International marketing means that the company wants to expand its market across borders. If one company decides to enter the international market, most situations should be considered; since people across the world have different needs, requirements, and most importantly, different culture (Czinkota and Ronkainen, 2010). Hence, care should be taken to assess the marketing environment as well as the overseas potential of markets. This statement is supported by what (Ghauri and Cateora, 2006) stated, because culture involves how group design for living, it is important for the study of international marketing. As (Kurtz and Boone, 2006) points out, that marketing strategies and business practices that work in one country may be offensive or ineffective in another or it may even have to be modified from one area of a country to another because of their cultures; since it is often subconscious and invisible mechanism of our thoughts (Hall, 1983). Although there are many experts defined culture differently, most of them have similar interpretation.
1. Definition of culture
One of the very first definitions of culture was provided by Sir Edward B. Tylor, he wrote “the complex whole which includes knowledge, beliefs, arts, morals, law, customs, and any other capabilities and habits acquired by a human as a member of society” (1871, McCort and Malhorta, 1993). Anthropologist (Kroeber, 1952) says culture comes in the form of patterns, explicit and implicit, of and for behaviour obtained and distributed by symbols, representing the recognisable achievements of social groups, including their embodiment in artefacts; the essential core of culture consists of traditional ideas and specially their attached values. In other words, culture refers to patterns of values, norms, and beliefs that affect the way people asses information (Hofstede, 1991). (Hall, 1959) describes culture as the way of life of a people: their attitude, sum of their learned behaviour, and material things. In many times, culture is subconscious; an invisible mechanism operating in our thoughts. It also distinguishes the members of one category or people from those of another; a particular “category of people” may include an ethnic group, a nation, a gender group, an organization, or some other unit (Hofstede, 1988). To conclude, culture is a learned behaviour which we have grown up with and soaked up with to give us the direction; in terms of how people feel about things, how we see things, and how we evaluate them, and it makes us part of the group.
Relating culture into marketing, (Sondergaard, 1994) states that the most widely used framework is the one developed by (Hofstede, 1984). Following his research, he assesses numbers of different culture with four aspects of cultural dimension:
1. Power Distance
This dimension reflects the power gap of the authority or hierarchy in a group. In high Power Distance there is a clear view of who has the most power in the group. It is more towards autocratic leadership. Whereas in lower power distance means the power is more equally distributed or more egalitarian.
2. Individualism – Collectivism
It identifies the relations between member of the group. In individualism society, individuals only care for themselves rather than others or their group, whereas collectivist group, people belong to groups that care for them in exchange for loyalty.
3. Masculinity – Femininity
Masculinity is related to the value of gender differences in society, or the distribution of emotional roles between different genders. The values of the masculinity contain values of competitiveness, assertiveness, materialism, ambition and power. Femininity places more value on relationships and quality of life.
4. Uncertainty Avoidance
Uncertainty avoidance refers to how people are willing to take on the ambiguity and uncertainty.
Moving now to examine how the information exchanged between people. (E. T. Hall, 1967) put forward a theory of Low-context Culture & High-context Culture. Cultures can be separated in two groups in regard to degree of context in their communication. Low-context culture is expressed in groups that embrace an individual culture. Low-context culture communication is characterized by verbal and explicit messages of speech, straightforward, and direct; most of the information is carried in the explicit manner. As (Hall, 1967) stated, High-context culture is just an exact opposite of Low-context culture; in high Context culture communication, most messages are implicit, indirect and efficient. To a Low-context culture member, High-context communication can be mystifying, because symbols (non-verbal communications) can be important (Hall, 1967). Hofstede suggested the communication in High Context culture, information flows easier and faster between members, therefore there is less need of explicit communication to be performed. Having defined what culture is, next section of this essay will discuss why is culture important to international marketing.
2. Why culture is important to international marketing
Nowadays, companies have to acknowledge the importance of culture in creating marketing strategy. (Kurtz and Boone, 2006) stated, companies need to understand its role in consumer decisions; they must also monitor trends in cultural values as well as shifts in these values. It may be said that the biggest challenge in international marketing is to examine and fully understand the cultural traditions, preferences, behaviour of a country. Moreover, when designing international marketing strategies, companies must see and acknowledge how culture affects consumer reactions in each of its markets (Kotler et al., 2008). One of the examples of how culture affects consumer decision is how they arrange their finance. An area who indicates high Uncertainty Avoidance index tend to have more savings rate and less credit usage in their life (Peterson, Kushwaha, and Kumar, 2015). Moreover, they also tend to spend more on insurance compared to an area who scored low on Uncertainty Avoidance. They also found out that people from high Masculinity index are more likely to overextend their spending patterns compared to those who indicates low Masculinity index (Peterson, Kushwaha, and Kumar, 2015). These two examples are very clear application on Hofstede's theory to consumer behaviour. This information would be quite useful for companies in the financial and insurance industry when they design their marketing strategy. (Ghauri and Cateora, 2006) For companies that apply Multidomestic Market Concept as their international orientation, they would need to adapt and use different strategy to satisfy unique characteristic of each foreign market, especially for Product in their marketing mix.
We can also see how different culture shows different consumer behaviour by looking at the Power Distance score. A study done by (Kim and Zhang, 2014) presents that people who are from high Power Distance area tend to have more desire to consume luxury product (e.g. Rolex, Louis Vuitton) when they are in power or sit in high authority compare to those who are from low Power Distance country. Those who are from high Power Distance area believe that they need to endorse power disparity to other people (Hofstede, 1984). A possible explanation for this result would be self-expression; they might think they need to show or express to others that they are having high power. As was mentioned in the previous example, this information would be useful for companies which offer luxury product; it would help them in terms of promotion (communication) or better distribution. The result of the research really depicts the illustration of Hofstede's theory; high Power Distance people believe everyone should have a defined place within the social order. In contrast, low Power Distance belief cultures is to maintain and respect the equality in social interactions (Hofstede, 2001).
