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Cultural effects on international marketing

PART- A

Introduction

These days' companies are mounting with a rapid speed. Different companies are trying to achieve one goal and that is of being the leader. There are two types of companies, companies that operate within a specific border or companies that opt to go beyond the border and progress to many other countries from the parent country. Now when a company decides to expand its horizon by moving to other country, it becomes a multinational company. This expansion from a country to another country causes lots of problems to the managers responsible for marketing control. Countries are different with their customs, languages, religions and traditions. These cultural factors can be overcome by making an effective marketing policy that would serve as a guideline for marketers. In this assignment the perspective of different writer will be discussed as to how the cultural factors impact on the international marketing and for inexperienced marketers how similar but different cultural aspects give rise to the illusion that normally does not exist.

Cultural Effects on International Marketing

All those business activities that involve the movement of goods and services from the company to its consumers in different countries for the sole purposing of making profit is called international marketing. Cateora and Ghauri (1999)

It is believed that the marketers should act in a responsible way because when the cultural borders are crossed it led to un-known set of rules which are often not recognisable. Since the culture heavily influences the behaviour of the potential customers therefore the international marketers often has to access the attractiveness and viability of country's market by making a list of cultural factors. The information gathered from these factors are used to make decisions on

1. What is the market?

2. How local culture can be adopted?

3. What are the ways of influencing it?

(Source : http://books.google.com, Accessed on 08/02/2010)

According to kahal (1994) when dealing with international marketing if we ignore the differences in cultures then it is the biggest crime we can commit.

Hofstede (1983) and Trompinaar (1993) argued that cultural differences could affect human behaviours, a fact he proved from his earlier study.

Hofstede (1980) conducted the study of national cultures for IBM employees across the world and found that different nations have their own cultural traits .According to him culture can be identified into following dimensions.

Power distance is the expectation and acceptance of less powerful member of society for equal power distribution (Hofstede, 1991).

Example: Maynard and Tian (2004), found that major international brands have their websites in Chinese in order to communicate with their customers and showing socially responsible towards markets in china.

Collectivism refers to group attributes including their activities and shared interests where as

individualism put personal interest over group objectives.

(Hofstede, 1980, 1991, 2001; Marcus & Kitayama, 1991; Triandis, 1995).

Example: According to Hofstede concept of collectism Chinese living in Singapore are high in conservatism and hierarchy but less independent. Schwartz (1994, quoted in Bresnahan, 1999)

Femininity versus masculinity is the involvement of men and women responsibilities in their respective societies. Feminine society refers to a society where both men and women are treated similarly where as in masculinity the men usually are (Yan Tian 481) regarded as more enthusiastic and ambitious then women. (Hofstede, 1980, 1991, 2001).

Examples: Most Islamic countries are considered to be masculine where women are not allowed to do certain things where as in west where feminine society allows the complete freedom to women.

uncertainty avoidance, is the degree of threat one feels in the society due to a unknown circumstances (Hofstede, 1991).

Example: The tainting crisis of Coca Cola that happened in Western Europe in 1999. Taylor, M. (2000)

Long-term versus short-term describes any companies approach towards its aims or objectives (Hofstede, 1991, 2001).

Example: Japanese make long term strategies where as Americans tend to focus on short term objectives in their approach.

(Source: http://list.msu.edu/cgiibin/wa?A2=ind9909b&L=aejmc&F=&S=&P=7081, Accessed on 10/02/2010)

Determining the Relevant Factors of influence

The marketing managers' analyses the cultural impacts on the product in the different parts of the country and it largely depend on the nature of the product, customers and the distribution channels. Based on the cultural characteristics the product benefit varies in different countries. When determining the cultural factors it is important that self reference criterion should not occur as it amalgamates own experience and values into another culture market e.g. a marketer from UK analyzing the Pakistan market would find the sales contracts are of minor role and he would feel doing business risky in the absence of legal contract. Since the involvement of self reference criterion can never be ruled out to the analysis of cultural factors of influence therefore the marketers often take necessary precautions by making multicultural teams for assessments.

