International marketing strategies and practices

International Marketing

Ethnocentrism is an attitude of superiority, in a cultural sense, where one thinks that one's culture is superior to the others'. Ethnocentrism is the basis of the racism and nationalism and the tribalism sentiments that exist in the world of humans. (Definition of ethnocentrism) In addition, ethnocentricity is generally accompanied by a feeling that because one's own culture is the bets, it is easy to feel contempt and hatred towards other cultures that exist, and also, because of this feeling, the world is also seen through rose tinted glasses. (Speak Soft, Speak Sure) This means that since our own culture is the best, it automatically means that all the others must fit into the expectations that are a part and parcel of our culture, especially since their culture is so inferior to ours. Here it has to be mentioned that the concept of Ethnocentrism cannot be said to be a part of the culture of certain sects of people, in any particular country; it is rather a general feeling that exists in all human beings anywhere in the world. (Mission Resources)

Self-reference on the other hand is when an object refers to itself, when there are two logical levels of a level and a meta-level. The concept of self-reference is generally used in philosophy, mathematics, linguistics, computer programming, and so on, and statements based on the idea of self reference tend to lead to paradoxes. (Self reference definition) How do the concepts of ethnocentricity and self-reference affect the world of International Marketing? In a paper written by Mark Speece and Krairoeck Pinkaeo the concept of 'ethnocentrism' is examined by taking as examples the instances where the price/equality relationship that is generally seen in several countries all over the world deviates from the accepted norms. The examples that are stated are taken from life insurance and from certain international programs held in Universities of Thailand.

It was noticed that when consumers were asked to rate the Thai services being offered in evaluating the country of origin brands and their designs, Thais rated the services of Thai as being the very best, thereby demonstrating the fact that ethnocentrism did exist. However, it must be remembered that this may not be an accurate method of assessing ethnocentrism in Thailand, since it is an irrefutable fact that most consumers tend to believe that the goods and services, as in this case, being offered by their own country are of the best quality, unrivalled by any others. Therefore, it goes without saying that when the consumers believe that these services are of the best quality, then they will be ready to pay the price for the quality, as better quality is always associated with higher prices. However, in Thailand, it was seen that the Thais were not ready to pay the appropriate price for the quality that they were expecting, and this is the basis of this paper.

It is a fact that the influence of the World Trade Organization and the General Agreement on Trade in Services has created a rapidly growing market for trade in services. Though this may be a very good symptom of the future prosperity and growth of world trade and international business, the very subtle but very real barriers of ethnocentrism must be acknowledged by the open service markets and the foreign services and trading sector who wish to establish a base in any foreign country. The issue of ethnocentrism can be taken in the light of the broader issue of the problem of the 'country of origin' or COO, as it is referred to, when foreign services generally bring their own images of their own country with them when they enter the other country, and the initial judgment is passed by the consumers after a very short initial evaluation, especially in cases where the entrant is a virtual newcomer, and there is no previous experience to judge from. The perceptions, based on the 'country of origin' may become quite distorted by ethnocentrism, wherein the products and services being offered at home seem to be much better and more attractive to the domestic consumer in every aspect than those that the foreigner is trying to sell in the International market. (Service expectations and consumer ethnocentrism)

Sometimes it can even so happen that the consumer feels an innate and newfound obligation to buy his own country's products, and not those that are being offered by the newcomer. It is a fact that nobody has been able to give a satisfactory definition or explanation to the problem of ethnocentrism. There is a general opinion that ethnocentrism is deeply rooted in the belief that it would be bets to buy the products and services being offered at home, because of a feeling of nationalism or patriotism, whereby, if these products are bought, then it is good for the country, and the consumers nationalistic ideals are fulfilled and satisfied. This explanation may be true in some cases and not in all, and this still dose not explain the concept of ethnocentrism. One example for ethnocentrism is seen in the economic crisis that was faced by Thailand, during which several companies and the government tried to base their advertising campaigns on the concept that it would be bets for consumers to 'buy Thai' products and services because they would be demonstrating a patriotic feeling by remaining loyal to their own country.

