Multicultural Marketing2nd Session

Cross culture consumer behavior & Local Consumer and Globalization of Consumption

Cross-Cultural Consumer Behavior Universal or Specific Consumers? Culture and Consumer behavior

Hierarchy of Needs (Maslow) Culture Based Values Institutions, social conventions, habits, and customs

The Influence of Culture on selected aspects of consumer behavior Loyalty Consumer Involvement Perceived risk

Marketing as an exchange of “Meanings”

Is consumer behavior universal or specific to its group

• One view is that all consumers can be approached as being similar• Everyone gets hungry, they sleep, eat breakfast… etc

• 2nd perspective is that all consumers have adapted foreign traits• McDonalds in Kuwait, Japan

• 3rd is that consumers (a) of a certain ethnicity have modified consumption patterns in those countries (b) and some ethnic products have reached world class status by being adopted in most countries

• Asian cuisines (Sushi)• The 4th is the opposite of Global PerspectiveMarketing is a process involving communication and exchange: consumers buy meanings as well as objects.

Hierarchy of Needs

Physiological

Safety

Esteem

Social

Selfactualization

• Rank order?• Criteria for satisfaction?• Needs vs. Desires• Economic influences?

Culture and Consumer Behavior Hierarchy of needs is not true in every culture

In some economies, people focus more on basic survival needs Hindu culture encourage the need for self actualization without

materialistic desires

Individualism and Collectivism Does an individual makes his own decision or is he/she

influenced socially (shared / social intentions) Korean students have lunch together or go to the same college

abroad. (Obligation to belong to a certain group) Asian families restrict autonomous behavior amongst their

children Independent / Interdependence

Be Yourself (More western culture based value) Affect on marketing studies – Impulse buying, consumption patterns,

emotional appeal.

Culture and Consumer Behavior Institutions: The State, the Church and Trade

Unions French Catholic hierarchy has generally opposes to

Sunday trading. German trade unions oppose an extension of

opening hours. Stores at 2 p.m. on Saturdays Closed on Sundays. The result is that many German consumers must shop

quickly on Saturday mornings. Catalogue-based mail order and online shopping are

good substitutes As a result, mail order sales are highly developed in

Germany such as Neckermann, Bertelsmann and Quelle.

Culture and Consumer Behavior Social conventions, habits and customs:

Other products are in a sense institution dependent, whatever their mode of distribution or consumption: Marriage-related goods such as a wedding dress or the

products featured on wedding lists, or many kinds of traditional gift that are offered for specific occasions

Eating habits ‘Food is both substance and symbol; providing both

physical nourishment and a key form of communication that carries many kinds of meanings.’

Cultural variations, in addition to the social interpretation of eating habits, include the following:1. The number of meals consumed each day.

2. The standard duration of a meal, and the positionof meals in the daily schedule.

Café au lait and ‘Slow Food’

Influence of Culture on aspects of CB Psychological Process

Motivation to own, buy, spend, consume, show, share, give?

Perception Perception of shapes, colours and space? (Red is lucky in Chinese)

Learning and Memory Familiarity with product classes?

Attitude Resistance to change (Resistance to FAST FOOD in France)

Decision Making Individual or social influences

Loyalty Value of certainty?

Consumer Complaint Perceptions of quality?

Influence of Culture on aspects of CB Loyalty

USA – Value Opportunity Assumed disloyal Enjoy change more than stability Price competition

Asian – Value Certainty High level of single brand dominance Rely on information from reference groups – WOM is

important Follow group consensus until proved wrong

Influence of Culture on aspects of CB Consumer Involvement

Higher in Asians with regard to purchasing for social and symbolic values (buying a car)

Low in Asians if product is for private use (Price and Quality)

Perceived Risk Can be separated to financial, physical, social risk

… etc Buying a car where road safety is not an issue (Physical

risk) petrol is cheap (financial risk) but if the car breaks down on the highway and there is no mechanic available (reliability risk)

Marketing as an Exchange of Meanings Consumers buy meanings and marketers

communicate meanings through products and advertisements. Many of the meanings in M.Exc are culture based Therefore in the process of exchange through

buyer–seller relations, marketing communications or product consumption, interpretations are made spontaneously,

The Role of Emotions in Japanese marketing Affect on sales team regarding compensation

In Japan, the husband is supposed to hand all his income over to his wife. If he doesn’t, he is criticized by people around him.

Class Group AssignmentPlease write on an A4 sheet of paper. Write all group member names clearly. Write the title as Assignment no. 1All write down the question which is below

Why can 'word-of-mouth communication' among people be considered as a fairly

robust consumer behavior concept cross-culturally?

