Customer Behavior Case Study

Group member: Wang Jie (Tina) Callum Heaney Dai Yiwei (Eve)

11.1 The China syndrome: Cultural misunderstandings can lead to marketing failures

Q1 What the single most important error made by ScanCRM in its failure to

appreciate Chinese business culture?

Failed to have any understanding of the cultural and business environment it was preparing to expand into

Q1 contScanCRM’s failure in 3 parts

Very simplistic analysis to justify Chinese market

Blinded by the projected financial return

Neglected to consider that the features of small- and medium-sized enterprises in China

Q1 suggestions

Adaptive global marketing ---firms embrace an adaptive marketing

strategy catering to specific cultural values (Schiffman, et al., 2014)

e.g Chinese Symbol

Text

Q2. What alternative strategies and approaches could the company have considered employing

when launching its product into China?

Conducting cross-cultural consumer analysis Conducting market research Starting with one city or region Providing separate media campaigns HENCE Choose the right market segments based on

infrastructure development, population per capita income and consumer preferences.

Q3. Discuss the ‘four fundamentals’ of Chinese business

culture:

The four fundamentals are:• Face • Foreignness • Hierarchy • Relationships (Guanxi)

Firms seeking to conduct efficient businessIn China need to understand all fourelements.

Q4. Consider the other consumer behaviour factors you have considered in this course.

How might they also differ in other cultures?

Perception: The process by which an individual receives,

selects and interprets stimuli to form a meaningful and coherent picture of the world. It can be described as ‘how we see the world around us’ (Schiffman, et al., 2014).

Q4. contChina America (Western)

Collectivist attitude Individualism

Relationship

ColorColour China, Denmark

& ArgentinaNigeria & Germany

Britain & France

red Lucky Unlucky Male color

Q5. Undertake research to identify some specific Chinese regional differences, in addition to the broad cultural differences identified in the case.

Northern Chinese Southern Chinese

Straightforward communication

Beating around the bush

“Let’s not talk about the money. That will hurt our relationship”

Talk about the business rather than relationship

“A friend in need is a friend indeed”

Careful calculation and strict budgeting

Q6. Select a country with a different cultural background & develop a

cultural competency report: Russia:• Ranked 99th for ease of business.• Relatively transitional economy shapes current

business attitude and values.• Cultural of corruption – ‘cost of doing business’• Cultural values place strong emphasise on

strength, & negotiations can be staged or acted to rattle the other party.• Formal western style meetings are often

preliminary to actual business discussions and are used to gauge the other party.

• Personal relationships are critical as actual business is often discussed and finalised over relatively informal dinners typically at the host’s home.

http://www.businessweek.com/articles/2014-01-02/the-2014-winter-olympics-in-sochi-cost-51-billion

Learned from ScanCRM’s failure when expanding

into a new market

‘Western way’ of doing business – NOT necessarily the right way in all

situations NEED a good understanding of – the individual consumer behaviours – the underlying norms and rituals of whole

cultures.

Any Questions ?