Cultural Distance Measurement And Its Impact Marketing Essay

Cultural Distance Measurement And Its Impact Marketing Essay In todays globalised world economy, the nations are becoming extremely cross-cultural. A better understanding of global consumer culture and its influences on consumer behaviour will play an integral role for both international marketers and consumer researchers to penetrate new international markets. The role of cultural difference in the present cross-cultural environment is taken into consideration for localizing marketing strategies (Kroeber and Kluckhohn, 1952). The designing of international marketing strategies and understanding the local market cultures is a challenge for new consumer researchers to understand and analyse the needs of foreign consumers. It is essential to understand the aspects of cultural dimensions to assess the impact of culture on consumer decisions, as the culture tends to manipulate the decisions of the consumer based on cultural value system (Akaka and Alden, 2010). This cultural value system acts as a guide for interactions within the members of the s ociety and between the consumer and its products. What is culture? According to Hofstede (2001), the culture is defined as, the collective programming of the mind which distinguishes the members of one group or category of people from another. This definition focusses on the etic approach, where the researchers look for universal or culture free concepts and its theories. However, the emic methodology is an alternative approach focussing on the subject being researched and understanding its issues. Culture is defined emically as, the lens through which all phenomena are seen. It determines how these phenomenas are adopted and assimilated Luna and Gupta (2001). In fact, there are several models of culture differences which are utilized to determine the framework of culture in shared groups or in a group acting as an interpretive model of consumer behaviour. This paper evaluates the culture dimension models proposed by Hofstede (2001) and House (2004) and the impact of different cultures in global consumer market. Some people may argue that culture is a shared idea, yet with different value sets, influenced by cross cultural beliefs. Within the reality of intercultural communication, the behavioural pattern followed by one society is integral to the basic concept of culture (McSweeney, 2002). Hofstede categorized culture into five different dimensions such as power distance, individualism/collectivism, uncertainty avoidance, masculinity/feminity, and long term/short term orientation. The market researchers implemented Hofstedes cultural dimensions to the communications related to digital technology. Javidan et al. (2004), for instance, recognized individualism/collectivism which is one of the cultural dimensions proposed by (Hofstede, 2001), through a text based transcript of courses listserv (University online portal). They noticed that students from individualist culture behaved differently than the students from collectivist culture while communicating in listserv. The white American students, especially males were discovered to be more individualistic in their approach as compared to the Asian students who were more group oriented displaying a strong sense of we approach in their messages. This study showed that organizational communication through internet authenticated the influence of different cultural traits on the students behavioural pattern, belonging to different national cultures. Furthermore, Chiou (1999) conducted market research in the United States and Taiwan which resulted into findings that consumers in individualist cultures used products to demonstrate thei r inner values, while in collectivist cultures the consumers were more influenced to utilize the product to reinforce the social relationships. In an international public relations situation, the presence of power distance factor was also confirmed by other researchers, where power distance played an integral role in terms of product crisis. For example, the Coca Cola tainting crisis in Belgium in 1999. The product was recalled as the consumers complained about the irregular taste and odour in the bottled products. Due to Symptoms of reported illness, the Belgian Health Ministry banned the products of the Coca Cola Enterprise. Approximately, 15 million cans and tinned products were recalled. The CEO of Coca Cola apologized to the Belgian Health Ministry, and posted notes in newspapers and addressed consumers through media. On 22nd June 1999, the Belgian Health Ministry lifted the ban on Coca Cola Enterprise, and the company provided premiums to 72,000 consumers (Johnson Peppas, 2003). This case exhibits high level of power distance between the government and the consumers, which demonstrates a strong response to the crisis as compared to the countries that exhibits low power distance. On the other hand, Steenkamp et al. (2001) studied the effect of national culture on shaping consumer perceptions. He argues that the relationship between the conceptual definition of Hofstedes dimension and its implementation to measure cultural dimensions is weak and unclear. The scores are based on the samples recorded from IBM employees, which do not represent their own country in the research. This model can be implemented in small scale industries and less developed countries. In addition, he also states that Hofstedes research is more focussed on work related values which makes the data time and context specific. Similarly, McSweeney (2002) argues that Hofstedes research displayed narrowness of the survey conducted on population limited to one organisation IBM. Although the survey was conducted in 66 countries where IBM subsidiaries were located, the data used to build national culture comparisons was considerably limited to feedbacks from sales-plus marketing employees of IBM. The survey was matched on an occupational