News | 01/06/2016
Creativity and its Role in Emerging Markets
The inconsistencies in the emerging market strategies of many multinational firms should be addressed and analysed openly, including on the level of academia. The potential of billions of new consumers that attract multinationals to emerging markets require bespoke marketing campaigns to ensure they directly translate into a high market penetration, promising market shares and a significant business profitability.
Understanding the key business characteristics of emerging markets which are often represented by low incomes, variability in consumers, availability of infrastructure and the relative low cost of labour which is often substituted for capital –provides multi-national companies with the first data-set to interrogate and analyse the market movement profile.
Emerging markets are natural laboratories in which theories and assumptions about their underlying mechanisms can be tested, generalizations derived and boundary conditions identified. Averda’s expansion and significant growth over the last ten years can be partly attributed to its robust market research tools and processes, underpinned by theory development, acquisition of meaningful data, analysis of the data to test one's theories and learning.
The 21st century multi-national businesses are becoming more and more aware of the role held by ‘Glocalisation’ in their marketing efforts. Defined by the American Marketing Association the organizational approach that provides clear global strategic direction along with the flexibility to adapt to local opportunities and requirements, ‘Glocalisation’ addresses the development of a cooperative mind-set among region or country organizations to ensure the effective implementation of global strategies. Cultural make-up, socio-demographics, geo-political realities and behavioural patterns play a significant role in adapting the global marketing strategies to the local marketing needs.
Creativity, as a business term, has recently joined ‘innovation’ and became a key term in the debates on knowledge economy. Companies that foster creativity are 3.5 times more likely to outperform their peers in terms of revenue growth (Adobe, 2015) and they enjoy greater market share and competitive leadership than their counterparts. Among the leaders in market share, creative companies tend to outperform their less creative counterparts by a factor of 1.5.
According to one of the latest creativity reports available for the GCC region (Kippreport, 2015), 27% of organisations in the GCC are striving to be pioneers, whilst 67% of GCC respondents state that less risky types of incremental innovation delivers greater value to them than breakthroughs:
Globalized digital and other electronic technologies have largely driven out standardized forms of work and have encouraged a vast expansion in human capital resulting from the cognitive and cultural assets of the labour force. However, given its presence on three continents and very diverse markets, Averda understood that culture has become not only a vital ingredient of national identity and “branding”, but has also become a marker of local distinctiveness and a tool of international projection. Towns, cities and city-regions as autonomous actors within the globalized economy are constantly growing and play a critical role in building relational assets.
According to the United Nations’ 2013 Creative Economy Report, for young people the informal sector of Africa’s creative economy can provide a range of opportunities to work, create start-ups and develop skills. Marketing objectives are also beginning to take root in the visions of African local officials, who are also beginning to recognize that civil society bodies have a key role to play in building up production and distribution infrastructures, as well as in the development and financing of cultural and creative enterprises.
While there are many commonalities across emerging markets and economies, it would be detrimental to multi-nationals and other foreign direct investors to consider that the business practices, campaigns and marketing efforts that can be successful in Middle East and GCC will be fully applicable to West African countries and South Africa.
Recently speaking at a creativity focussed public event organised by Ras Al Khaimah (RAK) Chamber of Commerce in the United Arab Emirates, Mrs Philippa Charlton, Averda Marketing Director, said: ‘For any targeted, success-driven and results-led marketing strategy, it is the insider knowledge that helps take the business forward. To achieve this, Averda implements a ‘Glocal’ marketing model where our global value proposition and brand strategy is localised to the country and market in which we operate. This is driven by local research, suppliers and insight. Knowing the local culture, understanding the local values, measuring the impact we, as a business, have on the livelihoods of the people your activities touch daily, help ensure we provide relevant and impactful marketing solutions in every market we are present in.’