1. Multicultural Marketing ICD International Business SchoolProf: Baber MIRZAFirst Session6th March 13

2. Before we begin About your professor I like creativity with a touch of practicality Rules About the teaching style Mostly French students English will be used with simple terms About the course Material (book that I am using) You dont need to buy a book, you can use thisPowerPoint and my lecture as your notes Quizzes and Final Project Next class there will be a quiz I will also give you details about your final project in yournext class 3. Marketing and ConsumerBehavior Marketing is about creating value forthe customer The customer is influenced by manyfactors such as culture, social group,personality Culture is complex and is the target formarketers for profitable associations 4. Todays topics The Cultural Variable(Factor) inInternational Marketing The cultural process Cultural dynamics part I: Time and Space Cultural dynamics part II: Interactions,Mindsets, and Behaviors 5. PART ONETHE CULTURAL PROCESS 6. Definitions of culture Linton (1945, p. 21): A culture is the configurationof learned behaviour and results of behaviourwhose component elements are shared andtransmitted by the members of a particular society. Goodenough (1971): culture is a set of beliefs orstandards, shared by a group of people, which helpthe individual decide what is, what can be, how tofeel, what to do and how to go about doing it. 7. Sources of Culture Language(s) Nationality Education Profession Group Religion Family Sex Social class Corporate or organizational culture 8. Elements of culture Biological Foundations Language and communication Institutions Material Productions Symbolic Productions 9. Homogeneity Potential Linguisticethnocentrism? Religious Ethnic Climatic Geographical Institutional & political Social/income 10. StereotypesCooks - French Cooks - BritishMechanics - German Mechanics - FrenchPolice - British Police - GermansLovers - Italian Lovers - SwissOrganize - Swiss Organize - Italian 11. What use is culture? Provides a set of beliefs & standards What to do and how to do it correctly What is palatable, admissible, ethical, magical, religious, hygienic, quality, etc. When it is time to sleep, to eat, to work, etc. 12. Interpreting symbols 7 bad luck in Kenya 7 good luck in the Czech Republic 7 magical in Benin, Africa 10 is bad luck in Korea 4 is related to death in Japan Red represents witchcraft and death in manyAfrican countries, but is a positive in Denmark Avoid triangular shapes in Hong Kong, Korea &Taiwan It is a negative shapeSOURCE: Business America, July 12, 1993 13. PART TWOCULTURAL DYNAMICS TIME AND SPACE 14. 1. Culture is learned2. Culture is forgottenHofstedes analogy Your culture is like your nose: you do not see it properly yourself, but everybody else does and thinks it is peculiar ifit differs from theirs. In addition, you always go where it leads you, and it is always in the way. 15. Same problems Kluckhohn & Strodtbeck (1961)- different solutionsCommon problems & orientations Innate human nature: good, evil or mixed Nature: subjugation, harmony or mastery Time: past, present or future Activity: being, doing or do to be Relational: linearity, collaterality or individuality Space: private, public or mixed 16. Evaluate Solutions Cognitive People think it works that way Affective People like it that way Directive People will do it that way 17. Basic cultural assumptionsFigure 2.1 A model of cultural dynamics 18. Halls Silent Languages Language of Time Language of Space Language of Things Language of Friendship Language of Agreements 19. TimeCommon problems:How does this affect Is time tangible?the marketing mix: scarce resource Products & services? How to schedule tasks? Promotions? one at a time or multiple Distribution? Are lifetimes single or Pricing?cyclical? Separable or seasonal What should weemphasize? past, present, future 20. Space and relationshipsCommon problems:How does this affect Belongingthe marketing mix: Personalization (being) vs. Products & services?depersonalization (doing) Ingroup orientation Promotions? Rights & obligations Distribution? Achieving membership Pricing? Concrete vs. abstract territory Conditions of membership Group vs. individualistic 21. Proxemics (Hall, 1966) Size of space