Competing successfully against multinationals: a longitudinal perspective of Hungarian advertising agencies

An increasing amount of attention is being placed on domestic firms in emerging markets especially in understanding how they develop strategy in response to market-based reforms and competition from multinational corporations. However, of this attention little is given to the plight of service firms. In an effort to address this gap, we conduct a case study of seven advertising agencies in Hungary. Using a three-pronged structure of the resource-based view, and its extension (dynamic capabilities framework), institution-based view and competitive strategy research, we find evidence of only some of the differentiation strategies found in other markets. The use of networks proved beneficial in the development of these strategies. We also discover two transitioning strategies utilized by firms as they move from a command economy toward a market-based economy.