The term emerging markets came to light in the late 1980’s when the Morgan Stanley Capital International Emerging Markets Index begun (Sheth, 2011). This marketing index aimed to determine countries worth of stakeholders’ attention. Emerging markets are markets that are moving towards becoming the so called “advanced markets.”
Emerging markets offer grounds for growth prospects as compared to developed economies. Despite the slow pace of development in many emerging markets, they continue to constitute 70% of over-all growth rates (Ramamurti and Singh 2009). Emerging markets are susceptible to challenges like technology matters, finances, and social factors among others. This essay will try to elaborate on some of the pitfalls posing a threat to collecting information and steering market research in Indonesia and ways to overcome the challenges.
Companies and other institutes rely on the marketing research reports for them to manage the threats associated with the provision of new commodities and services.
The technological part has a significant influence on the market. Generally, the manner of offering goods, services, the value of these commodities, the capability of collecting information, and administration control, have been transformed by the development of new technology. Technology can have a significant effect on marketing not only essential changes but can also be detrimental.
The fast-growing technology like social media has made a significant impact in business marketing. Studies show that technology can influence the proficiency of production rates and out-sourcing decisions (Burgess and Steenkamp 2006, pg. 340). Technology also reflects on various aspects such as research and growth activities and technical changes. Therefore, companies must be conversant with the technology levels, commercial and management skills of the target market before making any choices.
Many marketing experts rely on technology for guidance on critical matters of flexibility, data storage, safety, and operations set-up. But when it comes to selecting the IT approach to steer marketing duty, the marketing technologist has a role to play (Cavusgil, Ghauri and Akcal 2012). With the increasing number of platforms and high-tech devices, it is difficult for businesses to make predictions of offering continuous client experiences since marketing integrations have becoming more difficult.
Marketers’ are struggling with producing sufficient demand for their commodities. And as time progresses and competition braces, this will become factual. Additionally, the different publishing avenues make it challenging for marketers to identify where to center their efforts (Berthon et al. 2012, pg.265). Therefore, when it comes to generating content that yields adequate traffic and leads, marketing professionals should ask themselves if they are genuinely making high quality content; can people pay for this type of material? Also, do they know the kind of content their audience desires? Once they see the kind of content their customers’ need, the attention shifts to marketing it in a manner that makes the customers notice.
Identifying the Appropriate Technology for Your Needs as a company is important. Most of the times the response on technology is detached. Marketing specialists may turn to friends, colleagues, and market analyst reports to figure out which technologies best fit their requirements. Unfortunately, they find that the feedback spreads across social media and emails. To resolve this matter marketing professionals can look into software’s that provide marketing IT landscape that emphases on business hitches and how to solve them (Khanna and Palepu 2010).
Social and Cultural References
Indonesia is arguably Southeast Asia’s most traditional culture. However, Indonesia is still maintains its historical aspect and culture despite westernization. The education system in Indonesia has a significant influence on business. Studies show that Indonesia has the lowest number of well-educated individuals in Southeast Asia. Despite the various efforts to improve public learning systems, Indonesia still lags behind when ranked among other countries.
Another limitation of the Indonesian education structure is evident among the experts with university degrees. The teaching mainly concentrates on learning factual knowledge, and multiple answer questions dictate with no chance for students to be involved in critical writing.
88% of Indonesians are Muslims (Luo and Tung 2007). Muslim is the only visible religion in the Indonesian society. But, the level of obligation to Islam and day-day life practices differs more in Indonesia than in other Muslim nations. The numbers of Muslims have been rising over the last couple of years, but only 25% of Indonesian Muslims observe the Islamic dress code.
The Friday mid-day prayers, Ramadhan holidays, Eid Mubarak, and Idul Fitr affect how the business runs in Indonesia. The period these people go for holiday’s results to low productivity levels thus, changing the market.
The defects of public training systems paved the way for Islamic schools in Indonesia. However, regardless of these schools providing education to Indonesian children, education specialists say otherwise. Their studies indicate that the small instruction contained in the religious studies does not offer adequate skills for graduates to participate in business. Moreover, the education system should enable students participate in essay writing to shape their critical thinking.
For Indonesia to overcome this education challenge, most Indonesian institutes need to capitalize on training programs. Foreign organizations recruiting employees straight from campus should conduct training bearing in mind that these individuals have fewer skills as compared to the western graduate counterparts (Luo and Tung 2007). This training initiative would offer a competitive ground for foreign businesses since they get an opportunity to recruit the top candidates.
Cognizant of these religious limitations, an organization can organize its tasks so that it has a minimum effect on the general production (Peng, Wang and Jiang 2008, pg.922). On the other hand, foreign businesses functioning in Indonesia can inform their head offices back home about the shorter operational periods and drops in production so that tasks and time-lines can be amended accordingly.
