Gold in the Crumbs

For years the developed world has been viewed as the “mother lode” for worldwide business. Companies poured their resources into serving the 14 per cent of the world’s population that is fortunate enough to live there.

According to the authors, Vijay Mahajan, former dean of the Indian School of Business and current holder of the Harbin Centennial Chair in Business at the university of Texas in Austin and Kamini Banga, an independent marketing consultant, these markets are over-saturated, over-competitive and aging.

The growth, they argue, lies in reaching the rest of the world. Focusing on the 86 percent of the world with a per capital gross national product of less than $10,000 year offers a rich opportunity. These markets have been largely invisible to worldwide companies and even some firms operating there. Yes, the authors acknowledge, these countries lack infrastructure and media. They have low literacy rates. Their consumers react in unconventional ways.

Yet with the right solutions, these markets represent staging opportunities. The authors suggest reaching that potential by:

1. Reaching middle class and the affluent consumers along with the poor. These markets are larger, wealthier and more diverse than you realize.
2. Designing products that reflect local environments and cultures.
3. Using expatriates to ricochet your products into the local economy.
4. Growth big by thinking small.
5. Bringing your own infrastructure with you.
6. Take the market to the people.

To illustrate these strategies, the authors draw on dozens of emerging market examples. They offer actionable strategies and tactics for product design, pricing, packaging, distribution and advertising.

Emerging markets are different. Yet, worldwide companies are already reaping billions of dollars in sales from them. ( )