GE uses Olympics to pitch emerging markets push

28 02 2008

GE uses Olympics to pitch emerging markets push

Posted by: in Companies Competitive Strategy

Filed under: Competitive strategy, General Electric (GE), Marketing and advertising, China

General Electric (NYSE: GE) is still trying to convince investors that it can offset slow growth and some weak divisional results by doing well in emerging markets. So far, the stock market has not purchased in.

The market has actually been hostile to the message. GE shares are just above $34, which is not far from their 52-week low and down considerably from their high of $42.15. Over time, earnings from regions like India and China may help the stock, but the company is going to have to push harder to mark its case. It will use the Olympics in Beijing as a spring-board.

“We want to humanize G.E. even as we show worldwide investors that G.E. is a major player in the world,” stated Don Schneider, executive creative director at BBDO New York, the Omnicom (NYSE: OMC) unit that is G.E.’s longtime advertising agency, told the The New York Times

GE is a major player in the world but the politics in countries such as China might not make growth there as simple as investors would hope. A global recession could also slow infrastructure building in Asia and the India sub-continent.

To some extent, the large marketing budget for this Olympics is a waste of money. Wall Street wants to know that GE is willing to deal with its slow-growing medical and industrial units either by selling them or slicing costs. Tickets to the Olympics won’t help.

Douglas A. McIntyre is an editor at 247wallst.com.