Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
THE SELF-REFERENCE CRITERION
√ (Learning Objective #4)
A person’s perception of market needs is framed by his or her own cultural experience. A
framework for reducing perceptual blockage and distortion was developed by James Lee.
The unconscious reference to one’s own cultural values is the self-reference criterion (SRC). To
eliminate or reduce cultural myopia, Lee proposed a four-step framework.
Define the problem or goal in terms of home country cultural traits, habits, and norms.
Define the problem or goal in terms of host-country cultural traits, habits, and norms.
Make no value judgments.
Isolate the SRC influence and examine it carefully to see if it complicates the problem.
Redefine the problem without the SRC influence and solve for the host-country market
situation.
SRC teaches that a vital, critical skill of the global marketer is unbiased perception, the ability to
see a culture.
SRC can be a negative force in global business leading to misunderstanding and failure. A person
must suspend assumptions based on prior experience and success and add new knowledge about
human behavior and motivation.
Diusion Theory
√ (Learning Objective # 5)
Sociologist Everett Rogers distilled his research into three concepts that are extremely useful to
global marketers: the adoption process, characteristics of innovations, and adopter categories.
An innovation is something new. However, a product already introduced in one market may be
an innovation elsewhere because it is new and different for the targeted market.
Managers find themselves marketing products that may be, simultaneously, innovations in some
markets and mature or declining products in other markets.
The Adoption Process
The adoption process - the mental stages from the first knowledge of an innovation to product
adoption or purchase:
Awareness. The customer becomes aware for the first time of the product or
innovation. Global marketers create awareness through general exposure to advertising
messages.
Interest. The customer is interested enough to learn more. The customer will engage in
research and seek information.
Evaluation. The individual mentally assesses the product's benefits and decides whether
or not to try it.
Trial. Most customers will not purchase expensive products without a "trial." For
inexpensive products, an initial single purchase is defined as trial.
Adoption. The individual either makes an initial purchase or continues to purchase a
product. Sales reps and word of mouth are forces in the decision to buy.
Characteristics of Innovations
Five factors affect the rate of adoption:
Relative advantage: How a new product compares with existing products or methods.
Compatibility: How consistent a product is with existing values and past experiences.
Complexity: How difficult the new product is to understand and use.
Divisibility: How easy it is to try a product on a limited basis without great expense.
Communicability. How well the benefits or value of a product are communicated.
Adopter Categories
Adopter categories are classifications of individuals in a market on the basis of innovativeness.
(See Figure 4-3)
Five categories have been assigned to the segments of a normal distribution:
The first 2.5 percent to purchase a product are innovators.
The next 13.5 percent are early adopters
The next 34 percent are the early majority
The next 34 percent are the late majority
The final 16 percent are laggards.
Innovators are more venturesome, more cosmopolitan, and wealthier than those who adopt later.
Earlier adopters are the most influential people in their communities and have great influence on
the early and late majority, the bulk of the adopters of any product.
Early adopters tend to be younger, with higher social status, and a more favorable financial
position than later adopters.
Persuading innovators and early adopters to purchase a product is critical; these groups must
make the first move in order for eventual penetration of a product into the broader market.
Diffusion of Innovations in Pacific Rim Countries
Since Japan, South Korea, and Taiwan are high-context, homogeneous cultures while the U.S. is
a low-context, heterogeneous culture, research showed that Asia had faster diffusion rates.
Adoption would proceed more quickly in markets where innovations were introduced late,
allowing time to assess the relative advantages, compatibility, and other product attributes.
The Asian adopter behavior differs from Western behavior. There are fewer Asian innovators
since risk avoidance is high.
When Asian consumers become aware that others tried the product, they quickly follow suit.
MARKETING IMPLICATIONS OF SOCIAL AND CULTURAL ENVIRONMENTS
(Learning Objective #5)
The various cultural factors described earlier can exert important influences on consumer and
industrial products marketed around the globe.
