Marketing across Culture - Essay Example

?­­ Winter Final exam Denon, a manufacturer of semi-professional audio components sells the same basic version of their surround sound receivers using different model numbers and finishes (silver, black, gold tone) depending on the market in which it is intended to sell. They also limit the warranties depending on where the product is marketed. Why does Denon do this? What else could they do to combat this problem? Marketers, all over the world, sell their products in different markets with unique needs and characteristics. Therefore, marketers need to have different marketing strategies for each and every market where it is being sold and marketed. This is the reason why Denon sells its surround sound receivers with different model numbers, features (silver, black, gold tone) as well as warranties in order to cater to the unique needs of these markets. In order to combat the problem of different needs of the markets, a lot of marketers make a specific marketing plan for a particular product and then they adjust this plan depending on the market where it is being sold in order to fulfill the needs of the customers of this market. For example, many organizations sell their products in hundreds of markets all over the world. It is impossible to make specific marketing plans and strategies for each and every market. Therefore, these marketers make a common international marketing plan and then, they make adjustments to these plans and strategies according to the specific and unique needs of the market. 2. What are the problems you are likely to encounter with the distribution of your products in: China, Japan, and India? Which country poses the biggest problem? Explain your answer. With rapid globalization, companies are now selling their products in different countries worldwide. All of these countries have different markets with unique needs and characteristics. Companies have to face a number of problems while catering to the needs of these different countries. Companies selling in China, Japan and India have to face a number of additional problems and difficulties. With respect to china, marketers have to face the complexity of hiring expert Chinese agents for importing as well as marketing their products within China. Due to the communication, transport as well as regional difficulties, companies need to hire, train as well as constantly keep in contact with these agents (Selling and Distributing in China without a Legal Presence, n.p.). As far as Japan is concerned, one of the major problems is the difficulty of penetrating its cultural barriers and complex bureaucratic relationships and structures. The multi-layered distribution network in India is the biggest problems faced by marketers all over the world. It is difficult for marketers to reach a large number of customers and develop a high market share. Therefore, India is said to be the country which poses the most difficult problem for marketers as it is twice as hard to distribute products in India as it is else where. 3. Many products fulfill both a functional need as well as a social need. When deciding how much to adapt an existing product for a new foreign market, which type of need should a marketer focus on? Explain your answer. When entering a new foreign market, marketers should focus more on functional needs rather than on social needs. This is because the main reason for entering a market is to fulfill the functional needs of the customers. Functional needs are those needs which are fulfilled by the various functions of the product. After the fulfillment of the functional needs, the consumer gets socially attached with the product or service and that is when the marketer should start emphasizing on social needs. Therefore, during the initial stage the marketer should place more emphasis and focus on the functional needs. After that product’s functional needs turn into social needs, the marketer should switch his focus on it. Marketers need to determine the stage of the product lifecycle and then make strategies and plans related to the marketing of the product. 4. A multinational corporation has the choice of following either a financial integration philosophy or a financial independence philosophy. In the long term, which choice should result in a firm having more subsidiaries around the world? Explain your answer. A firm’s philosophy depends on its short term as well as long term objectives. If the main objective of a firm is to have more subsidiaries around the world, then the most suitable strategy would be to employ the financial integration philosophy rather than being financially independent. Under the financial independence policy, a firm mainly finances all its investments and costs whereas under a financial integration policy, a firm makes contracts with third parties which provide finances for various activities of the firm. Therefore, the policy of financial integration would result in a corporation having more subsidiaries around the world. Having more subsidiaries requires a large amount of funds which some multinationals might not be able to generate using the financial independence policy. Therefore, using the philosophy of financial integration, a firm would be able to generate more funds and as a result, it would be able to have a large number of subsidiaries around the world. 