Chapter 4
Social and Cultural
Environments
Introduction
This can happen to anyone, anywhere, at anytime if
you don’t understand other people’s culture.
Finn Hansen
Hansen, head of international operations at Arla Foods, referring
to the boycott of Danish products by Muslims and the political
debacle that followed the publication of images of the prophet
Mohammed in a Danish newspaper.
http://www.timesonline.co.uk/tol/news/world/europe/ar
ticle723266.ece
4-2
Culture and marketing
Some ways of living are unique to culture (e.g. prom;
going away to college)
Some ways of living are common across cultures
(e.g. celebrating births, marriages, etc.)
Rapid inter-connectedness means shared ways of
living increase
Global consumer cultures (credit-card culture, pub culture,
coffee culture, fast-food culture, etc.)
Primarily embodied in the global teenager
Rapid interconnectedness means that resistance to
imported cultures also increases
Cargill seeds, KFC in India, McDonalds in France, American
fast food
4-3
Culture and marketing
Find which aspects of culture does your
product / brand impact
Are these aspects shared / unique
Shared aspects: standardized marketing
programs
Unique aspects: Adapted marketing
programs
Which products are impacted by GCC?
4-4
4-5
Breakfast habits in India
Breakfast habits
Indians like to eat hot, sit-down breakfasts
Milk generally comes in fresh every morning. Needs
to be heated before consumption
Rice preparations in the south, wheat and corn
preparations in the north
Are used to and prefer spicier foods, not sweet
Drink hot tea with milk and sugar with breakfast
Oats are for horses
Often eat with their fingers – may use a spoon
4-6
Kellogg’s breakfast cereals in
India - Product
What should Kellogg’s adapt and what
should they standardize?
Product
•
•
•
•
•
Cornflakes (as in the US)
Wheat flakes and rice flakes cereals
Suitable for warm milk
Unsweetened
Cereal bars
Packaging
• Weight in grams (metric)
4-7
Kellogg’s breakfast cereals in
India - Price
Premium pricing
Cornflakes Rs. 130 for 475 gms. i.e. $2.75 for 16
ounces of cornflakes.
US price: 12 ounces - $3.
Average cost of an Indian breakfast – Rs. 20, i.e.
$0.40
Why premium pricing?
‘premium’ image associated with Western foods
4-8
Kellogg’s breakfast cereals in
India - Place
Most retailers are small
shopkeepers; large
grocery stores are few
and concentrated in
urban areas
Cereals mainly available in
large cities
Wholesaler  Retailer
chain used
4-9
Kellogg’s breakfast cereals in
India - Promotion
Cereal bars – positioned as an anytime snack – placed in the
candy aisle in a grocery store
Cereals
http://www.youtube.com/watch?v=uoDwJT_ZP-M&NR=1
http://www.youtube.com/watch?v=uSXHOPe1eE&p=7DB7C4654547C017&playnext=1&index=28
Kellogg’s US ads
http://www.youtube.com/watch?v=CtPTrG0DxXY
http://www.youtube.com/watch?v=5Id3yJ8Qalo&feature=relate
d
4-10
4-11
Clothes washing in India
• Daily, by hand (belief that clothes do not come out clean
unless properly scrubbed)
• Maid
• Hang them out to dry
• Sturdy white (males) and colorful (females) cottons
• Power is expensive
• Living space is at a premium
• Water is scarce
• Greater foaming = greater cleaning power
• Clothes become dirty faster in dusty, hot climates
4-12
P & G’s detergents in India
Product
The Tide Bar
Price
125 gm (7 ounces) bar is
Rs. 7 ($0.15) - inexpensive
Place
Everywhere (incl. small
villages) – mass distribution
Promotion
http://www.youtube.com/w
atch?v=RWALQ-EmRig
Promotions in villages: Weekly
market, Bullock carts, animals, Bollywood
stars & music
4-13
http://www.pgindia.com/hp/tidebar.htm
For consumers who craved for Tide’s surprising whiteness in the form of a bar, try the New
Tide Bar that provides superior whiteness through tough dirt removal. The New Tide
Bar is unique as compared to the available detergent bars because of its three unique
features:
1) It has green speckles called Whiteons, a P&G proprietary technology to deliver superior
whiteness, which is further enhanced when clothes are being dried under the sun,
as Whiteons release a unique whitening action on reacting with sunlight;
2) Its technology also ensures that it lasts longer, does not dissolve easily and
delivers a good balance between bar-hardness and ease of application on
clothes and;
3) It has a lemony & refreshing fragrance that lingers on clothes hours after wash.
