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Cultural Dynamics in Assessing Global Markets
Cultural Dynamics in Assessing Global Markets
1. The importance of culture to an international marketer
2. The origins and elements of culture
3. The impact of cultural borrowing
4. The strategy of planned change and its consequences
What is Culture
“Culture refers to “the human-made part of human environment—the sum total of knowledge, beliefs, art, morals, laws, customs, and any other capabilities and habits acquired by humans as members of society”
· Culture is the integrated sum total of learned behavioral traits that are shared by member of society.
– Culture – Ways of living, built up by a group of human beings, that are transmitted from one generation to another
– Culture is acted out in social institutions
– Culture has both conscious and unconscious values, ideas and attitudes
· Culture is both material and nonmaterial
Culture’s Pervasive Impact
• Culture influences every part of our lives
• Cultures impact on birth rates in Taiwan, Japan, and Singapore
• Birthrates have implications for sellers of diapers, toys, schools, and colleges
• Consumption of different types of food influence is culture: Chocolate by Swiss, seafood by Japanese preference, beef by British, wines by France and Italy
• Even diseases are influenced by culture: stomach cancer in Japan, and lung cancer in Spain
Origins of Culture
Culture is the sum of the “values, rituals, symbols, beliefs, and thought processes that are learned, shared by a group of people, and transmitted from generation to generation”
Culture has been conceptualized as:
- “Software of the mind” culture is a guide for humans on how to think and behave; it is a problem-solving tool (Hofstede)
- An invisible barrier… a completely different way of organizing life, of thinking, and of conceiving the underlying assumptions about the family and the state, the economic system, and even Man himself” (Hall)
- A “thicket” (U.S. Ambassador Hodgson)
Origins of Culture: Geography
- Geography, which includes climate, topography, flora, fauna, and microbiology, influences our social institutions
- Two researchers suggest that geography influences everything from history to present-day cultural values
- First, Jared Diamond states that historically innovations spread faster east-to-west than north-to-south
- Second, Philip Parker reports strong correlations between the latitude (climate) and the per capita GDP of countries
Origins of Culture: History
- The impact of specific events in history can be seen reflected in technology, social institutions, cultural values, and even consumer behavior
For e.g., American trade policy depended on tobacco being the original source of the Virginia colony’s economic survival in the 1600s
2. The military conflicts in the Middle East in 2003 bred new cola brands, Mecca Cola, Muslim Up, and Arab Cola
Origins of Culture: The Political Economy
- For most of the 20th Century three approaches to governance competed for world dominance: fascism, communism, and democracy/free enterprise
- Necessary to appreciate the influence of the political economy on social institutions and cultural values and ways of thinking
Origins of Culture: Technology
· Technological innovations also impact institutions and cultural
· Jet aircraft, air conditioning, televisions, computers, and the internet have all influenced culture
· Arguably the greatest impact is the pill that has allowed women to have careers and freed men to spend more time with kids
Origins of Culture: Social Institutions
• Social institutions including family, religion, school, the media, government, and corporations all affect culture
• The family, social classes, group behavior, age groups, and how societies define decency and civility are interpreted differently within every culture
(1) Family behavior varies across the world, e.g., extended families living together to Dad washing dishes
(2) Religious value systems differ across the world, e.g., Muslims not allowed to eat pork to Hindus not allowed to consume beef
(3) School andeducation, and literacy rates affect culture and economic growth
(4) Media (magazines, TV, the Internet) influences culture and behavior
(5) Government policies influence thethinking and behaviors citizens of adult citizens, e.g., the French government offers new “birth bonuses” of $800 given to women as an incentive to increase family size
(6) Corporations influence culture via the products they market, e.g., MTV
Elements of Culture
International marketers must design products, distribution systems, and promotional programs with due consideration to culture, which was defined as including five elements:
1. Cultural values
4. Beliefs, and
5. Thought processes
1. Cultural Values
· Differences in cultural values, which is found to exist among countries, affects consumer behavior
· Value - enduring belief or feeling that a specific mode of conduct is personally or socially preferable to another mode of conduct
· Hofstede, who studied over 90,000 people in 66 countries, found that the cultures differed along four primary dimensions:
(a) Individualism/Collective Index (IDV), which focuses on self-orientation
– The Individualism/Collective Index refers to the preference for behavior that promotes one’s self-interest
– High IDV cultures reflect an “I” mentality and tend to reward and accept individual initiative
– Low IDV cultures reflect a “we” mentality and generally subjugate the individual to the group
– Collectivism pertains to societies in which people from birth onward are integrated into strong, cohesive groups, which protect them in exchange for unquestioning loyalty
(b) Power Distance Index (PDI), which focuses on authority orientation
– The Power Distance Index measures power inequality between superiors and subordinates within a social system
– Cultures with high PDI scores tend to be hierarchical and value power and social status
– High PDI cultures the those who hold power are entitled to privileges
– Cultures with low PDI scores value equality and reflect egalitarian views
(c) Uncertainty Avoidance Index (UAI), which focuses on risk orientation;
– The Uncertainty Avoidance Index measures the tolerance of uncertainty and ambiguity among members of a society
– High UAI cultures are highly intolerant of ambiguity, experience anxiety and stress, accord a high level of authority to rules as a means of avoiding risk
– Low UAI cultures are associated with a low level of anxiety and stress, a tolerance of deviance and dissent, and a willingness to take risks
(d) Masculinity/Femininity Index (MAS), which focuses on assertiveness and achievement
- Masculinity—Men assertive, competitive and concerned with material success and Women nurturing and welfare
- Femininity—social role of men and women overlap with neither gender exhibit overly ambitious or competitive behavior i.e. Japan and Austria.
