09-Jun-12

International Marketing
14th Edition
P h i l i p R. C a t e o r a
M a r y C. G i l l y
John L. Graham

Cultural Dynamics in Assessing

Global Markets
Chapter 4

McGraw-Hill/Irwin
International Marketing 14/e Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

What Should You Learn?

• The importance of culture to an international
marketer
• The origins and elements of culture
• The impact of cultural borrowing
• The strategy of planned change and its
consequences

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The International Marketing Task

Foreign environment
(uncontrollable)
Political/legal 1 Economic
forces forces
Domestic environment
(uncontrollable)
2
7 Competitive
Political/
legal (controllable) structure Competitive
Cultural Forces
forces
forces Environmental
Price Product
uncontrollables
7 3 country market A
Channels of
Promotion Environmental
distribution
6 uncontrollables
country
market B
Geography Level of
Economic climate Technology Environmental
and
Infrastructure uncontrollables
4 country
5
Structure of market C
distribution
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Global Perspective Equities

Culture Gets in the Way
• Culture deals with a group’s design for living
• The successful marketer clearly must be a
student of culture
• Markets are the result of the three-way interaction
of a marketer’s
– Economic Conditions
– Efforts of Company's marketers
– Elements of Culture
• The use of something new is the beginning of
cultural change
– The marketer becomes a change agent

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Culture’s Pervasive Impact

• Culture affects every part of our lives, every day, from
birth to death, and everything in between

• As countries move from agricultural to industrial to

services economies’ birthrates decline

• Culture not only affects consumption, it also affects

production

4-4

Definitions and Origins of Culture

• Traditional definition 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
• Humans make adaptations to changing
environments through innovation
• Individuals learn culture from social institutions
– Socialization (growing up)
– Acculturation (adjusting to a new culture)
– Application (decisions about consumption and production)

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Origins, Elements,
and Consequences of Culture

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Do You Like Flowers? – Why?

• Geography
• History
• Technology and economics
• Social institutions
• Cultural values
• Aesthetics as symbols

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Do You Like Flowers? – Why?

For the Dutch, flowers are more important than
just beautiful colors. For them, it's more like a
national fascination.

Geography – the rivers and the bays make the

Netherlands a great trading country. The vibrant
colors of tulip first came to Europe from the
Ottoman Empire on a Dutch ship in 1561.

Economics – Tulip trade became international for

the Dutch. The Dutch remain the largest exporters
of flowers (60% global market share).

Cultural Values – the high value the Dutch place

on flowers is reflected in many ways, not the least
of which is their high consumption rate. 4-12

Patterns of Consumption
(annual per capita)

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Elements of Culture
• Cultural values
– Power Distance Index (PDI)
• focuses on authority orientation
– Individualism/Collectivism Index (IDV)
• focuses on self- orientation
– Masculinity/Femininity Index (MAS)
• focuses on assertiveness and achievement
– Uncertainty Avoidance Index (UAI)
• focuses on risk orientation
– Other Cultural Values and Consumer Behavior PDI
IDV
MAS
UAI
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Elements of Culture
Why Korean Air had more plane crashes than other airlines?
• Korean Air had more plane crashes than almost any other
airline in the world for a period at the end of the 1990s. When
we think of airline crashes, we think, Oh, they must have had
old planes. They must have had badly trained pilots.

• No. What they were struggling with was a cultural legacy, that
Korean culture is hierarchical. You are obliged to be deferential
toward your elders and superiors in a way that would be
unimaginable in other cultures.

• But Boeing and Airbus design modern, complex airplanes to be

flown by two equals. That works beautifully in low-power-
distance cultures, where hierarchies aren't as relevant. But in
cultures that have high power distance (PDI), it’s very difficult.

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Hofstede’s Indexes
Language, and Linguistic Distance

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CEO Compensation to Avg. Employees

as an indication to PDI

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Wage Gap Between Men & Women

as an indication for the MAS

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Cultural Knowledge
• Factual knowledge
– Has meaning as a straightforward fact about a culture
– Assumes additional significance when interpreted within the
context of the culture
► Needs to be learned

• Interpretive knowledge
– Requires a degree of insight that may best be described as a
feeling
► Most dependent of past experience for interpretation
► Most frequently prone to misinterpretation
► Requires consultation and cooperation with bilingual natives with marketing
backgrounds

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Cultural Sensitivity and Tolerance

• Being attuned to the nuances of culture so that a
new culture can be viewed objectively, evaluated
and appreciated
– Cultures are not right or wrong, better or worse, they are simply
different
– The more exotic the situation, the more sensitive, tolerant, and
flexible one needs to be

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Cultural Change
• Dynamic in nature – it is a living process
• Paradoxical because culture is conservative and
resists change
– Changes caused by war or natural disasters
– Society seeking ways to solve problems created by changes in
environment
– Culture is the means used in adjusting to the environmental and
historical components of human existence

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Cultural Borrowing
• Effort to learn from others’ cultural ways in the
quest for better solutions to a society’s particular
problems
– Imitating diversity of other makes cultures unique
– Contact can make cultures grow closer or further apart
• Habits, foods, and customs are adapted to fit
each society’s needs

4-24

Similarities – An Illusion
• A common language does not guarantee a similar
interpretation of word or phrases
– May cause lack of understanding because of apparent and
assumed similarities
• Just because something sells in one country
doesn’t mean it will sell in another
– Cultural differences among member of European Union a product
of centuries of history

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Resistance to Change
• Gradual cultural growth does not occur without
some resistance
– New methods, ideas, and products are held to be suspect before
they are accepted, if ever
• Resistance to genetically modified (GM) foods
– Resisted by Europeans
– Consumed by Asians
– Not even labeled in U.S. until 2000

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Planned and Unplanned

Cultural Change
• Determine which cultural factors conflict with an
innovation
• Change those factors from obstacles to acceptance into
stimulants for change
• Marketers have two options when introducing and
innovation to a culture
– They can wait
– They can cause change
• Cultural congruence
– Marketing products similar to ones already on the market in a
manner as congruent as possible with existing cultural norms

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Consequences of Innovation
• May inadvertently bring about change that affects very
fabric of a social system
• Consequences of diffusion of an innovation
– May be functional or dysfunctional
► Depending on whether the effects on the social system are desirable or undesirable

• Introduction of a processed feeding formula into the diet

of babies in underdeveloped countries ended up being
dysfunctional

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Thank You
@RamyKhodeir

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