Culture and its impact on
MARKETING
EPRG Model - Characteristics
Ethnocentric
Polycentric
Each country is
relatively
independent
Geocentric
Approach
International
operations are
secondary
The world is
one common
market
Vision
Centered on the Each market is
domestic
unique
market
Global vision of
the world
Priority
Searching for
identical
segments in
foreign markets
Taking into
consideration
differences in
foreign markets
Unifying
differences in
the world
market
Planning
center
National
headquarters
Subsidiary in
each country
World
headquarters
Structure
International
Division for
Matrix structure
EPRG Model - Characteristics
Ethnocentric
Polycentric
Geocentric
Staff
Citizens from
the domestic
market
Citizens from
each market
Most qualified
Marketing
strategy
Extension
Adaptation
Extension,
Adaptation,
Creation
Management
style
Centralized
Decentralized
Integrated and
interactive
Production
Domestic
Local
Low-cost
sources of
supply
Partnerships
Agent, licensing Joint-ventures
Strategic
alliances
Performance
Domestic
World market
Local market
Culture and international marketing
• Concepts of culture
• Dimensions and models of culture
• Examples and international marketing consequences
What is culture?
• “Culture is the integrated sum total of learned behavioral
traits that are shared by members of a society” (Hoebel)
• “Culture is the entirety of societal knowledge, norms and
values” (Antonides and Van Raaij)
• “Culture is the collective mental programming of the people
in an environment. Culture is not a characteristic of
individuals; it encompasses a number of people who were
conditioned by the same education and life experience”
(Hofstede)
Culture both affects and describes human behavior,
it is essential in international marketing
Fundamentals of culture
– Culture is a total pattern of behavior that is consistent
and compatible in its components. It is not a collection
of random behaviors…
– Culture is a learned behavior. It is not biologically
transmitted. It depends on environment, not heredity.
– Culture is behavior that is shared by a group of
people, a society. It is a distinctive way of life.
Culture vs. personality
• Personality is the individual’s unique
personal set of mental programs that he/she
does not share with any other human being.
• Culture is what members of a group have in
common. “It is the glue that binds groups
together” (De Mooij)
Human nature depends on culture: ideas, values, acts, emotions… are
cultural products. Cultural patterns help people to live together in a society.
Manifestations of culture
Symbols
Heroes
Rituals
Values
and
Norms
Expressions
of culture
Symbols
• Symbols are words, gestures, pictures, or objects that
carry a particular meaning recognized only by those
who share a culture.
• This is the most superficial manifestation of culture.
• New symbols are easily developed and old ones
quickly disappear.
• Symbols from one cultural group are regularly copied
by others.
Heroes
• Heroes are people, alive or dead, real or
imaginary, who possess characteristics that
are highly prized in a society.
• They serve as role models for behavior.
• They can become globally known, but their
stories often become local.
Rituals
• Rituals are the collective activities
considered socially essential within a
culture.
• They are carried out for their own sake.
• They are easily observed, but not always
understood.
Values
• Values are at the core of culture.
• Values are stable beliefs regarding desired behavior or end
states.
• They often have a religious, ideological or humanistic
background.
• Goals are derived from values.
• Values are among the first things children learn, not
consciously but implicitly.
• Core values are resistant to globalization; they vary across
cultures and are not likely to change frequently.
Norms
• Norms and values are part of the “non-material”
culture.
• Norms are beliefs regarding how to behave and
how not to behave (do’s and don’ts).
• People differ in the extent to which they accept
and comply with norms.
• They create expectations and criteria regarding the
conduct of others.
Explicit vs. implicit culture
• Explicit culture: languages, behavior,
know-how, institutions (directly observable)
• Implicit culture: moral values, learning
process, beliefs and representations
(subconscious)
According to Hoebel…
There are 3 types of cultural norms in terms of
behavior:
• 10% of norms are technical:
– explicit, logical and transferable; written norms of a society (laws,
technical manuals, rules, etc…)
• 30% of norms are formal:
– explicit, moral and transmissible; traditions of a culture; learned
through education (manners, courtesy…)
• 60% of norms are informal:
– implicit, instinctive and imitated; sunken part of the iceberg (facial
expressions, body language, cultural perspective on time and space…)
How do these cultural norms influence
international business and marketing?
