Market Penetration and Acquisition Strategies for Emerging Economies

Klaus E. Meyer, Yen Tran

Research output: Contribution to journalArticle

91 Citations (Scopus)

Abstract

Multinational enterprises (MNEs) are expanding their global reach, carrying their products and brands to new and diverse markets in emerging economies. As they tailor their strategies to the local context, they have to create product and brand portfolios that match their competences with local needs. A multi-tier strategy with local and/or global brands may provide MNEs with the widest reach into the market and the potential for market leadership. However, it has to be supported with an appropriate combination of global and local resources. Foreign entrants therefore have to develop operational capabilities for the specific context, which requires complementary resources that are typically controlled by local firms. As institutional obstacles and weaknesses of local firms often inhibit the direct acquisitions, foreign investors may pursue unconventional strategies to acquire local resources.

We outline the strategies for penetrating local markets through multi-tier branding and the acquisition of local firms, and offer new typologies that describe staged, multiple, indirect, or brownfield acquisitions. We illustrate them by analysing the entry and growth of Carlsberg Breweries in four very different emerging economies: Poland, Lithuania, Vietnam and China.
Original languageEnglish
Pages (from-to)177-197
Number of pages21
JournalLong Range Planning
Volume39
Issue number2
DOIs
Publication statusPublished - Apr 2006

Keywords

  • International Business Strategy, Emerging Markets.FDI

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