International Marketing - McDonalds - Case Study Example

International Marketing al Affiliation) The consumer behaviour in international and local marketing largely depends on cultural factors that include unstated assumptions, values, norms, beliefs, communication, perceptions, procedures and evaluations. Culture defines similarity and complexity across international markets, though it is important to note that some consumer behaviours are not based on cultural attachments but on societal influence. Therefore, the cultural factors vary depending on the country, but are increasingly complex when people move into foreign countries that have extremely different dimensions of their home culture. In response to the diversity of the vast cultures spread around the world, international marketers must adopt effective marketing communication techniques that address the cultural needs of various groups in both the global and domestic perspectives. Therefore, market segmentation is critical in such situations to develop proper segments that divide the customer tastes and preferences according to the cultural backgrounds (Otmazgin, 2014). To this end, micromarketing is a tool that enables the international marketers in the intensification of marketing messages that are customer-centric in nature, hence providing each customer with the necessary personal information concerning the company’s services and products. In essence, culture is the sum total of customs, values and beliefs that influence the consumer behaviour of a people in a particular society. In contrast to values and beliefs, customs represent acceptable and usual ways of behaving. For instance, it is a routine for consumers to add diet sweeteners in tea or coffee, as it is for others to put ketchup on potato chips or scrambled eggs. As values represent the mentality that a consumer has towards a commodity, beliefs shape the attitude of that consumer towards the same commodity. To expound on that, certain consumers have perceptions about the quality of German made automobiles against the Swedish made automobiles. Consumer behaviour, in line with international markets, represents the study of individuals, organizations, groups and the processes they employ in selecting and securing services and products to satisfy their needs. The consumer behaviour encompasses the elements of sociology, psychology, economics and social anthropology. This action is responsible for influencing the decision-making process of buyers. The cultural factors that affect the consumer behaviour relate to the environment that the consumer belongs (Wong & Zeng, 2015). The existence of a person within a society or environment influences the person’s values. In the international market, it is necessary for a brand to take into account these factors and apply an appropriate marketing strategy. The marking strategy that a company chooses determines the role the company will have in a societies’ perception of the products. In the Western culture, for example, invitation of friends or colleagues for lunch, drinks or dinner is a common practice. To the contrary, the Japanese customs do not support invitation of people into homes. Such type of cultural difference is a major determinant for international brands that deal in beverages and savoury snacks. Similarly, the McDonald’s represents a brilliant example of the adaptation of the cultural specificities in each market that the food chain store ventures in. the Chicken Maharaja Mac and the Masala Grill Chicken with Indian spices give the Indian consumers a feeling of attachment to the company. Nevertheless, in France, McDonalds has the McBaguette with Dijon mustard and French baguette to imply to the French that the company is attached to the native French feeding habits (Okazaki, 2012). Similar specificities by McDonald are in the Turkish and Japanese markets. The above applications by the giant fast food store explains the importance of awareness of the local market with specific local products to fulfil the tastes and needs of the consumers across the different cultures. In understanding the entry strategy for any foreign market, companies should consider doing extensive research on understanding customers, where they reside, the manner in which they live, their historical background as well as the geography. The cultural background influences the consumption of people, further distinguishing their priorities. In addition to that, there exist sub cultures that identify different groups of people who share the same values, lifestyles but different tastes. Subcultures include ethic groups, gender, age differences, religious affiliations and the nationality. Companies consider sub cultures in segmentation in the market. Consideration of subcultures enables a company to adapt a certain communication or production strategy to the specific needs and the values of the segments. In the recent years, for instance, the international market has expanded the segment of “ethnic cosmetics.” These products, are designed to suit the non-Caucasian populations, and to other skin type pigmentation for Arab, African, and Indian populations. This marketing strategy uses the cultural association of ethnicity to capture the attention of the specific segment of the non-Caucasian population. The cultural link of the skin colour is a branding position that that targets to capture a market that had only make up products for the Caucasian population (Mitry & Smith, 2009). Religions, as well as geographical regions form an essential part of the global subculture. The preferences of different consumers who live in close proximity to each other often can be very different. Principally, individuals who belong to certain subcultures have their own attitudes, sub-culture values as well as unique social structures. These factors distinguish them from members of another subculture. Above all, the differences create important sub-cultural segments that dictate the marketing activities of both foreign and local entities in that particular market. Most important, the marketers must strive to acquaint themselves with the detailed characteristics of each subculture. This information helps create a viable marketing mix price, assists in making the choice for a suitable promotional and advertisement strategy as well as boosting the identification of the brand name. With the necessary knowledge on the sub-cultures, the product positioning becomes easier and efficient. Primarily, the international brands have the obligation to communicate in different ways to suit the needs of foreign markets. This goes to the extent of creating specific products with no significant essential difference to suit the sub cultures in the international market. The Coca Cola Company, for example, is a