Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 Influences of Acculturation to Global Consumer Culture and Ethnic Identification towards Western Culture Consumption Behaviors Azaria Sophiani Nadhirah and Ir. Mustika Sufiati Purwanegara Consumers these days can decide which one they would prefer among the tremendous variety of products, whether they will stay going local, try to adopt the global ones, or implement the combination of both. On the other hand, the debate is still ongoing in respect to the beliefs that acculturation to global consumer culture (AGCC) is negatively correlated with ethnic identification (EID) while the other one state that it is possible for someone to be acculturated to global consumer culture without losing its ethnical identity. Therefore, marketers cannot make assumption that cultures in different countries are similar each other. Following this, the objectives of this research are to focus on the relationship of AGCC and EID to see how these affect Indonesian consumers to the Western culture consumption behaviors and to decide which type of marketing strategy can be implemented to the global products. About 349 questionnaires were spread to several big cities in Indonesia. As a result, AGCC and EID were negatively correlated each other and all consumption behaviors were positively influenced by AGCC and not significantly influenced by EID. All Western culture consumption behaviors were categorized as assimilation according to Berry model, therefore, marketers were suggested to apply “standardization” as consumers assimilated the acculturation process. Keywords: acculturation to global consumer culture, ethnic identification, globalization, consumption behavior 1. Introduction Although globalization is not a new phenomenon, the effect of which continue to increase rapidly around the world. Globalization has brought countries much closer by the exchange of products, information, and culture. This is reinforced by the fact that people in every corner of the world are able to eat the same food these days, along with the same fashion to wear, the same television program and movie to watch, the same car to drive, the same restaurant to visit, and the same hotel to stay. (Ger & Belk, 1996). Questions like “Is Western culture covering the earth?” or “Does globalization lead to the end of cultural diversities among people?” will certainly lead to the endless pros and cons debate (indiana.edu, 2005). It should be admitted that the globalization coming from Western countries is highly inevitable. However, consumers these days actually can decide which one they would prefer among the tremendous variety of products, whether they will stay going local, trying to adopt the global ones, or implementing the combination of both. Hui, M.K., Joy, A., Kim, C., & ____________________________________________________________________________ Miss. Azaria Sophiani Nadhirah, School of Business and Management, Institut Teknologi Bandung (ITB), Jl. Ganesha No. 10 Bandung 40132 Indonesia. +62222531923 email: azaria.sophiani@sbm-itb.ac.id Dr. Ir. Mustika Sufiati Purwanegara, School of Business and Management, Institut Teknologi Bandung (ITB), Jl. Ganesha No. 10 Bandung 40132 Indonesia. +62222531923 email: mustika@sbm-itb.ac.id Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 Laroche, M (1992) states that it is possible for persons became acculturated by different culture, without losing their ethnic identity (EID). On the contrary, Penaloza (1994) argues that there is negative correlation between acculturation and ethnic identity after investigating the impact of ethnic identity on acculturation. Reflecting the fact that not all people will adopt globalization, in other word, not all people are acculturated to the other different cultures, is a dominant point of this research. Therefore, marketers cannot make assumption that cultures in different countries are similar each other. In promoting global products particularly, marketers should develop an appropriate marketing strategy as to fulfill the consumer needs and wants. The challenge, thus, are to understand the culture of potential target markets and decide among “standardization”, “adaptation”, or a “standardization and adaption” strategy. (Naghavi, 2011). Standardization: When companies determine to make a standardization of their marketing mix regardless of the cultural differences, it means that product, price, advertising, and other marketing activities will be implemented the same in all countries. (Naghavi, 2011). Adaptation: In order to win the new market, marketers should understand the diversification between