Local Consumers &The Globalization of Consumption Free Trade

Diversity in Global Markets The Global Convergence of Consumption Patterns

At the Macro Level At Micro Level

Emergence of a Global Consumer Culture Standardized World Package McDonald-ization

Local Products and Consumption Experience Culture Bound Products Habits and Shared Meaning

Local Consumer Culture and Resistance to Change

Free Trade All countries benefit from exports and imports Cultural exchange usually happened through

trade Industries can develop around a certain product

(western pharmaceuticals) giving rise to jobs Countries that import heavily are not at a

disadvantage They can charge on duties, taxes They can provide subsidies and levies for local

importers Tax Free Economies

Allow for market entry But marketers may face difficulties in entering a

market due to competition

Free Trade Pricing

A commodity in one nation maybe a luxury item in another nation Toyota Camry in India is a luxury but in Dubai (its considered

a Taxi)

Standardization of products Voltage in USA is 110V but in other countries its 220V Halal (for Muslims) or Kosher (for Jews) products. Left hand drive Vs. Right hand drive (some people in

the world drive on the wrong side of the road) In Globalization, Diversity presents

An opportunity to create a differentiation strategy, And to gain competitive advantage

Convergence of Consumption Patterns At the Macro Level

Removing barriers to trade helps in globalization of industries

This leads to demographic convergence such as age, income, household with consumptions Wine consumption has decreased and beer consumption has

increased in the south (in France, Greece, Italy,) The opposite pattern has evolved in the north of Europe (in

Austria, Belgium, Denmark, Germany) leading to macro-level convergence

Beef consumption in Japan, traditionally a fish-eating country, has developed considerably while there has been a rise in fish consumption in traditionally meat eating countries.

In this sense, globalization increases, not decreases, diversity in everyone’s experience.

Convergence of Consumption Patterns At the micro level, researches have found culture

influences consumption patterns1. For product type durable, household and functional

products varied more by culture than non-durable, sensory and personal products.

2. For product/service category, restaurants, air travel and hair shampoo are more influenced by culture than beer, jeans, going to the cinema, soft drinks and stereos.

3. For situational frequency, time of day, where consumers shopped, the length of time and the reason varied by culture for food, but not for clothing.

4. For reasons for purchase maintenance, enjoyment and defense reasons differed by country.

Emergence of a Global Consumer Culture Standard world package

A consumer culture guides people in defining their aspirations towards a certain set of possessions. The standard US package of goods has developed into

a standard world package that includes a car and a home with electric lighting, a refrigerator and a television.

The same holds true for services, since the fast-food restaurant has become part of the standard world package.

‘Standard’ has three meanings: (1) the same for everybody; (2) the same everywhere in the world; (3) the same for alltime. e.g., Coca Cola

Emergence of a Global Consumer Culture McDonald’s (standardization) has led to globalization of

fast food through four points1. Efficiency:

The McDonaldized service offers the optimum method for getting from one point (being hungry) to another (being fed).

2. Systematic quantification and calculation: McDonald’s offers more ‘bang for the buck’ and provides its

customers with ‘value’ meals.

3. Predictability Whether in Chicago, Moscow or Tokyo, we find the same Big Mac and

French Fries. Consumers find great comfort in this predictability which reduces perceived risk.

4. Control through use of technology Rules are fairly strict and automatic systems (e.g. soft drinks or ice-

cream dispensers) control the exact quantity, in line with point 2. This also facilitates predictability by reassuring customers about the

service to be obtained from McDonald’s.

Local Products & Consumption Experience If consumer culture matters, then it is likely that consumers

will invest more meaning in products that are more bound to cultural interpretation. The question is therefore: what is more culture-free and what more

culture-bound, in terms of product and service categories on the one hand, and consumer behavior on the other?

Culture Bound Products: Some aspects to examine are

Rich (or poor) cultural context – Shopping, consuming, and disposing

Relationship to the physical environment – Climate, population, agriculture

Cultural or National identity – Use of local products and craftsmanship (Italian suits, Egyptian cotton, French fashion designers)

Language - Songs, soap operas, films and novels. Ikea uses pictures to avoid language barriers in its instruction manual

Local Products & Consumption Experience Habits and shared meanings

Habits are ways of doing and behaving that have been reinforced by authorization and gratification,

Once the programming is forgotten they appear legitimate.

Examples Kaffeetrinken

The special relationship of Germans to coffee & cakes (Kuchen) has much to do with happy hours experienced since childhood when people relax in a tight society with an internalized pressure for conforming to rules.

Drinking Beer Shape and size of beer glasses Flavor (bitterness, froth, bubbles, sweetness, alcohol levels)

End of Lecture See you after two weeks baber_mirza@hotmail.com Groups to be formed in the next session. Final Group project to be given next week