Post on 02-Jun-2018
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Slide 5.1
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Chapter 5Local consumers and the globalization of
consumption
Marketing
AcrossCultures
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Slide 5.2
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Trend towards homogenization
Globalization of demand
Consumer behaviour (Ch 5)
Marketing environments (Ch 6)
Globalization of supply & competition
(Ch6)
Globalization of offerings
(Ch8)
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Slide 5.3
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Michael Porters view of world markets
1. Global Industries:Competition on aworldwide basis due to
absence of regulatory barriers high experience effects
homogeneity of consumerbehaviour across countries
quasi-absence of market barriers
relatively low transportation costs,
customs duties, and non-tariffbarriers
2. Multi-domestic Industries: Fragmented national markets
international competition within foreach domestic market(pharmaceuticals, motor insurance)
If products, consumer, behaviour,or elements of the marketing mix
depend on culture (culture-bound), multi-domesticity isstronger
There exists a continuum frompure global to fully multi-domestic
Service industries change from
multi-domestic to global (GATS) Optimal location of the value
chain is a key issue
A view of preventive and reactive strategy based on competitive forces
bargaining power vis--visboth customers and suppliers and
the pressure of substitute products and technological alternatives
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Slide 5.4
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Key factors to be monitored:
Industry trends towards globalmarkets
Basic reasons for continued multi-domesticity (such asclimate, geography, resources)
Market deregulation / WTO or other worldwide treaty vs.persistence of local regulation (e.g. motor insurance)
International standards / certification
Consumer behaviour: remaining idiosyncrasies and theirdurability (over 5, 10, 20 years)
Local products / service solutions (e.g. bundled vs.unbundled insurance services for households)
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Slide 5.5
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Defining market strategy
Basic concepts may differ: even seemingly similar,concrete concepts, such as syrup or coffee
The function(s) of similar products may vary across
markets; examples: beer, bicycle, TV Market surveys do not apply in the same way cross-
nationally because of local market researchinfrastructure and local response styles
How then to compare across national markets? Similarities and differences are in the eye of the observer: we
always start comparing from a reference point (issue ofethnocentrism)
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Slide 5.6
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Demand forms and IM strategies Primary Demand (Dp) = demand to all potential suppliers for a
generic item (aggregate demand for aspirin in a particular country)or for broad generic needs (e.g. demand for transportation)
If primary demand is low (or nil) => Try to educate the consumer
Selective demand (Ds) = demand to the firm for all its brands in aparticular product category (demand for aspirin from Bayer)
If selective demand is low => Try to increase market share againstestablished competitors on the local scene
Demand to the brand (Dm )= demand for a particular brand(demand dAriel, Procters washing powder/liquid)
If Dm = 0 or => Try to establish brand locally, that is, gain consumerrecognition and build brand image
Dp = Ds
Ds = Dm
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Slide 5.7
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Primary demand in a national/regional
context is influenced by Climate
Physical environment
Functional benefits searched for by consumers
Non-functional benefits (status, image, etc.)
Interface functional/non-functional (e.g. pens)
Education/socialization (Vegemite/Cenovis)
Habits in early childhood Purchasing power issues (they also matter and
they are too often forgotten !)
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Slide 5.8
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Global Convergence
Broad product categories over a long time
Through imitation of foreign consumption
patterns and adoption of foreign items whichbecome progressively global and local
Globalization and modernization
Socio-demographic trendsAge, size of household, proportion of immigrants,
gender equality
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Slide 5.9
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Major airline alliances (2004)Air Canada
Air New Zealand
All Nippon
Asiana
Austrian
Bmi British MidlandLOT Polish
Lufthansa
SAS
Singapore Airlines
Spanair
Thai Airways InternationalUnited Airlines
US Airways
Varig
Aer Lingus
American Airlines
British Airways
Cathay Pacific
Finnair
IberiaLAN-Chile
Qantas
Aeromexico
Air France
Alitalia
Continental
CSA - Czech
Delta Air LinesKorean Air Lines KLM
Northwest
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Slide 5.10
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Wine consumption in northern and southern Europe.(Source: Smith and Heede, 1996, p. 1081)
0
10
20
30
40
50
60
70
80
90
100
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995
years
liters
per
capita
South
North
Ratio
Macro Trends
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Slide 5.11
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Beer consumption in northern and southern Europe(Source: Smith and Heede, 1996, p. 1081)
0
20
40
60
80
100
120
140
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995
year
liters/
capita
North
South
Ratio
Macro Trends
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Slide 5.12
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Global Chocolate yearly consumption in kg/capita(Sources : CAOBISCO and ICCO / USDA*) in kg / capita /year
0
2
4
6
8
10
12
1992 / 1993 1994 / 1995 1996 / 1997
Switzerland
Germany
United Kingdom
Belgium
France
Netherlands
Iceland*
Italy
United States*Canada*
Japan*
China*
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Slide 5.13
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Cheese consumtion in Europe (2001)Greece 26.6 kg/capita/year
France 24.5 kg/capita/year
Italy 22.6 kg/capita/year
Germany 19.9 kg/capita/year
Denmark 19 kg/capita/year