Cultural variables can also determine distribution strategies. This depends on the lifestyle of each culture or each region. For example, Avon, cosmetics manufacturers from USA which uses a distribution approach by direct selling to customers in the America, whilst in China and Taiwan market, Avon distributing their product through kiosks, small counters in department stores, the internet, and selling products at home-shopping TV channels (Kliendl, 2006). This is more attractive to Chinese and Taiwanese consumers to make purchases. As (Kurtz and Boone, 2006) states, marketing strategies and business practices that work in one country may be ineffective in another or it may even have to be modified from one area of a country to another because of their culture. And the culture discussed here, is E.T. Hall's High-context culture theory. (Hall and Hall, 2006) points out that High-context culture tend to prefer direct or face-to-face selling, because it also creates connection or relation between them. This is a very effective practice to encourage customer to move to conative or behavioural stage in the buyer decision process (Kotler and Armstrong, 2012). This section has explained why culture is important for the international marketing, the final section of this paper will show the example of how a company has altered its marketing strategy because of culture in two different areas.
3. Toyota Camry comparison in the USA and China
There is an example of two different advertisements for one same product but marketed in two culturally different countries. The product is Toyota Camry, and the countries are USA and China. As reported by (E.T. Hall, 1976), one of the countries that indicates Low-context communications is USA which means most of the communications are explicit and direct. China however, is the exact opposite of how communication in the USA, where communications can be vague and ambiguous or High-context. Picture 1.1, 1.2, and 1.3 below shows Toyota Camry Advertisement in the US. From the advertisement, we can get all information about the product clearly. It shows a lot of straightforward scenes to describe the product. At first, we knew this was an advertisement for Toyota Camry, and then we knew the information of the product: that it has a rear-view camera, a smart central command, and electronic panoramic roof. The information they are trying to tell are direct, straight-to-the-point, and in a simple manner. It is clear that this advertisement is exhibited in a Low-context culture for direct and obvious expressions of products, people in Low-context Culture could easily understand this form of advertising.
Picture 1.1. A Toyota Camry commercial advertisement in the USA
Picture 1.2. Toyota Camry commercial advertisement in the USA
Picture 1.3. Toyota Camry commercial advertisement in the USA
Picture 2.1. Toyota Camry commercial advertisement in China
Picture 2.2. Toyota Camry commercial advertisement in China
Picture 2.3. Toyota Camry commercial advertisement in China
The second ad (Picture 2.1, 2.2, and 2.3) are Toyota Camry advertisement in China. We can see that the ad is much more unclear than the US version. At first, we did not know that it was an advertisement of a car, all the viewers could see was a light moving on the Rings of Saturn. Then after about five seconds, it tells us that it was actually a Toyota Camry that moves on it. All viewers can see is that the driver seems enjoying the experience of driving Toyota Camry in the extraterritorial area––beyond this, nothing is informed on it. From the indirect and implicit messages presented to the audience, it can be concluded that this is an advertisement from a High-context culture mode. Thus, this advertisement must be interpreted from a contextual perspective and taken into account in cultural factors, such as beliefs and values (Hall, 1976). (Hall and Hall, 2006) also state that High-context culture communication is about “creating atmosphere” creating good environment as part of how they communicate. For example, if this ad is interpreted by Chinese, they will probably understand and get the message Toyota China is trying to tell, and good a result will be achieved. Perhaps, they interpret this advertisement as by driving a Toyota Camry, they would feel that they are on another level of excitement. Without the function and quality of this product directly, the audience has obtained the main function of this product and the contextual effect will be concluded. As (E.T. Hall, 1976) states “The communication style is more implicit and indirect”. However, if this ad is interpreted by viewers from a Low-context culture, they would be confused with bizarre concept of the whole advertisement and they would probably not have the desire to buy the product; as (Hall and Hall, 2006) states “Low-context people are at a loss when High-context people do not provide enough information”. These ads are also example of what (Mooij, 2010) states, advertising in Low-context culture, argumentation and rhetoric can be found, whereas advertising in High-context culture is often viewed by symbolism or indirect verbal communication.
Another plausible reason of why they have different advertisement, might be because they are trying to communicate to different group or target different market. It could be seen that by showing how practical the car is, Toyota USA's target might be families who needs practicality, families who need car with lots of features; that is presumably why they show lots of functionality of the car. As opposed to what Toyota China is trying to tell, they don't really seem to show how practical the car is might be because their target don't need practicality in a car—it seems that they target executives or entrepreneur who needs to show different image or emotional status. Because they target different market, it is also possible that they try to tell different benefit that customer would get from exactly the same product.
We can surely see that Toyota USA is trying to tell us the functional benefit of having their product; that it is equipped with features like smart central command, rear-view camera, and other smart gadget. In contrast to what we see in the Toyota China commercial advertisement, they might try to tell the viewers that by having their product, consumers would get emotional and self-expressive benefit. They might want to tell their viewers that by driving a Camry, customer would feel another level excitement or being different with others. It seems that they targeted customers who prefer emotional benefit over functionality; and they believe that customers would get that benefit by driving a Toyota Camry. As (Heller, 2018) stated, that marketer needs to communicate the benefits of the product when they promote their product; and it is probably what Toyota USA and Toyota China do with their advertisement here.
Culture can be very important not only in international marketing, but also in international business; because business is not just the act of introducing, promoting, or selling; it also involves a socio-economic interaction, meaning there is a lot of interactions involved amongst the market and when it comes to interactions, culture will likely to determine whether the interaction can be accepted in the society or not (Czinkota and Ronkainen, 2010).
...(download the rest of the essay above)