Fletcher 4e PPT Ch03

Fletcher & Brown: International Marketing 4e © 2008 Pearson Education Australia

Chapter 3

Catering for the Cultural and Social Environment of International Business

Fletcher & Brown: International Marketing 4e © 2008 Pearson Education Australia 2

Objectives

– Appreciate the impact of culture on international marketing

– Apply key cultural concepts when evaluating international marketing situations

– Evaluate the ways in which cultural differences impede international communications

– Undertake cross-cultural analysis and comparison

– Recognise the need for cultural sensitivity when preparing for and conducting international negotiations


Introduction

– No single accepted definition of culture

– Indicative definitions of culture

– ‘Culture is the total way of life in a society’ (Fletcher, 1979)

– Culture is the collective programming of the mind (Hofstede, 1980)


Introduction

– Culture encompasses a number of broad dimensions. Culture is:

– Prescriptive– Learned– Dynamic– Subjective– Shared

– Three key elements of culture– Language and communications systems– Material culture and artefacts– Values and belief systems


Impact of Culture on International Marketing

– Conditions needs and wants of potential buyers

– Impacts on the way messages are received and interpreted

– Pervades all elements of the marketing mix


Culturally Related Factors which Influence Marketing

– Knowledge– Factual or interpretive

– Sensitivity– View cultural nuances objectively

– Collectivism– Role in decision making

– Social conventions– Reflection of culture

– Cognitive styles– Loyalty, involvement, risk


Cultural universals

– Some common traits in all cultures include:

– The physical world

– The social environment

– The emotional setting

– However, the way these universals are reflected in each culture may differ


Elements of culture

– To understand customers you need to understand their cultural heritage, which has developed over time

– Need to study the elements of culture– Material culture - technology and economics

– Social institutions - concerned with the way people relate to each other

– Relations with the universe - religion, superstition, and impact on value systems

– Aesthetics - activities and art forms

– Language - differ in the way they convey meanings


Expressions of Culture

– Symbols – Words, gestures, objects or pictures that are

recognisable and have specific meaning

– Heroes– People who possess the qualities highly

prized in that culture

– Rituals– Collective activities that are an essential

element of social activities


Expressions of Culture


Culture as a Collective Fingerprint

– A mark of identity not superiority

– It is dynamic in nature

– There exists resistance to change

– Elements of culture impact differently on different aspects of the marketing program


Levels at which Culture Operates

– National - values in which institutions are based

– Industrial - values and norms of industry

– Organisational - general business patterns of firms


Cultural Concepts and Cultural Differences

– Key Cultural Concepts

– Maslow’s Hierarchy of Needs - how consumers respond to cultural stimuli

– Self-reference Criterion - develop awareness

– High and low context cultures - verbal versus non-verbal cues

– Psychic Distance - factors that differentiate the foreign market from the home market


Cultural Concepts and Cultural Differences (cont.)

– Key Cultural Differences

– Time - assumptions about time vary across cultures

– Space - can be both physical and abstract

– Language - precision versus ambiguity

– Familiarity - friendship patterns

– Consumption patterns - material possessions and dress

– Business customs - bribery


Culture & Communication

– Verbal communication

– Who communicates the message and to whom

– What message is communicated

– How the message is communicated

– Where the message is communicated

– When the message is communicated

– Why the message is communicated


Culture & Communication (cont.)

– Non-verbal communication

– Body stress signals

– Lower body signals

– Body posture signals

– Random gestures

– Facial expressions


– Cultural adaptation

– Open tolerance

– Flexibility

– Humility

– Justice/fairness

– Adjustability to varying tempos

– Curiosity

– Knowledge of the country

– Liking of others

– Ability to command respect

– Ability to integrate into the environment




– Cultural Adaptation and Communication

– Adaptation involves affirmative acceptance not just tolerance of another culture

– Three categories of business customs– Cultural imperatives: customs that must be

accommodated and conformed to

– Cultural options: conformity is not compulsory but will enhance relationships

– Cultural exclusives: customs which it would be inappropriate for a foreigner to participate in


Cross-Cultural Comparisons

– Measuring culture on a global basis – Hofstede (1980) & Hofstede & Bond (1988)

– Five underlying dimensions to measure cultural differences across countries

– 1. Power Distance

– The degree to which inequality is accepted

– High in countries that let inequalities grow into inequalities of power and wealth

– Low in countries that play this down


Cross-Cultural Comparisons (cont.)

– 2. Uncertainty Avoidance

– Degree to which people feel threatened by uncertain or unknown situations

– High: places premium on job security, career patterns, rules, trust

– Low: greater willingness to accept risks, & less emotional resistance to change


– 3. Individualism Vs Collectivism

– The extent to which people in a culture look after their own interests and those of their immediate family, and ties are loose

– Individualism: ties are loose, achievements valued

– Collectivism: groups, ties are tight, people born into collectives



– 4. Masculine & Feminine

– Relationship between gender & work roles

– Masculine cultures: strong minded, individualistic, assertive

– Feminine cultures: modest, relational, concerned with quality of life



– 5. Long-term Vs Short-term Orientation

– Long-term - thrift, perseverance, trust

– Short-term - chase immediate returns, competitive, opportunism, price focus



Cultural Difference Dimensions (Trompenaars)

– Universal v particularism

– Individualism v communitarianism

– Neutral v affective

– Specific v diffuse

– Achievement v ascription


Approaches to Cultural Difference

– Two key approaches

– Etic approach : based on the notion that underlying cultural differences between nations are a set of variables that can be applied uniformly and which cover all dimensions of difference

– Emic approach : values and differences are culturally specific and not able to be reduced to common dimensions


Example: Chinese Emic Values

– Guanxi (relationships)

– Mianzi (prestige, face)

– Renquing (favour)

– Bao (reciprocity)


Social Aspects of the Conduct ofInternational Marketing

– Social sensitivity

– Good corporate citizenship

– Economic citizenship

– Legal citizenship

– Ethical citizenship

– Discretionary citizenship


Culture & International Negotiation

– Cultural differences make negotiations more complex in International Marketing

– Iceberg principle

– Culture and conduct of negotiations

– Different approaches to thinking

– Self-esteem, face, hierarchy

– Value systems

– Appropriate degree of formality

– Harmony & emotion


Preparing for International Negotiation

– The key components when preparing for international negotiations are:

– Your strategy

– Use a culturally sensitive approach

– The composition of the negotiating team

– Numbers, status, interpreter, tasks, deployment

– Research the context of negotiations

– The other negotiating team, the competition, possible alternative approaches


Stages in International Negotiation

– 5 major stages

– 1. Pre-negotiation stage– Composition of negotiation team, formulate objectives,

strategies, assess expected context of negotiations and likely problem areas

– 2. Opening stage– ‘Getting down to business’ versus trust building, check

understandings, information requirements of the parties


Stages in International Negotiation (cont.)

– 3. Bargaining stage– Requires the application of the negotiation strategy and

identification of the speed with which negotiations should develop

– 4. Concession and agreement stage– Influenced by contrasting culture, norms that influence

styles of negotiation

– 5. Post-negotiation stage– Be aware of cognitive dissonance and the need to

provide extra (or unexpected) concession(s), and also the practice of ‘nibbling


The Atmosphere of International Negotiations

– Degree of mutual orientation

– Feelings toward the other party

– Openness versus secrecy

– Willingness to make cultural adjustments

Fletcher 4e PPT Ch03

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