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3802
ISSN 2286-4822
www.euacademic.org
EUROPEAN ACADEMIC RESEARCH
Vol. I, Issue 10/ January 2014
Impact Factor: 0.485 (GIF)
DRJI Value: 5.9 (B+)
Importance of Culture in Success of International
Marketing
MANZOOR AHMED
Department of Marketing
College of Business Administration
King Saud University, Riyadh
Saudi Arabia
SHAFI ULLAH
Department of Marketing
College of Business Administration
King Saud University, Riyadh
Saudi Arabia
AFTAB ALAM
Department of Marketing
College of Business Administration
King Saud University, Riyadh
Saudi Arabia
University of Kuala Lumpur, Business School
(Uni Kl) Kuala Lumpur
Malaysia
Abstract:
The paper discusses the great significance of culture for an
organization to adversity in international marketing. To take more
competitive advantage it is vitally necessary to build and maintain
culture in an organization. In this research we describe the barriers
and hurdles that any organization faces in the international
marketing and also the various types of cultures according to the
nature of organization and market.
Key words: Culture, International Marketing, organization adaptive
tools, language, system of values, ethics, moral codes, system of
beliefs.
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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EUROPEAN ACADEMIC RESEARCH - Vol. I, Issue 10 / January 2014
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Objectives:
1. What is dissimilar in the culture of various nations with
respect to business?
2. How culture has different effects on the business
opinion/decision in the international markets.
3. The cultural barriers that an organization faces in
International Marketing.
Introduction:
It’s very important to discuss about the importance of culture in
international marketing, after firstly understanding what an
international marketing is and what culture is. Culture is
valuable for doing trade in local market but it is more
significant for international marketing, the reason being that in
international marketing people have different believes, nature,
culture, or language. All these aspects create the problem of
managing people in international marketing so it is important
for any organization to understand the cultural differences
before going for business in international markets.
Culture:
Culture is the shared norms and values of any organization.
Culture reflects customs, traditions, beliefs and religions of any
group of people. The culture of a country is called national
culture, reflecting the overall religious beliefs, customs and
traditions of a company. For example, Saudi Arabia is an
Islamic country and its culture reflects the values and beliefs of
Islam. Muslims offer prayers five times in a day, while the
American culture, a western one, focuses on personal
achievements.
The culture of an organization is called corporate
culture. Like the national culture, the corporate culture varies
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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from organization to organization of a country: companies in US
and England focus on individualism, while in Indonesia and
West Africa, they focus on collectivism.
According to Hofsted, a Dutch researcher, cultural
differences tend to spin around five key dimensions. These
dimensions play a vital role in understanding national culture
as well as corporate culture.
1. Individualism v/s Collectivism
The idea of individualism is based on the philosophy that one is
the owner of his or her life and he or she has an absolute right
to live it according to his wishes and desires and he has the
choice to pursue the values he or she considers best for himself /
herself. On other hand, the idea of the Collectivism is based on
the concept that the life on an individual does not belong to him
or her but belong to the group or society of which he/ she is a
part. He / She should give priority to the values and goals of the
group over his own values and goals. The idea of collectivism
says that a person has no rights except those which society
allowed him to enjoy. E.g. The United States culture is
individualism based, while the Japanese culture is collectivism
based.
2. Power Distance:
Power distance is the amount of power distributed by the
culture between the management and their subordinates. In
other words we can say that the power distance shows what
type of relationship exists among the subordinates and
management. When we say that there is low power distance in
an organization then it means that there are more interactions
between the management and employees, the former is more
democratic and delegates responsibilities to the subordinates. If
the opinion of the management is wrong on some issue then the
subordinates can reject his opinion without caring that he is in
a superior position. The phenomenon of the management being
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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always right is not applicable in the low power distance culture.
The management considers itself a member of the group and it
does not like to suppress his subordinates while when there is a
high power distance culture in an organization then the
management is always right, considering himself superior to
the others in the organization. It does not delegate its authority
to others, the decisions being always on a centralized basis. The
management sees itself on one level while its subordinates on
an inferior level. Australia and US are low power distance
culture, while China or Saudi Arabia are considered high power
distance cultures.
3. Masculinity v/s Femininity:
Masculinity states a male dominant country, society or culture.