Environmental sensitivity reflects the extent to which products must be adapted to the culture-
specific needs of different national markets.
At one end of the continuum are environmentally insensitive products that do not require
significant adaptation; at the other are products that are sensitive to environmental factors.
The greater the environmental sensitivity, the more managers must address country-specific
economic, regulatory, technological, social, and cultural environmental conditions.
Intel’s microprocessors can be sold anywhere because a chip is a chip, but food products have
high environmental sensitivity because of sensitivity to climate and culture.
The sensitivity of products can be represented on a two-dimensional scale (Figure 4-5). The
horizontal axis shows environmental sensitivity, the vertical axis the degree for product
adaptation needed.
At the upper right of Figure 4-5 are products with high environmental sensitivity. Food
sometimes falls into this category because it is sensitive to climate and culture.
Research studies show that, independent of social class and income, culture is a significant
influence on consumption behavior and durable goods ownership.
Consumer products are probably more sensitive to cultural difference than are industrial
products.
Hunger is a basic physiological need in Maslow’s hierarchy; everyone needs to eat, but what we
want to eat can be strongly influenced by culture.
Evidence from the front lines of the marketing wars suggests that food is probably the most
sensitive category of consumer products.
Hydration is a universal physiological need (see Exhibit 4-9). As is the case with food and
cooking, however, the particular liquids people want to drink can be strongly influenced by
culture. Coffee is a beverage category that illustrates the point.
On the European continent, coffee has been consumed for centuries. By contrast, Britain has
historically been a nation of tea drinkers, and the notion of afternoon tea is firmly entrenched in
British culture.
TEACHING TOOLS AND EXERCISES
Additional Cases:
"Tailoring Your Strategy to Fit the Culture" by Marieke de Mooij, Insight Magazine, June 2010;
IIR026-PDF-ENG.
"EMC2: Delivering Customer Centricity" by Thomas Steenburgh and Jill Avery, April 2011.
Harvard Business School 511124-PDF-ENG.
"Dacia Duster SUV" by Marina Apaydin, Hantulie Oana, and Nicoleta, January 2011, Richard
Ivey School, Product Number 910A31-PDF-ENG.
“Marketing: Who’s Really Minding the Store Globally”? Linda C. Ueltschy,; Irene Herremans;
John K. Ryans Jr. HBS BH190.
“Colgate Max Fresh: Global Brand Roll-Out”, John A. Quelch, Jacquie Labatt-Randle, HBS
508009.
Activity: Students should be preparing or presenting their Cultural-Economic Analysis and
Marketing Plan for their country and product as outlined in Chapter 1.
Out-Of-Class Reading: As an outside reading assignment, students will read how expanding
into adjacent markets is tougher than it looks; three-quarters of the time, the effort fails. Here is
how to change those odds dramatically.
Zook, Chris, and Allen, James. “Growth Outside the Core.” Harvard Business Review 81, no. 12
(December, 2003), pp. 67-73.
Cross-Cultural Differences: To assess cross-cultural differences, students will talk to people
from a different country. They can check with the office responsible for coordinating
international students to obtain names. Interview at least three people and get responses to the
following questions: (a) What country do you come from? (b) What is your first language? (c)
Describe you country’s culture in terms of the role of women in the workforce, the benefits
provided to employees, how managers treat their employees, and general management practices.
(d) What were the greatest difficulties you had in adapting to your new culture? (e) What advice
would you give me if I were in a marketing management position in your country?
Internet Exercise: Have students go to the homepage of The Internationalist
(www.internationalist.com). Here they can start to explore the world. Have them browse around
the sites and then click on International Business. They should select 2-3 countries in which they
have an interest. Students are to write a 1-page impression of findings regarding the culture of
these countries and should be prepared to discuss those findings with the class.