(Source: http://www.scribd.com/doc/12731294/International-Marketing,

Accessed on 12/02/2010)

Trompenaars and Hampden-Turner's model explains the behaviours and value sets for employees who deal with cross-cultural relations. Trompenaars' research shows that business trends in one part of the world is different from the another.

(Source : http://en.wikipedia.org/wiki/Charles_Hampden_Turner, Accessed on 12/02/2010)

Culture as explained by Lars Perner is the set of activities which includes like traditions, beliefs and abilities that a common man posses in a society

Evaluation Criteria

Evaluation criteria for the cultural environment are specific to the company and the product There are some general factors which may be relevant like values and norms, religion, education, language etc

A cultural framework - Tersptra and Sarathy (2000).

Values and Norms

Values shared by individuals with-in the group or society is generally the indicator the culture. Values are the beliefs that changes customer's perceptions. The international firm should be aware of the different values and altitudes that exist in any country.

Mutter (1993) stated that cultures do not necessarily resembles to each other because they posses differences within them because of values and norms.

For example, if a yellow colour is used by the company in its logo it is readily accepted in USA but in Mexico it is a symbol of death (Kotler, P., and Levy, S. J. (1969).

According to Hofstede (1991) it can be a planning consisting of a collective minds.

Generally values form the norms that is accepted rules, standards and models of behaviour which direct the search of information, buying decisions and usage behaviours. Therefore the marketer takes into account the dominant values of the potential customers of the market being under consideration. These values are based on religious beliefs, risk taking, consumption and life achievements.

Morris (1998) believes that due to the presence of various cultures during the process of globalization have a tremendous effect on cultural values of people and these values are so different that they are not even converged in cosmopolitan societies.

Researchers believe that when two or more cultures exist then orientation in culture often confuse people when they are tempted to analyse two cultural values that are opposite to each another. (Chen, 1999; Sagiv, 1995)

Religion

Dominant religion in the society determines the values and norms of behaviour. Therefore Islam in Middle East, Africa and Asia, Shintoism in Japan, Confucianism in China, Christianity in Europe and America and Hinduism in India have a strong influence on the norms of these societies.

Terpstra and Sarathy (1972) insisted if one has to understand the culture he must get involved with his religion.

Similarly every religion has different holidays in their calendar so in a way it effects economically thus the international business. (Daniels and Radebaugh, 2000)

Example:

Muslims do not eat pork because of religious concerns.

When 1997 was declared year of pig china banned all advertisements featuring pig in respect to maintain Muslim sentiments.

Another example are Amish people (agricultural based) who are against modernisation and do not use electricity and motor vehicles.

Even if the religion is not been actively followed still the religious influence cannot be discounted in assessing the importance of cultural elements.

Education

According to Terpstra and Sarathy (1972) education gives an access to training in different fields with the generation of idea, concepts and skills.

It gives a understanding of an individual's life background belonging to the international market which could be helpful for him to flourish in the future. The level of education determines how foreign marketing activities are being responded by its consumers.

Example: In countries where the literacy is low the advertising mode is normally audio through radios instead of written communication e.g. Afghanistan.

(Source: http://www.articlealley.com/article_34450_15.html, Accessed on 16/02/2010)

Schramm (1955) said communication is all but getting to common agreement between sender and the receiver where education plays an important role.

Language

Language plays a huge impact on culture. Sometimes a same word can have different meanings in different languages. Similarly verbal and non-verbal communication differs in every language by the people in your target market. Terpstra and Sarathy (1972) believe that this is the most striking difference when cultures are considered.

Examples:

When in Taiwan they translated the Pepsi slogan which was "Come alive with the Pepsi Generation" it turned out as "Pepsi will bring your ancestors back from the dead” similarly the Kentucky Fried Chicken slogan "Finger-lickin' good" in Chinese when translated emerged as "Eat your fingers off." All this does not leave good impression of the company with their customers.

(Source:www.asianjoke.com, Accessed on 16/02/2010).

Another example is of Poland where the government has directed all companies selling or advertising foreign products to use polish for advertising.

(Source:http://www.scribd.com/doc/19241376/Culture-and-Acceptance-of-New-Products, Accessed on 16/02/2010).

So care should be taken when advertising in order to avoid what happened with the Goldstar advertisement where the adaption into Arabic was carried out without considering that Arabic starts from left to right as a result whole campaign failed.