E.g. Asian countries are masculinity based. Those countries
where the rights of women are equal to men are femininity
based countries, societies or cultures. E.g. In western countries,
men and women work equally to earn and women have equal
rights at the workplace.
4. Uncertainty Avoidance:
Uncertainty Avoidance states that people avoid participating in
the activities about which they are not sure that they will
benefit them. They are happy to get involved in activities of
which they are sure they will benefit from and they have no
tolerance towards risk. Pakistan, India and the Arab countries
have such a type of culture while on other hand countries that
have low uncertainty avoidance, they have more tolerance to
risk. E.g. Japan has a low uncertainty avoidance and this is the
reason most of the investments are done in Japan by US and
European countries.
5. Long-Term versus Short-Term Orientation:
When someone is focused on the future and is willing to
postpone short term material or social success for the sake of
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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long term achievements then this perception is known as long –
term orientation and this culture has as its values persistence
and perseverance. The short-term orientation culture provides
importance to present or past than to the future. The people of
the short –term orientation give value to the social obligation
tradition and current social hierarchy. The present gratification
success and achievement are more important than the future.
These above mentioned five dimensions of Hofsted
reflect the culture of any organization. Before doing business in
any international market it is important to understand these
dimensions. International marketing needs to understand the
local culture of the country in which an entrepreneur wants to
develop a business.
This cultural framework helps marketing manager to identify
the cultural nature of an international market. Below there are
eight attributes of a cultural framework that help a marketing
manager to understand the culture of an international market.
Language:
Language is the most important attribute in a culture. If any
marketing manager wants to perform his business activities in
the international market then it’s necessary to understand both
the verbal and the non-verbal language of that culture. Verbal
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and non-verbal language of every country differs from each
other. Language and culture are in a close relationship. By
understanding language, the marketing manager can easily
interact with the customers of that culture more effectively.
For example, if a marketing manager of Saudi Arabia
has a strong grip on the Chinese language then he can easily
perform his business activities in China.
Religion:
Religion is a very important element of culture and has a great
influence on the lifestyles, beliefs, values and attitudes of the
people. Different people follow different religions and each
religion has its own concept about different things. So it is
necessary for the international marketing manager to keep in
view the teachings of a country’s religion and then lunch his
product in the market. If he launches a product which is not
allowed in their religion then definitely his product will face
failure in the market. Suppose a person wants to export pork
meat to Pakistan or Saudi Arabia or other Islamic country, then
he will not be successful in his business as pork meat is
prohibited by Islam. Similarly if a Muslim marketing manager
wants to start its business operations in Western countries then
he should first understand the lifestyle, beliefs, values and
attitudes of the western country in which he is going to start
his business operations because western countries have
different preferences. If a Muslim marketing manager wants to
achieve success then he should provide services or products
according to western preferences or that are allowed in their
religion.
Values and Attitudes:
Every country differs from each other. If the marketing
manager wants to go on the international market to start its
operations then first he should understand the values and
attitudes of that country. The organization should arrange
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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training sessions for marketing managers and motivate them to
learn all values and attitudes of that culture. For example
workers in France want to take their vacation in August while
in United States employees want to take a couple of weeks’
vacation in a year.
Education:
The education level in a country is important to understand.
For example in the countries that have a low literacy rate, the
marketing manager should avoid communication which consists
of written documents and they should not use visual media. In
those countries that have a high literacy rate, the marketing
manager should use written copies of advertisement and
different methods of advertisement that people can easily
understand, such as banners.
Social Organizations:
For business in international marketing one should find out
answers to questions such as - what is the role of women in that
country, or the level of influence of class or cast on a society.
For example, India has a fully established and rigid cast
system.
Law and Practices:
These are essential factors for understanding the culture of
international market and their importance is also very high for
a marketing manager. First of all, the marketing manager
should understand the law and practices of that country where
he wants to do business. For example Pakistan politics is
dynamic in nature so it is very difficult to perform business
operations in Pakistan. With the death event of Banazir Bhutto
many foreign companies rolled back their businesses from
Pakistan.
It is important to understand the culture of any country
because if an entrepreneur is able to understand the culture
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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then he/she can save himself/herself from different problems
such as communication problems. So first of all understanding
the different aspects of culture is important.
