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INTRODUCTION
Recent evidence from the revenues of US-based multinational firms suggests that emerging markets are increasingly becoming a significant and even a majority of their sales and income growth. Major corporations expect this trend to continue (Wessel & Greenberg, 2011). While multinational firms have experience in marketing products in developed markets, emerging markets tend to differ from developed markets on several fundamental dimensions such as governance, income, and infrastructure. Consequently, the complexity of operating in multiple markets has intensified. A core complexity facing such firms is whether the differences between emerging and developed markets influence the impact of marketing mix elements on brand sales. Do such differences have similar effects on the elements of the marketing mix? If they do, why is that the case? By addressing these questions, we shed light on the nature and extent to which the brand sales returns to marketing mix resource allocation (e.g., distribution or advertising intensity) is moderated by country-market characteristics across developed and emerging markets.
International marketing scholars have generated significant insights on marketing products/services in multiple markets through two parallel and related streams of research (e.g., Cavusgil, Zou, & Naidu, 1993; Farley, Hayes, & Kopalle, 2004; Jain, 1989; Townsend, Yeniyurt, & Talay, 2009). The first stream of research has a long history and investigates the performance implications of standardization vs customization of marketing strategies across markets (e.g., Cavusgil & Zou, 1994). Beginning with the conceptual debates on standardization (Douglas & Wind, 1987; Levitt, 1983), in this line of research, scholars focus on adaptation/standardization of the content of the marketing strategy (e.g., Should the marketing channel format be standardized across country markets?) as opposed to the effectiveness of marketing mix deployment (e.g., How sensitive is the effectiveness of distribution intensity to country characteristics?). Also, the focus of the marketing strategy analysis is usually on the adaptation vs standardization of the overall marketing program as opposed to individual marketing mix elements.1 The second stream of research addresses questions regarding the relationship between a subset of the elements of the marketing mix such as product (e.g., Roth, 1995), price (e.g., Erdem, Zhao, & Valenzuela, 2004), or promotion (e.g., Farley et al., 2004) and brand performance. Furthermore, researchers in this stream are interested in understanding the demand elasticity...