Can Brazilian firms survive the Chinese challenge: Effects of globalization on markets, strategies, and performance
European Business Review
Purpose – The purpose of this paper is to apply the structure-conduct-performance theory and the strategic fit concept to examine the effects of globalization on markets, strategies, and performance of business-to-consumer firms in Brazil.
Design/methodology/approach – The paper takes a qualitative approach to answer the research questions. Top decision makers such as president, chief executive officer, chairman of the board, vice president, and director of the companies were interviewed. The elite approach to in-depth interviewing was followed to obtain reliable information from the decision makers.
Findings – Findings indicate that globalization and especially the entry of Chinese firms significantly changed market contexts in Brazil. Brazilian executives responded to changes in market contexts by shifting from production to customer orientation, building brand equity, developing new products, and differentiating offerings. Overall, marketing performance of Brazilian firms was positive, but profitability suffered.
Originality/value – The study contributes to the literature by showing that globalization has changed market contexts in Brazil by developing a new form of competition in which firms from emerging economies are now competing against each other. Findings from this study can provide useful theoretical and strategic insights into the behavior and performance of firms in other emerging markets.