Research proposal Marketing in a multi-cultural market: challenges and ethical issues

Author: Iloka Benneth Chiemelie

Published: 16/12/2013

1.0 Introduction

This project is designed as an attempt towards addressing five issues that are facing managers when marketing to multicultural audience. Each of the five issues will be addressed in line with real-world examples by combing researches, academic literatures and the views of the author. Lastly, the issue of the ethical implications that marketing have to multicultural audience as it is related to the five issues.

For companies, marketing is an important business process as it is a representation of the company’s opportunity to promote, communicate value and sell its products to customers. There is an increasing shift from the traditional one-way approach of marketing to a two-ways approach that involves an individualized, customer focused and tailored marketing activities that are directed towards particular people and this have been found to be more effective (Rust et al, 2010). As a result of this, firms now faces issues with marketing due to the broad cultures that exist across borders, differences in needs, audience and locations of potential opportunities. These issues are very complex and just a few companies (for instance, Coca-Cola and Pepsi) have been able to comfortably provide the multicultural audience with similar product offerings. Criticisms have also emerged with respect to the understanding that most of the marketing activities emerge from western worlds and companies have fallen reluctant with respect to understanding the differences that exist in the global environment (Slater & Yani-­‐de-­‐Soriano, 2010; D’Andrea et al, 2010). Therefore, this project will focus on only on how MNEs understanding the new markets due to the restricted space for the project.

The fact is that international exposures is affecting the attitudes of consumers from the viewpoint of their needs and wants and it has led to researchers developing theories on homogeneity and heterogeneity with suggestions of a common and global consumer cultures, but it still remain that local consumptions are still resilient against global forces (Merz et al, 2008). In any case, authors also concur with the importance of firms to market their products across fragmented markets that have differing lifestyles, cultures and experiences irrespective (Sinkovics, et al, 2010).

Figure 1: highly of the issues

The above figure represents the main issues that will be discussed in this project. These issues are in the form of a cycle whereby one influences the other and they continue to evolve in the global scene.

2.0 Marketing to multicultural audience

This section addresses the issues and challenge faced by mangers with respect to marketing to multicultural audiences and these issues are addressed with academic theories and real life examples.

2.1 Market shifts: from developed to developing market

The shift has now changed from developed to developing markets as this market represents stronger economic growth and performance for MNEs. Bisson et al (2010) made known that developing markets are now adding about 70 million people annually to the middle class section and as such they represent tremendous growth and opportunities for companies that wish to expand their business in light with the economic issues that is currently plunging developed markets downwards. For example, P&G is expecting to add about one billion customers to their ranks in the next decade from the developing markets. In any case, researches have shown that MNEs are yet to shift their marketing activities to focus on the needs of the developing market; and this means that they are still offering baseball bats to football loving Brazilians, and even gardening tools to neighborhood in Latin America that have no yards (D’Andrea et al, 2010, p:115.). Thus, it is a big issue for MNEs to market in developing markets as a result of the huge cultural array, differences in ethnic background, and their not being accustomed to established global brands and they also demand quality, reliability and relevance in these products  (Bisson et al, 2010).

On a global outlook, USA and other western companies are not internationalizing into China and India, but differences exist with respect to communism and individualism. Thus, USA brands that market their products in an individualistic view might not gain the attention of Chinese market that is more of communistic view.

2.2 What is the choice between Globalization, localization or glocalization?

The decision by MNEs to internationalize also raises the challenge of whether they should make their products available in its original state, localize it or chose the alternative of glocaliizing the products and services to the new market. The ideal option is globalized products offering as it would offer economies of scale, but this is limited by differences in cultures, attitudes and expectations and as such can require adjustment to meet the local needs. Ooshuizen (2004, p:61.) made known that global marketing strategies need to be considered in order to ensure that the marketing approaches adopted are successfully customized to the specific market where they will be implemented, in line with the socio-economic and context of the market, while also maintaining the global appeal it entered the market with. This is normally termed “think global, act local.”

Taking KFC and McDonalds as an example, it can be seem that they have global product on the view that people need to eat, enjoy convenience and satisfy their utility based needs. (Merz et al, 2008). However, the ways these foods are presented vary across cultures such as “Vegie Burger” in Indian, “Pork Burger” in China and “Chicken Burger” in Malaysia. However, in order to attain economies of scale, these brands have standardized products that taste the same across the globe such as French fries and soft drinks.

2.3 Issues of international branding

Branding can be of high challenge to firms due to the numerous facets that it has, especially when considering the intangible aspects of such facets that can present different meanings to different markets and cultures. The way brands are perceived across the globe are very important for the multicultural audience and but there can be differences in the symbols, name, meanings and colors associated with the brand and all these features can lead to differences in perception. Thus, MNEs need to pay attention in order to ensure that the actual perceived meaning is different from that of competitors.

Most of the MNEs have now shifted the focus of their brands form just the products and services offered in order to attach a certain level of personality to their brand, which is often as a problem solver. Although Xerox’s main definition of product is to make copying equipment, their products are actually marketed as helping to improve efficiency in offices (Kotler & Keller, 2009, p:83.). P&G has also made the attempt to establish itself as a brand identity used for solving problems in homes instead of just a producer of household goods (Mead & Andrews, 2009, p:378.).

