It's no surprise to see more and more financial news covering the vast opportunities in emerging markets. After all, these markets' double-digit growth rates, exploding populations and vast natural resources make them ideal investments for the next decade. However, many analysts are now saying that the valuations of many emerging-market companies have gotten a little frothy. There may be another approach to gain access to the increased wealth of emerging markets' consumers and bypass rising stock valuations.

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Looking in Your Own Backyard
Funds like the Global X Brazil Consumer ETF (NASDAQ:BRAQ) have gained in popularity and assets as many investors have looked to cash in on the growing consumer story in developing markets. However, investors wanting to play this vast wave of new consumerism may want to look in their own backyards, as valuations in places like India might be a little generous. Emerging market stocks in the consumer staples and discretionary sectors are trading at premiums to their five-year price to earnings average.

As the planet's economy grows ever more interconnected, companies from various developed countries have increasingly looked beyond their own mature economies for bigger growth opportunities abroad. More than 48% of the sales from companies in the broad S&P 500 (NYSE:IVV) were received from sources outside the United States and that percentage is growing rapidly. The story is similar in other developed nations. Roughly 20% of earnings from large-cap, non-financial companies in the United Kingdom stem from emerging markets.

As well as being cheaper on a price-to-earnings metric, developed market stocks benefiting from global growth tend to be lower volatility and are more liquid than those in emerging markets. The market cap of consumer companies in emerging markets is just under $500 billion. This compares to the $4.7 trillion market cap for consumer corporations based in the developed world. In addition, developing nation's stocks have recently begun to lag their developed twins.

Developed Opportunities
As these emerging nation's economies continue to grow, their citizens will ultimately benefit by joining the ranks of the middle class. Consumer oriented stocks are one way to play that growth. Developed market multinational companies might be an even better solution for tapping into the new emerging market consumer. Investors wanting a broad-based play on consumerism can use the iShares S&P Global Consumer Discretionary ETF (NYSE:RXI). The fund tracks 168 of the largest discretionary firms such as Nike (NYSE:NKE) and charges 0.48% in expenses. For investors wanting individual choices, here are some developed-international picks.

After getting hammered during the first part of the housing crisis, A. O. Smith (NYSE:AOS) has bounced back. The maker of energy efficient water heaters and filtration devices expects to see double digit growth in Asia. As new homeowners enter the market in China, A. O. Smith will benefit. The company also recently announced its intention to become a major competitor in water technology markets in China and India. Shares of the company yield about 1%.

It seems that consumers in emerging markets enjoy a frosty beverage as much as those in the developed world. Brewer SABMiller (OTCBB:SBMRY) received more than 78% of its profits from emerging markets in 2009 and spirits producer Diageo (NYSE:DEO) has grown liquor sales in the Middle East and North Africa (MENA) region by 16% this year. Both make excellent plays for the growth in emerging markets. (For related reading, take a look at Investing In The MENA.)

While most consumers have brushed their teeth with Colgate toothpaste or washed their hands with Soft Soap, many would be surprised to learn that Colgate-Palmolive (NYSE:CL) sells more products in Brazil and the rest of Latin America than in the U.S. Approximately 75% of total revenue stems from its international operations.

Bottom Line
As emerging markets have become more popular, many analysts now point to less attractive valuations for their assets. However, their growth story is far from over. Investors may want to take a look at developed market multinationals as a way to play emerging markets. Consumer stocks with large emerging market presence such as Avon Products (NYSE: AVP) may be the best way to play this growth.

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