CHAPTER: TWO

INTERNATIONAL MARKETING
ENVIRONMENT
CULTURAL ENVIRONMENT
Meanig of culture
Characterstics of culture
Origin of culture
elements of culture &
cultural change
MEANING OF CULTURE:
There are many ways to think about the culture. It
shapes the behavior and daily pattern of our life.
Culture is the set of traditional believes and values
that are transmitted and shared in a given society.
Culture means acquired knowledge that people use
to interpret experience and generate social
behavior.
In business word, Culture is part of
the external influences that impact the
consumer. That is, culture represents influences
that are imposed on the consumer by other
individuals.
According to Warren J. Keegan Culture
includes both conscious unconscious values,
ideas, attitudes and symbols that shape human
behavior and that are transmitted from one
generation to the next.
Culture is the sum of the values, beliefs, rituals,
symbols, and thought process that are learned,
shared by a group of people, and transmitted
form generation to generation.
CHARACTERSTICS OF CULTURE
Culture is transmitted from one generation
to the next.
It is a set of beliefs and values.
Culture determines the behavior of man.
Every member of a culture shares normal
beliefs, values, feelings, notions, nature of
behavior with each other.
ORIGINS OF CULTURE
The best marketers not only appreciate the cultural
differences significant to their business, they also
understand the origin of these differences.
The factors such as geography, technology, political
economy, social institutions and social process determine
and form culture and cultural differences. Individuals
learn culture from social institutions through
socialization (growing up) and adjusting to a new culture.
Individuals absorb culture through role modeling or
imitation of their peers. Finally, people make decisions
about consumptions production through application of
their culture-based knowledge.
a.Geography: There lies a strong correlation between
the latitude(climate) and the per capita gross domestic
product (GDP)of countries . ( According to Philip Cotler).
For example: The living style , food habit , purchasing
pattern of the people of HOT countries are different
than the people of COLD countries only because of the
geographical difference.
b.History: The impact of specific events in history
can be seen reflected in technology , social
institutions ,cultural values , and consumer
behavior . The sense of nationalism caused the
marketers to launch their product in INDIA in
the name of HINDUSTAN LIVER instead of
UNILEVER though that was a world renown
brand .That happened because the culture was
greatly shaped by the history and created a
sense of nationalism among the Indians .
c. Technology: . It is a scale to measure the level
of cultural position to every people in a culture.
We can perceive other culture by watching
their use of technology. Television, computer,
birth control pill these have an impact on
institutions and cultural values.
d. The political Economy: There are three
approaches to governance such as fascism,
communism, democracy or free enterprise. It has an
effect on culture of commerce and consumption.
e.Social Institution: Social institutions include
family, religion, school, media, government and
corporations all affect the ways in which people
relate to one another, organize their activities to live
in harmony with one another and teach acceptable
behavior.
o Family: Family forms and functions very
substantially around the world and around the
country. The living pattern and family values differ
from country to country which lead directly to
differences in how children think and behave.
Religion: Because religion clearly does
affect peoples habits, their outlook on life,
and the products they buy, they way they
buy them and even the newspaper they
read. For example: Wine is forbidden in
Islam & Meet is forbidden in Hindu.
School: Education affects all aspects of the
culture, from economic development to
consumer behavior. The literacy rate of a
country is a potent force in economics
development. Because communicating with
a literate market is much easier than
communicating to one in which the
marketer must depend on symbols and
pictures.
Media: Media affects on the consciousness of the
people and there for have direct impacts on
marketing.
Government: Government formation pattern,
policies made by the government also affects
the culture. Government tries to influence the
thinking and behaviors of adult citizen.
Corporation: Multinational firms changed
consumer belief through the efficient
distribution of new products and services.
ELEMENTS OF CULTURE
An international marketer should have enough knowledge
about cultures of different countries. This will help an
international marketer to survive in the global competition.
The elements of culture are :
1. Material culture:
2. Social institution:
3. Human and the universe:
4. Aesthetics:
5. Language:
6. Cultural values:
8. Rituals
7. Beliefs:
1. MATERIAL CULTURE: IT IS FORMED WITH THE COMBINATION OF
TECHNOLOGICAL CONDITION AND ECONOMICAL ELEMENTS. IT HAS TWO ELEMENTS-
a) Technology: Technology refers to the techniques or methods of
making products & using those. It is possible to get a clean idea
about consumption pattern of a culture by observing the level of
technology. There are three level of technology.
I. High level technology. Ex - USA, Japan, China.
II.Moderate level technology. Ex - India.
III.Low level technology. Ex- Bangladesh, Nepal.
b) Economics: Economics is the manner in which
people employ their capabilities resulting benefits. It
includes factors of production, production of product,
distribution exchange, income, creation of utility etc.
Culture is created on the basis of pattern of economy.
Culture is different in capitalistic economy and socialistic
economy.
2.SOCIAL INSTITUTION
It includes social organization, education and political structure
which create relation with one another, teach to live socially and
teach acceptable behavior for next generation.
a) Social organization: Social organization includes the family,
social class system and business and non-business
organizations. Social organization affects the thinking,
status and role of people of a society.
Example: Culture in which family ties is vast, promotional
activities are more effective for all members than one in that
culture. Canada Pcitures Emglish add of travel for canada &
France.
b) Education: Education includes the process of transmitting
skill, ideas and attitudes as well as training in particular
disciplines. New generation can know about custom, idea,
beliefs, values, scientific and technological information through
education. Advertising language, medium, appeal differ in
educated & uneducated sociery.
C) POLITICAL STRUCTURE:
The nature of govt. system, rulling party, power of opposition
party, political stability affect the marketing programs of
companies. For example: Unstable political condition of BD
discourages foreign companies to come here.