cultures and set the adaptation of their strategies to the new culture. (Naghavi, 2011). Standardization and Adaptation: The implementation of this strategy incorporation seeks to have advantages of both strategies, which are the lower cost from standardization and adapting the product to the cultural differences; the marketers decide to determine the degree of standardization and adaptation in their marketing strategy (Naghavi, 2011). Globalization and acculturation are the primary focus to this research. Following this, the objectives of this research are to focus on the relationship of AGCC and EID to see how these affect Indonesian consumers towards Western culture consumption behavior and to decide which type of marketing strategy is most appropriate to be implemented to the global products. 2. Theory and Hypothesis 2.1 Consumer Behavior Consumer behavior plays an important role in marketing as it relates to the purchase behavior of the ultimate consumers. Marketers, particularly, need to analyze the consumer behavior to predict the marketing strategies and create a Marketing Mix for their products or services. The analysis can include the reason why consumers make the purchase decision, what factors influence consumer purchases, and the changing factors in society (udel.edu, n.d.) Moreover, Hoyer (2007) defines consumer behavior as a reflection to the consumer‟s decision regarding the acquisition, consumption, trait of goods, services, activities, experiences, people, and idea by human decision over time. Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 2.2 Ethnic Identification According to Bouchet (1995), how consumers recognize themselves is one of the most critical issues for marketers, mainly in this era of globalization. The extent to which they recognize with a particular ethnicity represents the commitment level of them regarding to the values and norms of the ethnic group, therefore, will influence their attitudes and behaviors. (Hirschman, 1981). The most widely accepted dimensions of ethnic identity, according to Cleveland‟s (2006) summary, are as follows: 1) language, 2) media consumption, 3) interpersonal relationships. 4) self-identification and pride, 5) desire to maintain one‟s own culture, 6) local customs, habits, and values, 7) family structure and sex roles, and 8) religious affiliation. 2.3 Acculturation These three different yet related terms have often been used interchangeably; diffusion, socialization, and acculturation. Culture diffusion happens when one culture is exposed to another (Berkman Lindquist & Sirgy, 1997); the process whereby people learn the culture standards in which they grow up in is named as socialization; meanwhile, acculturation is the culture changes as the effect from element contacts (e.g traits, norms, and values) of a different culture. (Berry; 1997). Therefore, acculturation takes two or more cultures interaction, (Mendoza & Martinez,1981; Mendoza, 1989), coming into contact for a period of time (Cleveland, 2006). Similarly, acculturation will begin within a period that people ought to decide to be adapted to either of the cultures or both of them when they are being faced to a new and originally diverse culture. (Redfield et al, 1936). The changes behavior resulted from acculturation can be varied. Lora, Lewis, Eskridge, Krogstrand, and Travnicek (2010), for example, examine the association of SES (education, income, employment) and acculturation on intake of n - 3 fatty acids in U.S Mid- western Latinas. Moreover, Vijagyopal & Dibb (2012) wanted to figure out the role of acculturation in brand choice among Indians people living in United Kingdom. 2.4 Ethnic Identification and Acculturation The relationship of ethnic identity and acculturation can be described as follows by Berry (1990): Figure 1: Ethnic Identity and Acculturation Matrix Maintain ethnic culture origin Acculturated by new group values and culture YES NO YES Integration Assimilation NO Separation Marginalization 1) Integration: keep some part of one‟s origin culture while also adopting some of the host culture 2) Separation: keep origin culture and avoid acquiring the host culture 3) Assimilation: learn and acquire the host culture and ignore the origin culture Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 4) Marginalization: persons who are rejected by the host culture and have no intention in keeping the origin culture. 