Category — Export Markets

Companies looking to target emerging markets could benefit from focusing both on obvious locations like China and India and somewhat neglected areas such as Colombia and Vietnam.

Financial services provider BBVA identified ten nations it believes will do more to aid the worldwide expansion in GDP than a majority of their advanced counterparts over the coming decade.

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Companies hoping to enhance their position in China should target a select group of up-and-coming cities, a report from The Economist Intelligence Unit (EIU) has argued.

Following recent estimations, the Chinese urban population could reach 880m people by 2037. The pace of urbanisation in China will have a fundamental effect on all businesses. China is still a developing market. Urbanisation does more than just drive growth; it also makes it more stable. Guangzhou, Wenzhou, Shanghai and Suzhou currently constitute the primary consumer markets, but other cities are quickly gaining ground. To identify the new generation of leading municipalities, the EIU analysed 86 prefectures boasting at least 1million inhabitants, choosing 20 it believed might form a base for expansion. These outlets – collectively termed CHAMPS – were spread throughout the country, and included Baotou, Shenyang, Wuhu, Hohhot, Xiamen, Wuhan, Nanchang and Xuzhou. During the next decade, these urban centres will grow by 27% to 85m people, in which time the 20 wealthiest cities should swell by 19% and hit 100 million.

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According to a Survey made by Nielsen (*) , consumers in China are now among the “most complex” in the world as a result of their rapidly-changing habits and preferences, a study has argued.

Historically, Chinese consumers visited stores around five times more often each week than their US counterparts, with the average basket size only a quarter of that in America.

In 2010, frequency rates have fallen, shown by a slight drop from 0.6 trips to 0.5 trips in the home and personal care sector per seven days, while the normal value of purchases has grown from 18.42 yuan ($2.76; €1.98) to 24.10 yuan.

“The trend toward fewer but more costly shopping trips reflects the Chinese consumer’s convergence with developed-world norms,” McKinsey said.

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The Brazilian middle class is rapidly increasing in size, offering major opportunities for brands from various categories.

The research firm Ibope reported that economic growth has resulted in 32m people, called “Classe C”, joining the middle class for the first time, swelling overall numbers to 100m. The middle class as a whole, which boasts a large number of relatively young shoppers, currently generates the majority of domestic consumption. Based on a survey of 20,000 people from Classe C, Ibope found a particular demand concerning property and cars, alongside a willingness to pay a premium for high-quality goods in sectors like personal care.

Moreover, this audience is seeking “products matching their values and principles, their lifestyle and attitudes,” its study added.

Fabio Mariano Borges, a professor at the School of Advertising and Marketing in São Paulo, said : “It shows that thèse last years we were targeting the wrong people. Class C now consists of telemarketers, secretaries, receptionists and teachers. Strong public consumption was responsible for taking the country out of the 2008 financial crisis.”

(Data sourced from Diário do Grande ABC)