Two levels of cultural diversity
in international business
• External cultural diversity
– Cultural determinants influencing purchasing and consumption
behaviors (Who buys? What? Where? How? Why?)
– Cultural determinants influencing negotiations (relationships
with suppliers, buyers, partners)
• Internal cultural diversity
– Observed within all MNCs (identity and corporate culture)
– Cultural differences that affect the way subsidiaries work
together
Four levels of culture in marketing
DOMINANT CULTURE
Non-material
consumer culture
Material culture of
products
Non-material culture
of the firm
(market)
(corporate culture)
Transfer of culture
Two main cultural transfer processes:
• Socialization: transfer of culture to new
generations; older generation to younger
generation; education.
• Acculturation: transfer of culture to adults who
have grown up in different cultures, who have
been socialized in different cultures; ethnic
minorities; multicultural societies.
Cultural transfer and change
SOCIALIZATION
Agents
CULTURAL
TRANSFER AND
CHANGE,
DYNAMIC
PROCESS
LEARNING BY
OBSERVATION
Agents
ACCULTURATION
Agents involved in cultural transfer
Agents
Age (years)
Most important values
Parents
0
Obedience, cleanliness, honesty
Siblings
2
Responsibility, social recognition
Schools, teachers
6
Ambition, capability, logical behavior
Friends
6
Courage, social recognition
Church
6
Honesty, peace, salvation, forgiveness
Sport, clubs
12
Ambition, courage
Mass media
12
Pleasure, intellect
Processes of cultural change
• Socialization and acculturation usually imply a
gradual cultural change because transfer agents tend
to favor cultural continuity rather than jeopardize
their powerful position.
• In contrast, innovative forces are less conservative
and may challenge the status quo.
4 processes: cohort effects, age effects,
democratization and exclusivation.
Cohort effects
• Acceptance of new values and behaviors begins at a
young age.
• These values and behaviors are retained over the
years.
• They are spread in society because young people
grow older and the “old” values gradually disappear
with the extinction of the older cohorts.
• Implies a slow cultural change.
Age effect
• Certain values or behaviors are associated with a
particular age group.
• Behaviors are modified as age groups change.
• Age-bound consumer behavior.
• Possible reverse socialization.
Democratization
• Cultural “leveling” or “spreading”
• Cultural differences across social classes decrease.
• Results from an increasing level of general
welfare, the influence of mass media and the stress
on the equality ideal.
• Mechanisms of democratization: trickle-down,
trickle-up, trickle-across.
Exclusivation
• Reverse of democratization
• Occurs less frequently
• Implies limited social spreading of values, goods
and behavior.
• Cultural change is limited to a certain group
(“elite”, “leading edge”).
Dimensions of culture
• What makes one culture different from another
culture?
• How can we compare cultures or cluster cultures
according to behavioral characteristics?
• Stereotypes vs. cultural dimensions
• Different cultures have different stereotypes of other
cultures.
Ethnocentrism and SRC
Cultural dimension models
• Hall – High-context vs. low-context cultures
• Kluckhohn – Relationship to nature
• Hofstede – Five dimensions of culture
Hall’s cultural model
• Focuses on communication patterns found within
cultures
• Four essential dimensions in terms of communication
patterns:
–
–
–
–
Context
Time
Space
Information flow
High-context vs. low-context cultures
Low-context and high-context cultures
• Low-context
– Messages are explicit
– Words carry most of the information in communication (facts,
data)
– Effective verbal communication is expected to be explicit, direct,
and unambiguous
• High-context
– Less information is contained in the verbal part of the message
– Much more information resides in the context of communication
(background, associations, symbols, basic values of the
communicators)
– Verbal mode is only one part of communication, nonverbal is
often seen as having greater importance
Degree of context of cultures: comparison of law (US and France)
Time
• Different cultures have different concepts of time.
This can explain differences in behavior.