giant beverage company operating in all continents of the world. The products that the company sells are universally homogenous. Despite this, Coca Cola undertakes several promotional strategies that aim at targeting specific groups based on the age, gender, lifestyle and perception. Therefore, the cultural correlation is important in defining the stability of a foreign product in the international market, as many consumers are more amenable to products and services that specifically target them. In the process of determining the marketing strategy that will suit a foreign market, the principles of market segmentation apply. The foreign markets are more heterogeneous than the domestic market. In selecting a market, geographical segmentation is the first approach for companies that require entry into the global market. Thereafter, the regional, transnational and global segmentations follow suit. In the global segments, the consumers share core aspirations, attitudes and values. This is different from the geographical segmentation that focuses on the countries, as it focuses majorly on individual consumers. Social classes are groups that are homogenous in terms of the social ranking. Amongst the basic cultural ties, the social classes differ across the different cultures in the world. The existent categories of social classes include the upper class, middle class and lower class. Social class varies across the international market, as people in a specific social class tend to have specific consumption patterns and desires. Moreover, the disparities in the social class arise, principally, from the purchasing power. The purchasing powers of consumers distinguish the buying habits and behaviours of people from different social classes. In any population, disparities and desires exist in the choice of products, vacation destination, TV shows, magazines, hobbies and retailers. For instance, the middle class and their upper class consumer counterparts consume more healthy and balanced diets contrary to people from the lower class (Samli, 2013). Similarly, these people do not go into the same retail stores. The consumer behaviours based on social classes establish the entry strategy that foreign companies use to enter a foreign market. While some companies target the upper class, other companies target the lower class. In a classic example, the Chinese car manufacturer, Shanghai Automobiles Corporation, holds the largest car sales in the larger African continent (Khupe & Iyanda, 2013). The company sells automotives at cheaper and discounted prices, hence attracting the low-income African population, by offering an alternative for them to buy desired products at cheaper prices. On the other hand, giant automobile manufacturing companies such as Bentley target the high-class people of the social class, having low productions but selling their products at exceptionally high prices. In the identification of the social classes formed by individuals, it is critical to realise that social groups do not appear often in formal processes of the everyday life. The market research must establish the behavioural characteristics of people living within a perspective social class segment. These behaviours, together with other factors like communication styles, education levels, economic values as well as social attitude classify the social class of specific people. The similarity of certain characteristics in the determinants of the social class enables the marketers to adjust the standards of their products to meet the requirements, preferences and tastes of specific social class groups. Moreover, above the basic cultural beliefs, social class is an indicator of similarity in interests. People from a specific social class have homogenous values, and these values pronounce the manner in which the people dress, interact, the designs in which they furnish their houses, the automobiles they use as well as the types of sporting activities they enjoy. In marketing a foreign brand of beer in the Republic South Africa, a marketer must target the heavy consumers of alcoholic products. Besides, rugby in this country is a preserve for the members of the high social class, while soccer is for the low social class. Nonetheless, the marketer must design two different promotional strategies that target both extremes of the social divide. In designing a promotional strategy, the choice of media plays a critical role. It is therefore necessary to establish the fundamental basic that describes the universal choice of the global high class, as they prefer magazines and books, compared to other sub classes that prefer televisions. In the TV program choice, the upper class have preferences for dramas and news, while the low class have tastes for sport prams and films. The languages spoken by the social classes also differ, as in many high-class settings; the tone of conversation is often formal and precise. In the low social class, the language is informal and full of slang. Advertisers in the foreign market must prepare a language that is understandable across each social class, before appealing the communication channels that are preferable to the specific social classes. The social perception of a retailer or a brand plays a critical role in shaping the purchasing decision and behaviour of consumers across markets. Besides, the social class compromises the behaviour of a consumer. While the lower class consumers focus majorly on prices and saving costs, the upper class shoppers are motivated by prestige, innovation and benefit that he/she obtains from using the product. People, because of their popularity, peer pressure or obligation of compliance follow certain trends. In the release of a new product, or innovation of a certain brand, a company affects the behaviour of consumers. More people follow the trend of buying the product. Social pressure and the desire to conform to a cultural trend explain the consumer behaviour that conceives massive following of a trend. International marketers often use the cultural trend to capture the market. The promotion and advertising mechanism that the company employs influences many people to buy such a product. In celebrity advertising, the company targets the celebrity’s fan base by employing the celebrity to endorse their product. Samsung Company sponsors various celebrities in the commercial, sports and entertainment industries to market their products across various segmented international markets. Since the production of the Samsung Galaxy phone series, the company has registered massive growth, as the cultural euphoria to use each version of the Galaxy series manifests in the global phone market. However, it is difficult for a brand to create a cultural trend. The competition in the global markets offers