2.5 Globalization Milward (2013) defines globalization as a concept that indicates the transformation and reallocation of products, capital, and human resources around the world to outgrow resource scarcities, also to increase efficiencies. He also believes that nowadays, it is impossible for people to live in isolation. He added that in this area of global transportation system like internet, distances will not matter as people still be able to interact around the globe each other. It can be inferred that culture and globalization process are interacting each other in complex ways, thus, it is very important for marketers to understand this kind of nature interaction. 2.6 Global Consumer Culture According to Cleveland (2006), many social scientists nowadays believe that global consumer culture is already at hand. Global consumer segment is defined (Dawar, Parker & Price, 1996; Hassan & Katsanis, 1991, 1994) as those who connect similar meanings with particular places, people, and things. Alden, Steenkamp, & Batra (1991) also comprehend global consumer culture as a cultural entity that is not correlated only with a single country, but rather a larger group assumed as international and transcending individual national cultures. Domzal and Kernan (1993) consider them as people who regard a product category in primarily the same way, regardless of their country origin. 2.7 Acculturation to Global Consumer Culture Cleveland (2006) simply state that acculturation to global consumer culture “considers how individual acquire the knowledge, skills, and behaviors that are characteristic of a nascent and deterritorialized global consumer culture. After a comprehensive review of pertinent literatures, six proposed dimensions were portrayed. Cleveland (2006) conceptualized AGCC having 6 dimensions, which are: 1) Exposure to Global and Foreign Mass Media (GMM): The global and foreign mass media can be composed from various media, like television, internet, magazines, etc. (Cleveland, 2006) 2) Exposure to Marketing Activities of Multinational Corporations (EXM): Advertising and the other promotional activities are the vehicle of transferring and transforming the product information into the purchase decision, most of marketers nowadays are more aggressive to cross the national borders. (Cleveland, 2006) 3) Exposure to and Use of the English Language: English language has become a sign of modernism and internationalism to many consumers. From the marketing world, English is often used on packaging and any other promotional mix, even in countries whose few residents are fluent in English, for example Japan as to convey symbolic forms of meanings, like cosmopolitanism (Alden et al., 1999) 4) Social Interactions through Travelling (TR): Traveling abroad is nowadays can be considered as a mainstream activity in accordance to the emergence of cheaper flight fees and easier access than ever before. (Cleveland, 2006). Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 5) Cosmopolitanism (COS): Cosmopolitan people are those who are more likely to engage themselves in other cultures, and have the capabilities to do so. (Cleveland, 2006). 6) Openness to and Desire to Emulate Global Consumer Culture (OPE): Several researches (e.g., Alden et al., 1999; Appadurai, 1990; Batra et.al., 2000) showed that people who admire the lifestyle from other countries tend to desire an ownership of consumption symbols from those countries. According to the theoretical foundations that have been explained before, the assumption can be created as follows. H1: AGCC and EID are negatively correlated each other. H2: Western culture consumption behaviors are positively influenced by AGCC. H3: Western culture consumption behaviors are negatively influenced by EID. 3. Research Methodology 3.1 Definition and Measurement Variables There were 5 variables in the questionnaire that is presented in table as below: Table 2: Variable Sources VAR Sources AGCC Cleveland (2006) EID Cleveland, (2006) CB Adapted to Indonesian culture. Cleveland (2006) conceptualized AGCC having 6 dimensions, which are: 1) cosmopolitanism (COS), 2) global and foreign mass media (GMM), 3) exposure to and use of the English language (ELU), 4) openness to and desire to emulate global consumer culture (OPE), 5) exposure to marketing activities of multinational or global corporation (EXM), and 6) social interaction: travel, migration, and contact with foreigners (SIN). However, ELU was eliminated reflecting the fact that respondents still live in their country origin with the assumption that they will still maintain their native language when communicating each other. Cleveland (2006) also developed EID model which was adapted from the past literatures. The dimensions of EID are: 1) local country language use (LCLU), 2) local media consumption (LMU), 3) local interpersonal relationships (LIR), 