Amway in China

Case Study: AMWAY in China

1. China is one of the fastest growing emerging markets in the world. Outline the characteristics of an emerging market within respect to China.

An emerging market provides growth opportunities for a multinational enterprise, which may find its existing business in a mature and saturated market. Emerging markets provide new investment opportunities, but there are risks both to residents and foreign investors. China become the fastest growing market country for most of the products and services industry because of its population growth. Moreover, China's economy is beginning to dominate the Asian economic landscape. It means that this country is certainly profitable. Besides that, the improvement in technologies, the changing of consumer taste creates opportunity to organization such as Amway. China as a fairly low trust environment, therefore word of mouth becomes an important component when a consumer deciding in getting a product or services especially personal product offered by Amway. China's economy is beginning to dominate the Asian economic landscape. Amway's direct selling techniques could scare the Chinese government and consumers, it means that Amway China affiliate could have to make changes in its distribution methods in order to work with China's regulations. Therefore, Amway could have to revise its business plans to only sell products in retail outlets when doing business in Chinese market.

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3. Who would be the Chinese target market? Would you employ a similar positioning strategy and marketing programme in China as the one you suggested for Malaysia? Why?

Amway offer range of products for home care, laundry care, personal care, skin care and cosmetics, nutritional supplements, home technology and fragrances. Therefore, their target market in China could be both female and male consumer, age 25 to 45 years old working adult with medium to high income located in suburban area.

No, I wouldn't employ the total similar but some possible positioning strategy and marketing program in China as there is a cultural gap between the Malaysia and China market. Chinese cultural values are largely formed and created from interpersonal relationships and social orientations compare to Malaysia. Positioning strategy leads to step to deliver and communicate the desired position to the Chinese consumer. To develop effective positioning strategy, marketing mix can be use to define the strategy, which include, place, price, product and promotion. Amway are more likely to position themselves in urban and city area, such as Shanghai, Beijing and Guangxi. Besides that, product price that Amway offers are medium to high range to suit their consumer income class. For product, Amway could come out with innovative product which can target the opposite gender such as men care product as the homosexual market are are increasing on demand. As for promotion, as mentioned above, door to door selling and direct selling are not part of the Chinese culture. Therefore, Chinese consumer might interest in loyalty program, celebrity endorsement or consistent advertisement to attract the Chinese consumers. The Chinese are seen as having a low level of involvement when purchases are for private consumption but a high level of involvement