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Cultural Dynamics in Assessing Global Markets

Cultural Dynamics in Assessing Global Markets. Chapter 4. Importance of Culture to International Marketing Efforts. “Culture gets in the Way” eBay example Japan’s cultural ideas about selling “castoffs” and buying from strangers (garage sales)

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Cultural Dynamics in Assessing Global Markets

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  1. Cultural Dynamics in Assessing Global Markets Chapter 4

  2. Importance of Culture to International Marketing Efforts • “Culture gets in the Way” • eBay example • Japan’s cultural ideas about selling “castoffs” and buying from strangers (garage sales) • France has laws restricting operations except to a few “government-certified auctioneers” • Importance of Culture • Successful businesses must be open to the learning of cultures of different countries • Culture effects every part of marketing (pricing, promotion, placing distribution, packaging…)

  3. Definition of Culture • Definitions of Culture: • Authors definition: “the sum total of knowledge, beliefs, art, morals, laws, customs and any other capabilities and habits acquired by humans..” • Geert Hofstede: culture as the “software of the mind… provides a guide for humans on how to think and behave” • Edward Hall: cultural differences are invisible and that if marketers ignore them it often hurts both companies and careers.

  4. Exhibit 4.4 “Origins, Elements, and Consequences of Culture • Adaptation occurs through • Socialization,Acculturation & Adaptation: • Through growing up and adjusting to new cultures • Origins of culture come from • Geography ( ex. climate connection to GDP) • History • Political Economy • Technology • Social Institutions (family, religion, school, media government corporations

  5. Exhibit 4.4 “Origins, Elements, and Consequences of Culture • Geert Hofstede 4 dimensions of Culture (exhibit 4.5 pg. 105) • 1. Individualism/Collectivism Index (IDV) • Scores High in IDV reflect more individualistic behaviors (U.S., Australia, Great Britain) • 2. Power Distance Index (PDI) • Measures the power between superiors and subordinates within a social system • Higher PDI scores are hierarchical (Arab countries, Guatemala, Mexico, Venezuela) • Tend to have general mistrust of others

  6. Exhibit 4.4 “Origins, Elements, and Consequences of Culture • Geert Hofstede 4 dimensions of Culture (exhibit 4.5 pg. 105) • 3. Uncertainty Avoidance Index (UAI) • Measures tolerance of uncertainty and ambiguity • Higher UAI scores mean intolerance of ambiguity and distrust new behaviors and ideas (Japan, France, Greece) • 4. Masculinity/Femininity Index (MAS) • Focuses on assertiveness and achievement • Proven least useful in measuring values within cultures

  7. Elements of Culture • Rituals • Patterns of behavior and interactions that are learned • See Crossing Borders 4.1 pg. 107 (“It’s Not the Gift That Counts, but How You Present it”) • Symbols • Language (exhibit 4.5) • Aesthetics (art, folklore, music, drama and dance) • Beliefs • Myths, superstitions, or other cultural beliefs • Thought Processes

  8. Cultural Knowledge • 2 Types of Cultural Knowledge • 1. Factual knowledge • Straightforward fact about a culture • See Crossing Borders 4.3 pg. 113 (“Gaining Cultural Awareness…”) • 2. Interpretive knowledge • Feeling that requires some insight as to how a culture exists • It is dependent upon experiences and can lead to incorrect conclusions when using (SRC) • Cultural Sensitivity and Tolerance • Successful International marketing companies are sensitive to differences in cultures and view them objectively

  9. Cultural Change • “Cultural Borrowing” • Countries often times “borrow” the solutions from other cultures and countries that have experienced similar types of issues and problems • Similarities can be an Illusion: • Need to be careful borrowing from other cultures where differences may be so subtle that the international marketer overlooks very important information

  10. Cultural Change • Resistance Change • Cultures will accept or resist change based on how disruptive the change • Planned & Unplanned Cultural Change • International Marketers have two options when introducing new products/services to a culture • 1. They can wait for the change to occur • 2. They can cause the change • McDonald’s example in Japan

  11. Cultural Change • Consequences of Innovation or Change • International Businesses can bring about functional or dysfunctional change • When product diffusion occurs, social change may also take place as a result of the acceptance of that product • Businesses do not intend to bring dysfunctional change, but it can happen • Nestle example in Nicaragua

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