3. Human and the universe:
a. Religion: Religion is the most sensitive elements of
culture. It affects almost every aspect of life. It may induce
people to accept or reject a product or add campaign. For
example: Ban of a Frecnh Perfume in Soudi Arab due to
the use of nude women pic on its container.
b. Beliefs system: Belief system is different in different
culture people. Man of many cultures is rationalist. Again
man of many cultures is dependable on their luck. As for
example People of Thailand believe that all wood of a
new building should be collected from same forest
otherwise it will not bring welfare.
4. Aesthetics:
Aesthetics refers to the ideas in a culture concerning beauty and good
taste, as expressed in the arts-music, art, drama and dance. It is a
special considerable factor to a marketer. As for example PEPSI
Company used Britney Spears for their advertising in many countries,
Vodaphone uses Sakira WAKAWAKA song for their advertising.
5. Language:
Is described as the mirror of culture and is multidimensional
by nature.Include both verbal and nonverbal communication.
without language communication is impossible. The same
word may be used differently in different countries.
For example- TOMBO means hotel in Bolivia, Colombia but in
Argentina & Uruguay it means dairy firm . International
Marketers must need to have enough understanding of
different language of different countries.
Attitude is a learned tendency to respond in a
consistent way to a given object or entity.
A belief is an organized pattern of knowledge that
an individuals holds to be true.
A Value can be defined as an enduring belief or
feeling that a specific mode of conduct is
preferable to another mode of conduct. It represents
the deepest level of culture.
6. ATTITUDES, BELIEFS AND VALUES
7. Rituals:
Rituals means ceremony, custom, tradition, formality, protocol etc.
Rituals are any behavior repeated or performed according to defined
guidelines. It differs across cultures. The urban and rural areas rituals
are quite different. Such as- marriage ceremony, birthday party,
funerals etc.
HIGH CONTEXT VS LOW CONTEXT CULTURES
HIGH- AND LOW-CONTEXT CULTURES
High Context
Information resides in
context
Emphasis on
background, basic
values, societal status
Less emphasis on
legal paperwork
Focus on personal
reputation
Saudi Arabia, Japan
Low Context
Messages are explicit
and specific
Words carry all
information
Reliance on legal
paperwork
Focus on non-personal
documentation of
credibility
Switzerland, U.S.,
Germany
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HIGH CONTEXT VS LOW CONTEXT CULTURES
GREET HOFSTEDES CULTURAL TYPOLOGY
Includes three broad dimensions :
Expected Social Behavior (Individualistic or
group; Low or high power distance; masculine
or feminine).
Mans search for truth (high or low uncertainty
avoidance).
Importance of time (short term or long term
orientation)
1. Power distance index (PDI): This index focus on authority
orientation that means power of superior. Such as- tolerance
of social inequality.
2. Individualism/collectivism index (IDV): This index mainly
focus on self orientation or interest of individual or group
people.
3. Uncertainty avoidance index (UAI): This index focus on risk
orientation matters of the organization.
4. Masculinity/Femininity index (MAS): Refers to the extent
to which traditional masculine values, like
aggressiveness and assertiveness, are valued.
5. Long term Vs Short term Orientation ( Search for Virtue):
Asseses the sense of immediacy within a culture, whether
gratification should be immediate or better.
SELF REFERENCE CRITERION(SRC):
Developed by James Lee
The unconscious reference to ones own cultural
values.
How to reduce?
1. Define the problem or goal in terms of home-country
cultural traits, habits,
and norms.
2. Define the problem or goal in terms of host-country cultural
traits, habits,
and norms. Make no value judgments.
3. Isolate the SRC influence and examine it carefully to see
how it complicates
the problem.
4. Redefine the problem without the SRC influence and solve
for the host country market situation.
See The
Example of Walt
Disney
DIFFUSION THEORY:
THE ADOPTION PROCESS
The mental stages through which an individual passes from
the time of his or her first knowledge of an innovation to
the time of product adoption or purchase
Awareness
Interest
Evaluation
Trial
Adoption
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DIFFUSION THEORY:
CHARACTERISTICS OF INNOVATIONS
Innovation is something new; five factors that
affect the rate at which innovations are
adopted include:
Relative advantage
Compatibility
Complexity
Divisibility
Communicability
Copyright 2013, Pearson Education Inc., Publishing as Prentice-Hall
DIFFUSION THEORY: ADOPTER CATEGORIES
Copyright 2013, Pearson Education Inc., Publishing as Prentice-Hall
CULTURAL KNOWLEDGE
The concept of cultural knowledge is broad and can be
defined by the way it is acquired.
I.Factual Knowledge: Acquired through communication,
research, and education. This knowledge is mostly visible and
expressed.
I.Interpretive knowledge: Acquired by understanding the
nuances of different cultural traits and patterns; achieved
through experience over a sufficient length of time.
MARKETING IMPLICATIONS
Cultural factors must be considered when
marketing consumer and industrial products
Environmental sensitivity reflects the extent
to which products must be adapted to the
culture-specific needs of different national
markets
Copyright 2013, Pearson Education Inc., Publishing as Prentice-Hall
ENVIRONMENTAL SENSITIVITY
Independent of social class and income,
culture is a significant influence on
consumption and purchasing
Food is the most culturally-sensitive
category of consumer goods
Dehydrated Knorr Soups did not gain popularity in the U.S.
market that preferred canned soups
Starbucks overcame cultural barriers in Great Britain and
had 466 outlets by 2005
Copyright 2013, Pearson Education Inc., Publishing as Prentice-Hall