Marketing to a Developing Country

Marketing to a Developing Country

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Marketing to a Developing Country

One of the suitable developing countries possessing a suitable market for penetration is the Kenyan market. As a country, Kenya assumes the position of the most developed nation within East Africa. With an estimated population of 41 million people, most nationals possess desirable educational backgrounds, significant English-conversant capacities as well as multilingual capabilities coupled with a sturdy entrepreneurial custom. Irrespective of the country’s Gross Domestic Product (GDP) standing at USD 35.8 billion as of 2011, the main challenge facing the economy involves increasing the country’s GDP, based on its fluctuating nature with respect to 2010’s GDP, which was USD 32.417 billion (United States of America Department of Commerce, 2011). Thus, such a market would be efficient for the exportation of cost-effective smartphones. One reason facilitating the exportation of smartphones involves the country’s population demography. 70 percent of Kenya’s population comprises the Youth aged below 35 years. Based on the considerable young population, there is increasing demand for cell phones and telecommunication technologies. Additionally, most youth rely on the internet due to the globalization of social networking. As such, telecommunication powerhouses such as Safaricom and Bharti Airtel focus on providing technologies such as 3G modems. Furthermore, the use of 3.75G internet, the anticipated entry of the 4G network and the considerable use of cell phones in accessing the Internet is exceptional based on the 14.3 million mobile phone internet users as of 2011. This reason solely provides an efficient market for smart phones that possess internet capabilities and superior applications for most educated and bilingual youth.

In order to ensure effectual exportation of smart phones in Kenya, much attention should focus on the features characterizing the respective product. Indeed, products need to possess features that meet the potential client’s needs. One of the factors that should instigate changing the aspects of the product involves the norm of advertising in the country. Advertisement comprises the main form of promotional marketing of products and services in the Kenyan market. The main forms of advertisement media constitute radio, print and television. The wide circulation of print media in the form of daily newspapers, weekly newspapers and monthly magazine periodicals provide a wide and effectual platform for marketing the product. As such, the new business should focus on investing considerably in advertising especially with the way it is cost-effective. Another feature that the exporter should focus on involves the cost implications of technology in product design. As such, the exporter should focus on using affordable technology in processes that exemplify the product design such as packaging. Furthermore, the costs of production with respect to technology are expensive and as such, trickle down to the consumer based on the inflation of prices of basic commodities. In addition, investing in cost-effective and affordable technology would enable the new business to produce their products without enforcing the trickle-down effect on the consumers or inflation of the product’s prices. As such, the potential clients, who appreciate quality and cost-effectiveness in products, will be able to access the product at a reasonable cost.

Nonetheless, in the event that the entering organization focuses on supplying service to the local consumers, it is possible for the products provided by the organization to attract international consumers. One of the main factors that support this assertion is due to Kenya being a preferable tourist destination. The tourism industry alone generates considerable income to the Kenyan economy. This is because of the large number of international tourists that visit the country due to its natural scenery especially within the coast as well as the wildlife that include rare animals such as the Big Five, which comprise the lion, the leopard, the rhino, the elephant and the buffalo. In addition, as of 2011, the tourism levels for the beginning quarter of the year amassed to 1.04 million tourists. As such, the emerging organization can focus on providing tourism services for the international customers by entering into a conjunction with a local tour guide. This will facilitate the operations of tourism within the country. Another service that the organization will provide in order to satisfy international consumers is Internet services. This forms the main purpose for the introduction of cost-effective smartphones by the emergent organization. The provision of internet services would considerably aid the international consumers due to the relative and reasonable cost of internet in Kenya. This is due to the large number of cellular phone internet users who comprise 14.3 million users (United States of America Department of Commerce, 2012). The decreasing cost of the internet is increasing at a rapid rate due to price competition within the telecommunications sector. Before, Safaricom assumed the role of a monopoly since it possessed considerable economies of scale within the market that allowed it to initiate barriers to entry against other competitors. Nonetheless, the high prices of Safaricom’s offers on the internet as well as its telecommunication technologies such as modems and cellular phones facilitated the acquisition of telecommunication firm Celtel by Bharti Airtel. Additionally, the entry of Essar Telecommunications under the name of the Yu network and Orange telecommunications provided similar products but at reasonable prices that facilitated considerable brand switching. Furthermore, the adoption of the internet in facilitating government services further decreased the cost of the internet within Kenya. Nevertheless, the recent integration of fiber optics in order to access the internet at relatively high speeds through the Fiber to the Home (FTTH) initiative and its spread throughout the country facilitate price competition within the provision of internet services among telecommunication firms (United States of America Department of Commerce, 2012).

