Managing product variety in emerging markets

Abstract

PurposeThe need for an efficient provision of product variety has been widely established as a means of competing in the marketplace, yet previous studies into the management of product variety have commonly analysed products in isolated developed markets. The purpose of this paper is to investigate how firms manage their product variety in emerging markets. This paper aims to investigate the rationale underlying the restriction of variety in such settings, and define general mechanisms by which firms can adapt their product variety when operating in both emerging and developed markets simultaneously.Design/methodology/approachThe paper uses the case of a global vehicle manufacturer that offers common products across developed and emerging markets to illustrate the difference between them in terms of product variety, and examine the process that underlies its management. The paper utilises a combination of data collection techniques.FindingsThe paper shows empirically how product variety (in particular ex factory variety) is restricted in emerging markets, as one would expect, and it identifies the mechanisms by which product variety is managed across different markets. The paper further illustrates how emerging markets have developed secondary coping mechanisms to deliver additional variety through late configuration in the distribution system.Originality/valueBy examining the differential management of product variety in emerging and developed markets, the findings yield several novel aspects by providing both empirical evidence and explanations for the restriction of product variety in emerging markets.