S2 - Global Cultural Political Legal Environment

INTERNATIONAL
MARKETING
Global Cultural Political Legal
Environment
Dr. Khanh Ngo

khanh.ngo@isb.edu.vn
www.isb.edu.vn
What did you learn from previous session?
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Code:
10/15/2021 Dr. Khanh Ngo www.isb.edu.vn

Learning Objective
• Global Cultural Environment

• Meaning of Culture
• Elements of Culture
• Cross-Cultural Comparisons
• Adapting to Cultures
• Culture and the Marketing Mix
• Global Political and Legal Environment
• Political Environment—Individual Governments
• Political Environment—Social Pressures and Political Risk
• International Law and Local Legal Environment
• Issues Transcending National Boundaries
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INTERNATIONAL
MARKETING
Global Cultural Environment
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Introduction: North Face
https://www.youtube.com/watch?v=WU1HbZDvvJ0
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Introduction: North Face
https://www.youtube.com/watch?v=QuGhXlY6r-k
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Introduction: PUMA
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Introduction
• Buyer behavior and consumer needs are largely driven by cultural

norms.
Ex: North Face, Puma
• Global business means dealing with consumers, strategic partners,
distributors, and competitors with different cultural mindsets
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Question
From a global marketing perspective, why does the

cultural environment matter?

Introduction
• Within a given culture, consumption processes can include four

stages:
• Access: consumer has physical and economic access to product?
• Buying behavior: how do consumers make decision to buy in foreign market?
• Consumption characteristics: what factors drive the consumption patterns?
• Disposal: how do customers dispose of product (re-sales, recycling,…)
• Each of these stages is heavily influenced by the culture in which the
consumer thrives.
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Definition of Culture
• There are numerous definitions of culture. In this text, culture (in a

business setting) is defined as being learned, composed of interrelated
parts and shared
• 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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Elements of Culture
• Material life (technologies that are

used to produce, distribute, and
consume goods and services)
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Elements of Culture
• Language:
• The spoken language
• The silent language
https://www.youtube.com/watch?v=qCo3wSGYRbQ
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Exhibit 4-2: How Not To Sell Abroad
• Blunders of translation are

common either direction
• Back translation can help
avoid problems
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Question
What should be the hints for talking to Non-native English

Speaker?

Elements of Culture
• Rule of thumb about talking to non-native English speakers:

• Vocabulary: simplest word (rich instead of loaded, affluent, opulent
• Idioms: pick idioms carefully (nickel-and-diming???)
• Grammar: one idea in each sentence. Avoid subclauses
• Culture references: avoid culture-specific references (doesn’t he look like
David Letterman???)
• Understanding non-native English speaker: Indian accent, Asian accent, Arab
accent.
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Elements of Culture
• Social Interactions (social interactions among people; nuclear family,

extended family; reference groups).
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Exhibit 4-3: Rules for Cracking the Guanxi Code
in China
https://www.youtube.com/watch?v=Dhdu4hNcUFs
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Elements of Culture
• Aesthetics (ideas and perceptions that a culture upholds in terms of

beauty and good taste). Visual, taste, smell and sound
https://www.youtube.com/watch?v=Y_LaqDi1PFM
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Elements of Culture
• Religion (belief in supernatural agents)
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Elements of Culture
• Education (major vehicle for

channeling culture from one
generation to the next).
• Value System (shape people’s
norms and standards)
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Group Activity
Choose a country and discover it’s Culture Etiquette which

relevant to a International Marketer. Present to the class
http://www.ediplomat.com/np/cultural_etiquette/cultural_etiquette.htm?fbclid=IwAR
3neuRmt7GB0nX-dN8aF9PaXbgs07CMCv7WY9LsjsQleGULOcUbTTxjDnU

