Culture Related Issues Buyer Behavior and consumer needs

Culture Related Issues – Buyer Behavior and consumer needs are largely driven by cultural norms. – Global business means dealing with consumers, strategic partners, distributors, and competitors with different cultural mindsets. –Within a given culture, consumption processes can include four stages: access, buying behavior, consumption characteristics, and disposal (see exhibit 4 -1) –Each of these stages is heavily influenced by the culture in which the consumer thrives.

Elements of Culture • Culture consists of many interrelated components. Knowledge of a culture requires a deep understanding of its different pats. Following are the elements of culture: - Material life (technologies that are used to produce, distribute, and consume goods and services) - Language (language has two parts: the spoken and the silent language) - Social interaction (social interactions among people; nuclear family, extended family; reference groups)

Elements of Culture (contd) – Aesthetics (ideas and perceptions that a culture upholds in terms of beauty and good taste) – Religion (community’s set of beliefs that relate to a reality that cannot be verified empirically) – Education (one of the major vehicles to channel from one generation to the next) – Value system (values shape people’s norms and standards)

Cross Culture Comparisons • Cultures differ from one another, but usually share certain aspects. • High context cultures: Interpretation of messages rests on contextual cues; examples: China, Korea, Japan, etc. • Low context cultures: Put the most emphasis on written or spoken words; United States, Scandinavia, Germany, etc.

Contextual Background of various countries. Japanese IMPLICIT Context Arabian Latin American Spanish Italian English (UK) French English (US) Scandinavian German Low Context EXPLICIT Swiss High

• Greek Hofstede’s Cultural Classification Scheme - Power distance: The degree of inequality among people that is viewed as being equitable - Uncertainity avoidance: The extent to which people in a given culture prefer structured situations with clear rules over unstructured ones.

Conclusion • Global marketers need to become sensitive to cultural biases that influence their thinking, behavior, and decision making. • Self-reference criterion (SRC): Refers to the people’s unconscious tendency to resort to their own cultural experience and value systems to interpret a given situation. • Ethnocentrism refers to the feelings of one’s own cultural superiority.

Legal issues facing the company. Type of decision Pricing decisions Packaging Decisions Competitive Decisions Selling Decisions Production decisions Channel Decisions Issue Price Fixing. Deceptive pricing. Pollution regulations Fair Packaging and labeling. Patent protection. Warranty requirements. Product Safety. Barriers to entry Anticompetitive collusion Bribery Stealing trade secrets Wages and benefits Safety Requirements Dealers’ rights Exclusive territorial distributorships