Businesses tend to secure themselves financially and overlook certain characteristics, prior to expanding into international markets. For the purpose of this critical analysis case study, international markets are foreign other than the United States and the various consumers that inhabit them. Culture is a broad and vague concept. We will define culture as the values, beliefs and practices that a group of individuals hold. Culture is a major factor and businesses need to be conscious when expanding into foreign markets. The following paper will examine cultural issues that U.S. businesses must address before attempting to sell their products internationally, six problems Mattel faced expanding Barbie into foreign Chinese markets, and then …show more content…
Mattel had invested $30 million in a large six story building and evidently employed local Chinese workers but given the continuous use of the western Barbie style, the astronomical real-estate fees, and non-influential brand the retail store could not stay open; the price of conducting business in China was simply too steep (Voigt, 2012).
Six Cultural Issues and Mattel Performance
Failure to understand specific cultural differences can be detrimental to a company. Mattel should have considered and acknowledged the Chinese values and attitudes, gender differences, views towards aesthetics, approaches to marketing styles, culturally driven economic factors and the significance of the language in the general approach.
The perception of values and attitudes as it pertains to the consumer needs is a significant issue to consider. In China, hard work, collectivism and stability are an important factor, while in America, individualism, independence, and flexibility are of greater importance (Davvetas, Sichtmann, & Diamantopoulos, 2015). While there are common values and attitude in both cultures, they do vary in the order of significance, and each culture has specific values that exist in various factors (Kubat & Swaminathan,
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If a specific culture expresses a preference to flamboyant glamour, then a product marketed in a conservative manner might not accurately target consumers. According to Wang, (2012), Chinese believe “feminine” is more about being conservative, sensitive, gentle and sweet verses smart and strong or fashion forward. Chinese women are inclined to desire cute, girly pink garments over the provocative, racy American apparel. One reason why ‘Hello Kitty’ has done so well in China is they keep products cute and innocent (Wang, 2012). Americans dress in a more nontraditional way that allows each individual to express him or herself, whereas Chinese dress more traditionally conservative. Tailoring products aesthetics to the specific culture is essential for which the market exists or it runs the risk of being misrepresented (Wang, 2012). Mattel attempted to promote styles of clothing that did not align with the Chinese apparel, and furthermore, they found it to be a low quality for the price (Wang, 2012). It is vital to comprehend the target market before attempting expansion, or it will be a costly detriment to the
The ethics involved in the creation of standardized positions where the actions of morality are judged and based on a set of rules. The duties that are created provide an obligatory or as some would like to call it, a binding effect between subjects as they are perceived as duties. The rules often will be made up of moral legislation, human dignity and universalizability. Usually, the duty of ethics will focus on the actions of person per-say and not the results of their actions. Duty ethics tackle the aspect of intentions and motives to determine one's actions. When the intentions of an individual become negative then the action will be negative regardless of the results. However, duty ethics can be quite strict and this can make them become categorized actions in a good or bad way. According to Crane & Matten (2016), this categorization is not practical because at times it is, not a matter of right and wrong, but making the appropriate judgments based on the end results of the action.
The issue of verbal and non-verbal communication styles is an important cross-cultural difference to consider when seeking expansion of business in China, because it can help Company ABC facilitate successful business transactions and outperform its competitors. According to a survey by the Economist Intelligence Unit with 572 business executives, 79% of the respondents indicated that communication barriers have resulted in low market share in China.
Individual’s consumption pattern and purchase decision are strongly influenced by cultural norms and values of the society he lives in (H. S. Kim & Drolet, 2003; Oyserman, Coon, & Kemmelmeier, 2002; Sun, Horn, & Merritt, 2004). Since individuals in collectivist society pay more attention towards harmony of the gro...
Hofstede (1983) suggests that individuals from similar cultures have a “collective mental programming” which is part of their conditioning that they share with other citizens of the country they reside in but not with other citizens who do not live in the same country. Hofstede defines this “collective mental programming” as culture (Armstrong, 1996). Several researchers have documented the cultural influence on consumer behaviour (e.g Erickson et al, 1984). Other researchers have focused on ethnic differences (e.g. Wallenford and Reilly, 1983). Tse et al (1988) also investigated whether a manager’s home culture has “predicable” significant effects on decision making of executives from the People’s Republic of China and Canada.
