International Market Communication Marketing Across Cultures. Chapter 5 Local consumers and the globalization of consumption Lecture notes [key notions: consumption fordism, globalization, the utilitarian view, convergence] ’The central paradox of globalization is the encounter between companies that are increasingly global and consumers who remain largely local’ (Usunier 2000: 136) Usunier’s main argument: ‘Consumption styles converge only at a macroscopic level’. Usunier’s point is that too little emphasis has been put on studying the details of ‘meaning invested’ by local consumers in the things and services they buy and in their consumption experiences (ibid.) A second argument forwarded by Usunier is that there is an apparent trend toward homogenisation of markets. He suggests three areas to be studied: 1) Globalization of demand (convergence of consumer behaviour and convergence of marketing environments world-wide) 2) Globalization of supply and competition (progressive shift from domestic protected industries to global industries). (Trade organizations, etc.) 3) Globalization of products and marketing offerings (treated in chapter 8) 1. Traditional international trade doctrines (Ricardo’s On the Principles of Political Economy and Taxation (1817) – the law of comparative advantage => a country that does not produce wine should buy it from a country with expertise in wine production because of the comparative advantage of the latter in International Market Communication Marketing Across Cultures. Chapter 5 Local consumers and the globalization of consumption manufacturing the product.) This point of view was utilitarian (focus on product utility – price and quantity) and the cultural meaning invested in the products by consumers (quality) was ignored. (This is a problem with global marketing approaches). – The corn laws – abolition of trade barriers – opening up of markets – leading perhaps to job losses. [There seems to be a clash of interests between cultural diversity and global welfare]. 2. The utilitarian view focuses on price, and low-cost arguments are used (the ideology of ‘standard in the American mind’). Most authors in the area of international marketing (e.g. Levitt) believe that differences in national tastes will disappear = a word-view). (Consumption-fordism = mass consumption of goods) Usunier is very critical of the utilitarian view. He quotes Czinkota and Ronkainen (1995, p. 3) who present global preferences as a simple fact: ‘No longer an alternative, global marketing has become an imperative for business’. But [Important for companies to use the competitive parameter of diversity in an age of standardization]. 3. Convergence at the macro-level Supply has become globalized (perhaps leading to) globalized patterns of consumption. Convergence in the following areas: - demography (age distribution, size of households, more immigrants) - sociocultural environment (growing equality between men and women, more working women, greater health and environment concerns a trend towards more femininity) - consumer behaviour (changing consumption patterns) International Market Communication Marketing Across Cultures. Chapter 5 Local consumers and the globalization of consumption Usunier’s conclusion is that quantitative globalization cannot be denied, but what is more interesting is that globalization increases diversity instead of reducing it if the local consumer is taken into account (2000: 141). 4. Convergence at a micro-level One study (Eshghi and Sheth (1985) of France, Brazil, Japan the US hypothesizes that lifestyles variation has greater impact on consumption patterns than national variation (users versus nonusers; owners versus non-owners of a number of products). But the influence by lifestyles was not as strong as initially assumed (although still significant) as national and cultural influences seemed to determine consumption patterns. Another study (Zaichkowsky and Sood (1988) suggests that in terms of ‘use’ and ‘consumer involvement’ with a product, consumer globalization differs according to product/service category. Further studies of yet other aspects of consumption have demonstrated that ‘the age of universal marketing is not yet upon us’ as there is considerable variation from one nation to another (Usunier 2000: 144). However, conclusions on the impact of globalization on consumption patterns should be drawn with caution because of the complexity of the area. 5. Is there a global consumer culture? McDonaldization (builds on three principles 1) the same for everybody, 2) the same everywhere in the world, 3) the same for all time. These principles incorporate efficiency, systematic quantification and calculation, predictability and control through International Market Communication Marketing Across Cultures. Chapter 5 Local consumers and the globalization of consumption the substitution of non-human for human technology.) Examples: Coca-Cola, McDonald’s. The emergence of a global ‘modern’ culture (consumption fordism, high individualism, tightly structured time patterns). The concept should not be confused with the convergence of local cultures (e.g. language, writing systems, religions). 6. Concepts/products robust to cultural influence? Usunier asks the question: ‘what is more culture free and what more culture bound, in terms of product and service categories on the one hand, and consumer behaviour on the other?’ The question here is whether it is at all possible to think of products that are robust to cultural influence. Some products are more culture-bound than others (e.g. furniture, food). Electronic equipment is not culture-bound in western countries, but in the developing world may be seen as a status symbol. Usunier (2000: 150) claims that pictures are less culturebound than written linguistic materials, e.g. the IKEA assembling instructions. Compare, however, the Morsø wood burning stove brochure. Non-durable goods are more culture-bound (appeal to tastes, habits and customs). The same can be said for films, novels and products that involve a relationship to others (e.g. gifts). Culture bonds may be studied by making a cultural biography of a product. International Market Communication Marketing Across Cultures. Chapter 5 Local consumers and the globalization of consumption 7. The role of habits in consumer experiences Habits are central in local consumer behaviour because they make people’s actions self-evident. Habit is based on what is common-sensical. Examples: drinking coffee as a social event, British fire safety systems and beer drinking. 8. Globalization constraints Consumers are not global themselves, but they prefer cheap, good-quality products. They are not conscious of buying a global product. They value individual expression in their purchases. There has been some resistance to the opening of national markets through the WTO. (The problem of the third world , e.g. Nestlé). A preference for national products in the western world (consumer ethnocentrism). (This is different in developing countries). The issue of ‘buy national’ campaigns. (Usunier’s advice is to play clearly on nationalistic feelings). 9. Conclusions Families are likely to be attracted to modern fordist consumption. Some individuals are postmodernist consumers Some individuals are critical/political consumers. International Market Communication Marketing Across Cultures. Chapter 5 Local consumers and the globalization of consumption Marketers are likely to be pragmatic in their marketing efforts, showing adaptations and flexibility in facing local consumption.