2. Elements of Culture: Rituals, and Symbols
– Rituals are patterns of behavior and interaction that are learned and repeated vary from country to country, e.g., extended lunch hours in Spain and Greece
– Language as Symbols: the “languages” of time, space, things, friendships, and agreements
– French attempting to preserve the purity of their language
– In Canada, language has been the focus of political disputes including secession
– Differences in language vocabulary varies widely
– Aesthetics as Symbols: the arts, folklore, music, drama, and dance of a culture influences marketing
• English Translations made by Japanese firm that were added to labels to increase prestige for their products being sold in China
3. Elements of Culture: Beliefs and Thought Processes
– Beliefs, which stem from religious training, vary from culture to culture
Eg : The western aversion to the number 13 or refusing to walk under a ladder
Japanese concern about Year of the Fire Horse
The Chinese practice of Feng Shui in designing buildings
– Belief - an organized pattern of knowledge that an individual holds to be true about the world
– Thought processes also vary across cultures: eg: “Asian and Western” thinking
– In summary, marketers must consider larger cultural consequences of marketing actions
Factual versus Interpretive Cultural Knowledge
There are two kinds of knowledge about cultures both of which are necessary
Factual knowledge is usually obvious and must be learned, e.g., different meanings of colors, and different tastes; it deals with a facts about a culture
Interpretive knowledge is the ability to understand and appreciate the nuances of different cultural traits and patterns, e.g., the meaning of time, and attitudes toward people
Interpretive knowledge requires a degree of insight It is dependent on past experience for interpretation It is prone to misinterpretation if one’s SRC is used
Cultural Change and Cultural Borrowing
• International marketers should appreciate how cultures change and accept or reject new ideas
• How cultures change, e.g., war (changes in Japan after World War II) or by natural disaster
• Hofstede has shown that consumers’ acceptance of innovations varies across cultures – innovation was associated with higher individualism (IDV), and lower power distance (PDI) and uncertainty avoidance (UAI)
• International marketers should be aware the extent to which cultures borrow ideas and learn from other cultures
• Helps in the marketing of products from one culture to a different culture
Resistance to Change
Cultures change gradually with resistance to changes. The resistance varies inversely with the interest a society has in the change. Culture doesn’t resist change if the product is a status-valued imported item, a fashion item, or is given the advantage of inferior feelings about local products. Marketers can expect resistance to their products, with greater resistance to those products with the greatest deviation from the cultural norm or status quo.
Examples of cultures that resist change:
1. Working women in Masculine societies like Saudi Arabia
2. Acceptance of genetically modified foods (or “Frankenfood”) in Europe
Planned and Unplanned Cultural Change
• Cultures that are resistant to change represent a major hurdle in marketing products
Cultural change can be accomplished by:
• First, determine which cultural factors conflict with an innovation, thus creating resistance to its acceptance
• Second, change those factors from obstacles to acceptance into stimulants for change
• Third, marketers can cause change by introducing an idea or product and deliberately setting about to overcome resistance and to cause change that accelerates the rate of acceptance
• Firms can use a strategy of planned change by deliberately changing those aspects of the culture offering resistance to predetermined marketing goals, e.g., introducing western foods and baseball into Japan
Three cultural change strategies
There are three strategies.
(a) Culturally congruent strategy: The culturally congruent strategy involves marketing products similar to ones already on the market in a manner as congruent as possible with existing cultural norms, thereby minimizing resistance.
(b) Strategy of unplanned change: A strategy of planned change means deliberately setting out to change those aspects of a culture most likely to offer resistance to predetermined marketing goals.