This campaign failed miserably, while 'Buy Thai' campaigns that focused on the better quality of home products and services fared much better and saw more success. This example shows that ethnocentrism may not always be based solely on patriotism and nationalistic feelings, but may involve quite a few complex feelings related to the quality of the product and its pricing, and the feelings of patriotism all linked together. Therefore when the individual feels that his home product is high up the quality hierarchy, then he can feel that 'my own country's products are the bets', a sentiment that is seen in most developed countries. Developing countries may feel that their home products rate second to those from an industrialized and developed country, but they may still feel that their country's products rate higher in the COO hierarchy. (Service expectations and consumer ethnocentrism)

What actually is International Marketing, and how does ethnocentrism affect it? International Marketing is the idea that involves the concept of recognizing that people in different parts of the world have different needs. Certain large companies like Coca-Cola, Gillette, BIC, and Nissan have manufactured brands that are known all over the world; in other words, they are known as 'global brands' that are sold to a 'global audience'. The marketing mix that these companies use for selling their products must be of the exact proportion that includes the knowledge of regional customs and traditions, and in values and language and even in their currency so that it can be positioned accurately. This is what international marketing means. These companies must be aware of the fact that unless the focus is mainly on the local languages and customs, the marketing campaign will not be a success. For example, in the case of Coca-Cola, the advertising focused on local languages and traditions when attempting to position the product, especially in countries like China and in India, where local flavor is of paramount importance. (International Marketing)

The company must accept that there are differences in the lifestyles and traditions of people all over the world, and also that certain products would only suit certain countries and not others. Before marketing the product, the overseas market must be analyzed and tested, in the same manner, as it would be done in their own home countries. This effort will take a much longer time to get done, primarily because of the unfamiliarity of the new location. However, once it is done, it will reap immense benefits for the company, because it would be known whether the product could be sold or not, and if it can be sold in that country, how it can be positioned so that local sentiments and flavors are not interfered with. Some companies undertake to standardize their products so that they may be easily adaptable to the foreign markets. When this is done, the three standard approaches must be kept in mind. These are: 'polycentrism', wherein a company would create subsidiaries, each with their own policies and marketing objectives, and these subsidiaries would remain completely decentralized from the original parent company.

When this method is used, the product could be adapted easily to the exact mix that would appeal to the consumer in the overseas market. The method of 'ethnocentrism' is one in which overseas operations are not given appropriate importance; the plans for the marketing campaigns are created at home, and the differences in consumers and in their different behaviors are not considered to be of any importance. The third approach is termed 'geocentrism' wherein standardization will only take place whenever it is absolutely necessary, and adaptation will happen when it is needed. This is a more realistic and pragmatic approach to the problem of international marketing. (International Marketing)

It can be stated that the issues of ethnocentrism and of COO have a direct impact on international marketing, as seen in the various different consumer preferences on a particular service provider, the International Air Carriers. Ethnocentrism in this context is taken as a 'social identity theory' wherein individuals become afflicted with conforming to a certain type of group behavior, in this case the group behavior being that of nationalism, patriotism, and authoritarianism. Both COO and ethnocentrism are seen as exerting an immense amount of influence on the final preference for the service provider in this case, the air carrier industry in Australia. Ethnocentrism is seen as casting a socio-psychological influence on the decision making process of the consumer that would lead him towards making his choice of the particular airliner that he must choose that would promote his feelings of patriotism and nationalism and make him happy in the knowledge that he had done something good for his country by making his appropriate choice.

The three main objectives within this study were to initially identify the various attributes of air travel that would influence the consumer's preferences in choosing that particular air carrier, then to study the influence of consumer ethnocentrism on the issue, then to discover the customer's preferences of international air carriers based on the similarities and the dissimilarities in culturally different countries. This type of study would be of extreme importance and usefulness for the service provider of any country who would wish to set up a base in a foreign country, in the international market. This particular study revealed that international carriers would do best if they were to concentrate their efforts at international marketing of their service if they were to promote the COO or the 'country of origin' while at the same time internationalizing their services. (Country of Origin and Ethnocentrism Influences on Consumer Preferences)

In the same vein, it can be stated that as long as the organization takes it upon itself to adhere to the cultural values of the social group that it will associate itself with, and maintain a certain standard of the so called 'cultural melting' process by which the group of 'global workers' acclimatize themselves to working internationally. The 'organizational vision' of the company must depend on the cultural traditions of the foreign country they are establishing themselves in, and be wary of the label of 'parochialism' that may ensue if these important issues are neglected. When it comes to the question of establishing a company and marketing the product or service in international soil, it must be understood that when the company is to be internationalized, the workforce will be a global one. Therefore it goes without saying that these workers must be thoroughly analyzed.