(Source: http://books.google.co.uk, Accessed on 16/02/2010).

Aesthetics

When somebody likes anything by using his senses e.g. smelling or by feeling it comes under aesthetics. In international marketing a good presentation is really important to capture the customers. For example a painting or a soothing music.

(Source: http://www.marketingteacher.com/Lessons/lesson_international_marketing_culture.htm, Accessed on 20/02/2010)

Technology and Material Culture

It consists of technology and economic factors that are the main elements in it. According to Terpstra and Sarathy (1972) the infrastructure in any country can hinder international marketing. Africa has 2% of all telephone lines but got a population of 12%. Internet facility is available in different countries with respect to their social and economical developments. Similarly mobile technology is not the same everywhere. In order to overcome these barriers a country needs to have good IT infrastructure and proper technical knowledge.

Example: Rise in Chinese car industry (2nd in the world) and the introduction of clockwork radio by Trever Baylis in Africa (where batteries are costly).

(Source: http://www.marketingteacher.com/Lessons/lesson_international_marketing_culture.htm, Accessed on 20/02/2010)

Social Organisation

In different countries exists different social systems that includes family relations, the social stratifications, the interest groups and the status in a community group. How managers can be correlated with subordinates is also be explained by social organisation.

Ohbuchi (1999) observed that the Japanese people have developed a unique method of social structures, institutions and customs that reduces the conflicts to a great deal.

According to Terpstra and Sarathy (2000) it tells us about the country's governing structure example is cast system that used to exist in India.

Law and Politics

Sometimes certain issues are of more importance in the political environment. Companies that intend to target foreign markets are particularly interested in the ownership regulations and rights besides that laws concerned the employment are really important , system that is involved in the health and safety is often analysed thoroughly together with patent protection and the financial laws.

Examples:

Russia has a highly unstable government where laws could change overnight when a new leader is elected into power.

Where as in many countries tradition of democracy is not very popular all that makes it difficult to implement the laws such as in Pakistan or Burma.

In Islamic countries the laws and political system is based on Sharia traditions as in Saudi Arabia.

(Source: http://www.scribd.com/doc/15277070/Culture, Accessed on 17/02/2010)

PART- B

Cultural issues in marketing have become more prominent ever since the evolution of globalisation. A firms marketing program consisting of marketing strategies should be modified according to the foreign markets. It has been observed that international marketing is risky with many marketers' finds it difficult when they cross the borders and enter into the foreign market as they fail to analyze the consumers' need and other factors when trying to compare cultures. When inexperienced marketers try to promote their product in an unfamiliar or a new market it is difficult for him to distinguish between the various minor cultural aspects associated with population of that market. In such cases the marketer gets an illusion of similarity in culture in spite of presence of some differences.

A good example is of whirlpool when it entered to the sub continent in the early 1990s despite of having a great product it still had to face problems in establishing itself in the local market because of differences in consumer altitudes. McCracken, G. (1993)

According toPhilip Cateora "the successful marketer must be a student of culture"

In different countries people speak different languages, these languages could be same just like that there may exist a similarity with their race or inheritance. However it does not mean those cultures should be similar in all respects, the differences could lie with the acceptability and the usage of a particular product by both cultures. In the same way advertising pattern follows according to the cultural norms and there is no surety that the same promotional message for a same product could work in both countries. It is important to note that most times initial approach adapted by people could be same if we compare England and USA both are English speaking nations but the way culture absorbs and contributes in order to fulfil individual needs over the period of time make them very diverging cultures. Luna, D., & Gupta, S. (2001)

Same language does not guarantee same word interpretation everywhere. There is a good chance of being miss-understood since the phrase use at one place could have different meanings at different place. British people use lift in place of elevator similarly Americans have an alternative word for bathroom as toilet. Americans vacuum the carpet where as British hoovers it. A good example is of advertising campaign of Electrolux that highlights the difficulties in transferring message due to different interpretation of the theme. Nothing sucks like Electrolux is interpreted literally in the UK but in the US the slang implications would interfere the intended message.

