Self- Reference Criterion

Self-Reference Criterion (SRC) and Ethnocentrism

• SRC is an unconscious reference to one’s own cultural values, experiences, and knowledge as a basis for decisions.

• Ethnocentrism refers to the notion that one’s own culture or company knows best how to do things.

• Both the SRC and ethnocentrism impede the ability to assess a foreign market in its true

light.

Ethnocentrism

• The belief – that one’s culture is superior to another and that

strategies used in one’s home country will work just as well internationally

– the belief that purchasing foreign products hurts the local economy by causing loss of jobs, and that it is morally wrong and unpatriotic.

• Domestic marketing extension concept• Leads to the rejection of foreign products.

Obstacles to InternationalizationSelf-Reference Criterion• Conscious and unconscious reference to

own national culture while operating in the host country. (e.g. eye contact US-Japan)

• To counter the impact of the self-reference criterion, the corporation must select appropriate personnel for international assignments and engage in sensitivity training.

Does this picture offend you?

If so, then you may be guilty of Ethnocentrism!

• People who are ethnocentric apply their own values in judging the behavior and beliefs of other people raised in other cultures.

• Ethnocentrism contributes to social solidarity and a sense of value and community.

• However, it also fuels conflict.

Ethnocentrism, Cultural Relativism, and Human Rights

• The “human rights” movement suggests that there is a realm of justice and morality that supercedes the practices of many cultures.

• Examples: female genital mutilation in the Middle East; male circumcision at birth in the United States.

Ethnocentric Orientation

• Domestic strategies, techniques, and personnel are perceived as superior.

• International markets are secondary, regarded primarily as outlets for surplus domestic production.

• International marketing plans are developed in-house by the international division.

• E.g. Disney resort in France: Disneyland Resort Paris had to adapt it to local preferences: European fairy tales, food, and dress code for staff.

Polycentric Orientation

• Focuses on the importance and uniqueness of each international market

• Firms establish independent businesses in each target country.

• Fully decentralized, minimal coordination with headquarters

• Marketing strategies are specific to each country.• Outcomes: – No economies of scale– Duplicated functions– Higher final product costs

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Regiocentric Orientation

• World regions that share economic, political, and/or cultural traits are perceived as distinct markets. (e.g. EU, NAFTA)

• Divisions are organized based on location.• Regional offices coordinate marketing activities.

Geocentric Orientation

• Marketing strategies aimed at market segments, rather than geographic locations

• Maximizes efficiencies worldwide and provides standardized product or service throughout the world

• E.g. McDonalds

McDonalds India

Religion

• Society’s relationship to the supernatural determines dominant values and attitudes.

• Examples: – Protestant Religion—stresses hard work and frugality.– Judaism—stresses education and development.– Islam—focus on rules for social interaction. Bans the use of

interest rates. No pork or alcohol– Hinduism—encourages family orientation and dictates strict

dietary constraints. Strictly hierarchical. No Beef.– Buddhism—stresses sufferance and avoidance of worldly desires.

Religion and Its Impact on Business

• Business Days• Gender Roles• Gift Giving• Marketing Practices

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Christian

Business Business Business Business Business Business Moring

Islam Business Business Business Business Business Business

Judaism Business Business Business Business Business Business

Created BySwapnil Jadhav