various options for the consumers. Many forums and avenues challenge the introduction of products into the global market. These forums make it difficult to create a new trend. The exceptions of certain companies as Apple and Samsung emphasize the need for brands to maintain the attention that is requires in build a strong trend. Culture satisfies the needs of people existing in a society. Marketers should learn that culture offers guidance, direction and order in the phases of the believing people. In the global market, culture provides a set of rules that verify what a segment of people desire. Moreover, the sharing of culture is a reality that is transmitted in various institutions across the world. In contrast, consumer behaviour depends on more than just the culture. Social factors like reference groups, social status, and family influence the consumer behaviour significantly (Darity, 2008). The reference groups refer to the social groups that a consumer belongs. Such groups include the residential place, leisure, hobbies and work. The family on the other hand, shapes a person’s values and personality. In certain social status, decisions to buy a product are influenced by the assessment of a family. The family connection explains the inclination of consumer behaviour in preferring products that are similar to those acquired by their families. Apart from the social factors, personal factors including an individual’s characteristics also determine the consumer behaviour. The lifestyle a person lives evolves, as the person grows older. Similarly, an individual’s personality dictates the set of traits that the person has in interacting with the physiological and psychological situations around him. These factors have the ability to shape the mental picture of a person towards specific products. Further, certain psychological factors such as perception, education and motivation affect the consumer behaviour. Therefore, there is more to the consumer behaviour then just the culture. The impact that culture has on the global market, however, is immense. Culture transforms the global marketing through negotiation, ethics, management, communication, marketing mix, relationships as well as protocol. For a company to minimize cultural problems, it has to understand the value of local culture, and consider these values in decision-making. It is important for the company to have diversity in the staff in order to foster cross-cultural toleration. Such companies should acquaint their management with the necessary knowledge on the importance of focusing on cultural diversity in decision-making. In the globalised and competitive world of international marketing, the consumer represents the focal point of the choice of marketing strategy that the marketers choose to employ. This trend keeps increasing daily, as more channels that define the discussion of international business products also increase. The main aim of the international businesses, therefore, is to gain the loyalty and attraction of consumers by respecting the tastes of these consumers. This is possible by analysing the consumers’ personal experiences, questioning their desires and wants before formulating a desirable product to suit the above descriptions. In the choice of where to stock the company’s products, the subcultures come into perspective. By selling basic household commodities, the marketer should stock the products with retailers who interact most with the specific gender connected with household purchase. For instance, many people prefer supermarkets because the prices are cheaper, and offer credit opportunities as opposed to grocery. In targeting social classes, the supplier must look into such factors as the parking space and children’s playing areas before settling on where to stock the products. The modern international consumer’s preferences are in places and products that satisfy their cultural attachments in every aspect. The role of the family in each cultural and societal setting must be considered before introducing a product into a foreign market. In the East, the masculine figure is more responsible and effective in taking the first place in activities such as shopping, while in the West the general family participates in shopping. This explains why the international marketers should consider the social aspects of their promotional options based on the geographical placing of the foreign market. In conclusion, the rise in global trends makes it easier to contain the challenge of cultural diversity for foreign companies. The international companies are rapidly shifting to advocacy, with the technological facelifts that define the current nature of global business (Miyoshi & Kii, 2011). The social media enables companies to spread ideas and promote their products in overseas markets without physical presence in the foreign country. This enables cultural flow and increases the mobility of products, while improving the analysis of the consumer behaviour based on the geographical, cultural and social segments. For successful trade in the vast international market, it is important to overcome the economic and cultural boundaries that define global business. This will improve the competition standards in the world, while boosting the knowledge about the vast customs, habits, thoughts, preferences, beliefs and attitudes. Learning more about the properties of cultures is significant in the analysis of consumer behaviour and relevant knowledge about these cultures is useful in market segmentation, product positioning and identification of the target market. References Darity, W. (2008). International encyclopedia of the social sciences. Detroit, Mich.: Macmillan Reference USA. Khupe, S., & Iyanda, O. (2013). The proposed theoretical framework of consumer financial market efficiency and the exploration of key consumer credit behaviour factors in a developing economy.International Journal Of Business And Emerging Markets, 5(2), 101. doi:10.1504/ijbem.2013.052954 Mitry, D., & Smith, D. (2009). Convergence in global markets and consumer behaviour. International Journal Of Consumer Studies, 33(3), 316-321. doi:10.1111/j.1470-6431.2009.00746.x Miyoshi, H., & Kii, M. (2011). Technological innovation and public policy. Houndmills, Basingstoke, Hampshire: Palgrave Macmillan. Okazaki, S. (2012). Handbook of research on international advertising. Cheltenham, UK: Edward Elgar. Otmazgin, N. (2014). Regionalizing culture. Honolulu: University of Hawaiʻi Press. Samli, A. (2013). International consumer behavior in the 21st Century. New York, NY: Springer. Wong, M., & Zeng, X. (2015). Price and quality of remanufactured products related to consumer behaviour. International Journal Of Trade And Global Markets, 8(1), 17. doi:10.1504/ijtgm.2015.067970 Read More