It provides outstanding whiteness on white clothes and provides excellent everyday
cleaning for colored clothes too, and is available at Rs. 5 for a 75gm. bar, Rs.
8.50 for a 125gm. bar, and Rs. 13 for a 200gm. bar.
4-14
Quibla Cola Products
4-15
Aesthetics and Color
Red—associated with blood, wine-making, activity,
heat, and vibrancy in many countries but is poorly
received in some African countries
White—identified with purity and cleanliness in the
West, with death in parts of Asia
Gray—means inexpensive in Japan and China, but
high quality and expensive in the United States
Purple – death in the Middle East, royalty in UK
4-16
The Meaning of Color
Yellow
indicates a
merchant in
India
Red signifies
good luck and
celebration in
China
In England
and the U.S.,
“Something
Blue” on a
bride’s garter
symbolizes
4-17
fidelity
4-17
Dietary Preferences
Domino’s Pizza pulled out of Italy
because its products were seen as “too
American” with bold tomato sauce and
heavy toppings.
Subway had to educate Indians about
the benefits of sandwiches because
they do not normally eat bread.
4-18
Dietary Preferences
Would you eat…..
Sturgeon roe (Russia)
Reindeer (Finland)
Rabbit, Snails and Frog legs (France)
Blood sausage (Germany)
Haggis – Scotland
Sorpotel – Goa
Snakes & rhesus monkey brains (Hong Kong)
Roos (Australia)
Raw puffer fish (Japan)
Converging dietary preferences (fast food)
4-19
Some communication gaffes
The Big Mac: Originally sold in France under
the name Gros Mec. The expression means "big
pimp" in French.
The Rolls-Royce Silver Myst: In German, mist
means "human waste." (Clairol's Mist Stick
curling iron had the same problem.)
GM cars: Originally sold in Belgium using the
slogan, "Body by Fisher," which translated as
"Corpse by Fisher."
Cue toothpaste: Marketed in France by
Colgate-Palmolive until they learned that Cue
is also the name of a popular pornographic
magazine.
4-20
Some communication gaffes
Puffs tissues: In Germany, puff is slang for
"whorehouse."
The Jotter: A pen made by Parker. In some
Latin countries, jotter is slang for "jockstrap."
Schweppes Tonic Water: The company
changed the name from Schweppes Tonic
Water to Schweppes Tonica when they learned
that in Italian, "il water" means "the
bathroom.“
Colgate is a Spanish command that means ‘go
hang yourself’
4-21
Language and Communication
Speaking English
around the globe
There are more people
who speak English as a
foreign language than
native speakers.
85% of European teens
study English
Sony, Nokia, Matsushita
require managers to
speak English.
Nonverbal
communication
Westerners tend to be
verbal, Asians value
nonverbal
communication.
In Japan, bowing has
many nuances.
In the Mideast,
Westerners should not
show the soles of shoes
or pass documents with
the left hand.