4) self-identification and pride (SIP), 5) desire to maintain one‟s own culture (DMC), 6) local customs, habits, and values (LCHV). However, local country language use was eliminated from the research by the assumption that most of Indonesian people prefer to use Indonesian language in their day-to-day communication, while local interpersonal relationship was eliminated because there was not much interaction between Indonesian and foreign people, means that people mostly interact with local people. The questionnaire was measured with two types of scaling; part one to part four used one to seven point Likert in which indicated from “1” in strong disagreement to “7” strong agreement, part five used one to seven point Likert which denoted varied specification based on the nature of the consumption and purchase type that have been tested. For examples, music Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 consumption frequency were measured from never (1) to daily (7). Next, global restaurant and cinema visit, along with related cultural goods purchased were measured from never (1) to several time per month (7). Finally, global music concert watched was measured from never (1) to several time per year (7). Last, Cleveland (2006) suggested 70 sections for consumer behavior analysis. However, implementing his suggestion would make questionnaire long and increase the fatigue of the respondents that may affect the quality of the questionnaire itself. Thus, consumer behavior elements were made simpler by only adapting to the Indonesian culture, which are: 1) Listen to Western song, 2) Watch Western TV program, 3) Visit Western restaurant, 4) Watch Western movies in cinema, 5) Purchase Western goods/merchandise, and 6) Watch Western concert. 3.2 Research Subject The sample could be either male or female that live in big cities around Indonesia. These criteria were created to adapt the target market chosen by companies related in the area of consumption behavior that being researched. A minimum of 349 respondents should be collected according to requirements determined; population size greater than 1,000,000 with margin error of 5%. About 330 online questionnaires were successfully acquired from the help of many related community and fan base administrators. To be able to reach the minimum respondents, paper-based questionnaires were spread to students in School of Business and Management, Institut Teknologi Bandung. Of the 60 questionnaires spread, there were 42 questionnaires returned. Meanwhile, 5 of them were considered unusable as some questions were found partially completed. From the online and paper-based questionnaires, 367 questionnaires can be further tested. 3.3 Data Analysis Technique Having gathered data from questionnaires, SPSS was employed to analyze the data using these following methods: - Simple Linear Regression Analysis Simple linear regression was used to see which factors affect which variables if it is analyzed one by one (one dependent with one independent variable). - Multiple Linear Regression Analysis Multiple linear regression is used to predict values of one variable towards more other variables. 4. Results Looking the fact that most of questionnaires were filled by students, the overwhelming majority of respondents were in the age of 19-22 years old (57%). About 4% of total respondents were in between 27-30 years old. Most of them were female (71%). For the occupation, most of respondents were university students (68%). Meanwhile, most of them spend approximately Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 below IDR 1 million per month (48%), and followed by the expense of 1 – 2 million per month (35%). 4.1 Validity and Reliability According to Bajpai, N. (2011), factor validation test can be continued if the sub variables have KMO value which is between 0.5 and 1.0 and total variance explained is greater than 50%. Cronbach‟s Alpa was used to measure the reliability (or the consistency) of the multiple Likert questions in the questionnaire. According to Nunnally (1960), variable that generates Alpha > 60% indicates an appropriate level of internal consistency. Table 3: Acculturation to Global Consumer Culture (AGCC) – Validity and Reliability Test Sub Variable COS GMM Western OPE EXM SIN Indicators Enjoy talking about events and trends Like to observe people Listen music from other countries Regularly read events taking place in other countries Interested in learning more about people Like to learn other ways of life Favorite actors from Western Often watch Western program Enjoy watching Western movies Like to read magazines about Western celebrities Enjoy