zones? West Intimate Intimate 0-45 cm Personal Personal 45 cm-1 m Social Social 1-2 m Who can enter? Sensory exchange? Marketing Mix? 22. TASKRELATIONSHIPMediterraneanNorthwestern European Traditional Central EuropeanLatinNorthAmerican American MiddleEastern Global Business Schuster & Copeland (1996) 23. Northwestern / Central EuropeanGermany, UK, Scandinavia, Austria Task oriented efficient and fast little time for irrelevant items like structured agenda start and finish times are set formality Foreigners, who dont respect time orientation less professional or less sophisticated 24. Canada, USA, Australia Similar task orientation More casual, less formal Greetings and small talk, first name agendas are flexible Relationships are business 25. Mediterranean Europenon-Parisian French, Iberian, Italian,Greek Can use task orientation Extended tribe Develop a connection or personal bond meet informality probe personal connection Task important but time is flexible late, delay delivery is OK Competed tasks measure success Foreigners disconnect if no relationship connect on similarities e.g. tour, language 26. Latin American Increased relationship emphasis extended tribe include any Latin, Spanish country Can be task oriented but not preferred Relationship important, even for foreigners demonstrate trust, credibility or interest Rules change with relationship includes obligations and duties (multi-dimension) Task is important but so is trust, honour andcompatibility 27. Traditional CulturesAsian, developing, centrally-controlled Similarities in orientation to sales Clan - identity, protection and preference Part of group or product in demand Relationships are the gateway cold selling not usually effective High context - words not so important Low context - responsibility, date, penalty Identify appropriate network Unique product 28. Middle Eastern Relationship first - blood Family relation part of the team religious tenet Not available to outsiders introductions persuasion least significant trust established and maintained conflict interests, nepotism time limits are rude and disrespectful 29. Traits of successful expatriate manager Ability to get along well with people awareness of cultural difference open-mindedness tolerance of foreign cultures adaptability interest previous experience ability to learn foreign languages 30. PART THREECULTURAL DYNAMICS INTERACTIONS, MINDSETS AND BEHAVIOURS 31. The self-shock: being exposed to culturally different people puts our self-image deeply into questionOthers Behaviours Other Behaviours OthersIdentitySelf Self Clash Home countryHost country 32. Self and others How does this affectthe marketing mix?Common problems: Products & services? Treat strangers? Promotions? Nature good or bad? Distribution? Appraise others? Pricing? Who do we trust? Appraise ourselves? What is valued? Relate to our group? Individualism-collectivism 33. Characterizing Dimensions Relation to authority hierarchical relations (power distance) Relation to self self-concept and personality (individualism) Relation to risk tolerance for unknown and deviations (uncertainty avoidance, tightness) Propensity to change receptivity of changes (Long term orientation) Clark (1990) 34. 20 Statements I am _________ I am _________ I am _________ 35. Collectivism vs. Individualism Collectivism Individualism emphasis ingroup needs & emphasis self needs &goalsgoals beliefs shared with in- beliefs distinguish fromgroupothers homogeneous ingroups homogeneous outgroupsheterogeneous outgroupsheterogeneous ingroups norms predict behaviour attitudes predict behaviourbetter than attitudesbetter than norms 36. Countries (1980) Individualism Collectivism United States Japan Great Britain Iran Canada Taiwan Italy Colombia Australia 37. Application: (Nakata and Sivakumar 1996)Individualism increases self-reliance Individualism promotes new productdevelopment during the initial orconceptualization phase - nonconformity Collectivism promotes new productdevelopment during the implementationphase - interdependence 38. MasculinityMasculinity:Femininity: Ambitious & need to excel Quality of life - serving Tendency to polarizeothers Live in order to work Striving for consensus Big & fast are beautiful Work in order to live Admiration for the Small and