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Chapter 9 – Economic Development and the Americas
Teaching Objectives
This is the first of three chapters that include discussions of key topics – economic development,
economic integration, and burgeoning economic growth – all discussed in the context of the market
regions most appropriate. First we discuss Economic Development in the Americas.
Barring a major political and economic shift in the developing world, evidence is strong that through the
first decades of the 21st century emerging markets will be where the majority of world’s total trade
growth will occur. Growth will occur on a variety of fronts: development of infrastructure, opportunities
of foreign investors, and a spectacular growth of the consumer market. The events taking place in
emerging markets make international business exciting and will create opportunities and challenges for
multinational firms.
The impact of trends that are sweeping the developing countries—transition from socialist to market-
driven economies, the liberalization of trade and investment policies in developing countries, the transfer
of public-sector enterprise to the private sector, and the rapid development of regional market alliances—
should be the emphasis of this chapter. The teaching objectives of this chapter are to:
1) Stress the importance of the political and economic changes affecting global marketing, and
particularly the Americas.
2) Illustrate the connection between the economic level of a country and the opportunities created as
economic growth occurs.
3) Explore the various developing markets in the Americas and the diversity represented across the
continents.
4) Discuss the growth of new market segments and the emerging middle class in the Latin America
and other emerging markets.
Comments and Suggestions
1. The growing importance of new market segments is reflected in the number of studies on
consumers that are being conducted. A recent Roper Starch Worldwide global study of 40,000
consumers in 40 countries identified four major styles of shopping. Deal Makers (29%), who love
the process of buying; Price Seekers (27%), who place primary value on the product they are
buying; Brand Loyalists (23%), who purchase name brands and remain true to them; and Luxury
Innovators (21%), those who seek the new, prestigious brands.
The following is a breakdown by country.
Brand
Loyalists
Price
Seekers
Luxury
Innovators
Deal
Makers
U.S. 11.3%, 35.5%, 16.6% 36.6%
Mexico 19.1 23.4, 19.9 35.0
China 27.9 23.4 22.8 25.7
India 34.6 7.4 35.8 22.2
Japan 23.5 41.0 7.9 27.1
Saudi Arabia 14.8 8.9 34.4 40.3
France 19.5 45.5 8.5 26.6
Germany 16.9 43.7 15.7 21.9
Spain 27.0 34.4 18.1 19.6
U.K. 28.7 27.2 17.5 25.5
Czech Republic 23.9 26.9 25.7 22.61
2. “Cases 1-2 (Nestle) and 4-5 (Aids, condoms) provide a backdrop for a discussion of the everyday
realities in emerging markets. Both go into great detail how consumer behaviors, products, and
promotion interact to have huge impacts on public health.
Lecture Outline
I. Global Perspective: Wal-Mart, Tide, and Three-Snake Wine
II. Marketing and Economic Development
A. Stages of Economic Development
B. NIC Growth Factors
C. Information Technology, the Internet, and Economic Development
D. Objectives of Developing Countries
E. Infrastructure and Development
F. Marketing’s Contributions
III. Marketing in a Developing Country
A. Level of Market Development
B. Demand in a Developing Country
C. Big Emerging Markets (BEMs)
IV. The Americas
A. NAFTA
B. DR-CAFTA
C. Southern Cone Free Trade Area (Mercosur)
D. Latin American Progress
E. Latin American Economic Cooperation
F. NAFTA to FTAA or SAFTA?
V. Strategic Implications for Marketing
1 Source: “How the World Shops,” Advertising Age, June 5, 1995, p.3