Austria 18.4 kg/capita/yearNetherlands 17.8 kg/capita/year
Sweden 17.2 kg/capita/year
Finland 16.5 kg/capita/year
UEBL(Belgium+Lux) 16.1 kg/capita/year
Portugal 10.2 kg/capita/year
United Kingdom 9.7 kg/capita/year
Spain 9.6 kg/capita/year
Ireland 6.2 kg/capita/year
Source : www.datalait.com/fr/fromage/marche.asp#2
http://www.datalait.com/fr/fromage/marche.asphttp://www.datalait.com/fr/fromage/marche.asp8/10/2019 Curs Master 9
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Slide 5.14
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Cheese Consumption worldwide
Yearly per capita consumption of cheese differs
worldwide
European consumption is on average much higherthan it is in other areas of the world
It still varies from 6.2 kg/capita/year in Ireland to 26.6
kg/ capita/year in Greece
In Latin America it only varies from 4.5 kg/ capita/yearin Brazil to 11 kg/ capita/year in Argentina
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Slide 5.15
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Production of cheese in China (thousands of tons)
0
50
100
150
200
250
Year
Thousands
oftons
Source : www.fao.org
http://www.fao.org/http://www.fao.org/8/10/2019 Curs Master 9
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Slide 5.16
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
0
50
100
150
200
250
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Year
Thousands
oftons
ofcheese
Source : www.fao.org
Consumption of cheese in China (thousands of tons)
http://www.fao.org/http://www.fao.org/8/10/2019 Curs Master 9
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Slide 5.17
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Why are there differences in local
consumption patterns? Climate (ice-cream example)
Local diets (for food and beverages especially)
Local regulations (genetic modifications) Local taste for similar items (s versus sucr)
Different use of similar items (Camembert paniert)
Different meaning in context for similar products
(colours => certain symbolic attributes) Differences in motivations and buying behaviour
Local consumption habits rooted in early childhood, andsocialization at school and in the family (Vegemite)
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Slide 5.18
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Example of consumer behaviour for milk-
based products in France and China
Consumption/cap: 68 litres /year
Consumption of diversified milk-
based products: milk, cheese,
butter, yoghurt, etc.
Daily consumption.
Purchasing decision: basic quality
being well controlled, price is a
key factor
Consumers are used to milk-based
products and receptive to
symbols which emphasize
genuineness, origin, organic
manufacturing (labels, bio, etc.)
Consumption/cap: 3 litres/year
Consumption focused on yoghurt
(80%)
Product perceived as exotic
Purchasing decision: choice of
high quality imported products
perceived as having superior
quality when compared with
domestic products
Consumers are uneducated for
using this kind of product
properly (especially as concerns
conservation )
France China
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Slide 5.19
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Product/Country Example: Rice
in Malaysia vs. The United States
Malaysia
Mainly local, Thai rice
manufacturers Differentiated by grade
Frequent main dish, crosses social
strata
Mainly plain white rice
10 kilogram bags of rice
Hands also used for serving
US
Minute Rice, Rice-a-Roni, Uncle
Bens Differentiated by brand, flavour,
convenience
Infrequent side dish, ethnic
consumption
A lot of flavoured rice Small, quick cooking portions
Silverware used for rice eating
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Slide 5.20
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Breakfast Around the World China
rice porridge, steamed buns
Japan yakizana (broiled trout), nama tamajo (raw eggs) over gohan (steamed rice)
Australia Vegemite on toast, or bacon and eggs with broiled tomatoes and mushrooms
Scandinavia marinated herring
Austria dark bread with butter, jam, honey, chocolate, cheese, or ham, boiled eggs,
pastries
Mexico
huevos rancheros (eggs on a tortilla with hot sauce) and refried beans USA
pancakes, doughnuts, toast with butter, jam, or bacon and eggs
France Croissants (plain, butter and jam or chocolate)
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Slide 5.21
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Vegemite
The official Vegemite website
http://www.vegemite.com.au
Some thoughts about Vegemite from non-Australians
http://www.cockeyed.com/inside/vegemite/vegemite.html
http://www.vegemite.com.au/http://www.cockeyed.com/inside/vegemite/vegemite.htmlhttp://www.cockeyed.com/inside/vegemite/vegemite.htmlhttp://www.cockeyed.com/inside/vegemite/vegemite.htmlhttp://www.cockeyed.com/inside/vegemite/vegemite.htmlhttp://www.vegemite.com.au/8/10/2019 Curs Master 9
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Slide 5.22
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Emergence of a global consumer
culture
World standard package
Limitations?
'McDonaldization' of society: Standard (key benefit =
predictable performance);
the same for everybody;
the same everywhere in theworld;
the same over time
Ritzer (1993): 4 elements1. Efficiency
2. Systematic quantification
3. Predictability
4. Control: substitution ofnon-human for human
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Slide 5.23
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Modern culture
1. Individualist orientation
2. Strong emphasis on material
achievementsdoing/having not being
3. Strongly economic, commoditized time
4. Tendency to discard past in favour of
future orientation
5. Fairly high degree of utilitarianism
S
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Slide 5.24
Usunier & Lee, Marketing Across Cultures, 4E Pearson Education Limited, 2005
Culture-bound products
Rich cultural context Shopping, consuming,
disposing
Relationship to the physicalenvironment Climate, population density,
housing, flora, fauna
Cultural or national identity
Language
Relationship to others
Display, show, share
Complex
High level of interpretation
and local knowledge
Nature of the product
Non-durables, clothing,
food, cleaners
Slid 5 25
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Slide 5.25
Usunier & Lee Marketing Across Cultures 4E Pearson Education Limited 2005
Preference global / local
Global
Developing countries
Adoration
National
Developed countries
Nationalistictendencies
Animosity