slow are beautifulachiever Sympathy for the unfortunate Decisiveness Intuition 39. Countries (1980) Masculine Feminine Venezuela Sweden Italy Thailand Germany Spain Australia 40. Application: (Nakata and Sivakumar 1996)Masculinity - increases self-reliance Femininity positively affects theconceptualization stage of newproduct development - supportiveclimate Masculinity promotes theimplementation stage - goaldirectedness and formalization 41. Power DistanceLarge Small High dependence needs Low dependence needs Inequality accepted Inequality minimized Hierarchy needed Hierarchy for convenience Superiors often Superiors accessibleinaccessible Power-holders have All have equal rightsprivileges Change by revolution Change by evolution 42. Countries (1980) High power distance Low power distance Philippines United States Mexico the Netherlands India Australia France Israel 43. Application: (Nakata and Sivakumar 1996)Power Distance - promotes dependence Low power distance High power distancefacilitates new product facilitates new productdevelopment duringdevelopment at thethe conceptualization implementation stage -stage - diverse ideas centralized command 44. Uncertainty AvoidanceStrongWeak Anxiety, higher stress Relaxed, lower stress Inner urge to work hard Hard work not a virtue per se Emotions accepted Emotions not shown Conflict is threatening Conflict & competition ok Need of consensus Acceptance of dissent Need to avoid failure Willingness to take risks Need for laws & rules Few rules 45. Countries (1980) High uncertainty Low uncertaintyavoidanceavoidance France United States Belgium Hong Kong Greece Canada Portugal Singapore 46. Application: (Nakata and Sivakumar 1996)Uncertainty Avoidance - promotes dependence? Low uncertainty avoidance facilitates theinitiation phase - risk taking and minimalcontrols High uncertainty avoidance facilitatesimplementation stage - tight planning andcontrols 47. Long/short term orientation or Confucian DynamicHighLow Many truths Absolute truth (time, context) Pragmatic Conventional/traditional Long-term orientation Short term orientation Acceptance of change Concern for stability Perseverance Quick results expected Thrift for investment Spending for today 48. Long term orientation Short term orientation Hong Kong West Africa Taiwan Canada Japan Pakistan South Korea Brazil 49. Application: (Nakata and Sivakumar 1996) Long term orientation promotes newproduct development Short term orientation impedes newproduct development 50. What correlates with Hofstedesdimensions? (see Hofstede 2001) Individualism Power Distance+ purchase insurance, have+ confidence in the press, lack ofdogs, own a motor home forconfidence in police, childleisure, read more books, obediencehave an answering machine Uncertainty Avoidance Masculinity + buying new (vs used) cars,+ status purchases (watches,buying precious metals andjewellery), importance of car gems, use of mineral waterengine power, business class buying stocks, use of internettravel, confidence in and other media, eating ice-advertising cream, frozen food, Partner involvement in carconfectionary and snackschoice, women as mainshoppers 51. Internet use across Europe for business: -PD for education: -MAS for e-mail: -UA for leisure: -MAS, -UA M. de Mooij "Global Marketing andAdvertising, Understanding CulturalParadoxes", 1998, Sage Publications 52. Convergence of cultures sofar? Evidence says NO even if you only look at the rich countries People use the new media tostrengthen their cultural identity immigrants, researchers, family members,hobbyists, extremists... living together apart 53. Schwartz Values & IndividualismMore individualistsocieties & young,educated, urbanSelf-Direction Universalism Simulation Benevolence HedonismConformity Tradition Achievement SecurityMorecollectivist Power societies& religious 54. Attitude towards actionHow does this affect themarketing mix:Common problems: Products & services? Why act? Promotions? fatalism? Distribution? What is action? Pricing? Speech vs deeds? Thinking to action? Styles? Feelings to action? Separate or integrate Dealing with rules? Practical vs. ideal 55. Cultural assumptions & behaviourFigure 3.2 Basic and cultural assumptions and actual behaviour(Source: Derr and Laurent, 1989. Reproduced with permission)