CHAPTER
GLOBAL
ENVIRONMENTAL
SCAN
Pages 183-190
By Brandon Miller
Joke Time:
The Real Reason Behind the
Andersen/Enron Fiasco
Global Environmental Scan
Uncontrollable factors that affect global
marketing:
• Cultural factors
• Economic factors
• Political-Regulatory factors
Overview
• Cultural Diversity (cultural factors)
 Cross-cultural analysis
• Values
• Customs
 Foreign Corrupt Practices Act
• Cultural Symbols
 Semiotics
• Language
 Back translation
• Cultural ethnocentricity
 Consumer ethnocentrism
Overview Continued
• Economic Factors
•
•
•
•
Stage of Economic Development
Economic Infrastructure
Consumer Income and Purchasing Power
Currency Exchange Rates
Cultural Environmental Factors
• A cross-cultural analysis involves the
study of similarities and differences
among consumers in two or more
nations or societies
• The cross-cultural analysis creates an
understanding about values, customs,
symbols, & languages of other societies.
Cultural Environmental Factors:
Values
• A society’s values represent personally
or socially preferable modes of conduct
or states of existence that are enduring.
Values influence the behavior of the
consumers.
• McDonalds example in India
• Visa example in Germany
Cultural Environmental Factors:
Customs
• Customs are the norms and
expectations about the way people
do things in a specific country.
• Cosmetics example in France
• Japanese Valentines Day example
Cultural Environmental Factors:
Customs
• The Foreign Corrupt Practices Act
makes it a crime for U.S. corporations to
bride an official of a foreign government
or political party to obtain or retain
business in a foreign country.
• Bribes are a tax deductible expense in
France & Greece
Cultural Environmental Factors:
Symbols
• Cultural symbols are things that
represent ideas and concepts. Semiotics
is the study of these symbols. Improper
use of symbols can be disastrous for
global marketers.
• Tiffany & Company example in Japan
• Coke example with the Parthenon
Cultural Environmental Factors:
Language & Back Translation
• The best language to communicate
with consumers in is their own.
• Over 3,000 languages spoken worldwide
• Vicks example in Germany
Cultural Environmental Factors:
Language & Back Translation
• In back translation, a translated
word or phrase is retranslated into the
original language by a different
interpreter. (error checking control)
• Nike flames example
Cultural Environmental Factors:
Consumer Ethnocentrism
• Consumer ethnocentrism is the
tendency to believe that is
inappropriate or immoral to
purchase foreign-made products.
• Observed in segments of the U.S.,
France, Japan, Korea, & Germany
Economic Environmental
Considerations
• Economic Factors:
•
•
•
•
Stage of Economic Development
Economic Infrastructure
Consumer Income and Purchasing Power
Currency Exchange Rates
Economic Environmental Factors:
Stage of Economic Development
• Developed Countries: Mixed
economies (Ex: U.S., Japan, Canada, &
Western Europe)
• Developing Countries: Usually moving
towards an industrialized economy (Ex:
Hungary, South Africa, & Pakistan)
Economic Environmental Factors:
Economic Infrastructure
• Economic infrastructure is a country’s
communication, transportation,
financial, & distribution systems.
• Critical for determining how, where, &
to whom to market.
• Coke example in India
Economic Environmental Factors:
Consumer Income & Purchasing Power
• Marketers must consider the average
household incomes of the consumers.
FIGURE 7-5
How
purchasing
power
differs
around
the world
Economic Environmental Factors:
Currency Exchange Rates
• A currency exchange rate is the price
of one country’s currency expressed in
terms of another country’s currency.
• Failure to consider exchange rates can
have severe consequences
• Mattel Barbie example
Review
Global marketing is affected by uncontrollable
factors that include:
• Cultural factors
•
•
•
•
•
Values
Customs
Cultural Symbols
Language
Cultural ethnocentricity
• Economic factors
•
•
•
•
Stage of Economic Development
Economic Infrastructure
Consumer Income and Purchasing Power
Currency Exchange Rates
Any Questions or Comments?
Thanks for listening
By Brandon Miller