Assuming a country had a favorable political, legal and economic environment; its cultural environment was evaluated. Culture impacts demand and the marketing mix; therefore, if a country's culture was deemed unfavorable, it was not included in the top ten ranking. Similarly, if a country's culture seemed especially favorable, that aspect is denoted later in the analysis. Cultural factors considered in this analysis:
Over the last 30 years the world has seen drastic changes in the Chinese way of making business. Nowadays, China has opened its businesses to the rest of the world, especially America and Europe (Teagarden & Cai, 2009). As a result, their economy has increased and the evolution of the companies have changed to be from closed doors to be international and multinational (Teagarden & Cai, 2009). This essay will analyze, first of all, how some Chinese companies have had success abroad, looking at the strategy that they applied to expand and to improve their products. Furthermore, this essay will show examples of successful Chinese firms, such as Lenovo and TCL Group, and how they achieve it.
...who have no connection or access to the fashion industry directly, and people who are not interested in fashion even the people from upper class who consider it trivial. Secondly, it can be seen that in ancient China, it was mainly caused by social structure (traditional four classes), conservative cultural atmosphere (specific division of gender’s work) and economic situation (natural economic and agrarian society), trickle-down theory works in a limited range within imperial family indeed. In contemporary China, trickle-down theory works in an untypical way which means trend from the ‘powerful class’ to the ‘weak class’ in China. Thirdly, it was due to historical and sociological problems, that Chinese fashion is basically feminine, even in contemporary fashion. Lastly, the western fashion force is still a dominant power which impacts the Chinese fashion industry.
As a result, culture plays a vital role in expanding international business with its impacts from general strategic direction to details like logo.
In an article called Cultural Factor Highly Influences On Consumers & Their Buying Behavior – In Indian Context, the basic characteristics of culture are described:
Regardless of the success of your company on a national scale, to engage yourself in a successful venture outside of your borders requires several critical elements that one must acknowledge and apply with great care. One of those requirements would be to thoroughly research the cultural environment in which you wish to launch your product no matter how popular and indispensable you believe it might be. In the past, many national giants have hit the wall when introducing a foreign market or launching a new marketing campaign because of the cultural gap they encountered on the other side of their borders. Another way of preventing a flop on an international market is to carefully study the economical past of this country, which might differ quite a bit from the one the company flourished in. In addition to the previous precautions, it Would be advise to make sure that your product will blend seamlessly within the spending habits of the consumers. Overall, meticulous market studies and patience often constitute the way to success on a foreign soil.
a company can familiarize itself with cultural nuances which may impact the design, packaging or advertising of the product. Moreover, traveling abroad allows one to locate and cultivate new customers, as well as improve relationships and communication with current foreign representatives and associates
Socio- cultural factors consists of language, ethics, religion, values and customer perceptions. It deeply affects t...
“Cultures provide people with ways of thinking – ways of seeing, hearing, and interpreting the world” (www.colorado.edu, 2005, para. 1). Everyone seeing, hearing, and interpreting information differently can cause numerous cultural issues that can be problematic, or even detrimental to an organizations ability to be successful on a global level. Within this work an examination of four different videos will be completed, the objective is to identify five cultural issues in the videos and select a framework that could be used to analyze and understand the cultural issues. In the four videos the issues that arise are behavioral constraints, emotional constraints, communication restraints. Sociology constraints, and psychological constraints so lets take a closer look at how the factors of the frameworks would apply to the issues seen in the videos.
...enture into overseas market comes with expectations as well as uncertainties due to unfamiliarity. Charles and Keith, the fashion retailer, has to understand clearly that what appeals in one market might not be accepted in the others and this is almost the same for all industries. Thus, a thorough research on cultural background has to be done before entering an unfamiliar ground.