• Dimensions of time:
– Closure: a task must be completed, if not perceived as
“wasted”
– Long-term vs. short-term thinking
– Orientation toward past, present or future
– Linear or circular (tangible or intangible)
– M-time and P-time
– Cause and effect
– Time as symbol (“time is money”, efficiency, waiting,
discretionary time)
A few examples…
Factors
High-context
Low-context
Lawyers
Less important
Very important
A person’s word
To be trusted
« Get it in writing »
Responsibility for error
Taken by the highest level Pushed to the lowest level
Space
People breathe on each
other
People maintain a bubble
of private space
Time
Polychronic, circular
Monochronic, linear
Negotiations
Are lengthy
Proceed quickly
Competitive bidding
Infrequent
Common
Examples
Japan, China, Middle East US, Germany,
Switzerland
Kluckhohn’s cultural model
3 types of relationships between humanity and
nature:
– Mastery-over-nature (man is to conquer nature)
– Harmony-with-nature (man is to live in harmony with
nature)
– Subjugation-to-nature (man is dominated by nature)
Further developed with: nature of people, duty, mode of activity,
privacy of space, temporal orientation…
Humanity and Nature
Mastery-over-nature
-Humanity is separate
from nature
Harmony-with-nature Subjugation-to-nature
-No distinction between -People are dominated
humanity, nature and
by nature
supernatural
-Nature should be
controlled
-Communion,
exchange, subtle
-“To move a mountain” intimacy
-Identification with
nature
“Western” world,
Asia, Japan
in international marketing?
NorthUse
America
-Supernatural forces
play a dominant role in
religion
-Nothing can be done
to control nature
Africa, South America
Hofstede’s cultural model
• Hofstede’s 4D or 5D model
• Quantitative and longitudinal study of cultural differences between
countries
• Why some concepts of motivation do not work in all countries in the same
way
• “Culture’s Consequences” and “Cultures and Organizations: Software of
the Mind”
• Scores for each country explain why people and organizations in various
countries differ, comparative data.
Reference in international business and international marketing
How do we measure cultural distance?
Geert Hofstede’s Cultural Index
- National character survey
- 116.000 IBM employees
- 72 countries and 20 languages
Original scores
for 56 countries,
extended to
nearly 90
Five different poles make up the cultural index:
- Power distance
- Uncertainty avoidance
- Individualism
- Masculinity
- (Long term orientation)
5D Model
PDI
100
LTO
UAI
100
100
Work-related values
to consumptionrelated values
0
100
MAS
100
IDV
Power distance (PDI)
• High PDI vs. Low PDI
• “the extent to which less powerful members of a society accept and
expect that power is distributed unequally”
• Reflected in the values of both the less powerful and more powerful
members of society
• Influences the way people accept and give authority
• Shows class or social structure
• Focuses on the degree of equality, or inequality, between people in the
country’s society
Uncertainty avoidance (UAI)
• High UAI vs. Low UAI
• “ the extent to which people feel threatened by uncertainty and
ambiguity and try to avoid these situations”
• Strong UAI = need for rules and formality to structure life, search for
truth and belief in experts
• Conflict and competition are threatening
• Higher level of anxiety, show of emotions is accepted
Individualism (IDV)
• Individualistic vs. Collectivistic
• “people looking after themselves and their immediate family only,
versus people belonging to in-groups that look after them in exchange
for loyalty”
• “I”-conscious and “we”-conscious
• Focuses on the degree the society reinforces individual or collective
achievement and interpersonal relationships
• Distinguishes between societies where the group and being a member
is important (collectiveness) and societies where the group is less
important (individualism)
Masculinity (MAS)
• Masculine vs. Feminine
• “the dominant values in a masculine society are achievement and
success; the dominant values in a feminine society are caring for
others and quality of life”
• Focuses on the degree the society reinforces, or does not reinforce,
the traditional masculine work role model of male achievement,
performance, control and power
• Shows the importance of status in societies
• Indicates the degree of gender differentiation and the importance
of masculine values (assertiveness, money, material goods,
success…)
Long-term orientation (LTO)
• Long-term vs. Short-term orientation
• Chinese value survey, “Confucian dynamism”
• “the extent to which a society exhibits a pragmatic future-oriented
perspective rather than a conventional historic or short-term point of view”
• High LTO = perseverance, ordering relationships by status, thrift, sense of
shame, family ties, long-term thinking, paternalism
• Focuses on the degree the society embraces, or does not embrace, longterm devotion to traditional, forward thinking values
• Indicates whether the country prescribes to the values of long-term
commitments and respect for tradition
American culture
• Classical dimensions: M-time culture, linear timepattern, low-context, low PDI, individualistic, high
MAS, low UAI, short-term orientation
• Other dimensions: success, obsession with change
(new and better), credit card culture, education for
competitiveness, independence, ethnocentrism, strong
role differentiation, innovativeness, creativity, private
opinions expressed, education teaches students to be
critical (ask “why” not “how”), man must conquer
nature, (De Mooij)
Japanese culture
• Classical dimensions: P-time culture, circular time
concept, high-context, high PDI, collectivistic,
masculine, strong UAI, long-term orientation
• Other dimensions: pressure to behave like
neighbors, shame-based society, avoid jolting social
harmony, dependence, private opinions not
expressed, status is important (success) but avoid
standing out in a crowd, cash culture, thrift and
perseverance, strong role differentiation, education
(“how” instead of “why”), education has an intrinsic
value, obsession with cleanliness, harmony with
nature… (De Mooij)
Intracultural differences
• Few cultures are homogeneous in terms of cultural
traits and norms
• Consequence of globalization?
