Marketing strategy

A new cross-border marketing strategy relies on an interdependent ecosystem

LAWRENCE – The COVID-19 pandemic, coupled with supply chain hurdles, has made the international marketplace even more difficult for businesses to navigate. But Murali Mantrala, Ned Fleming Professor of Marketing at the University of Kansas, advocates that companies consider a new approach.

“Marketing Ecosystem Orchestration (MEO) creates the environment for the entire market to grow and improve,” Mantrala said.

“And in the process, he ‘lifts all the boats’.”

His article titled “Orchestration of the cross-border marketing ecosystem: a conceptualization of its determinants and boundary conditions” introduces a new concept-based approach to inform and guide cross-border marketing strategy. It examines how Starbucks, Uber, Airbnb, Amazon and Apple operate in today’s digitally interconnected global markets. It is published in the International Journal of Research in Marketing.

“From the perspective of our research, the old model of thinking was that multinationals had to expand overseas and choose what kind of partnership or arrangement they entered into,” said Mantrala, who co- wrote the article with colleagues Kelly Hewett, G. Tomas M. Hult, Nandini Nim, and Kiran Pedada.

“They basically invest in their own assets and partnerships to build what we call the value chain. But when you look around for about 10 years – maybe even 20 years – a lot of the most successful companies are the ones that don’t just rely on growing their own channel. In fact, they promote or sow growth in areas that could benefit them, but could also benefit other parties independently. »

Mantrala interviewed a dozen CEOs and CMOs from different companies while looking at case studies of how these companies adapted to new environments using MEO.

“The most misunderstood thing about the international marketplace is that somehow companies can just push their way through other countries and do things for themselves,” said he declared. “I think the whole environment needs to be supported.”

Murali MantralaFor example, Starbucks, the Seattle-based company that is the world’s largest coffeehouse chain, carefully tailors its approach to expansion depending on the country in question. In Spain, Portugal and India, Starbucks has adopted exclusive marketing partnerships.

“As in India, Starbucks relied more on these joint ventures; it hasn’t done much to try to develop the country’s coffee drinking habits or for coffee culture,” he said. “But in China, which was really a place of tea drinking, he understood that first he has to create the market through the orchestration of the marketing ecosystem.”

This produces the most sustainable type of market. Otherwise, countries like China sometimes force companies that are doing too well at home to leave.

“China has actually welcomed the way Starbucks does things,” Mantrala said. “It not only helps Starbucks, but it helps a lot of farmers and other workers. in new markets.

This strategy is not exactly a modern invention. It has been used in recent decades by subsidiaries of multinationals – such as London-based consumer goods company Unilever and US-based General Electric – to penetrate rural sectors in emerging markets like India and Bangladesh. More recently, technology company platforms such as Uber and Amazon often use an MEO approach in different national markets.

Mantrala’s research impetus didn’t start with coffee; it started with newspapers.

“The industry had advertisers and readers, but they were really hammered by online news sources. Newspapers needed new strategies to figure out how to stay financially viable,” he said of his platform-based research.

Mantrala found that the financial fallout was not as severe as newspaper publishers assumed, as they continued to believe that their success was based on getting more advertisers. They were abandoning investments in the editorial side to realize that advertisers were there to reach readers, and readers were only attracted by strong editorial content.

“What they really should be investing in is editorial content, and they were doing the exact opposite,” he recalls.

Based on this search for networking and building both sides of a market, Mantrala was recruited to be part of a thought leadership conference in his home country of India at the Indian School of Business. This morphed into a “new thinking for international strategies” group, which became this current team working on marketing ecosystem research.

A KU faculty member since 2020, Mantrala specializes in quantitative marketing strategy, particularly retail channels, marketing resource allocation, and sales force management.

The professor believes that orchestrating the marketing ecosystem is the ideal business strategy for the here and now.

“There’s all this focus on sustainability, especially among the younger generation,” Mantrala said. “MEO is very consistent with that kind of sustainability and ‘fairness for all’. Because what you’re really advocating is that if you want to be healthy and profitable and grow, sometimes it pays to invest in other market players and activities.

“He supports the people who support you.”

Left photo: Pixabay
Right picture: Murali Mantrala