Slide 5.

1

Marketing
Across
Cultures
Chapter 5
Local consumers and the globalization of
consumption
Usunier & Lee, Marketing Across Cultures, 4E

© Pearson Education Limited, 2005

Slide 5.2

Trend towards homogenization

Globalization of demand
 Consumer

behaviour (Ch 5)
 Marketing environments (Ch 6)

Globalization of supply & competition
 (Ch6)

Globalization of offerings
 (Ch8)

Usunier & Lee, Marketing Across Cultures, 4E

© Pearson Education Limited, 2005

and non-tariff barriers  Multi-domestic Industries:   Fragmented national markets international competition within for each domestic market (pharmaceuticals. consumer. 2. customs duties. based on competitive forces bargaining power vis-à-vis both customers and suppliers and the pressure of substitute products and technological alternatives Global Industries: Competition on a  worldwide basis due to  absence of regulatory barriers  high experience effects  homogeneity of consumer behaviour across countries  quasi-absence of market barriers  relatively low transportation costs. 4E   If products.Slide 5. 2005 . or elements of the marketing mix depend on culture (culturebound). Marketing Across Cultures. motor insurance) Usunier & Lee. multi-domesticity is stronger There exists a continuum from pure global to fully multi-domestic Service industries change from multi-domestic to global (GATS) Optimal location of the value chain is a key issue © Pearson Education Limited. behaviour.3 Michael Porter’s view of world markets A view of preventive and reactive strategy    1.

2005 . 10. unbundled insurance services for households) Usunier & Lee.g. persistence of local regulation (e. resources…) Market deregulation / WTO or other worldwide treaty vs.Slide 5. Marketing Across Cultures. geography.4 Key factors to be monitored: Industry trends towards global markets      Basic reasons for continued multi-domesticity (such as climate. motor insurance) International standards / certification Consumer behaviour: remaining idiosyncrasies and their durability (over 5.g. 20 years) Local products / service solutions (e. 4E © Pearson Education Limited. bundled vs.

4E © Pearson Education Limited. examples: beer. concrete concepts. bicycle. such as syrup or coffee The function(s) of similar products may vary across markets.Slide 5. Marketing Across Cultures. TV Market surveys do not apply in the same way crossnationally because of local market research infrastructure and local response styles How then to compare across national markets?  Similarities and differences are in the eye of the observer: we always start comparing from a reference point (issue of ethnocentrism) Usunier & Lee.5 Defining market strategy     Basic concepts may differ: even seemingly similar. 2005 .

g. Procter’s washing powder/liquid)   If primary demand is low (or nil) => Try to educate the consumer If Dm = 0 or  => Try to establish brand locally. demand for transportation)   Selective demand (Ds) = demand to the firm for all its brands in a particular product category (demand for aspirin from Bayer)    If selective demand is low => Try to increase market share against established competitors on the local scene Demand to the brand (Dm )= demand for a particular brand (demand d’Ariel. that is.6 Demand forms and IM strategies  Primary Demand (Dp) = demand to all potential suppliers for a generic item (aggregate demand for aspirin in a particular country) or for broad generic needs (e. gain consumer recognition and build brand image Dp =  Ds Ds =  Dm Usunier & Lee.Slide 5. 4E © Pearson Education Limited. 2005 . Marketing Across Cultures.

Marketing Across Cultures. 4E © Pearson Education Limited.) Interface functional/non-functional (e.7 Primary demand in a national/regional context is influenced by         Climate Physical environment Functional benefits searched for by consumers Non-functional benefits (status. pens) Education/socialization (Vegemite/Cenovis) Habits in early childhood Purchasing power issues (they also matter and they are too often forgotten !) Usunier & Lee. 2005 .Slide 5. etc.g. image.

Marketing Across Cultures. proportion of immigrants. 2005 . size of household.8 Global Convergence     Broad product categories over a long time Through imitation of foreign consumption patterns and adoption of foreign items which become progressively global and local Globalization and modernization Socio-demographic trends  Age.Slide 5. gender equality Usunier & Lee. 4E © Pearson Education Limited.

