International Marketing &

Operations

The socio-cultural environment & Buying

Behaviour
Sandy De Mel (From Kotabe & Helsen)
Adapted by Tariku Atomsa (PhD)
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Lesson Overview

Defining Culture

Elements of Culture

Cross-Cultural Comparisons

Adapting to Cultures

Cultures & the Marketing Mix

Organizational Cultures

Global Account Management (GAM)

Global Customer Relationship Management (CRM)

Question: Why analyzing different cultures as

marketers?

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Introduction
Buyer behavior & consumer needs are largely
driven by cultural norms.
Global business means dealing with consumers,
strategic partners, distributors & competitors
with different cultural mindsets .
Within a given culture, consumption processes
can include four stages (Exhibit 4-1):
Access
Buying behavior
Consumption characteristics
Disposal
Each of these stages is heavily influenced by the
culture in which the consumer thrives.
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1. Definition of Culture
There are numerous definitions of culture.
In this text, culture (in a business setting) is defined as
being a:
Learned
Shared
Compelling
Interrelated set of symbols whose meanings provide a
set of orientations for members of society.
Cultures may be defined by national borders, especially
when countries are isolated by natural barriers .
Cultures contain subcultures that have little in common
with one another.

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2. Elements of Culture
Culture consists of many interrelated components.
Knowledge of a culture requires a deep
understanding of its different parts.
Following are the elements of culture:
Material life (technologies that are used to
produce, distribute & consume goods & services)
Language (language has two parts: the spoken &
the silent language)
Social interaction (interactions among people;
nuclear family, extended family; reference
groups)
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2. Elements of Culture
Aesthetics (ideas & perceptions that a culture
upholds in terms of beauty & good taste)
Religion (communitys set of beliefs that relate
to a reality that cannot be verified empirically)
Education (One of the major vehicles to
channel from one generation to the next)
Value System (values shape peoples norms &
standards)
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3. Cross-Cultural Comparisons
Cultures differ from one another, but usually share

certain aspects.
Recent social psychology research reveals key cultural

differences b/n East (high) & West (low) context

cultures in how people perceive reality & reasoning.
High-context cultures: Interpretation of messages

rests on contextual cues; e.g., China, Korea, Japan.

Low-context cultures: Put the most emphasis on

written or spoken words; e.g., USA, Scandinavia,

Germany.
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Contextual Background of Various Countries

Japanese

High context

IMPLICIT

Arabian
Latin American

Spanish
Italian
English (UK)
French
English (US)
Scandinavian
German

Low context

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Swiss

EXPLICIT

3. Cross-Cultural Comparisons
Geert Hofstedes Cultural Classification Scheme / Five
Cultural Dimensions (Slide 11; Exhibits 4-7A & 4-7B):
Power distance: The degree of inequality among people
that is viewed as being equitable
Uncertainty avoidance: The extent to which people in a
given culture prefer structured situations with clear
rules over unstructured ones
Individualism: The degree to which people prefer to act
as individuals rather than group members.
Masculinity: The importance of male values
(assertiveness, success, competitive drive, achievement)
vs. female values (solidarity, quality of life).
Long-term orientation vs. short-term focus: Future
vs. past & present orientations

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3. Cross-Cultural Comparisons
Project GLOBE (Global Leadership &
Organizational Behavior Effectiveness )
Project GLOBE is a large-scale ongoing research
project that explores cultural values & their
impact on organizational leadership in 62
countries
The first three dimensions are the same as
Hofstedes constructs:
Uncertainty avoidance
Power distance
Collectivism
The remaining six dimensions include:
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3. Cross-Cultural Comparisons
Collectivism II
Gender egalitarianism all humans are equal in
fundamental worth or social status
Assertiveness
Future orientation
Performance orientation
Humane orientation.
World Value Survey (WVS):
is organized by the University of Michigan.
has been conducted multiple times & the
population covered is much broader than in other
similar studies.
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 The WVS encompasses two broad categories:

traditional vs. secular values & the quality of life.

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4. Adaptation to Cultures
Global marketers need to become sensitive to
cultural biases that influence their thinking,
behavior & decision making.
Self-reference criterion (SRC): Refers to the
peoples unconscious tendency to resort to their
own cultural experience & value systems to
interpret a given business situation.
Ethnocentrism refers to the feeling of ones own
cultural superiority.
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5. Culture & the Marketing Mix

Culture is a key pillar of the marketplace.
Product Policy:
Certain products are more culture-bound than other
products.
Food, beverages & clothing products tend to be very
culture-bound.
Pricing:
Pricing policies are driven by four Cs:
Customers
Company (costs, objectives, strategy)
Competition
Collaborators (e.g., distributors)

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5. Culture & the Marketing Mix

Distribution:
Cultural variables may also dictate distribution
strategies.
Promotion:
Promotion is the most visible marketing mix.
Culture will typically have a major influence on a
firms communication strategy.
Local cultural taboos & norms also influence
advertising styles.
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6. Organizational Cultures
Organizational Culture:
Most companies are characterized by their
organizational (corporate) culture.
A model of organizational culture types
includes the following four cultures:
Clan culture refers to collaborate
Adhocracy culture refers to create
Hierarchy culture refers to control
Market culture refers to compete
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7. Global Account Management

(GAM)
Cameron & Quinn (1999, p. 41) list the effectiveness criteria for
each culture as follows):
Culture Type

Clan

Effectiveness Criteria
Cohesion, Morale, Development of Human
Resource

Adhocracy

Cutting-edge output, Creativity, Growth

Hierarchy

Efficiency, Timeliness, Smooth functioning

Market

Market Share, Goal achievement, Beating

competitors

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7. Global Account Management

(GAM)
The coordination of the management of customer

accounts across national boundaries are referred to as

global account management (GAM) - multinational
customer.
Global Accounts may:
require a single point of contact
demand coordination of resources for serving customers
push for uniform prices & terms of trade
have standardized products & service
require a high degree of consistency in service quality &
performance
support in countries where the company has no presence

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7. Global Account Management

Managing Account Relationships:
Clarify the role of the account management team.
Make incentive structure realistic .
Pick the right account managers.
Create a strong support network.
Make sure that the customer relationship operates at
more than one level.
Account Management should be flexible & dynamic.

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8. Global Customer R/ship

Management (CRM)
The process of managing interaction b/n the company &
its customers is called customer relationship
management

customer relationship management :

Helps in customer retention
Helps in richer communication & interactive marketing
Helps in tailored services
Helps to maintain a closer contact with the customers
Benefits of CRM:
A better understanding of customers expectations &
behavior
Ability to measure the customers value to the company

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8. Global Customer R/ship

Management (CRM)

Lower customer acquisition & retention costs

Ability to interact & communicate with customers in
countries where access to traditional channels is
limited
Guidelines for Successful CRM Implementation:
Make the program business-driven rather than ITdriven
Monitor & keep track of data protection & privacy
laws in those countries where CRM systems are being
used or are in the planning stage
A good data is the main pre-requisite.
Rewards being sent out to customers are relevant,
targeted & personal.
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