5. For the following industries/products, discuss to what extent: (a) A world consumer exists; (b) The product or service offered are themselves global (similar worldwide): and (c) The industry itself can be considered as global: a. –Airlines: b. -Tobacco c. -Meat-based foods d. -Sheets and pillows e. –Pharmaceuticals f. You may use a grid to answer this question. a) Airlines i. A world consumer for airlines does not exist because airlines are categorized as a luxury service and priced accordingly. ii. The service of air transportation is a global one. In different regions, taking the general income and work and leisure requirements into consideration, different airlines offer varying degrees of facilities for air transportation. Airlines might be priced highly in major cities and have low pricing strategies and similar packages for low-income regions. iii. The airline industry is a global one because it has destinations and landing sites in almost all countries. The industry is global in the sense that although some cities and towns may still not have proper airline services but chief territories of all nations are linked by air transportation. b) Tobacco i. Tobacco does have a world consumer because for most people it amounts to spending only a small section of disposable income. It is easy for a large number of citizens, world wide, to sustain a smoking habit. ii. The product being offered is a global one because apart from being used in cigarettes it is also used to make other products. In South East Asia, for example, tobacco is used to make a local cigarette made from a herb leaf. iii. The tobacco industry can be considered global because many brands are sold throughout the globe. c) Meat Based Foods i. Meat based foods do not have a world consumer because many populations are vegetarian and some markets have different cultural guidelines for which meat is permissible. ii. The product is a global one because it is available internationally. iii. The meat industry is a global one since frozen meat and meat based foods are traded items d) Sheets and pillows i. There is no world consumer since for instance desert tribes use animal hides and dried plant leaves in place of pillows and sheets ii. The product is a global one because many towns, cities and settlements supply of sheets and pillows is available. iii. The industry is not a global one. However, there are a few brands which sell these items across a range of globally dispersed countries e) Pharmaceuticals i. A world consumer exists for this product. Although there are some geographically closed terrains where supply of medicines is restricted or limited. Even tribes in Africa have now been introduced to most life saving drugs. ii. The product itself is not a global one because different drugs are produced in different countries and many are protected by patents iii. The pharmaceutical industry is a global one since demand for most life saving drugs, analgesics and antibiotics is found across the globe. 6. How do you suppose Hollywood’s influence on the globalization of consumer culture affect a firm’s decision to use product placement as part of their marketing strategy? Globalization has not only influenced consumer and business markets but it has also affected the industries related to entertainment as well. Examples include the Hollywood, as well as the Bollywood film industry. Hollywood, in particular, has affected consumer cultures of its viewers and this in turn, affects the decisions of firm. These decisions include a firm’s decision of product placement as a part of its marketing strategy. Product placement is when characters of a movie or fictional plays actually use a real commercial product. This is used as a marketing strategy to influence the decisions and choices of final consumers. Firms are now more inclined towards using product placement as a marketing strategy due to increased influence on consumer cultures by the Hollywood industry. Firms are continuously looking for ways to attract consumers and increase their market shares. Due to the success of the Hollywood industry worldwide, firms decided to use this opportunity by using the strategy of product placement and influencing consumer choice to increase their sales and market share. Consumers get persuaded by the use of these products by celebrities and this influences their final consumption choices. 7. Explain what the textbook author means when he writes: “Globalization favors the consumer not the worker.” Be thorough with your explanation. Marketers are, now, getting connected globally with their partners as well as their customers. Therefore, these marketers need to understand the principle of global marketing. This is important if they want to achieve sustainable growth and survive in domestic as well as international markets. Many authors believe that globalization results in far greater benefits for customers than workers. This is because almost all companies are connected to one another as a result of global competition. In order to compete effectively, companies make use of different competitive strategies including lower prices, greater incentives for customers etc. These strategies are highly beneficial for customers because companies need to attract customers and fulfill their needs in order to increase their market share, worldwide. In contrast, however, employees have to bear the costs and disadvantages as the main focus of companies shift towards attracting new employees and retaining the old ones. Companies are willing to fire employees if they do not work efficiently and do not focus on customers. 