2005 .9 Major airline alliances (2004) Air Canada Air New Zealand All Nippon Asiana Austrian Bmi British Midland LOT Polish Lufthansa SAS Singapore Airlines Spanair Thai Airways International United Airlines US Airways Varig Usunier & Lee.Slide 5. Marketing Across Cultures.Czech Delta Air Lines Korean Air Lines KLM Northwest © Pearson Education Limited. 4E Aer Lingus American Airlines British Airways Cathay Pacific Finnair Iberia LAN-Chile Qantas Aeromexico Air France Alitalia Continental CSA .

2005 . p. 1996. 1081) Usunier & Lee. 4E © Pearson Education Limited.Slide 5. Marketing Across Cultures. (Source: Smith and Heede.10 Macro Trends liters per capita 100 90 80 70 South 60 50 40 North Ratio 30 20 10 0 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 years Wine consumption in northern and southern Europe.

4E © Pearson Education Limited. Marketing Across Cultures.Slide 5.11 liters/capita Macro Trends 140 120 100 80 60 40 20 0 1950 North South Ratio 1955 1960 1965 1970 1975 1980 1985 1990 1995 ye a r Beer consumption in northern and southern Europe (Source: Smith and Heede. 2005 . 1996. 1081) Usunier & Lee. p.

4E © Pearson Education Limited. 2005 . Marketing Across Cultures.12 Global Chocolate yearly consumption in kg/capita (Sources : CAOBISCO and ICCO / USDA*) in kg / capita /year Switzerland 12 Germany 10 United Kingdom Belgium 8 France 6 Netherlands Iceland* 4 Italy 2 United States* Canada* 0 1992 / 1993 1994 / 1995 1996 / 1997 Japan* China* Usunier & Lee.Slide 5.

5 kg/capita/year Italy 22.datalait.asp#2 Usunier & Lee.2 kg/capita/year United Kingdom 9.2 kg/capita/year Source : www. 4E © Pearson Education Limited.6 kg/capita/year France 24.com/fr/fromage/marche.13 Cheese consumtion in Europe (2001) Greece 26.5 kg/capita/year UEBL(Belgium+Lux) 16.Slide 5.7 kg/capita/year Spain 9.8 kg/capita/year Sweden 17.6 kg/capita/year Germany 19.1 kg/capita/year Portugal 10.6 kg/capita/year Ireland 6.4 kg/capita/year Netherlands 17.9 kg/capita/year Denmark 19 kg/capita/year Austria 18.2 kg/capita/year Finland 16. 2005 . Marketing Across Cultures.

14 Cheese Consumption worldwide  Yearly per capita consumption of cheese differs worldwide  European consumption is on average much higher than it is in other areas of the world  It still varies from 6.2 kg/capita/year in Ireland to 26. 4E © Pearson Education Limited.Slide 5. Marketing Across Cultures.6 kg/ capita/year in Greece  In Latin America it only varies from 4. 2005 .5 kg/ capita/year in Brazil to 11 kg/ capita/year in Argentina Usunier & Lee.

2005 .Slide 5. 4E Year © Pearson Education Limited.15 Production of cheese in China (thousands of tons) 250 Thousands of tons 200 150 100 50 0 Source : www.fao. Marketing Across Cultures.org Usunier & Lee.

16 Consumption of cheese in China (thousands of tons) Thousands of tons of cheese 250 200 150 100 50 0 1991 1992 1993 1994 Source : www.fao. 4E 1995 1996 1997 1998 1999 2000 2001 Year © Pearson Education Limited. Marketing Across Cultures. 2005 .Slide 5.org Usunier & Lee.

Slide 5. and socialization at school and in the family (Vegemite) Usunier & Lee. Marketing Across Cultures.17 Why are there differences in local consumption patterns?         Climate (ice-cream example) Local diets (for food and beverages especially) Local regulations (genetic modifications) Local taste for similar items (süß versus sucré) Different use of similar items (Camembert paniert) Different meaning in context for similar products (colours => certain symbolic attributes) Differences in motivations and buying behaviour Local consumption habits rooted in early childhood. 2005 . 4E © Pearson Education Limited.