The type of workers they are, whether they belong to a migrant population, whether they are remote global workers, and the general results of the advent of the class called 'global worker'. When this analysis has been carried out, the next step would be to analyze whether the management would be able to cope with the idea of ethnocentrism, and this would be achieved by analyzing the basic concepts of ethnocentrism, and the related concepts of nationalism, xenophobia and of patriotism. Once this is done the next step would be to analyze the various methods of organizational vision that the management will be utilizing in the future, and, finally, analyze the concept of managerial ethnocentrism and research the possibility and probability of its endurance in the long run. (Global workers and managerial ethnocentrism, a discussion)

What is the importance of International Marketing, and why is it important. How is the theory of Self-Reference associated with International Marketing? Professor Paul Herbig in his lecture on International Marketing stated that international marketing was important for one primary reason, that of International Trade, that has been increasing in leaps and bounds through the years. More than 70% of all American companies have as its customers international concerns, and therefore, almost all American companies are involved in International Marketing and International Trade. Trade figures reveal that in America alone, the trade goes in excess of 25% of the total global GNP, a percentage that will definitely increase in the future years. It is a fact that some European countries have a total trade volume, or what is known as the figure for imports and exports together in excess of 70% of their GDP. (The Importance of International Marketing)

Since it is a fact that international trade involves the transportation of goods and services across international borders, the issue of marketing these goods and services must be studied before they are sold. Marketing therefore is seen to be more important than the actual sale of the product; analysts see it as the catalyst behind the trade that would take place between people across international borders. International Marketing would, therefore, involve the innate cleansing of the human mind of pre-conceived notions and domestic mind sets, as this would only obstruct the success of the marketing campaign in the alien land among alien people. The company must clear its mind of its ethnocentric thinking and adapt it's thinking to the foreign country it is trying to sell the product to. When this is not done, the company will be faced with bewildering and unexpected failure. For example, when Federal Express entered the European market, all the literature was written in American English, a language incomprehensible to all except the American. (The Importance of International Marketing)

Federal Express also failed to research certain basic facts like the working hours of Europeans, which was until 8 o'clock and not until 5 o'clock like in America, and package pick up times were set at the American time and not at the European time. Ultimately, though Federal Express is an excellent package, it failed miserable, and because of inadequate research on the customs and traditions in the market where it was trying to sell the product. EuroDisney is an example of how not to do international marketing. This happened in the 1990's, after the Walt Disney Company had launched its Tokyo Disneyland many years before. The Tokyo Disneyland was meant to be a licensor, with the power to gather a minimum amount of money because of the fact that somebody else owned the Park in which it was located. It had earlier committed two mistakes, and they would not be repeated now.

One was that they would own the land and the park, and that its own hotels could be built on the land. America was desperate to bring the American way of life to the Europeans. It was for these reasons that a sunny spot in Spain lost favor over a remote area in the city of Paris. The price for the estimated pro1ject was more than $4 billion, of which $160 million was paid by Disney, and the rest was taken as a financial risk by the French government. Why did Disney worry when the odds were in favor of Paris succeeding, as Tokyo had done? Not only was Tokyo's population higher, but also the people of Tokyo enjoyed a per capita income that was 50% higher than that of the Parisian, and Tokyo's Disneyland was only a few miles outside the town while the Parisian Disneyland was further away. Access was also different, while in Paris it was easy, in Tokyo it was not. (The Importance of International Marketing)

What happened was that the Frenchmen did not accept the idea of an American company daring to set up shop in Paris; they considered it an affront to the Parisian sentiment and culture, and launched a protest. Farmers protested the fact that the French government had condemned their land so that it could be given over to the Americans. Even the traditional legal approach of the American on the legal system as the first step rather than as a last resort as followed by the French people was irritating to them. Disney worked very hard to adjust to the European market, even raising the costs to $4 billion. When the park opened in April 1992, there was utter chaos. Hotel stays were different from those in America, as were the services and the food and wine. Whatever happened were the result of inadequate research, and the disregard of the advice of locals, which is a must if the product or service is to succeed in an international market.

Disney Euro had to accept defeat and a restructuring plan was proposed in 1995 and executed in 1996. The point to be stressed here is that the following areas must be given their due importance if one is to hope to avoid the 'self-reference' criterion of the example of Disney. Some other examples that demonstrate failures when attempts were made to enter the international market because of the self-reference mistakes committed by them are Snapple, which failed to comply with the rules of entering an international market. When Snapple entered the Japanese market, the Japanese rejected the drink, as it was too sweet for the Japanese palate. Ruffles and Cheetos also did not fare well, because of various problems, but mainly because the companies did not bother to conduct a thorough research that would make the product sell better in an alien environment. (The Importance of International Marketing)