• Intracultural differences (nationality, religion,
race, language or geographic areas) result in the
emergence of distinct subcultures
• Existence of cross-cultural and intracultural
differences: opportunities and threats
To summarize on culture…
• Culture is complex and multi-dimensional, but classification
is important in business
• Cultural distance is essential in international marketing
• Culture influences perceptions and drives how we
communicate and what we communicate
• SRC and ethnocentrism can explain the failure of many
companies in the international arena
• Acculturation (adjusting and adapting to a specific culture
other than one’s own) is one of the keys to success in
international operations
How does culture affect
international marketing?
• Languages and the use of language in communicating,
advertising, negotiating…
• Marketing research is much more difficult to conduct from a
methodological perspective
• Buying patterns and behaviors will vary in different cultural
contexts
• Marketing mix will be perceived differently from one country
to another
• Management styles will be directly related to culture…
Marketing and cultural differences
Marketing area
Influence of cultural differences
Consumer behavior
Decision-making, cross-cultural attitudes, local vs. global
Marketing research
Cross-national equivalences
Global marketing strategy
Global strategy vs. customized strategy
Segmentation & targeting
Inter-national (regional, global) vs. intra-national
Product policy
Adapt or standardize product attributes
Brand image
Brand perception, country of origin, “made in”
Pricing policy
Price-quality ratio, influence of price in decision-making
Distribution channels
Type of channel, distributor relationships
Communication
Values, visions of the world, communication styles
Advertising
Advertising messages, symbols, adaptation of strategy
Sales
Sales force management, PR, corruption, ethics
Negotiation
Negotiation strategies, process, results, styles…
Source: Usunier
Culture’s consequences on
international marketing
• Marketing research (understanding consumers)
• Segmentation (classifying consumers)
• Product policy (satisfying consumers)
• Distribution channels (reaching consumers)
• Advertising (communicating with consumers)
Some final thoughts…..
• “Many cultural differences — varying attitudes concerning
when best to speak or stay quiet, the role of the leader in the
room, and what kind of negative feedback is the most
constructive — may seem small. But if you are unaware of
the differences and unarmed with strategies for managing
them effectively, they can derail your team meetings,
demotivate your employees, frustrate your foreign suppliers,
and in dozens of other ways make it much more difficult to
achieve your goals.”
»
Erin Meyer - The Culture Map: Decoding How People Think, Lead, and Get Things Done
Across Cultures:
In Conclusion…..
• Culture plays a huge part in marketing in today’s global
marketplace. Overlooking the importance that culture has can be
disastrous for the brand, and hinder business from being able to
grow.
• Tailoring marketing messages to suit the requirements of each
culture and creating native-language assets to educate the
audience about the product or service is a fundamental part of
the process.
• It’s also important to keep in mind that culture is changing and
there are also things that can be done in order to position the
brand alongside important trends.
In Conclusion…..cont’d
• The elimination of gender stereotypes in advertising in the UK
and the backlash against them in many Western cultures is a good
example.
• Having a corporate culture that exemplifies a certain ideology
(like protecting the environment, giving back to the community or
providing equal opportunity to people of all origins, for example)
can add yet another layer to the cultural marketing initiatives.
• Just remember, a “one size fits all” mentality to marketing across
cultures doesn’t work. Trying to be everything to everybody will
just end up making you nothing to nobody.
• And all this goes for B2B marketing just as much as it does for
the B2C world.
What about Indian Culture?
• Well, that is a topic for another day!!
• Recommendation: Please view the many youTube videos
mythologist, Devdutt Pattanaik, has on the influence of
Indian Culture on Indian business mangement styles.
Thank You