Cross-Cultural Comparisons
• Cultures differ from one another, but usually share certain aspects.
Key cultural differences between East (high) and West (low) context
cultures in how people perceive reality and reasoning
• High-context cultures: Interpretation of messages rests on contextual cues;
e.g., China, Korea, Japan, Latin America.
• Low-context cultures: Put the most emphasis on written or spoken words;
e.g., USA, Scandinavia, Germany
• https://www.weforum.org/agenda/2015/10/german-vs-chinese-
what-are-the-cultural-differences/
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Adapting to Cultures
• Global marketers need to become sensitive to cultural biases that

influence their thinking, behavior, and decision-making.
• Self-reference criterion (SRC): Refers to people’s unconscious tendency
to resort to their own cultural experience and value systems to
interpret a given business situation. Need to correct this SCR
• Companies can rely on several tools to prepare managers for cross-
cultural differences: intensive foreign language training, humility
character, cultural training (business custom, dining protocol and
negotiation strategies,…), online tools if limited budget.
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Culture and the Marketing Mix
• Culture is a key pillar of the marketplace. The success of

international marketing activities is largely driven by culture.
• Product Policy: Many products and services must be tailored to local
values and preferences to make them more appealing in the host
market, while some can also be banned or restricted due to cultural
reasons.
• Pricing: Customers’ willingness to pay for products will vary across
cultures; what may be perceived as good value in one culture may
have little to no value in other cultures.
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Culture and the Marketing Mix
• Distribution: Cultural variables may also dictate distribution

strategies.
• Promotion: Promotion is the most visible element of the marketing
mix. Culture will typically have a major influence on a firm’s
communication strategy. Local cultural taboos and norms also
influence advertising styles.
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INTERNATIONAL
MARKETING
Global Political Legal
Environment
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Individual Governments
• Government affects almost

every aspect of business life in
a country.
• National politics affect business
environment directly, through
changes in policies, regulations,
and laws.
• The political stability and mood
in a country affect the actions a
government will take.
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• Government Policies and Regulations

It is the role of government to promote a country’s interests in the
international arena for various reasons and objectives, such as:
national security, developing new industries, and protecting declining
industries.
• Incentives and Government Programs
• Trade Laws
• Government Procurement
• Embargoes and Sanctions
• Tariff and Nontariff Barriers (Exhibit 5-1)
• Export License Requirements
• Investment Regulations (ownership and financial controls)
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Question: Menti
What did Vietnamese government do to attract foreign

investment, for example Samsung?


• Trade Laws: Tariff and Nontariff Barriers (Exhibit 5-1)
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Political Environment - Individual Governments

• Government Procurement
• Embargoes and Sanctions
• Export License Requirements
• Investment Regulations (ownership and financial controls)
• Ownership Controls
• Financial Controls
• Macroeconomic Policies (the cost of capital, level of economic growth, rates of
inflation and international exchange rates)
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Exhibit 5-2: Government Policy Areas and
Instruments
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Exhibit 5-4: Examples of Country Risk Ratings
Ranked by Composite Overall Rating, Jan. 2015
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Exhibit 5-4: Examples of Country Risk Ratings
Ranked by Composite Overall Rating, Jan. 2015
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Exhibit 5-6: Legal Issues Facing the Company
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Issues Transcending National Boundaries
• ISO 9000 certification has become an essential marketing tool for

firms.
• ISO 14000 is market-driven approach to environmental protection
• Intellectual Property Protection
• Patent
• Copyright
• Trade-mark
• Trade Secret
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Exhibit 5-8: Top 60 Countries in Ratings for the
Level of Intellectual Property Protection
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INTERNATIONAL

Dr. Khanh Ngo

10/15/2021 Dr. Khanh Ngo www.isb.edu.vn

• Global Cultural Environment

• Buyer behavior and consumer needs are largely driven by cultural

From a global marketing perspective, why does the

10/15/2021 Dr. Khanh Ngo www.isb.edu.vn

• Within a given culture, consumption processes can include four

• There are numerous definitions of culture. In this text, culture (in a

• Material life (technologies that are

• Blunders of translation are

What should be the hints for talking to Non-native English

10/15/2021 Dr. Khanh Ngo www.isb.edu.vn

• Rule of thumb about talking to non-native English speakers:

• Social Interactions (social interactions among people; nuclear family,

• Aesthetics (ideas and perceptions that a culture upholds in terms of

• Religion (belief in supernatural agents)

• Education (major vehicle for

Choose a country and discover it’s Culture Etiquette which

10/15/2021 Dr. Khanh Ngo www.isb.edu.vn

• Global marketers need to become sensitive to cultural biases that

• Culture is a key pillar of the marketplace. The success of

• Distribution: Cultural variables may also dictate distribution

• Government affects almost

• Government Policies and Regulations

What did Vietnamese government do to attract foreign

10/15/2021 Dr. Khanh Ngo www.isb.edu.vn

• Government Policies and Regulations

• Government Policies and Regulations

• ISO 9000 certification has become an essential marketing tool for

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