Daily consumption. cheese. bio.Slide 5.) Usunier & Lee. yoghurt. Marketing Across Cultures. etc. etc. Purchasing decision: basic quality being well controlled. 4E China      Consumption/cap: 3 litres/year Consumption focused on yoghurt (80%) Product perceived as exotic Purchasing decision: choice of high quality imported products perceived as having superior quality when compared with domestic products Consumers are uneducated for using this kind of product properly (especially as concerns conservation …) © Pearson Education Limited.18 Example of consumer behaviour for milkbased products in France and China France      Consumption/cap: 68 litres /year Consumption of diversified milkbased products: milk. origin. price is a key factor Consumers are used to milk-based products and receptive to symbols which emphasize genuineness. organic manufacturing (labels. butter. 2005 .

quick cooking portions Silverware used for rice eating © Pearson Education Limited. The United States Malaysia  Mainly local.Slide 5. Uncle Ben’s Differentiated by brand. flavour. Marketing Across Cultures. ethnic consumption A lot of flavoured rice Small. 2005 . Rice-a-Roni. 4E Minute Rice.19 Product/Country Example: Rice in Malaysia vs. crosses social strata  Mainly plain white rice  10 kilogram bags of rice  Hands also used for serving US       Usunier & Lee. convenience Infrequent side dish. Thai rice manufacturers  Differentiated by grade  Frequent main dish.

or bacon and eggs with broiled tomatoes and mushrooms Scandinavia   yakizana (broiled trout). or ham. butter and jam or chocolate) Usunier & Lee. chocolate. 4E © Pearson Education Limited. honey. cheese. steamed buns pancakes. or bacon and eggs France  Croissants (plain. jam. jam. boiled eggs. Marketing Across Cultures.Slide 5.20 Breakfast Around the World  China   Japan   huevos rancheros (eggs on a tortilla with hot sauce) and refried beans USA   dark bread with butter. doughnuts. pastries Mexico   marinated herring Austria   Vegemite on toast. 2005 . nama tamajo (raw eggs) over gohan (steamed rice) Australia   rice porridge. toast with butter.

Slide 5.au Some thoughts about Vegemite from non-Australians http://www.com.html Usunier & Lee.vegemite.21 Vegemite The official Vegemite website http://www. 2005 .cockeyed. Marketing Across Cultures. 4E © Pearson Education Limited.com/inside/vegemite/vege mite.

Slide 5. the same for everybody. Efficiency Systematic quantification Predictability Control: substitution of non-human for human © Pearson Education Limited. 2005 . the same everywhere in the world. 3.22 Emergence of a global consumer culture  World standard package   Limitations? 'McDonaldization' of society:     Standard (key benefit = predictable performance). the same over time Usunier & Lee. 2. Marketing Across Cultures. 4E Ritzer (1993): 4 elements 1. 4.

4. “commoditized” time Tendency to discard past in favour of future orientation Fairly high degree of utilitarianism Usunier & Lee.Slide 5. 3. 4E © Pearson Education Limited. 2.23 Modern culture 1. 5. 2005 . Marketing Across Cultures. Individualist orientation Strong emphasis on material achievements – doing/having not being Strongly economic.

disposing Climate. cleaners © Pearson Education Limited.24 Culture-bound products  Rich cultural context   Relationship to the physical environment    Shopping. clothing. housing. consuming.Slide 5. 4E  Relationship to others   Complex   Display. Marketing Across Cultures. share High level of interpretation and local knowledge Nature of the product  Non-durables. population density. show. flora. 2005 . food. fauna Cultural or national identity Language Usunier & Lee.

Slide 5. 4E National  Developed countries  Nationalistic tendencies  Animosity © Pearson Education Limited. Marketing Across Cultures.25 Preference global / local Global  Developing countries  Adoration Usunier & Lee. 2005 .