BUSINESS MODELS OF INTERNATIONAL COMPANIES IN EMERGING MARKETS
Galina S. Tsvetkova1*, Anna V. Filatova2, Nadezhda M. Krasnova 3
1 Assist. Prof. Dr., Mari State University, Volga State University of Technology, The Russian Federation, galla_200760@mail.ru
2 Assist. Prof. Dr., Mari State University, The Russian Federation, annvit@rambler.ru
3 Assist. Prof. Dr., Mari State University, The Russian Federation, krasnovanadezhda5@yandex.ru
*Corresponding author
Abstract
The purpose of the research is to study strategic decisions of international companies in emerging markets and strategic business models in foreign markets.
The paper presents the analysis of modern theoretical approaches to the development of business models and marketing strategies of international companies. The authors refer to the works of such famous American scientists as Michael Porter, Igor Ansoff, Ricky W. Griffin and Michael W. Pustay, an Australian researcher Christopher Bartlett and an Indian scholar Sumantra Ghoshal.
While selecting research methods, the results of marketing research on international companies which are described in the works of such Russian scientists as N. K. Moiseeva, V. I. Cherenkov, S. V. Karpova were taken into account.
The paper shows that the diversity of business models allows international companies from the USA, Germany, France, South Korea to move successfully into the Russian market and win new customers. Despite economic sanctions against Russia and tense geopolitical situation, international companies continue their expansion in the Russian market. It is proved by the increase in French investment in many sectors of the Russian economy. For example, Renault and Peugeot invest in the Russian car industry, Societe Generale – in banking services, Danon and Bonduelle – in the food manufacturing industry and Auchan – in retail trade.
Practical aspects of the research are carried out on the example of the French company Schneider Electric. The company has more than two hundred factories all over the world including Russia where it has six own manufacturing sites. Being emerging market, the Russian market is a strategic segment for Schneider Electric. The company has invested in Russian production capacity over one billion U.S. dollars. The analysis of the Russian segment confirms the attractiveness for Schneider Electric to do business in this country. The study of business solutions of Schneider Electric allows the authors to conclude that the French company implements the transnational strategy. This strategy provides business with the optimal combination of efficient business activities due to globalization of operations and adaptation to local conditions.
The authors have conducted the study of the work of the plant “Potential” which is one of the Russian production sites of Schneider Electric. Special attention is paid to the analysis of marketing tools of the plant and intercultural communication. SWOT analysis of the work of the subsidiary of the international company has allowed the authors to identify the strengths and weaknesses of its production activities. The influence of the activities of the plant "Potential" on the local market in the town of Kozmodemyansk in the Mari El Republic is studied. The positive and negative factors of the work of the French company in the local market are highlighted. Recommendations to improve the efficiency of doing business are made in the conclusion.
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