Videos:
U.K. Bellwether Report: Marketers Are Pessimistic About 2012 – European Companies are
scaling back marketing plans for 2012.
http://adage.com/article/global-news/u-k-bellwether-report-marketers-pessimistic-2012/232201/
Four Seasons Embraces Digital Marketing, Virtual Experiences – How they are coping with
advertising changes worldwide, and the new moves they are making.
http://adage.com/article/cmo-interviews/seasons-embraces-digital-marketing-virtual-
experiences/232055/
Film: Assign the film “Rising Sun.” The movie is a murder mystery based on the culture clash
between Los Angeles police and Japanese multinational business interests. It is entertaining and
educational at the same time.
SUGGESTED READING
Books
Abegglen, James C., and George Stalk Jr. Kaisha, The Japanese Corporation. New York: Basic
Books, 1985.
Alfino, Mark, John S. Caputo, and Robin Wynyard. McDonaldization Revisited: Critical Essays
on Consumer Culture. Westport, CT: Praeger, 1998.
Benedict, Ruth. Patterns of Culture. Boston: Houghton Mifflin, 1959.
Brislin, R. W., W. J. Lonner, and R. M. Thorndike. Cross-Cultural Research Methods. New York:
John Wiley & Sons, 1973.
Dale, Peter N. The Myth of Japanese Uniqueness. New York: St. Martin's Press, 1986.
Featherstone, Mike, ed. Global Culture: Nationalism, Globalization and Modernity. London:
Sage Publications, 1990.
Hall, Edward T. Beyond Culture. Garden City, N.Y.: Anchor, 1976.
_____ and Mildred Reed Hall. Hidden Differences: Doing Business with the Japanese. New
York: Doubleday, 1990.
_____ and Mildred Reed Hall. Understanding Cultural Differences. Yarmouth, ME: Intercultural
Press, 1990.
Harris, Philip R., and Robert T. Moran. Managing Cultural Differences: High Performance
Strategies for a New World of Business, 3d ed. Houston: Gulf Publishing Company, 1991.
Hofstede, Geert. Cultures and Organizations: Software of the Mind. New York: McGraw-Hill,
1991.
Lewis, Richard D. When Cultures Collide. London: Nicholas Brealey Publishing, 2000.
Moran, R. and W. Stripp. Dynamics of Successful International Business Negotiations.
Houston: Gulf Publishing Company, 1991.
Articles
Alden, Dana L., Jan-Benedict Steenkamp, and Rajeev Batra. “Brand Positioning through
Advertising in Asia, North America, and Europe: The Role of Global Consumer Culture.”
Journal of Marketing 63, no. 1 (January 1999), pp. 75-87.
Bonvillian, Gary, and Willliam A. Nowlin. “Cultural Awareness: An Essential Element of Doing
Business Abroad.” Business Horizons 37, no. 6 (November 1994), p. 44.
Dulek, Ronald E., John S. Fielden, and John S. Hill. “International Communications: An
Executive Primer.” Business Horizons 34, no. 1 (January/February 1991), pp. 20-25.
Fedor, Kenneth J. and William B. Werther, Jr. “Making Sense of Cultural Factors in International
Alliances.” Organizational Dynamics, 24, no. 4 (Spring 1995), pp. 33-48.
Fitzgerald, Nora. “Oceans Apart, but Closer than You Think.” World Trade, (February 1996), p.
58.
Ford, John B., Michael S. LaTour, and Tony L. Henthorne. “Perceptions of Marital Roles in
Purchase Decision Processes: A Cross Cultural Study,” Journal of the Academy of
Marketing Science, 23, no. 2 (Spring, 1995), pp. 120-131.
Ford, John B., and Earl D. Honeycutt, Jr. “Japanese National Culture as a Basis for
Understanding Japanese Business Practices.” Business Horizons 35, no. 6
(November/December 1992), pp. 27-34.
Froz, Nadeen and Taghi Ramin. “Understnding Cultural Variables is Critical to Success in
International Business.” International Journal of Mangement 21, no. 3 (2004), pp. 307-
324.