(Source:http://www.visionarymarketing.com/articles/lostintranslation,

Accessed on 17/02/2010)

When GM introduced its Nova model in Latin America thought that people will accept it as nova in Spanish means star but people started calling it no-va meaning it will not go.

De Mooij, M. (1998).

Edward Hall who was an anthropologist suggested that it is very hard for British and Americans to reach to a common understanding because there are some cultural similarities which very apparent between them.

Oscar Wilde said“The English have really everything in common with the American except of course the language”

(Source: http://books.google.co.uk/books?id=l_TUbgkSlioC&dq=cultural+illusions+in+marketing&source=gbs_navlinks_s , Accessed on 19/02/2010)

Ever since the formation of European union the stress is now on European customer rather than individual customer. It is true that after the formation of European Union it is much easier to carry out trade in Europe because of the similar trading laws but that does not mean that consumer needs with in European Union consisting of many nations is the same. These cultural differences have existed for centuries and cannot be easily removed. A cultural difference could even exist within the country as well and most inexperienced marketers are not likely to give it much notice as in the case of UK which is a small country yet consisting of four independent countries England, Wales, Scotland and N. Ireland they have common language but different laws for example health promotions and social marketing.

(Source: http://mgv.mim.edu.my/books/booktoc/3473.htm, Accessed on 18/02/2010)

In USA the dating system is different with months coming first followed by the days and the year, so when a marketer promotes his products abroad he needs to be aware of this fact otherwise it would lead to a great confusion for the consumers with the exact dates for the delivery and payments.

USA is a big country constituting of many sub cultures and the modern communications and travel methods have ensured that the homogenisation is a very slow if occurring, all this makes a marketer's job more difficult who has to tackle with different cultures all the time by coming up with a strategy that covers all the cultures because North eastern part of USA is culturally very different to Southern part and it is not possible to compare them at all.

Similarly in India, West Bengal is very different to Maharashtra when it comes to marriages and ceremonies, if a marketer is marketing for a marriage bureau in West Bengal follows a marketing strategy or technique he used to do in Maharashtra it would be a disaster. Alden, S., & and Batra, R. (1999).

Mueller, B (1995), after the success of Marlboro in US and Europe when launched in the Hong Kong the advertisement was a failure as the locals could not understand the concept of horseback riding in the countryside.

It is important for marketers to thoroughly examine each country when launching their product or even a service and they should not relate the marketing trends of one country for some other country because it is possible that a successful marketing campaign might not work in any other country for example Pakistan with a Islamic society and a Hindu dominant society in India speak a common language without any significant difference in accent or dialects yet they have a huge religious difference as a whole that sometimes compels the inexperience marketer to amalgamate different aspects of marketing which are not common to both societies like the promotion and advertising of beef in Pakistan can be successful where as in India a similar strategy could work for the promotion of pork instead . This shows that a good marketing strategy in one country could prove a disaster in another country unless careful measures are taken.

Marketers when marketing should keep in mind the educational background of the place they are marketing in. Sometimes due to poor literacy rate it is not easy for people to understand what the product is and how they can use it and the complexity of marketing methods may ultimately prove the failure of the product. Marketers get an illusion that they can achieve similar targets with people having common characteristics to other areas but the fact is most times it is not possible.

(Source:http://www.citeman.com/management/sales-marketing-management/,

Accessed on 19/02/2010)

Conclusion

Since the world has become a global village and people around the world rely on each other for their needs all this has caused an increase in common consumer behaviours. The advancement in mass communication and dependence of nations on each other economically and socially has brought them nearer to each other. People are looking for more and more apparent similarities for their financial gains often ignoring minute cultural differences that are bound to exist. A good marketer knows that the culture borrows first followed by the adaption and finally customization according to its needs therefore what is actually evident on the surface could be entirely different to the cultural meaning.

Since every culture is composed of several factors that can differ a great deal from other cultures the foremost duty of the international marketer is to analyse the market and the culture in which he is planning to operate and then make suitable strategies and plans which could be implemented in those circumstances. His level of thinking should be at the same level as of locals and he must know how to catch the attention of his customers. It may include developing or introducing new innovations by means of inventions either internally or through externally in the form of borrowing culture dynamics positively or negatively.