Cultural Dynamics in

Assessing Global Markets

Chapter 4
Importance of Culture to
International Marketing Efforts
“Culture gets in the Way”
eBay example
• Japan’s cultural ideas about selling “castoffs” and buying
from strangers (garage sales)
• France has laws restricting operations except to a few
“government-certified auctioneers”
Importance of Culture
• Successful businesses must be open to the learning of
cultures of different countries
• Culture effects every part of marketing (pricing,
promotion, placing distribution, packaging…)
Definition of Culture
Definitions of Culture:
Authors definition: “the sum total of knowledge,
beliefs, art, morals, laws, customs and any other
capabilities and habits acquired by humans..”
Geert Hofstede: culture as the “software of the
mind… provides a guide for humans on how to
think and behave”
Edward Hall: cultural differences are invisible and
that if marketers ignore them it often hurts both
companies and careers.
Exhibit 4.4 “Origins, Elements,
and Consequences of Culture
Adaptation occurs through
• Socialization,Acculturation & Adaptation:
– Through growing up and adjusting to new cultures
Origins of culture come from
• Geography ( ex. climate connection to GDP)
• History
• Political Economy
• Technology
• Social Institutions (family, religion, school,
media government corporations
Exhibit 4.4 “Origins, Elements,
and Consequences of Culture
Geert Hofstede 4 dimensions of Culture
(exhibit 4.5 pg. 105)
1. Individualism/Collectivism Index (IDV)
– Scores High in IDV reflect more individualistic behaviors
(U.S., Australia, Great Britain)
2. Power Distance Index (PDI)
• Measures the power between superiors and subordinates
within a social system
– Higher PDI scores are hierarchical (Arab countries,
Guatemala, Mexico, Venezuela)
– Tend to have general mistrust of others
Exhibit 4.4 “Origins, Elements,
and Consequences of Culture
Geert Hofstede 4 dimensions of Culture
(exhibit 4.5 pg. 105)
3. Uncertainty Avoidance Index (UAI)
• Measures tolerance of uncertainty and ambiguity
– Higher UAI scores mean intolerance of ambiguity and
distrust new behaviors and ideas (Japan, France, Greece)
4. Masculinity/Femininity Index (MAS)
• Focuses on assertiveness and achievement
• Proven least useful in measuring values within cultures
Elements of Culture
Rituals
Patterns of behavior and interactions that are learned
See Crossing Borders 4.1 pg. 107 (“It’s Not the Gift
That Counts, but How You Present it”)
Symbols
Language (exhibit 4.5)
Aesthetics (art, folklore, music, drama and dance)
Beliefs
Myths, superstitions, or other cultural beliefs
Thought Processes
Cultural Knowledge
2 Types of Cultural Knowledge
1. Factual knowledge
• Straightforward fact about a culture
– See Crossing Borders 4.3 pg. 113 (“Gaining Cultural
Awareness…”)
2. Interpretive knowledge
• Feeling that requires some insight as to how a culture exists
• It is dependent upon experiences and can lead to incorrect
conclusions when using (SRC)
Cultural Sensitivity and Tolerance
• Successful International marketing companies are sensitive
to differences in cultures and view them objectively
Cultural Change
“Cultural Borrowing”
Countries often times “borrow” the
solutions from other cultures and countries
that have experienced similar types of
issues and problems
• Similarities can be an Illusion:
– Need to be careful borrowing from other cultures
where differences may be so subtle that the
international marketer overlooks very important
information
Cultural Change
Resistance Change
Cultures will accept or resist change based on how
disruptive the change
Planned & Unplanned Cultural Change
International Marketers have two options when
introducing new products/services to a culture
• 1. They can wait for the change to occur
• 2. They can cause the change
– McDonald’s example in Japan
Cultural Change
Consequences of Innovation or Change
International Businesses can bring about
functional or dysfunctional change
• When product diffusion occurs, social change
may also take place as a result of the
acceptance of that product
• Businesses do not intend to bring dysfunctional
change, but it can happen
– Nestle example in Nicaragua