Literature Review:
Culture has been defined in many ways by various authors and
researchers. However culture has strong relationship with
organization success. Culture has influence on the performance
of companies. Culture plays a very important role to motivate
the employees but it depends upon the type of culture which we
are adopting, how culture influence the organization and the
employees. Are the employees sincere with the organization or
not? Then, there come the positive and negative aspects of a
culture, since this influences the behavior of the workers. The
manager may need to redesign the culture - what are the core
values of a culture and then the employees who are willing to
adopt those values must be chosen and motivated for the
success of organization. We should require the commitment of
the employees to adopt the culture and its values. Culture is
the most important task for a manager or an organization.
(Rashid, Sambarivan, and Johari 2003)
The organization performance has a relationship with
the market orientation, organizational culture and brand
performance. Two gaps arise in the performance of an
organization. No knowledge about the market and performance
of employees is good enough; it depends on how you increase
the knowledge of employees and adopt the new culture. An
organization must have a strong innovative culture and
through this the success and full brand are building. It depends
upon the response of customers. What is the image of your
brand in the customer’s eye? And who are your competitors?
You should provide value to the customers. Focus on the need
and want of the customers. Needs and wants relate with the
culture. Needs and wants develop from the culture. What is in
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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the culture? What are the preferences and trends? By adopting
a new culture and what is that your market can achieve by
brand performance? You should first see the market and
culture of that country where you are starting the business and
then adopt that type of culture. (Cass and Viet 2007)
Culture is an important factor in organization’s long
term success. Organization culture is like an intangible thing
which designs the competitors in an environment.
Organization’s culture is a reflection of the habits it develops.
Which strategies we should focus on for developing culture, how
does culture develop? The culture is like a DNA in the
organization. Our actions are based on assumption, beliefs and
values. Basically culture is how things are done within the
organization You can make many choices which will help you to
maintain and repair the culture, you should put every effort to
change and maintain the culture of organization (Pennington
2009)
When we are doing business abroad the success of your
business depends upon how the employees use their skills in
the different culture. It depends whether the employees are
capable or not. If they are experts in their jobs or not, previous
research shows that employees are not able to understand the
other culture and may become a hurdle in the success of the
business abroad (Ferraro, 2006) “Culture is transmitted
through the process of learning and interacting with one’s
environment, rather than through the genetic process”
(Ferraro, 2006) “Culture is acquired knowledge that people use
to interpret experience and generate social behavior”. In its
broadest scene, the term refers to the result of human
interaction.
Most scholars of culture would agree on the following
characteristics of culture:
1) Learned: We cannot inherit the culture; we can only learn
and experience the culture.
2) Shared: People of organization and society can share
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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culture; it is not for one person only.
3) Patterned: Culture has a proper design if we change one
part design of culture then other parts must be automatically
changed.
4) Adaptive: Culture depends upon the human capacity that
person wants to change or adopt it.
In this world many types of culture are present.
Cultures directly influence the people; we can examine cultural
differences and effect on the international marketing. Culture
can change the technology, top management attitude, top
management decisions and introduce new ideas and can even
affect the government relationships. But the basic point is how
people perceive the things and how they behave. Culture also
affects the business activities. For example if we are doing
business in Pakistan and convert our business in an abroad
one, then the culture of the other country affects the business
activities. So we should require a good understanding and good
communication skills. First we should understand the culture
of the host country and what are the preferences of people,
what people think. You should provide the same values to the
customers and communicate with the customer the way in
which the customers want. Top management should also
provide the knowledge to the employees because basically they
are dealing with the customers. (Hodgetts, Luthans, Doh, 2000)
Through culture we know how we can create
relationships and networks. We can understand the Asian
market culture if we divide the culture in different groups;
basically culture is the artificial boundaries, we segment the
variables of culture and then implement the ethic approach
which helps to analyze the culture. By applying the ethic model
we understand the culture and the creation of network
formulation in terms of three driving forces i.e. condition in
change, philosophy and religion, and strategy and tactics. By
condition in change we understand change in technology,
political, economical, legal and market conditions of a country.
