The Role of Culture
While business strategy plays a key role in successful collaboration and building a global brand, understanding the culture of the country being invested in is paramount. The culture dictates the methodology and approach for numerous operating models and a lack of research and understanding of the culture can quickly lead to demise for a company seeking to expand. A considerable amount of companies fail to complete substantial or intensive research before expanding their businesses beyond the United States border (Chung & Smith, 2007) and as a result do not set themselves up for optimal success. An area of extreme significance for the business in which the understanding of the local culture has far reaching effects is marketing. The onus is on management to do their research and put together a marketing team that understands the cultural dynamics and can tailor a marketing package that suits that dynamic (Jensen, 2015). In preparing their product or service for market, management needs to critically review the marketing strategy to ensure the marketing strategy is localized to the culture being operated in and is not part of a one size fits all marketing strategy.
Another component of culture worth researching in-depth prior to expansion is gaining an understanding the role of local, state, and central governments in the desired country. In the case of China, the role of government is more hands-on than that of the United States thus leading to norms
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International marketing or business is uniquely different from the local market because the product price, place and promotion is vastly different from what is been offered to local customers (Johansson, 2000) With the emergence of the information technology, cross border marketing has never been a distant dream. However, it has never been easier even for giant multinational companies to face challenges that come in international business. The biggest challenge comes from the culture which varies from country to country.
So far as international business is concerned, the four dimensions of culture form an important facet. Knowledge of the manner in which different features of a business are viewed in different cultures, can help a manager in understanding and sailing successfully across the international business market.
Since people and customers to be specific come from different cultural backgrounds, considering and understanding the cultural background and practices of every market niche. In ensuring that the organizational activities do not conflict with the cultures of clients and that they suit the needs of the cultures, the following would be done by the organization;
Cultural differences between nations often require a company to have multiple marketing strategies. What may be acceptable in on country may not be acceptable in another country. The cultural differences require companies to develop marketing plans that are suitable for each individual culture. Not being aware of and understanding the cultural differences can create costly and embarrassing errors that may actually offend those in other countries. Cultural differences can affect the colors of products, the graphics used on packaging, and how the product is communicated to the foreign target market.
Every country differs in culture which has been there for centuries. The international market is growing rapidly, with more and more multinational organisations entering new markets each day. In this assignment I will evaluate how the difference in cultures affects the performance of international businesses.
Denizci, B. & Xiang, L. (2009). Linking marketing efforts to financial outcome: an exploratory study in tourism and hospitality contexts. Journal of Hospitality
Making business abroad can be risky, but it can also be profitable for a company as well; thus the necessity to study in deep the country where the company will bring the business to. International companies are faced with many cultural challenges, when doing business across and inside of different borders. Identifying the significant cultural issues involved when evaluating the attractiveness of a particular location as a place for doing business can be crucial for a business. Aspects to consider when studying culture in a new place
Cultures are varying among different parts of the globe. People with different cultures have different characteristics and viewpoints on the subjects due to diverse understanding and method of learning. During the past few decades, the international trade grows in a very rapid rate due to the advantages that it provides; “increased sales, operational efficiencies, exposure to new technologies and broader consumer choices” (Heslin). Therefore, when considering the culture aspect to current business world, it is crucial for business to understand the culture aspect because of the tremendous growth of international business as well as utilize the international market to its maximum
Gao (2013) suggests that there is a need for marketers to develop different products or services when consumers in a foreign culture have different needs. According Gao (2013) The Home Depot had misjudged its target market and didn’t understand its Chinese consumers. “National cultures determines business models, and regional subcultures further refine business models” (Gao.2013). Gao further goes on to argue that is important for international retailers to rearrange themselves and rebuild their business models if they are to succeed in the Chinese market.
As many companies have started to work globally, it is important to understand the effects of cultural differences on ethical decision making to avoid possible business risk and to design successful international marketing management programs. With the advancement of globalization, the concept of culture has become an important part of organizations. Many companies face problems like different cultures, different consumer behavior and different way of communication etc. Marketing is one of the most appropriate and effective way of dealing with customers of different market. They need to build appropriate intercultural marketing approach, which suits the need and wishes of customers. Culture is the collective programming of the mind, which
Whenever a company is entering a new market it has to take into consideration the cultural differences between countries. Based on the case study analysis, the difference between the two countries in terms of eating out habits and eating preferences seem not to be understood by the Denver headquarter. Denver headquarter believes that it can enforce the same business model applied in the U.S to its stores in China, regardless of local preference. In addition, Foster seems to lack knowledge about the Chinese culture because she was not familiar with the market in China, as she had no experience working internationally. There was a lack of cross-cultural communication between Chen and Foster; even though, Chen had experienced both cultures while studying abroad in the U.S.
McCort, D. J., & Malhorta, N. K. (1993). Culture and consumer behaviour: Toward and understanding of cross-culture consumer behaviour in international marketing, Journal of International Consumer Marketing, 6, 91-127.
Luckie's Professional Consultants must continually cultivate a trusted advisor role with prospects and clients alike for the business to grow. The most critical aspect of the domestic and global branding strategies is the focus on how to become and sustain the positioning of a trusted advisor. As Luckie's Professional Consultants is in a high-end, very complex service business, the need to manage expectations of clients and deliver experiences far beyond what customers is expect is critical to their growth. The domestic and global branding strategy needs to reflect the value of continual excellence of performance on clients' projects, with the focus being on continually surpassing their expectations as well. The core strength of this business will be how much it is trusted and considered an essential element of any client's strategies across the broad base of services the company offers.
The key issue discussed within the article was about whether companies with brands that run across countries should go global or localize their advertising campaigns for multi-national brands. Global marketing campaigns allow for brands to run the same marketing campaigns across many different countries, utilizing the same creative with few changes across multiple regions of the world. Global marketing campaigns are very efficient because they allow for a single creative message to be utilized which is cheaper and faster to produce, allows for easy media purchases, and is simpler to traffic creative to different locations. In the case, the marketing team for Johnny Walker wanted to utilize this global marketing method, by creating one commercial that could be run across multiple countries with little to no variations to the creative in each market (only small changes would be made, e.g. translating languages). The problem with global marketing campaigns is different countries often have different interpretations of the creative, due to the unique cultural, demographic, and economic situations they are surrounded by. This can lead audiences within one country to be highly receptive to a message, and an audiences in another country to interpret it in a different way. In the Johnny Walker example, they created one commercial that featured young men doing different extreme and exciting adventures, showing that Johnny Walker empowered them to do what they wanted in their lives.