In order for the organization to ensure that its services are available to potential consumers, it should ensure that the provision of its services such as sales and consumer support gain situation in the developed and economic hub or hubs within the country. Services such as sales and customer support are vital for any organization in Kenya. Within the telecommunications market, most international cellular phone organization base their sales and customer support within international markets in the region’s economic hub. Nonetheless, it is vital to understand the importance of the sales and customer support services in order to determine the locus of decision-making for the organization. Usually, most civilians in the country require utmost information regarding a particular product. Furthermore, most civilians also initiate enquiry especially due to technology. This is because the rate at which rural to urban migration progresses in the modern years increases the number of people who are unfamiliar with operational technology. As such, the exporting organization should focus on the training of local faculty that will possess the necessary customer etiquette in addressing the problems presented by the current buyers. Additionally, for customer support, the exporting organization should also focus on the provision of considerable and comprehensive product information that will be effectual in assisting the operation of the technical products (smartphones) that they plan to sell in the city. As such, in order to provide such services with relation to decision-making, the exporting organization should base the locus of decision making in the city of Nairobi. This is because Nairobi is the most developed city within the country as well as the Eastern Africa region. It is also the economic center and performs the commercial and logistics activities of the complete Eastern Africa region. As such, by basing its headquarters in Nairobi, the organization will have a multiple access of business routes to the neighboring countries such as Uganda and Tanzania. Furthermore, the organization, as mentioned above, will be able to provide services to international persons based on the abundance of five-star hotels such as The Sarova Stanley, The Hotel Intercontinental and The Hilton Hotel.

As a developing market, Kenya requires a miscellany of investments in order to facilitate the development of key opportune areas such as infrastructure and the economic growth of the country as a whole. As such, the Kenyan economy acknowledges several forms of investment within the country. One form of investment common in the Kenyan economy is the Initial Public Offer (IPO). Usually, IPOs gain considerable popularity in Kenya’s investment climate based on their ability to finance several considerable projects based on infrastructural development such as production of power, cellular commerce, and road infrastructure. Furthermore, the Nairobi Stock Exchange (NSE), which is the main stock market, facilitates the provision of IPOs. The success of IPO as a financing instrument in Kenya was evident in the privatization of a government share of 25 percent in Safaricom (United States of America Department of Commerce, 2012). This facilitated the considerable infusion of finance within the government. Numerous other IPOs terminated in the previous three years gain significant subscription from local investors also illustrate the availability and use of IPO as local financing instruments for significant infrastructural and economic development projects. Another variant of financing instrument within the Kenyan market is Foreign Direct Investment (FDI). Foreign Direct Investment is one of the most common financing methods in most developed and developing markets. China, as another emergent market, receives FDIs from major developed countries such as Canada and as such, facilitates the growth of the Chinese economy in trade activities internationally (Zhang, 2006). Recently, the Kenyan market receives considerable and quasi-public FDI from leading economies such as China. Furthermore, private FDI into the Kenyan economy originates from states across the Gulf such as Saudi Arabia as well as other minor investors such as Libya and India. Moreover, other financing instruments such as debt financing from international banks such as Stanbic Bank and financial grants from international organizations such as World Bank also facilitate financing though they do not assist in the lessening of the current account deficit. As such, FDI, which is considerable and independent of the government, provides a long-term solution towards ensuring enduring economic growth for the country.

Regarding the telecommunications market, most brands of smartphones are actually from international cellular phone manufacturers. Most of these manufacturers gained early market entry advantage during the inception of the telecommunications market in the late 1990s. This is also evident for telecommunication organizations such as Safaricom and Airtel, which at that time went by the name, Kencell. These firms also penetrated the market at its inception and as such, gained a stronghold in the provision of telecommunication services with respect to the arrival of cellular phones within the Kenyan market. As such, the existing brands exported to the country include Samsung smartphones, which come in various models such as Samsung Galaxy Pocket, Samsung Galaxy Young, Samsung SIII and the Samsung Galaxy Note Series. Other brands include Huawei, ZTE, Nokia and Motorola. Nonetheless, the brand name for the new smartphone will be Africana. The Africana Smartphone will represent the nature of African authenticity that is rapidly eroding due to the globalization of Americanization in the world. Furthermore, the Africana Smartphone will be the first phone to possess an in-house application dubbed ‘Africana’ as well that will be accessible for Kenyans as well as other African countries in the event that the organization seeks to expand to other regional borders. Furthermore, the basis of the brand name will also encourage that the targeted customers familiarize themselves with their own culture by integrating the use of the Kiswahili language as the official language for the phone’s basic operations.

References

United States of America Department of Commerce. (2011). Doing Business in Kenya: 2011 Country Commercial Guide for U.S. Companies. Retrieved from <http://www.buyusainfo.net/docs/x_374344.pdf/>

United States of America Department of Commerce. (2012). Doing Business in Kenya: 2012 Country Commercial Guide for U.S. Companies. Retrieved from <http://www.buyusainfo.net/docs/x_5137303.pdf/>

Zhang, K. H. (January 01, 2006). Foreign direct investment in China. Canadian Foreign Policy Journal, 13, 2, 35-50.

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