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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Philosophy and religion describes the religious and society
values. Strategy and tactics define the strategy of negotiation
and communication and it can change the whole life of the
organization in international marketing. (Fretcher and Fang
2006, 13)
Culture is an important source for internal and external
organization. With the passage of time market behaviors are
getting changed. Forecasting about market behavior is getting
so much difficult day by day. We do not know about next day,
next month, next year, what will be the new change. The trend
of getting education increases, people have more knowledge,
they adopt new things, while markets become complex.
Organization requires negotiating with their own corporate
culture in which they are operating. Differences in the regions,
difference in the organization culture function that we are
using in an organization, and thinking of people working in the
organization, all these aspects play a great role. When one
dimension clashes the other negative thing may come in front
and have a bad effect on the organization. We can say it impact
of culture. Culture will be stable until any event occurs that
will have a negative impact on culture. Such events cannot be
stopped but a marketing manager should predict and be
prepared for the negative outcomes which can be the result of
any event. (Feost 2000)
As globalization is increasing, economic conditions are
getting changed, members of firms increases, profits of an
organization increase and increase in profits shows directly the
link with international market. In international markets
competition is very high; the competitor’s advantage is a main
factor as to how we compete with our competitors. In
international markets ethics are more important because ethics
differ from country to country and, depending on which country
we are working in, its culture affects the ethical decision
making. (Signapakdi, 1999 at all) “A committed employee is one
who stays with the organization in favorable or unfavorable
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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conditions” (Meyec & Allen, 1997)
Recommendations:
After the research on the influence or importance of culture on
the success of international marketing, we are going to suggest
some recommendations which are very important to
understand the culture of any foreign market.
These recommendations are as follows:
1) It is the responsibility of the human resource manager to
create and maintain culture in an organization. A company
should hire such HR managers who are competent and can
adopt changes rapidly. Before hiring HR managers, the
organizations must make it compulsory for HR manager to
create and maintain culture and organization; this should be
mentioned as a responsibility of the HR managers in their job
description.
2) The organization should give orientation to the new
employees about their culture and tell them about the norms,
values, beliefs and attitudes of organization.
3) Every country has a different culture; if an organization
wants to start business in a foreign market then they should
understand the culture of the foreign market, their taste,
preferences, education and decisional background. For example,
in some countries employees want freedom at the workplace
and in some countries there is a centralized hierarchy.
4) If the organization wants to send its employees in foreign
markets then these should be trained. Organizations should
provide training about the culture of the foreign market in
which the organization wants to do its business operations. For
example, if employees don’t know the language of the country in
which they want to do business, then they can never achieve
success.
5) If any organization wants to do business in the foreign
market then first of all it must understand the differences of
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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culture and their importance.
Conclusion:
At the end of research, we must conclude that research and
organizational success are interrelated. If any organization
wants to perform its business activities in foreign market then
it should first understand the culture of that market. Every
organization has a different culture and it is the responsibility
of employees to understand the culture of an organization.
Every country has a different culture - countries in Asia and
countries in Europe have different cultures; it is the
responsibility of an organization that it should adapt its culture
to that country’s culture. Organization culture includes norms,
values, beliefs; an organization should understand different
aspects of culture like religion, values, attitudes, education,
social organization, technology, law and practices, aesthetics
and language. These eight dimensions of culture help a
marketing manager to understand the culture of market and
any organization.
Culture plays a very important role to motivate
employees in the workforce. When an organization sets its
culture and forces its employees to follow it at that time only do
the candidates join the organization as employees who are
willing to adopt the culture of that organization. It is the
responsibility of the HR manager to create a culture and share
it with the other staff of an organization.
Culture of any country can influence the top
management decisions, the attitude and technology of an
organization. To achieve success, the organization should follow
the culture of that particular country. First of all, top
management should see the culture of that country, the
preferences of customers, understand the market in which an
organization want to perform its business operations, the
attitude of employees. For example, in Europe, employees focus
Manzoor Ahmed, Shafi Ullah, Aftab Alam- Importance of Culture in Success of
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on individualism, while employees in Asia focus on collectivism.
Without understanding the culture of a country in which
the organization wants to do its business, the organization
cannot achieve success because if it doesn’t know the norms,
values, beliefs and attitude of the customers then employees
cannot run their business successfully. To perform business
activities in a foreign market, it is necessary to understand the
culture of the foreign market.
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Meyer, John P. & Natalie J. Allen. 1997. Commitment in the
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