listening popular music in Western Enjoy visiting websites Pay attention to the fashions Think people my age are the same around the world Enjoy trying foreign food Like to try restaurant that offer different culture food Open to try new things Globalization is good Foreign product advertising signs in my city Common to see foreign products ads in local media Often see foreign product when watching TV The number of foreign brands ads is higher than the local one Would like to work for a multinational company Found foreign product ads when reading newspaper Prefer spending vacation abroad Have travelled extensively Live in another culture one day Visiting foreign countries is my favorite Often think doing some travelling abroad Family members live in another country Factor Loading KMO Total Variance Explained (%) Reliab ility New Sub Variable Name 0.73 54.69 0.72 Culture Learning (CL) 0.86 70.11 0.91 - 0.6 59 0.65 Trying Attitude (TA) 59.25 0.72 Foreign Ads Media Exposure (FAME) 50.11 0.79 - 0.76 0.72 0.78 0.76 0.83 0.79 0.61 -0.17 -0.45 0.79 0.75 0.45 - 0.79 *Notes: black boxes indicate that the indicator was decided to be removed, while those which do not generate factor leading mean that they were not divided into two or more factors after the validation process. Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 A remedial action was required to the sub variables of COS, OPE, and EXM as they generated variance extracted lower than 0.5 in order to increase the percentage of variance extracted. Offending indicators were deleted in order to make the construct‟s sub variables valid. However, some turned out still generating inappropriate total variance extracted, then it was decided to delete another indicator from its group belonging by categorizing back the indicators based on the intent of the statements, or in the terms of „words‟. As we were doing so, the name of the sub variables was changed in order to be able to represent the revised indicators. Table 4: Ethnic Identification (EID) – Validity and Reliability Test Variable EID Sub Variable DMC SIP LCHV LMU KMO 0.68 0.84 0.75 0.80 Total Variance Explained (%) 64.98 58.91 53.20 56.96 Reliability 0.72 0.85 0.70 0.85 From Table 4 above, we can infer that all sub variables from EID were valid and reliable. 4.2 The Influences within Variables Direct Effect – Each Factor Partially In the following table, we can see which factors affect which variables and also the value of specific factors that influence dependent variable is also presented. Table 5: Simple Linear Regression Dependent Variables Listen to Western song Watch Western TV program Visit Western restaurant Watch Western movies in cinema Purchase Western goods/merchandise Watch Western music concert AGCC EID Independe nt Variables AGCC EID AGCC EID AGCC EID AGCC EID AGCC EID AGCC EID EID AGCC R a 0.473 a 0.081 a 0.575 a 0.120 0.554 a 0.156 0.554 a 0.156 0.52 a 0.041 a .244 a 0.004 0.251 0.251 R Squared Adjusted R Squared 0.223 0.007 0.33 0.014 0.307 0.024 0.307 0.024 0.27 0.002 0.06 0 0.063 0.063 0.220 0.004 0.327 0.011 0.305 0.021 0.305 0.021 0.267 -0.001 0.056 -0.003 0.059 0.059 Coefficient Direct Effect Beta 0.473 -0.081 0.575 -0.12 0.554 -0.156 0.554 -0.156 0.52 -0.041 0.244 0.004 -0.251 -0.251 t 8.326 -1.471 10.897 -2.191 10.342 -2.858 10.342 -2.858 9.448 -0.751 3.906 0.073 -4.023 -4.023 Sig 0.000 0.142 0.000 0.029 0.000 0.005 0.000 0.005 0.000 0.453 0.000 0.942 0.000 0.000 From simple linear regression, it can be inferred that almost all AGCC and EID were the influencer of consumption behaviors. Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 Direct Effect – Multiple Factor Together The table below provides the effect from one dependent variable combined with AGCC and EID at the same time. Table 6: Multiple Linear Regression Dependent Variables Listen to Western song Watch Western TV program Visit Western restaurant Watch Western movies in cinema Purchase Western goods/merchandise Watch Western music concert Independ ent Variables AGCC EID AGCC EID AGCC EID AGCC EID AGCC EID AGCC EID R R Squared Adjusted R Squared 0.475 0.225 0.219 0.582 0.339 0.334 0.568 0.323 0.317 0.452 0.205 0.198 0.52 0.271 0.264 0.247 0.061 0.053 Coefficient Direct Effect Beta 0.462 -0.044 0.550 -0.099 0.522 -0.129 0.453 0.001 0.524 0.018 0.254 0.041 t 7.863 -0.753 10.141 -1.826 9.516 -2.346 7.612 0.011 9.207 0.315 3.937 0.641 Sig 0.000 0.452 0.000 0.069 0.000 0.020 0.000 0.991 0.000 0.753 0.000 0.522 Raising the previous result, it can be seen that there are some independent variables that were significant in simple linear regression yet turned out to be not significant in multi linear