G - Cross-cultural product politics Flashcards
Standardization vs. Adaption
Basic problem of Standardization vs. Adaption
Standardization is used for global marketing and more or less culture free. Adaption however is used for domestic marketing and is culture bound.
Cross-cultural marketing is somewhere in the middle: as global as possible, as local as necessary.
Standardization vs. Adaption
Scope of different products
Product type:
Availability:
Example:
Product type: national
Availability: one national market
Example: “McAroni” salad with noodles, developed for Sweden
Product type: international
Availability: many national markets
Example: “Noodle soup” - for Asian cultures
Product type: global
Availability: worldwide
Example: “Big Mac”
Problems with standardization
Typical mistakes of Global marketing
Example
Coca-Cola removed 2 liter bottles from Spains market after the company realized that the fridges in Spain are typically small
The Standardization / Adaption-Problem
Factors influencing the S/A-Decision
Standardization
Type of good:
Economies of scale:
Protectionism:
Cultural bondage:
Type of good:
- Luxury, investment and high-tech good
Economies of scale:
- realizable
Protectionism:
- weak
Cultural bondage:
- no (culture free)
The Standardization / Adaption-Problem
Factors influencing the S/A-Decision
Adaption
Type of good:
Economies of scale:
Protectionism:
Cultural bondage:
Type of good:
- Consumer and high-touch food
Economies of scale:
- not realizable
Protectionism:
- strong
Cultural bondage:
- yes (culture bound)
The Standardization / Adaption-Problem
Culture Bondage of Products
When culture bondage is weak, high standardization is high, e.g. Computer (hardware), airline companies, photography equipment.
When culture bondage is high, standardization is low, e.g. textiles, sweets/confect, food, publisher goods.
Survey: Which elements of the product politics can be standardized?
Product Quality (78%) Brand name (72%) Image (71%) Performance (67%) Size and color (54%) Packaging and styling (52%)
The Standardization / Adaption-Problem
Product attributes / value
Substantial
- basic benefit
Extended
- added value, e.g. services
Generic
- Social and emotional benefit
The Standardization / Adaption-Problem
Factors influencing S/A of product attribute
Physical attributes
Pro Adaption vs. pro standardization
Pro Adaption:
- cost-reducing adaption
- local standards, hygiene and safety regulations
- consumer behavior
- physical environment
Pro standardization:
- experience effects
- Economies of scale
- international standards
- international product use
The Standardization / Adaption-Problem
Factors influencing S/A of product attribute
Service attributes
Pro adaption vs. pro standardization
Pro adaption:
- limited savings related to scale
- local peculiarities in services, maintenance and distribution
Pro standardization:
- significant learning effects
- internationally mobile customers
The Standardization / Adaption-Problem
Factors influencing S/A of product attribute
Symbolic attributes
Pro adaption vs. pro standardization
Pro adaption:
- unfavorable image of imported product, company, nationality or brand name
- inadequate meaning, conveyed by color, shape, etc.
Pro standardization:
- favorable image of imported products, company, nationality, or brand
- exotic or ethnic appeal
- demand for “universals”
Country of origin effect (CoO)
“Any effects on a person’s perception arising from stereotypes of associations with a product’s country of origin”
- influence of the country of origin of a product or service on the perception and evaluation of consumers
- scientific origin: A study by Schooler (1965) found that Guatemalan students prefer domestic products over Mexican products
Country of Origin Label
Excursus De-Internationalization
- 20% of the German companies active abroad relocate their product back to Germany within four to five years
- origin from a low-wage-country may turn out as disadvantage
- e.g. longer shipping distance -> long time span until it’s available in the market
Country of Origin Label
Macro- vs. Micro-Level
Macro:
- country-specific image
Micro:
- country-specific product image
Country of origin label
Types of country of origin labels
Country of:
Sourcing
Assembly or manufacture ("made in")
Design
Product or country of component
Brand (relevant for buying decision)Mechanism of the country of origin effect
Cue Information
CoO has an effect like a mental short cut (like brands or prices)
-> if you don’t have much information about the product the country of origin helps to categorize if it’s a good product
Explanation of the CoO-Effect
Cue utilization theory
Boundary conditions for using the country of origin
Boundary conditions for using the country of origin:
- high relevance of quality
- high quality insecurity
- low availability of information about the product quality
Explanation of the CoO-Effect
Cue utilization theory
Attributes of the used quality signals
Security Value of the CoO-Sign (“Descriptive Belief”)
and Prediction Value of the CoO-Sign (“Inferential Belief”) lead to consumers using the CoO-label as a quality sign
Effect of the CoO
Meta-Analysis on the Effect of CoO
Results
influence of the CoO on
…product quality (attitude) 30%
…buying intention (intention) 19%
…purchase, boycott (actual behavior) -> questionable
Possibly exaggeration of the CoO-Effect in research
Effect of the CoO
Meta-Analysis on the Effect of the CoO
Reasons
- single cue-designs (-> research design lacks ecological validity)
- student samples
- social desirable answering behavior
Signalizing the CoO
Design Elements that visualize the CoO
Verbal
Direct cue:
- unambiguous naming of the country of origin
Indirect cue:
- Appeal via foreign language or elements
Signalizing the CoO
Design Elements that visualize the CoO
Non-verbal
Visual:
- Showing typical emblems or persons etc.
