Academic journal article Review of Business & Finance Studies

Cultural Diagnosis and by Passing; the Effect on Successful Internationalization

Academic journal article Review of Business & Finance Studies

Cultural Diagnosis and by Passing; the Effect on Successful Internationalization

Article excerpt

ABSTRACT

Globalization and its effect on business continue to propel firms to look beyond local markets for opportunities for market development and as a source of growth. However, Cultural differences in various markets continue to exert enormous pressure on international market operations as a result of cultural bypassing or misdiagnosis and this requires international marteters to undertake robust cultural analysis to ensure successful market servicing strategies. This paper reviews and discusses the crucial role of culture in successful internationalization; key reviews of marketing strategies and failures of some major corporations presented, cultural analytical frameworks have been evaluated and novel theoretical propositions made to segment cultural elements into soft and hard cultures. The paper provides a logical step approach framework to guide the international market practitioners analyzing foreign market cultures.

JEL: F23, M106

KEYWORDS: International marketing, Culture, Diagnosis, Market failures, Soft and hard culture

INTRODUCTION

The role and influence of culture to international business operations is paramount in a globalized environment where consumers are more informed and discerning than ever before. The cultural dispositions and grounding of individual consumers affect their attitude and behavior towards a product or service. The environment in which the individual or group socialized affects the attitude and behavior (Zeenat 201 1). However, numerous firms continue to misdiagnose, bypass or fail to consider the cultural implications of their international marketing decisions leading to preventable market failures. Many researchers in the area have acknowledged the critical place of culture in the successful internationalization of firms and brands. Wilson & Gilligan (1997) confirms that the most fundamental and indeed closest influencing force on behavior is the culture of a people which proves to be the most enduring. Similarly, Subhashini (2007) noted that the dimensions considered in shopper behavior in India do not only examine the individual motivations but also the cultural differences that influence shopper behavior. Culture consists of the values, beliefs, and norms of a society and they represent the most influential factor to a successful product launch or failure (Young & Javalgi 2007).

Many companies consider new market development as a strategic growth path (Ansoff, 1957) and mostly they see the development of international markets as the fastest means of growth or expansion. The process leading to internationalization would be clearer and less cumbersome if international market operators appreciate the fact that markets are not the same in terms of consumer profiling and behavior and that it is rare to transfer wholesale what pertains in the local markets into the foreign markets. As Kotier (1988) cited by Wilson & Gilligan (1997) suggest that, human behavior is largely a result of cultural socialization leading to the development of set of values, perceptions, preferences and behavior. It has been suggested that the marketer's main focus in the internationalization process is to understand the similarities and differences in cultural norms and values and to adapt their offering to suit the differences and similarities (Keegan, 2002). Further, social values and the culture ofthat society influence international marketing is strongly (Papadopoulos, Zikmund and d'Amico, 1988). Following from the above role that culture plays in the internationalization process, a critical cultural examination and analysis is very crucial for any firm going international. The accurate analysis and diagnosis of the foreign market culture enhances the effective delivery and success rates in the foreign market operations.

In spite of the undisputed critical role of cultural values to successful internationalization of brands, there has been several complete brand failures as a consequence of cultural bypassing(CB) either inadequate research into the cultural norms and values of the foreign market or completely ignoring culture as a critical factor in the successful internationalization process. …

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