regression, and vice versa. The analysis was further used to the one which generate higher adjusted R squared as it shows a better model or higher accuracy. The results among them are as the following: - Both simple and multi linear regression shows that listening to Western song is positively influenced by AGCC (sig=0.000, beta=0.473, adjusted R squared=0.220). - Simple linear regression shows that watching Western TV program is positively influenced by AGCC and negatively influenced by EID, while higher adjusted R squared in multi linear regression shows that this behavior is only positively influenced by AGCC (sig=0.000, beta=0.550, adjusted R squared=0.334). - Both simple and multi linear regression shows that visiting Western restaurant is positively influenced by AGCC (sig=0.000, beta=0.522, adjusted R squared=0.317) and negatively influenced by EID (sig=0.020, beta=-0.129, adjusted R squared=0.317). - Both simple and multi linear regression shows that watching Western movies in cinema is positively influenced by AGCC (sig=0.000, beta=0.554, adjusted R squared=0.305). - Both simple and multi linear regression shows that purchasing Western goods/merchandise is positively influenced by AGCC (sig=0.000, beta =0.520, adjusted R squared=0.267). - Both simple and multi linear regression shows that watching Western music concert is positively influenced by AGCC (sig=0.000, beta=0.244, adjusted R squared=0.056). - AGCC is negatively correlated each other with EID (sig= 0.000, beta= 0.251, adjusted R squared=0.059). Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 4.3 Hypotheses Summary Having analyzed the data, below is the summary of the hypotheses: Table 7: Hypothesis Summary Hypothe sis H1 H2 H3 Description AGCC EID (-) AGCC Western consumption behaviors (+) EID Western consumption behaviors (-) culture culture Result Finding Supported Significant negative correlation Supported Significant positive influence Not supported All Western culture consumption behaviors had no significant relationship with EID 4.4 Proposed Model Below is the proposed model between AGCC, EID, and consumption behaviors. Listen to Western song Watch Western TV program Dimensions of AGCC -0.198** AGCC 0.583*** Visit Western restaurant Watch Western movies in cinema EID -0.123** Dimensions of EID Notes: 1. * indicates a significance level under 0.05 2. ** indicates a significance level under 0.01 3. *** indicates a significance level equals to 0.000 4. Black lines indicate positive influence, red lines indicate negative influence Purchase Western goods Watch Western music concert Figure 1: Proposed Model Proceedings of World Business and Social Science Research Conference 24-25 October, 2013, Novotel Bangkok on Siam Square, Bangkok, Thailand, ISBN: 978-1-922069-33-7 5. Conclusion It can be inferred that acculturation to global consumer culture (AGCC) was negatively correlated each other with ethnic identification (EID). This result indicates that the higher people hold AGCC will correspond to lower value of EID. If these two were associated with Western cultural consumption behaviors, different results appeared between the analysis from simple and multi linear regression. Therefore, the adjusted R squared from each method was compared as to see which one is considered can give a more accurate prediction. AGCC seemed to be a strong positive influencer for the frequency of all Western consumption behaviors, which are the behavior of listening to Western songs, watching Western TV programs, visiting Western restaurants, watching Western movies in cinema, purchasing Western goods, and watching Western concert, by the mean that the increases in AGCC will correspond to increases in frequency of consumption behaviors. However, there were no behaviors having significant relationship with EID. Looking first at the interaction of AGCC, EID, and Western consumption behaviors, all the Western consumption behaviors can be categorized as “assimilation” according to Berry model, which is when the behaviors relate to positive relation to AGCC and negatively/non-significantly related to EID. This research can determine an appropriate marketing strategy for marketers according to the dynamic impact of global cultural influence towards consumption behaviors. Global marketers are suggested to apply “standardization” marketing strategy in which consumers are categorized in the assimilation context. As targeted consumers and/or customers in the assimilation model tend to acquire global culture, companies then can set global standards for their products when it is marketed in Indonesia. 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