Acoustic:
- Typical sounds
Consumer Ethnocentrism
Preference for domestic products
Reasons:
Normative
- motivation to support local economy
- buy-domestic-calls
Affective
- assumption of better image and product quality
- patriotism
Consumer Ethnocentrism
Theory of social identity
- social identity is created by social affiliation with the in-group and disassociation from the outgroup
- prestige of the ingroup relevant -> group enhancing
Hostility or dislike of other countries
Consumer animosity
Explicit refusal of products from one specific country
Causes:
political, cultural, economic and military conflicts
Hostility or dislike of other countries
Consumer animosity
Consequences (examples)
Boycott of US products (2006)
-> Heinz-Ketchup, Anti-Cola, Esso
Boycott of Danish products (2006)
-> Arla (short-time-work, 1,34 Mio€/Tag)
Boycott of French products (2008)
-> traveling agency -20% bookings
Cross-cultural differences in the boycott Prevalence (Hoffmann 2014)
Data base:
- secondary data:
- > boycott prevalence: World value survey
- > culture: Globe
Findings:
Influence of culture on boycott prevalence. The effect is stable after controlling for GDP etc.
International Brand names
Framework for brand name decisions
Positioning
Brand image is in the center of corporate image, positioning of competitor, needs of target group A, B and C
International Brand names
Framework for brand name decisions
Requirements for brand positioning
national
- fit with corporate strategy
- distinction from competitor
- fit with target group
- perceptibility
- conciseness
Linguistic Aspects of International Brand names
Types of brand names
Descriptive names
- e.g. Kinderschokolade
Associative names
- e.g. Schauma
Artificial names
- e.g. Haribo (acronym)
Linguistic Aspects of International Brand names
S/A Decision -> are the brand names feasible to standardize? Transferable to other languages and cultures?
Contingency variables
Legal criteria
- differentiation possible
- protectability internationally possible?
Marketing criteria
- relevant for product
- fit to corporate image
- signalizing of positioning
- appeal
Linguistic criteria
- Phonetic attributes
- semantic attributes
- morphologic attributes
Linguistic Aspects of International Brand names
S/A Decision -> are the brand names feasible to standardize? Transferable to other languages and cultures?
Contingency variables
Linguistic criteria
Phonetic attributes
- pronounceability
- readability
- euphony
Semantic attributes
- positive associations
- comprehensibility
- memorability
- language-independence
Morphologic attributes
- briefness
- simplicity
Linguistic Aspects of International Brand names
Strategies to transfer brand names to other languages
Adaptation
Linguistic Transfer
Standardization
Linguistic Aspects of International Brand names
Strategies to transfer brand names to other languages
Adaption
Creation:
- Developing a new name for the target country
- > Local brand names
Linguistic Aspects of International Brand names
Strategies to transfer brand names to other languages
Linguistic transfer
Phonetic translation (Transliteration) -> sounds similar to the original
Semantic Translation
-> translation that captures the meaning of the original name
Phonosemantic translation
-> both
Linguistic Aspects of International Brand names
Strategies to transfer brand names to other languages
Standardization
Using the original name in all countries (e.g. IKEA)
-> global brand name