4-22
High- and Low- Context Cultures
High Context
Information resides in
context
Emphasis on background,
basic values, societal
status
Less emphasis on legal
paperwork
Focus on personal
reputation
Saudi Arabia, Japan
Low Context
Messages are explicit and
specific
Words carry all
information
Reliance on legal
paperwork
Focus on non-personal
documentation of
credibility
Switzerland, United
States, Germany
4-23
High- and Low- Context Cultures
Factor/Dimension
High Context
Low Context
Lawyers
Less important
Very important
A person’s word
Is his/her bond
Is not reliable—get it in
writing
Responsibility for
organizational error
Taken by highest level
Pushed to the lowest level
Space
People breathe on one
another
Private space maintained
Time
Polychronic
Monochronic
Competitive bidding
Infrequent
Common
4-24
Marketing implications of
context
High Context
Low Context
Negotiations
Lengthy
Direct &
purposeful
Prices
Bargainable
Firm
Promotional
platform
Extended family /
collective
Immediate family /
individualistic
Respect
Given without
question
Earned
4-25
Hofstede’s Cultural Typology
Power Distance – expectation and acceptance of
unequal distribution of power (High PD – Hongkong,
France; Low PD – Austria)
Individualism / Collectivism – ‘one above all or all above
one’ (High I/C – USA, UK; Low I/C – Taiwan)
Masculinity – sharply defined roles for men and women
(High M/F – Japan; Low M/F – Sweden)
Uncertainty Avoidance – comfort with ambiguity (High
UA – Greece, Portugal; Low UA – Denmark)
Long-Term Orientation – Is gratification immediate or
deferred (High LTO – Hongkong; Low LTO – Spain)
http://www.geert-hofstede.com/
4-26
Hofstede’s Cultural Typology –
Some Implications
Power distance – higher PD means
lower trust levels
Greater control preferred in countries with
high PD
Greater individualism – generally
greater demand for luxury goods
Immediate gratification, less team work
Greater collectivism – word-of-mouth very
powerful e.g. Tamogotchi (virtual pets)
Groups in ads vs. individuals in ads
4-27
The Chinese Negotiation
(2003)Graham & Lam, HBR
American
Individualist
Egalitarian
Information-oriented
Reductionist
Sequential
Seeks the truth
the argument culture
Chinese
Collectivist
Hierarchical
Relationship oriented
Holistic
Circular
Seeks the way
The haggling culture
4-28
The Chinese Negotiation (2003)Graham & Lam, HBR: How they
approach the negotiation process
American
Quick meetings
Informal
Make cold calls
Full authority
Direct
Proposals first
Aggressive
Forging a ‘good deal’
Impatient
Chinese
Long courting process
Formal
Draw on intermediaries
Limited authority
Indirect
Explanations first
Questioning
Forging a long term
relationship
enduring
4-29
The Chinese Negotiation (2003)Graham & Lam, HBR: Eight
elements of their negotiation style
Guanxi (Personal Connections) – premium on social capital
within group of friends, relatives and associates. The person
with the best guanxi wins. Reciprocity in guanxi is important
Zhongjian Ren (the Intermediary) – a go-between needs to be
used to make connections
Shehui Dengji (Social Status) – obedience and deference to
one’s superiors is strong – low level company executives cannot
break bread with high level chinese executives
Renji Hexie (Interpersonal harmony) – positive feelings holds
interpersonal relationships together – nontask activities may
involve long dinners, home visits, invitations to sports and other
events, etc. Trust and harmony are important
4-30
The Chinese Negotiation (2003)Graham & Lam, HBR: Eight
elements of their negotiation style
Zhengti Guannian (Holistic thinking) – discussing all aspects of
the deal at once – divergent from sequential thinking in the US
Jiejian (Thrift) – the tendency to save has engendered
bargaining over price usually through haggling
Mianzi (Face or Social Capital) – a person’s business reputation
and social standing rests on saving face. If Westerners cause
the chinese embarrassment or loss of composure even
unintentionally, it can be disastrous for negotiations. Face can
be earned, lost, given or taken away
Chiku Nailao (Endurance, Relentlessness) – talent is not as
important as diligence and work ethic. Negotiations can be
lengthy, chinese work hard at preparing for a meeting.
4-31