Cultural Aspects of Cross Border Mergers and Acquisitions
February 12, 2025
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Abstract The global economic crisis of 2008 brought home to the global investors the stark truth that they need to look beyond the Western economies for generating returns on capital invested. The fact that the BRICS or the emerging markets of Brazil, Russia, India, China, and South Africa weathered the economic downturn and were able […]
In the last couple of years, with the advent of the ongoing global economic crisis, many investors have been looking for newer markets to invest to derive higher returns or maintain their current returns on investment.
Concomitant with this trend, marketers are looking beyond the developed Western countries that are saturated for newer growth opportunities. In this context, much attention has been directed towards the BRICS (Brazil, Russia, India, China, and South Africa) and the other emerging markets like Indonesia, Vietnam, and African countries.
Already, some African countries have been identified as the next growth stories and the fact that investors have divided the emerging markets into BRICS and beyond portends an interesting fact.
That fact is to do with the size of the consumer base in these countries, which is expected to mimic the western consumers in consumption.
Imagine the impact of a Billion Chinese and a Billion Indians who would ramp up their consumption on the world’s marketers. No wonder the $30 Trillion Prize by 2025 is making the marketers of the west salivate at the prospect of humungous returns.
Of course, the rising consumption in India and China is not without perils as the carrying capacity of the planet is already strained because of rampant consumerism and depletion of resources.
The fact that our world of finite resources is unable to keep up with the unrestrained consumption means that the addition of Chinese and Indian consumers to the kitty would make matters worse. This aspect is not lost on the Western companies as they try to devise sustainable business practices to be followed in the BRICS and beyond.
The moot point here is that if the marketers get their act right, they would be able to not only tap into the growing market but would also ensure that consumption can be done in a sustainable manner.
Returning to the main point, the marketers in the West have realized that marketing in the west and marketing in the east are two different things. Hence, they have adopted a mix of strategies that can be called “Glocal” or the merging of Global selling with local conditions. In this manner, the marketers in the west hope to capitalize on the burgeoning middle class in these countries that wants to have lifestyles comparable with the West.
The other aspect that needs to be pointed out is that these countries have been opening up at an accelerated pace and given the recent actions by the Chinese and Indians to liberalize their economies further, the doors for foreign investors have been throw open and a red carpet laid out for them.
Finally, whichever way one looks at it, the aspiration levels of the Chinese and Indian consumers’ means that the $30 Trillion consumption pie that is up for grabs between now and 2025 would definitely attract the attention of the western companies that have realized that their domestic markets have been saturated.
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