Herbig, Paul A., and Hugh E Kramer. “Do’s and Don’ts of Cross-Cultural Negotiations.”
Industrial Marketing Management 21, no. 4 (November 1992), pp. 287-298.
Hofstede, Geert, and Michael Harris Bond. “The Confucius Connection: From Cultural Roots to
Economic Growth.” Organizational Dynamics, (Spring 1988), pp. 5-21.
Jacobs, Laurence E., Charles Keown, Reginald Worthley, and Kyung-I Ghymn. “Cross-Cultural
Colour Comparisons: Global Marketers Beware!” International Marketing Review 8, no.
3 (1991), pp. 21-30.
Kim, Donghoon, Yigang Pan, and Heung Soo Park. “High- Versus Low-Context Culture: A
Comparison of Chinese, Korean, and American Cultures.” Psychology & Marketing 15,
no. 6 (September 1998), pp. 507-521.
Lewis, Maureen. “Why Cross-Cultural Training Simulations Work.” Journal of European
Industrial Training, 29, no. 7 (2005), pp. 595-598.
Lin, Carloyn A. “Cultural Values Reflected in Chinese and American Television Advertising.”
Journal of Advertising 30, no. 4 (Winter 2001) pp. 83-94.
Manrai, Lalita A., and Ajay K. Manrai. “Current Issues in the Cross-Cultural and Cross-National
Consumer Research.” Journal of International Consumer Marketing 8, no. 3-4 (1996),
pp. 9-22.
Menger, Richard. “Japanese and American Negotiators: Overcoming Cultural Barriers to
Understanding.” Academy of Management Executive 13, no. 4 (November 1999), pp.
100-101.
Mintu, Alma T., and Roger J. Calantone. “A Comparative Approach to International Marketing
Negotiation.” Journal of Applied Business Research 7, no. 4 (Fall 1991), pp. 90-97.
Money, R. Bruce, Mary C. Gilly, and John L. Graham. “Explorations of National Culture and
Word-of-Mouth Referral Behavior in the Purchase of Industrial Services in the United
States and Japan.” Journal of Marketing 62, no. 4 (October 1998), pp. 76-87.
Reardon, Kathleen Kelley, and Robert E. Spekman. “Starting Out Right: Negotiating Lessons for
Domestic and Cross-Cultural Business Alliances.” Business Horizons 37, no. 1 (January-
February 1994), pp. 71-79.
Ross, Martin S. “The Effects of Culture and Socioeconomics on the Performance of Global
Brand Image Strategies.” Journal of Marketing Research 32 (May 1995), pp. 163-175.
Shane, Scott A. “The Effect of Cultural Differences in Perceptions of Transactions Costs on
National Differences in the Preference for International Joint Ventures.” Asia Pacific
Journal of Management 10, no. 1 (1993), pp. 57-69.
Sivakumar, K., and Cheryl Nakata. “The Stampede toward Hofstede's Framework: Avoiding the
Sample Design Pit in Cross-Cultural Research.” Journal of International Business
Studies 32, no. 3 (2001), pp. 555-574.
Schneider, Susan C., and Arnoud De Meyer. “Interpreting and Responding to Strategic Issues:
The Impact of National Culture.” Strategic Management Journal 12, no. 4 (May 1991),
pp. 307-320.
Tung, Rosalie L. “Handshakes Across the Sea: Cross-Cultural Negotiating for Business
Success.” Organizational Dynamics 19, no. 3 (Winter 1991), pp. 30-40.
Usunier, Jean-Claude G. “Business Time Perception and National Cultures: A Comparative
Survey.” Management International Review 31, no. 3 (Third Quarter 1991), pp. 197-217.
Yeh, Ryh-song, and John J. Lawrence. “Individualism and Confucian Dynamism: A Note on
Hofstede's Cultural Root to Economic Growth.” Journal of International Business
Studies 26, no. 3 (1995), pp. 655-669.
