Business customs and practices in International Marketing
Business Customs and Practicesin International Marketing By Annika Zeit Sergio Stanga Müjdat Emre Semiz Lara Zitzer Maximilian Preuß Hochschule Neu-Ulm University
DOMESTIC VS INTERNATIONAL Diverse patterns of customer preferences, distribution channels, legal framework,… Need to mesh the corporate strategy with the host country policies Need to be competitive against technical standards Economic performance is measured in diverse currencies
MAIN GOALS EFFICIENCY achieved by: Increasing value of outputs (local responsiveness) Lowering cost of inputs (global integration) FLEXIBILITY Managing the risks Exploiting the opportunities arisen (PESTEL)WHICH IS THE SOURCE OF THE COMPETITIVE ADVANTAGE? GLOBAL INTEGRATION VS LOCAL RESPONSIVENESS
MENTALITIES MULTINATIONAL GLOBALPRODUCT LIFE CYCLE EACH NATION HAS GLOBAL PRODUCT LIFE PRODUCTS IN CYCLE (MOST DIFFERENT STAGES ADVANCED PRODUCTS)PRODUCT ADAPTATION ADAPTED TO NATIONAL ADAPTED TO GLOBAL DIFFERENCES WANTS AND NEEDSPRODUCTION STANDARDISATION GLOBAL STANDARDISED LIMITED BY NATIONAL PRODUCTION TASTESPRICE CUSTOMISED PRODUCT “BETTER = HIGHER PRICE STANDARDISED: IS CHEAPER”PROMOTION NATIONAL PRODUCT GLOBAL PRODUCT IMAGE IMAGEPLACE NATIONAL GLOBAL DISTRIBUTION STANDARDISATION OF CHANNELS DISTRIBUTION
MENTALITIESGlobal integration CONSUMER ELECTRONICS AUTOMOBILES Local responsiveness
MENTALITIESGlobal integration GLOBAL TRANSNATIONAL INTERNATIONAL MULTINATIONAL Local responsiveness
Why should a foreign marketer be concerned with the study ofculture? Cultural Sensitivity in business is essential/ vital Globalization - High volume of interdependence between markets of different areas. Complexity and heterogenity of cultural differences - High context / Low context culture Different political, legal, macro/microeconomic environment
In this respect , Advertising techniques / Advertising practices ‘’Cultural World’’ of the local market. Understanding the way of doing business in that culture Efficient Market Strategy Success launching an advertising campaign will differ amongst cultures . numbers, colours,languages etc. Dealing with the managers, customers from different cultures will require a deep cultural knowledge and sensitivity in order to get in the same mood and right information exchange perception.
Cultural Differences in Business :They Matter!
If the managers do not have the ability to be sensitiveabout the cultural differences such problems may comealong : General Motors Chevy Nova (Car) South America In Spanish, "nova" : "it wont go".
DisneylandHong Kong, China > Low success Later they decided to change the Mickey Mouse dressed inChinese customs and reconsider the menu to be local. The case of Orange, a French telecommunications company UK, In 1994 ,new marketing slogan across the UK: “The future’s bright… the future’s Orange.” In Northern Ireland, the term Orange is associated with the Orange Order, a Protestant organization with had anti-Catholic sentiments. > So this did not work well with the country’s Catholic population .
What is the possible results when managers are not concerned with the study of culture ? Misunderstandings Low sales- Waste of time , money and bad impressions ->> Withdrawal from the market (?)- Marketing strategies : Discovering the customers‘ and colleagues’ desires needs cultural study and empathy as much as costs and profits.