and organisational basis which neglected the fact of the employees, which could display the extent to which they can represent their nationality and their respective cultures. The sense of clarity in Hofstedes research with respect to national culture is unclear. Average tendency depending on questionnaire responses from the employees in a single company, failed to justify Hofstedes claim that national average tendency of consumers matches the average tendency of the people in the cross cultural environment. On the other hand, another research programme came into existence which categorized culture into nine major dimensions such as uncertainty avoidance, power distance, institutional collectivism, in-group collectivism, gender egalitarianism, assertiveness, future orientation, performance orientation, humane orientation and six primary global factors for leadership behaviour (House et al. 2004). Project GLOBE (Global Leadership and Organizational Behaviour Effectiveness) mainly focussed on the performance of leadership behaviours in different cultural contexts (House and Javidan, 2004). This project determined culture into two distinct types: cultural values and its practices. According to House et al. (2004), firstly, societal culture might influence an implicit belief which creates a CLT (cultural leadership theory). Secondly, leadership behaviour and attributes is directly influenced by societal culture. Thirdly, leader behaviours and characteristics leads to leader acceptance and effectiveness, however this interconnection is guided by CLT. The GLOBE dimensions of culture are applicable at both the societal or organisational level. For instance, feminine values are more developed in Japanese culture as compared to masculine values. Emotions and sensitivity plays an important role in Japanese marketing. For example, in Japan the wife decides how much money her husband can spend on his daily expenditures (Tanouchi, 1983). This factor can manipulate the buying behaviour of the husband. This society exhibits higher scores on gender egalitarianism practices as women is in the position where she has authority over her male counterpart, and societies where the scores are low (e.g. India, Kuwait, Egypt) the involvement of women in decision making is low. No society can be depicted as true egalitarian society where we can discover equal opportunities for men and women. Furthermore, future orientation is also one of the dimensions of culture discussed by House in his GLOBE project, where it demonstrates a cultural trait of individuals in societies involved in future planning and investment (Ashkanasy et al., 2004). For example, Intel, the worlds leading manufacturer of microprocessors is planning to enter the mobile phone market. Its investment and planning is based on its competence of developing and designing of smartphones which can be used more like a computer. Value added features of voice capability with faster internet access on smartphones like computers using Intels low power atom microprocessors. Based on this new technology, Intel is hoping to become a major player in the field of mobile communications (Jobber, 2010). This case exhibits low scores on the aspect of future orientation culture dimension proposed by House (2004). Intel wanted to invest on the technology to achieve market share and gain profit in the current market situation. The degree to which individual or the organisation has the propensity to save for the future requirements that society scores high on the future orientation dimension of culture According to recent study, Okazaki et al. (in press) scrutinized how soft sell versus hard sell techniques of advertising was interpreted by Japanese versus Unites States consumers. Using performance orientation and assertiveness which are two dimensions of culture in GLOBE study, it assessed the effectiveness of the ads in two societies. The results showed a variable response across the two cultures. The hard sell approaches are more persuasive for American consumers while soft sell advertising approaches are more favourable for Japanese consumers. This study shows that US consumers are more assertive and believe in performance oriented values. On the other hand, Japanese consumers are more likely to achieve irritation by hard selling ads because the ads were perceived as too aggressive, and too achievement oriented. This study exhibits multiple dimensions of GLOBE such as assertiveness and performance orientation. It also provides an idea about the perspective of advertising consid ering different culture practices and values. By the above mentioned interaction models proposed by (Hofstede, 1980b) and (House, 2004), culture can be segmented into cultural values and practices, corresponding to consumer behavioural pattern influenced by their own culture. The cultural difference need to be identified in the global marketing situation, because it gives an idea of understanding local cultures which authenticates a deeper understanding of consumption pattern in a specific situation. The understanding of culture distance also helps to build a relationship between the product or service and the consumers. Failure in understanding culture difference may lead to catastrophic ramifications. For example, Halal meats in fast food outlets. Halal is an Arabic word which means lawful, which denotes that animal, should be slaughtered by a Muslim and invokes the name of Allah as the animal, dies. Belgium has the largest Halal meat processing plants as the number of Muslim population is increasing in the European region. The fast food outlet such as McDonalds, KFC therefore has halal certification where there is low risk of contamination from pork products. Due to which fast food business has established quickly and is a growing trend in the Middle East. Saudi Arabia accounts of 15% of food sales through fast food business which has grown over the last 5 years. (Usunier