datta, H, van Heerde, HJ, Dekimpe, M & Steenkamp, JEBM 2019 'Universality or Differences in Marketing Elasticities in Emerging versus Developed Markets? The Moderating Role of Brand Equity'.

Universality or Differences in Marketing Elasticities in Emerging versus Developed Markets? The Moderating Role of Brand Equity. / Datta, Hannes; van Heerde, H.J.; Dekimpe, Marnik; Steenkamp, J.E.B.M.

2019.

Research output: Working paper › Other research output

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T1 - Universality or Differences in Marketing Elasticities in Emerging versus Developed Markets?

T2 - The Moderating Role of Brand Equity

AU - Datta, Hannes

AU - van Heerde, H.J.

AU - Dekimpe, Marnik

AU - Steenkamp, J.E.B.M.

PY - 2019/9/13

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N2 - Consumption in emerging markets is growing much faster than in developed markets. Accordingly, many global brand manufacturers venture into emerging markets, where they battle vigorously for market share. At the same time, emerging-market brands increasingly expand to more developed markets. While most firms have considerable expertise competing in similar markets, they lack insights on how consumers respond to marketing activities in economically dissimilar markets. Therefore, this paper quantifies the market-share elasticities of (i) three key marketing-mix instruments (price, distribution and line length), for (ii) 1,600+ international and domestic brands, across (iii) 14 durable categories (covering more recent categories like smartphones and mature ones like refrigerators), in (iv) 7 emerging and 7 developed markets from Asia and Australasia, for (v) up to 11 years. The findings suggest that differences in marketing elasticities between emerging and developed markets depend not only on the type of marketing variable (strongest difference for distribution), but also on brand equity (which affects elasticities more favorably in emerging markets than in developed markets). The paper discusses implications for marketing theory and practice.

AB - Consumption in emerging markets is growing much faster than in developed markets. Accordingly, many global brand manufacturers venture into emerging markets, where they battle vigorously for market share. At the same time, emerging-market brands increasingly expand to more developed markets. While most firms have considerable expertise competing in similar markets, they lack insights on how consumers respond to marketing activities in economically dissimilar markets. Therefore, this paper quantifies the market-share elasticities of (i) three key marketing-mix instruments (price, distribution and line length), for (ii) 1,600+ international and domestic brands, across (iii) 14 durable categories (covering more recent categories like smartphones and mature ones like refrigerators), in (iv) 7 emerging and 7 developed markets from Asia and Australasia, for (v) up to 11 years. The findings suggest that differences in marketing elasticities between emerging and developed markets depend not only on the type of marketing variable (strongest difference for distribution), but also on brand equity (which affects elasticities more favorably in emerging markets than in developed markets). The paper discusses implications for marketing theory and practice.

M3 - Working paper

BT - Universality or Differences in Marketing Elasticities in Emerging versus Developed Markets?

ER -

Datta H, van Heerde HJ, Dekimpe M, Steenkamp JEBM. Universality or Differences in Marketing Elasticities in Emerging versus Developed Markets? The Moderating Role of Brand Equity. 2019 Sep 13.

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