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How do variations in national culture impact on the marketing strategies of multinational companies? A case study of McDonalds
Marketing research is the systematic gathering and analysis of information about problems relating to marketing products and services. The goal of marketing research is to identify and define marketing opportunities and problems. Companies do the research in a systematic process in order to study customers as well as competitors.
Marketing research is used to understand the best ways to connect a customer and a product so that the customer buys the product. Only by understanding the needs and wants of the customer and by effectively meeting them, companies will be able to achieve the organizational goals and surpass the competition in the specific market. So it is very critical collect data about the customers, competitors, and other forces in the marketplace. This data in turn is collected and analyzed to make relevant marketing decisions, be it in relation to setting up a business, developing a product, creating a brand or coming up with an advertising campaign.
Marketing Research Process
Marketing Research process is set of steps used to conducting a systematic marketing research study. These include problem definition, defining an approach to the problem, defining research methodologies, data collection, data analysis and report presentation.
Culture defines the people's "way of life", meaning the way they do things. Culture could be related to a specific country, a section of community or within an organization. A people's culture includes their beliefs, rules of behavior, language, rituals, art, technology, styles of clothing, ways of producing and cooking food, religion, and political and economic systems. Culture is not inherited genetically; it must be learned and acquired. Socialization occurs when a person absorbs or learns the culture in which he or she is raised.
Marketing research should take into account the local culture of the country in which you wish to market. How marketing efforts interact with a culture determines the success or failure of a product. Advertising and promotion require special attention because they play a key role in communicating product concepts and benefits to the target customer.
The "Terpstra and Sarathy Cultural Framework" helps researchers to assess the cultural nature of an international market. It uses eight categories in its analysis. The Eight categories are Language, Religion, Values and Attitudes, Education, Social Organizations, Technology and Material Culture, Law and Politics and Aesthetics.
Language is an integral part of culture and is the main mode of communication. It can be divided into two major elements, which are the verbal and non verbal communication. The choice between verbal and non verbal communication needs to be balanced based on whether the national culture is high context culture or low context culture. In countries like Australia what is said is what is meant and spoken language carries the emphasis of communication - low context culture. Whereas in countries like Japan and some Arabic nations what is said may not be what is meant and the communication tend not to carry a direct message in it - high context culture. So the researchers need to make sure the marketing reaches out to the customers in the exact way it was meant to be communicated.
Another major cultural variable is religion and has significant effects on marketing strategy. For example, the identification of diverse beliefs and norms as well holidays and rituals is critical for an understanding of a foreign market. In some countries religion is the most dominant cultural force. Hence researchers need to ensure that their product and services doesn't offend or be distasteful to the local nation.
In the year 2007 the Chinese government banned all advertisements containing pictures of pig in order to maintain harmony with the country's Muslim population.
Values and Attributes
The values consumers from different countries place on things such as time, achievement, work, wealth and risk-taking will affect not only the product offered but also the packaging and communication activities. The methods used by a firm to motivate its personnel are also strongly influenced by the local culture and practice. For example workers in France tend to take vacation in August while workers in United States tend to take vacation during end of the year. So before entering a market it is important to understand the locality. Advertising campaigns should be altered or customized to suit the locality.
In the year 2006, the USD 130 million ad campaign was banned by the British Advertising Standards Authority from the United Kingdom as the ad campaign had a tag line " where the bloody hell are you?"
The level of education in a country has a direct impact on the sophistication of the target customer. A simple example will be the degree of literacy. In developed countries, main form of communication is advertising and printed method. In developing countries, they rely on training and verbally based educational programs to get their message across.
This relates to the way in which a society organizes itself. How the culture considers kinship, social institutions, interest groups and status systems. The role of women and caste systems are representative examples. Social mobility could be restricted in a country like India where caste and class systems are in place.
Technology and Material Culture
This aspect relates not to materialism but to the local market's ability to handle and deal with modern technology. Some cultures find the idea of leaving freezers plugged in overnight, or servicing cars that have not yet broken down difficult to understand. It is also very important to understand the availability of infrastructure to distribute the goods to customer. Innovation within technology is based on the need for such goods.