and Lee, 2005, p. 279). Similarly in countries like Malaysia, for example, fast food outlets such as Pizza Hut and KFC are advised by Syariah council to ensure that all overseas food supply and food production is Halal meat. The fast food companies identified the cultural importance and its difference with respect to Muslim traditions, and to attract the Muslim consumers they started with the Halal system, and posted notes and hoarding in front of the outlets which said that they follow the tradition of Halal meat. As a result, fast food outlets identified the cultural difference and gained market share in the global food sector. Another example which demonstrates cultural difference playing an important role in manipulating consumer behaviour is in the womens beauty sector. This sector consists of segments which provide brands with immense of opportunities to target specific groups. LOreal, for example, with its tag line Because youre worth it targets women who believe that they deserve to be self indulgence and pampering. Such niche targeting has made the brand into one of the leading players in the cosmetic market. However, on the other hand, Unilever entered the beauty market but chose not to compete with LOreal directly. Alternatively, it categorized women into different belief segments who oppose against beauty stereotypes. Dove promoted its product with its Campaign for Real Beauty where images of women do not match the tall, thin and young category. The brand created a different belief system by promoting workshops to help young girls with body related low self esteem. Dove successfully created a democratic view in the mind of the consumers about beauty and identified the market segment by tapping the women culture based on beliefs. Implementation of this strategy led Dove to be a major player in this market segment (Jobber, 2010). Consumer electronics market on the other hand is typically culture free product segment as they are more technologically based product or service and universally used. Here, the culture context acts lower priority and consumer behaviour is similar with respect to cross-national environments (Usunier and Lee, 2005). However, there is an exception in developing countries in which consumer electronic goods are bonded with culture. For example in China, owning a colour TV is a requirement to marriage and they sometimes are willing to wait so that they are able to afford the best colour TV to display the social status before marriage. Sony Corporation took advantage of this culture system and launched 3D LED BRAVIA Colour TV in China. Owning this TV in China is considered to be respectful and wealthy. Sony tapped the Chinese market with Japanese technology which favoured the organisation to create a brand image and now it is one of the major consumer brands in China in terms of television and music industry (Usunier and Lee, 2005) Some organisations tend to enter the niche market by targeting a specific group of culture. For instance, Nike produces wide range of sports equipments and follows the hip hop culture and the youth culture to persuade consumers to buy their fashionable products. For market penetration, Nike signed contracts with famous professional teams and athletes casting them in their advertisements and persuading young generation to buy the same product as their sports ideal is utilizing them. Nike targeted the sporting culture in young generation who care more about the utility and quality of the product rather than price. This strategy provides them a huge platform to position their product in the consumer market. Athletes are the main consumers of Nike products. This sporting company segmented the market according to the consumers sporting culture; this strategy helped Nike to build product intimacy with the consumers and persuaded them to purchase the product by associating the brand with high profile athletes like Michael Jordan. The recognition of distinct sporting culture in the consumer market led Nike to be the leading company in the world to provide sporting goods (www.articlebase.com) To conclude, it has been observed that culture plays an integral role in consumer behaviour. The marketers adapt and standardize their product according to the culture, so that they can segment, target, and position their product in a specific group or in the market as a whole. The organisations who failed to identify the cultural distance in consumers, struggled with the concept of brand positioning in the global market situation. Cultural difference can be reduced by analysing the local environment and practices to create a brand relationship between the product and the consumers. The brand adoption process of a consumer is influenced by personal value and expressions in their purchase. The individuality of the consumers affects the brand value and their perceptions about the brand. The concept of Glocalisation where Globalisation meets Localisation is essential in order to help the marketers to customize their global brands according to the local needs and suit the local cultures. One of the most important culture bound tool of marketing mix is advertising. It is the strongest link between the companies and its consumers in marketing communications. The words and images used in advertising can influence the consumer in terms of his culture, as the advertising campaign does not depends on particular country or region. This strategy can create an impact on global consumer culture at a considerable extent provide the message is interpreted in the way What is said and How it is said by the brand. In this case, as mentioned above, the brands such as Sony, McDonalds, KFC, and Nike identified the global consumer culture and their trends which patronized them to create a brand image in the minds of the consumers. In addition, they also created a brand relationship whic h corresponds to the global consumer culture by global marketing operations.