HomesicknessStressExcessive consumption ofdrugs, alkohol and foodAnxietyHelplessnessInsomnia
Turkey - Emre Can Bulut Name: Emre Can Bulut Age: 20 Why study abroad? To get to know to a different culture Syptoms of cultural shock: Stress: Understanding of rules: traffic e.g. Homesickness: to feel alone, think about home, wish to visit the family Help? Talking with friends
Turkey - Pinar Delibal Name: Pinar Delibal Age: 23 Why study in Germany? Improve the language skills Syptoms of cultural shock: Strict punctuality Rules stressful Anxiety Positive: German people
Spain – Sergio Stanga Name: Sergio Stanga Age: 21 Why study in Germany? Improve the language skills What is so different? Strict punctuality Body contact Symptoms of cultural shock: Feeling of loss Confusion Help? Spend time with other Erasmus students, talk about it
Latinoamérica - Rolando Cortes Name: Rolando Cortes Age: 20 Why study in Germany? Improve the language skills Syptoms of cultural shock: Insomnia
Hungary - Gergeli Mázik Name: Gergeli Mázik Age: 2? Why study in Germany? Improve the language skills different culture Syptoms of cultural shock: Homesickness Not so much, because the attitude of people is almost the same
•Recognize your problem•Talk with someone who understands you•Spend also some time alonediscover thecity•Read about history and traditions•Try to remember why you wanted to studyabroad and what means that for your futurelife•Go out with friends
about sending and receiving a message message in mind is not what you deliver the 4 levels of communication level of content = what is exactly said level of self-revelation = what you reveal about yourself level of appeal = what you want the receiver to do level of relation = relation between sender and receiver
Receiver just gets a picture - maybe not the same like the one in senders mind Why? - unspoken vs. spoken message encoding decoding Communication in marketing is about interpretation!
“level” of communication stick to the time which it takes phenomenon of “time” within communication by E. T. Hall & M. Hall -> high context vs. low context high context need to speak about status, relationship first low context need to quickly come to “the point”
high context individual low context individual: time aspect importance of content low context individual high context individual time aspect importance of social status Combination
to be aware of differences within communicationKnowledge of Ability to Becountry and its adapt flexiblecultureto know how Put no Integrate into to put it into pressure practice environment
Monochronic Time and Polychronic Time by Edward Hall•Do one thing at a time •Do many things at once• Concentrate on the job •Concentrate on the relationships•Take time commitments •Consider time commitments an• need information objective to be achieved, if possible•Are committed to the job •Are high-context and already have•Adhere religiously to plans information•Are concerned about not • Change plans often and easilydisturbing others; •Are more concerned with those who•rules of privacy and consideration are closely related (family, friends,•Show great respect for private close business associates) than withproperty; seldom borrow or lend privacy•Punctuality •Borrow and lend things often and easily • strong tendency to build lifetime relationships
Cultural Imperative Business customs and expectations that must be met and conformed to if relationships are to be successful.Cultural Adiaphora Areas of behaviour or customs that cultural aliens may wish to conform to or participate in.Cultural Exclusives Customs or behaviour patterns reserved exclusively for locals, from which foreigners are excluded
„I don„t want to buy this carpet please – Godspeed.“
Business customs and expectations that must be met and conformed to if relationships are to be successful. „must do“ „While in Rome, e.g.: Smalltalk in the USA, being on time and do as the Romans do!“ well prepared in Germany, leisure activities etc. Asia & Latin America Friendship leads to success! Trust and Acceptance as a cultural basis for business
Areas of behaviour or customs that cultural aliens may wish to conform to or participate in. „can do“ Following customs and/or e.g.: bowing in japan, greetings, rituals that are typical for eating special food etc. the according culture. Most visible customs Careful: Exaggeration may lead to annoyance Sign of goodwill and interest in the business partner„s culture
Customs or behaviour patterns reserved exclusively for locals, from which foreigners are excluded „don„t do“ e.g.: politics, religion, WWII in Germany, visiting a mosque in shorts, contradiction in Japan etc.
„I„d like a fresh beer for me and my friends please – get well soon!“
- International Marketing, Second Edition; Ghauri/Cateora- Paulaner Brauerei München- http://www.wordpress.com- http://www.CoxandForkum.com- Barbara Stöttinger / Hartmut H. Holzmüller ; International MarketingManagers´ Cultural Sensitivity, 2001- NBC‟s Today Show ; Doing Business in China, 2008- http://today.msnbc.msn.com