The cost of batteries was very expensive in Africa and power supplies to rural areas were non- existent. The launching of clockwork radio by Trevor Baylis was an instant success due to this.
Law and Politics
The legal and political environments in a market are regarded as consequences of the cultural traditions of that market. Legal and political systems are often a simple codification of the norms of behavior deemed acceptable by the local cultures. For example, the United Kingdom has laws based upon precedent and legislation which is largely market-driven and democratic society, whilst Iran has a political and legal system based upon the teachings and principles Islam and a Sharia tradition.
This covers the local culture's perception of things such as beauty, good taste and design, and dictates what is acceptable or appealing to the local eye. A firm needs to ensure that use of color, music, architecture or brand names in their product and communication strategies is sympathetic and acceptable to the local culture.
Experiments on Culture and Marketing
Culture is so much influential that in can affect a person's buying power. University of Sydney's Donnel Briley and Stanford Graduate school of business's Professor of marketing Jennifer Aaker has examined this complex issue. A series of experiments were carried out, among which four experiments showed the result that the differences or responses based on culture are reflected when the people face spontaneous incidents i.e. when they have no clue of the situation. That is the reason that a roadside bill board can only lure a person if it has something in it related to his culture and sub consciously that person gets attracted and receives influence. On the other hand, when a person has more time to explore about some advertisement i.e. watching TV or using internet, a person is not as much attracted because he is mentally prepared that he is about to come across and advertisement. In such case the cultural factor totally fails.
As an extension to same experiments a group of students of California University were asked to watch the Welch's grape juice advertisement. The group of students consisted of Anglo and Asian American students. Half of the students were asked to give their prompt views about the ad. While rest were asked to take time, think upon it and then comment and judge the effectiveness of the advert. The adverts were promotional in nature. They were focusing on the nutritional benefits of drinking grape juice. For example it stated that Welch's grape juice can give you higher levels of energy, it has great taste and is energy giving and it is all fun to drink it. While the second part of add was based on the appeal that this juice has harmful effects even it can cause cancer and heart attacks. The group which was asked for prompt reply commented it to be a non-attractive and preventive message portraying ad. This group had Asian Americans in it. While the group of Anlgo Americans that had real time to think found it very attractive and positive.
Personal knowledge or culture
Personal knowledge also affects the consumer judgment. A normal person's general knowledge is based upon obvious cases. But in addition to this general knowledge every person has some personal knowledge that comes from either learning, education and from experience. For instance, a person born and brought up in China is used to of his family culture and knows how he has to live in harmony with other family members and how he has to perform his part of house chores to help his family. There is collectivism in Chinese culture. But if the same person is exposed to the individualistic culture of America, where youngsters feel great to copy the rock stars and dress up like them. His family will not like him to wear such clothes. Therefore when a person is provided to face prompt judgment on an issue, the cultural values come in the way as a programmed default. While on the other hand, if adequate time is given to analyse a situation, personal knowledge over comes the cultural value.
Therefore the ideas about the factors that distinguish different cultures are always the key factors for the marketing communication internationally. Global strategies for brand management are also dependent on it.
No doubt, the understood significance of the issues of culture has increased ever since new technologies have been incorporated in daily business life. New technologies let the marketers to make its products accessible to its customers globally. The globally successful marketers are investing a lot on the research of different culture for this prudent reason. For example; Intel inside, Google and Nike.
Marketers have to be very careful in developing a marketing message they should know the accurate words to catch the of eye of attention of its potential customers on the basis of the culture he belongs to. It is more like "Hit it hard when it is hot". Marketers need to pin point the issue that a culture is sensitive about and design its message around this point. But there is high degree of carefulness needed; the message should obey all cultural values and morals. For this they have to be brief but accurate.
Marketing process faces a large set of diverse variables as it take place over different countries and it does act in different environments. Culture is one of the most determinant environments to the success of the marketing process. Hence it is very critical that the marketing research team studies deeply culture treaties of a country the company is planning to act in, so that special amendments in the organization overall plans and actions is made to act in accordance with the new market variables.