8. How do different cultural orientations ‘falsify’ our western conceptualization of Maslow’s hierarchy of needs? Explain your answer. Maslow’s hierarchy of needs is a theory in psychology proposed by Abraham Maslow which proposes that unless the basic needs of food, shelter and security, are not met by an individual then they cannot meet higher level needs. However, this theory can be criticized as being ethnocentric because it does not expand upon the fact that people from different cultures-for e.g. collectivist and individualistic cultures, can have a different hierarchy of the needs. In individualistic cultures the needs of the people are self-centered and the last and most satisfying fulfillment is that of self actualization (as mentioned by Maslow). In collectivist cultures the needs of belonging, community and family overshadow that of liberty and independence. In Korean and Japanese societies for instance, elders are highly respected and young people want to please their elders. Maslow’s hierarchy of needs also seats ‘sex’ as a basic physiological need. This disregards the development of society and man as an emotional and intellectual being and not simply an animal. 9. As T.R. Reid argued, even though Japan has prospered as a result of following a Confucian doctrine, there is much corruption in business and government, which goes completely against the teaching of Confucius. What is the best explanation for this contradictory state of affairs Confucianism is a philosophical system founded by the great Chinese philosophical and thinker, Confucius. This system revolves around the beliefs of ethical social relationships, humanistic values of sincerity and loyalty as a way of life as well as honesty and ethical principles in governmental activities. This philosophical system has affected global politics as well as philosophy as a whole (Beliefs of Confucianism, web). This system is used as a way of life in countries like Japan, China etc. This system is also being considered as a universal way of life as the core values associated with this system will continue to exist even if the society changes. This doctrine being followed in Japan means that all of the values associated with this doctrine are being followed as well. But it has been noted that businesses and governments in Japan have been involved in corruption which is strictly against the Confucian doctrine. This is mainly because with the advancement of technology, governments and businesses have become more power-oriented. As a result, they have forgotten the true beliefs and values of the Confucian system by involving themselves in corruption in order to fulfill their thirst for power and profits. The Confucian system did not allow any acts related to corruption but in order to increase their power and status in society, the business and government of Japan have involved themselves in corruption. 10. Explain the concept of “Asian shame” as it compares to “American guilt.” What are the implications of each vis-a-vis consumer behavior? The cultures of Asia and America have been compared in the past due to the various differences in their core beliefs and values. The Asian culture has been termed as being collectivist as Asians are more involved in group activities and strong family relations. However, the American culture has been associated with individualistic behavior as Americans like to work for their self interests and focus on individual behaviors rather than social relations. American culture has been termed as a guilt culture whereas Asian culture has been associated with a shame culture as their culture is enforced by social pressures unlike the American culture. These beliefs and characteristics of both the Asian and American cultures affect the behaviors and choices of their consumers. Studies have shown that these values actually affect the decisions and choices take by consumers in everyday life. This is because these cultures of guilt and shame are ways of life for both the Americans and Asians therefore, they have the ability to affect and influence consumer decisions. 11. In Japan, the most common type of social propaganda is aimed at reminding its citizens to uphold moral values. How do you suppose this type of ‘advertising’ would come across in the United States? What about in Bahrain? The citizens of Japan are reminded to uphold moral values as these are given high importance in the Japanese culture. This is because their culture supports collectivist behaviors and activities. In the United States, however, people are more inclined towards the individualistic culture and rather than working in groups and packs, they prefer working individually for their own self interests. Their culture is not value oriented but it is more goal-oriented as people focus on achieving goals and objectives over upholding moral values. Therefore, moral value-oriented advertising would not work in a society like that of United States. On the other hand, however, this type of advertising is likely to work in Bahrain as its culture supports value-oriented practices and behaviors. Therefore, advertising upholding moral values is most likely to work in countries like Japan and Bahrain rather than individualistic country like the United States. Works Cited "Beliefs of Confucianism." Buzzle. N.p., n.d. Web. 27 Jan. 2013. . "Selling and Distributing in China without a Legal Presence. China Briefing News." China Business News - China-Briefing. N.p., n.d. Web. 27 Jan. 2013. . Usunier, Jean, and Julie Lee. Marketing across cultures. 5th ed. Harlow, England: Financial Times/Prentice Hall, 2009. Print. Nisbett, Richard E.. The geography of thought: how Asians and Westerners think differently-- and why. New York: Free Press, 2003. Print. Reid, T. R.. Confucius lives next door: what living in the East teaches us about living in the West. New York: Random House, 1999. Print. Read More