The economic predicaments have the prospective to result in a period of an over-all stagnation that may immensely disrupt all nations’ course of economic development (Harvey, Speier and Novicevic 1999, pg.165). In general, the crisis may cause termination on and also counter development efforts in emerging countries
Income crises are termed complex and have a significant effect on decision making both socially and economically. This financial menace leads to substantial faults in financial organizations globally. But the developing markets are more susceptible to the business matter (Sheth 2011, pg. 165). These fiscal crises affect not only decision-making but also future advances, intensities of investment, new opportunities, import, and export provisions.
Inflation tends to cause the need for a more extensive and perhaps an increase in selling prices in business unlike before. These increased sales call for increased production rates. On the contrary, production levels cannot increase during this period resulting to the less capital input. With the functioning income as the chief measure of profit, sustaining the preferred level of cost-effectiveness calls for a rise in the marketing prices (Khanna and Palepu, 2010). This upsurge in prices in most cases spreads beyond the level allowed by economic pressures to offset the present costs mirrored under price rise-accounting.
During financial crises, the development of most businesses is at risk. The calamity poses severe tensions not only on the economic organization but also on the physical and emotional structures. To relief companies from the financial crisis, they can opt to increase their marketing expenditures especially during and after recession periods. Studies indicate that this strategy is beneficial in that there is a probable increase in sales, revenue, and market shares (Chesbrough 2010, pg.235). Additionally, companies can develop new marketing approaches, performing quality control, improving their productivity and decreasing general expenses. To implement these changes, carrying out market research is inevitable.
Executing these changes within organizations would be of great help not only to the organization but also to its shareholders. Fewer purchases made result into reduced revenue generation (Salman, Chivakul and Llaudes 2010). With the less income obtained during these financial crisis, most organizations are still required to cater for their staff. Less income calls for less payment for the employees. To overcome the challenge experienced in high payrolls, the organization has to lay off some of the dormant employees to avoid situations such as severance pay and even go into outsourcing some of the services.
Conclusion
The solution to the pitfalls outlined above poses a potential growth in the emerging markets. The improved growth in these markets will offer grounds for more investment opportunities, development of self-enterprises and new business ventures. The training initiative by foreign organizations will provide a competitive ground for international businesses. For Indonesian-based investments, they can avoid production setbacks by notifying their home head offices about the shorter operational periods and drops in production so that tasks and time-lines can be amended accordingly.
Additionally, overcoming financial shortcomings will increase sales, and market shares due to the increase in market expenditures and improved production. These fast-growing nations are the prime markets for global and home-coming businesses (Tracey and Phillips 2011). Knowing the right product content required by customers, marketers will have the appropriate information on their social media avenues. Having applications that educate marketers on the problems that affect marketing would help marketers evade shortcomings in the future.
References
Berthon, P.R., Pitt, L.F., Plangger, K. and Shapiro, D., 2012. Marketing meets Web 2.0, social media, and creative consumers: Implications for international marketing strategy. Business management horizons, 55(3), pp.261-271.
Burgess, S.M. and Steenkamp, J.B.E., 2006. Marketing renaissance: How research in emerging markets advances marketing science and practice. International Journal of Research in Marketing, 23(4), pp.337-356.
Cavusgil, S.T., Ghauri, P.N. and Akcal, A.A., 2012. Doing business in emerging markets. Sage.
Chesbrough, H., 2010. Business model innovation: opportunities and barriers. Long range planning, 43(2-3), pp.354-363.
Harvey, M.G., Speier, C. and Novicevic, M.M., 1999. The impact of emerging markets on staffing the global organization:: A knowledge-based view. Journal of International Management, 5(3), pp.167-186.
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Khanna, T. and Palepu, K.G., 2010. Winning in emerging markets: A road map for strategy and execution. Harvard Business Press.
Luo, Y. and Tung, R.L., 2007. International expansion of emerging market enterprises: A springboard perspective.
Peng, M.W., Wang, D.Y. and Jiang, Y., 2008. An institution-based view of international business strategy: A focus on emerging economies. Journal of international business studies, 39(5), pp.920-936.
Ramamurti, R. and Singh, J.V. eds., 2009. Emerging multinationals in emerging markets. Cambridge University Press.
Salman, M.F., Chivakul, M. and Llaudes, M.R., 2010. The Impact of the Great Recessionon Emerging Markets (No. 10-237). International Monetary Fund.
Sheth, J.N., 2011. Impact of emerging markets on marketing: Rethinking existing perspectives and practices. Journal of Marketing, 75(4), pp.166-182.
Tracey, P. and Phillips, N., 2011. Entrepreneurship in emerging markets. Management International Review, 51(1), pp.23-39.
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