(c) Strategy of planned change. The strategy of unplanned change consists of introducing an innovation and then waiting for an eventful cultural change that will permit the culture to accept the innovation.
The essence of unplanned change lies in the fact that the marketer does nothing to accelerate or help to bring about the necessary change where the marketer deliberately sets about to overcome resistance and to cause change that will accelerate the rate of adoption of his product or innovation.
Importance / Marketing Implications of culture
1. A successful marketer must be a student of culture. Culture is pervasive in all marketing activities— in pricing, promotion, channels of distribution, product, packaging, and styling
2. Understanding culture can determine success or failure in international marketing
3. Universal aspects of the cultural environment represent opportunities to standardize elements of a marketing program
4. The importance of “cultural empathy” to the foreign marketer is that being culturally sensitive allows him or her to objectively see, evaluate, and appreciate another culture. A marketer can obtain cultural empathy by studying the culture and living with it. The latter is not always possible, and it may be expedient to hire natives who speak your tongue and their own. This procedure will often give you the intuition which is necessary for success.
5. Markets are the result of the triune interaction of a marketer’s efforts, economic conditions, and all other elements of the culture.”: This statement emphasizes the point that markets evolve out of the interrelationship of three major factors. They are a marketer’s efforts, economic conditions and all the other elements of the culture. Marketers are constantly in the process of adjusting their efforts to cultural demands of the market, but they are also agents of change whenever the product or idea being marketed is innovative. Whatever the degree of acceptance and whatever level of culture, the use of something new is the beginning of cultural change and the marketer becomes a change agent. This statement is important because it emphasizes the fact that the marketer is not a passive influence in a culture and that, while the marketer attempts to react to cultural demands, in so doing the marketer also influences cultural change.
6. Resistance to cultural change will affect new product introduction in the respect that the greatest resistance will confront products which are farthest from the status quo, but this resistance can be lowered by gaining public interest. Lowering resistance in this situation means shortening the duration of the resistance. Domestic marketing is subject to the same resistance to change. Examples of this resistance in the domestic market are the introduction of contact lenses and using motorcycles as an acceptable means of recreation.
7. Understanding troublesome problems caused by language in foreign market: differences in tongues, the idiomatic interpretations mean something different
8. Improved communications have contributed to a convergence of tastes and preferences in a number of product categories
– Information resides in context
– Emphasis on background, basic values
– Less emphasis on legal paperwork
– Focus on personal reputation
– Saudi Arabia, Japan
– Messages are explicit and specific
– Words carry all information
– Reliance on legal paperwork
– Focus on non-personal documentation of credibility
- Switzerland, US, Germany
9. Marketer as a change agent
Whether or not the marketer is aware of it, he assumes the role of a change agent when he introduces into another culture new ideas or new products requiring some form of change in behavior for acceptance and use of the new idea or product. The international marketer must concern himself with the impact of his actions upon the new culture.
Cultural Factors of various countries
1. Never touch the head of a Thai or pass an object over it
The head is considered sacred in Thailand.
2. Avoid using triangular shapes in Hong Kong, Korea and Taiwan. It is considered a negative shape.
3. The number 7 is considered bad luck in Kenya, good luck in the Czech Republic and has a magical connotation in Benin.
4. The number 10 is bad luck in Korea.
5. The number 4 means death in Japan.
6. Red represents witchcraft and death in many African countries.
7. Red is a positive color in Denmark.
Cultural analysis for a potential market: Steps to be followed
a. Material Culture
1. Technology – the techniques and “know-how” of producing material goods.
2. Economics – the employment of capabilities and the results.
b. Social Institutions
1. Social organizations – family life, status, age.
2. Education – literacy and intelligence and how informed the public is.
3. Political structures – control over business.
c. Man and the Universe
1. Belief systems – how do these affect product and promotional acceptance?
1. Graphic and plastic arts – degree of modernization.
2. Folklore – superstition, tradition, etc.
3. Music, drama, and the dance – promotional possibilities.
Innovations: functional or dysfunctional.
The consequences of diffusion of an innovation may be functional or dysfunctional depending on whether the effects of the social system are desirable.
A dysfunctional innovation is one where the effects within the social system are undesirable.
A functional innovation is one where the effects within the social system are desirable (ie. there would be no dysfunctional consequences).
Eg. The introduction of condensed milk to the diet of babies in underdeveloped countries where protein deficiency is a health problem. On the surface it would appear that the consequences of the addition of condensed milk to the diet would result in better nutrition and health, stronger and faster growth, etc. However, evidence tends to indicate that in at least one situation there were dysfunctional consequences of the innovation. Instead of health benefits, a substantial increase in dysentery, diarrhea, and a high infant mortality rate resulted.