2.4 Consumer behavior

There are considerable differences in consumer behaviors across the glove as a result of differences in culture (Kotler & Keller, 2009). For instance, researches on consumer behavior have focused on the four main elements of individualism-vs-communism, masculinity-vs-femininity, long-term orientation, uncertainty avoidance, and power distance. However, Slater and Yani-­‐de-­‐Soriano (2010) noted that the convergence of culture now means that changes are noticeable in these elements. For instance, the success of Starbucks in China has been attributed to an individualistic approach in which it presents itself as the space between office and home where people can actually have their privacy. This issue can be solved by tailoring marketing activities to reflect the current trends in consumer behavior within the market.

2.5 Communication challenges

The fundamental element of marketing is actually to communicate the message of a firm to its target audience. There are differences in the communication style across cultures and these differences require attention to the promotional mix of MNEs (Kotler & Keller, 2009, p:650.). The challenge is on how to make communication more effective across different markets, and the issue of whether local differences should be allowed with strict guidance by creating pools of ads that local managers can choose from. The local taboos and traditions of the market should be understood by the manager and also avoided. Another area of importance is the choice of media as research have shown that irrespective of the high level of internet adoption by Chinese markets, majority of the Chinese customers will not consider any brand that have not appeared in the television (Atsmon et al, 2010).

3.0 Ethical implications

Although the issues above have been presented as having high influence on the success of MNEs, it is also important to understand the potential ethical issues that can arise from the points above. The understanding of ethics varies amongst culture and as such it is important that MNEs understanding how ethics is presented in their different markets (Ardichvili et al, 2010).

The first issue is that big corporations (such as Wal-Mart and Tesco) can wield high influence on uninformed customers and also attach local brands directly for their selfish monopolistic gains. This can led to extinction of numerous local brands and a potential increase in unemployment level.

Another issue is unethical marketing to uninformed customers with particular reference to children (Li et al, 2007.), persuading them to consume unhealthy products and increasing health related issues in these developing markets. For instance, KFC and McDonalds have been held responsible in numerous cases for the increasing level of obesity in children across countries.

The issue of international branding is also sensitive as stereotypical promotions can be against the norms and cultures of a given market such as when references are made to body shapes and generalizations, and this can be offensive to certain consumers and/or cultures (Burgos, 2008).

Ethics has also been raised with the issue of marketing researches that reveal the privacy of consumers to brands and as such leading these brands to tailor their products and services directly to these customer information and creating numerous unwanted products and services that these customers are forced to buy on impulse (Ashworth & Free, 2006).

4.0 Conclusion

From the above analysis, it can be seen that a number of issues are facing MNEs when it comes to marketing across cultures and the main project will look to present more detailed information on these issues as well as solutions on how they can be handled.

5.0 References

Ardichvili, A., Jondle, D. & Kowske, B. (2010) 'Dimensions of ethical business cultures: comparing data from 13 countries of Europe, Asia, and the Americas', Human Resource Development International, 13 (3), p:299--‐315.

Ashworth, L. & Free, C. (2006) Marketing Dataveillance and Digital Privacy: Using Theories of Justice to Understand Consumers Online Privacy Concerns’, Journal of Business Ethics, 67, p:107--‐123.

Atsmon, Y. (2010) ‘China’s new pragmatic consumers’, McKinsey Quarterly, October, p:1--‐13.

Bisson, P, Kirkland, R., & Stephenson, E. (2010) ‘The great rebalancing’, McKinsey Quarterly, June, p:1--‐7.

Burgos, D. (2008) ‘Use and Abuse of Cultural Elements in Multicultural Advertising’, Journal of Advertising Research, June, p:117--‐118.

Consumer culture debate’, International Marketing Review, 25 (2), p:166--‐182.

D’Andrea, G. Marcotte, D. & Dixon--‐Morrison, G. (2010) ‘Let the Emerging Market Be Your Teachers’ Harvard Business Review, December, p:115--‐120.

Kotler, P. And Keller, K.L. (2009) Marketing Management 13th ed. Upper Saddle River, NJ: Pearson Education.

Li, Y. Zhai, F. Yang, X., Schouten E. G., Hu, X. He, Y. Luan, D. And Ma, G. (2007) ‘Determinants of childhood overweight and obesity in China’, British Journal of Nutrition, 97, p:210–215.

Mead, R. & Andrews, T. (2009) International Management 4th ed: Chichester England: John Wiley & Sons.

Merz, M. A., He, Y. & Alden, D. L. (2008) ‘A categorization approach analyzing the global

Oosthuizen, T. (2004) ‘In Marketing Across Cultures: Are You Enlightening The World or Are You Speaking In Tongues’, Design Issues, 20 (2), p:61--‐72.

Rust R.T., Boorman, C. & Bhalla, G. (2010) ‘Rethinking Marketing’ Harvard Business Review, January, 88 (1), p:94--‐101.

Sinkovics, R. R., Leelapanyalert, K. & Yamin, M. (2010) ‘A comparative examination of consumer decision styles in Austria’, Journal of Marketing Management, 26, (11–12), p:1021– 1036.

Slater, S. & Yani--‐de--‐Soriano (2010) ‘Researching consumers In multicultural societies: Emerging methodological ssues’, Journal Of Marketing Management, 26 (11–12), p:1143– 1160.