biting the wax tadpole: marketing globally within cultural contexts

© Matthew A. Gilbert, MBA of 8

Biting the Wax Tadpole: Marketing

Globally Within Cultural Contexts

By Matthew A. Gilbert, MBA

MatthewAGilbert.com

[email protected]

(661) 513-3370

Abstract

As business embrace international markets, they must remain mindful of the cultural

contexts of the countries in which they expand their operations. This paper presents an overview of

famous cultural marketing miscommunications, explores approaches to collecting competitive and

cultural intelligence, the differing campaign styles of standardization and localization, options for

avenues of entry into a new country, and pricing strategies for international markets.

I. Mind Your Meanings

Would you buy a soda that promised to “bring your ancestors back from the dead?” If you

did, you would be drinking a Pepsi in Taiwan. Maybe you would like to buy some fried chicken that

encouraged you to “eat your fingers off?” If so, the Colonel’s secret recipe for Kentucky Fried

Chicken should remain a secret in China (Grimshaw, 2003)!

If you are an unmarried woman living in India, maybe you should consider lightening your

skin tone to reap greater rewards? Parmar (2003) comments that Hindustan Lever Ltd – the Indian

subsidiary of London-based Unilever – launched a controversial television ad for a skin-lightening

product called “Fair and Lovely.” The ad, which associated lighter skin tones with greater success

and parental approval, outraged women’s groups that claimed the ad was sexist, racist and

insulting (Parmar, 2003). The ad was subsequently pulled from broadcast.

Finally, why not try a Coke and a wax tadpole (instead of a Coke and a smile)? As explained

in Relocation Journal & Real Estate News (1996):

The name Coca-Cola in China was first rendered as Ke-kou-ke-la.…the

phrase means ‘bite the wax tadpole’ or ‘female horse stuffed with wax,’

depending on the dialect. Coke…found a close phonetic equivalent, 'ko-kou-

ko-le,' which can be loosely translated as ‘happiness in the mouth.’ (p. 1)

Why are mistakes such as these so common? Haven’t marketers learned to more

successfully deal with the global marketplace? And why is it so challenging to communicate a

creative message consistently? There are many answers to these questions, most of which require a

unique answer. The most common is cultural ignorance and lack of international intelligence.

As explained by Grimshaw (2003), “Communicating with an international audience

comprising different languages, cultures and degrees of marketing receptivity is fraught

Biting the Wax Tadpole…


with…pitfalls…The key to success in any media campaign lies in clear communication between

client and agency, but it is even more crucial in international marketing.” (p. 1).

II. Environmental Intelligence

There’s no question that, “markets are becoming increasingly global,” (Palmer, 2003, p.

2301). With the advent of Internet-accelerated commerce, greater ease of international travel, and

the reduction of trade barriers (e.g., NAFTA), marketing globally is an increasingly viable option for

companies of all sizes. Donnelly and Peter (2003) explain:

A growing number of U.S. corporations have transversed geographical boundaries and

become truly multinational…For other domestic companies, the question is no longer, Should we go

international? Instead, the questions relate to when, how, and where the companies should enter

the international marketplace. (p. 204) Global expansion – while presenting innumerable

opportunities for financial gain – is not without its challenges. Echoing the aforementioned cultural

concerns, Palmer (2003), cautions:

The global marketing environment is changing rapidly…understanding the

environment calls for a great amount of research. The impact of improving

international communications and cultural convergence are just two

dynamic factors at work to shape the global marketing environment. There

have been successes, but also many failures (p. 2301).

Nevertheless, Donnelly and Peter believe, “marketing globally is the same as marketing at

home…the marketing program must still be built around a sound product or service that is properly

priced, promoted, and distributed to a carefully analyzed target market,” (p. 205).

For marketers, their prime responsibilities remain understanding a target market and

developing goods/services that meet their needs while communicating the benefits of those

products in a culturally sensitive manner. Of course, there are also many pragmatic concerns to

consider when entering a new market.

These might include political uncertainty, import restrictions, exchange controls and

ownership restrictions, and economic conditions (Donnelly and Peter, 2003). Palmer (2003)

suggests the “PEST framework is useful for analysing foreign market opportunities,” (p. 2303) and

discusses its four main factors: political, economic, social and technological.

However, understanding the culture in which you are expanding your efforts is paramount

to success. Logically, as is the case with a domestic market, any savvy professional will seek to

understand the market in which they are operating. Accordingly, to discourage ineffective or,

worse, controversial campaigns, the first step of an international marketing effort is an intense

investment into what could best be called “environmental intelligence.”

III. Cultural Contexts

Acquiring environmental intelligence begins with defining in which context the country – or

the group within a country, as a nation can have several divergent demographics – exists. The



context of a culture will influence how a target market perceives a product or service and

understands the messages that you communicate.

In some cases, a target market might be similar to that of the marketing manager or, in

others, it might be very different. Per Donnelly and Peter (2002), “some of the most common areas

of difference lie in the way dissimilar cultures perceive time, thought patterns, personal space,

material possessions, family roles and relationships, personal achievement, competitiveness,

individuality, social behavior and other interrelated issues,” (p. 205). As a result, Palmer (2003)

explains, “a crucial task of overseas marketing management is the design of a marketing

programme which is sensitive to local needs,” (p. 2305).

In his 1976 book “Beyond Culture,” Edward T. Hall suggests that culture is understood

within the framework of high and low context orientations (Gordon, 2002a). As explained in

literature provided by Gordon (2002a):

In a low-context culture, messages are explicit; words carry most of the

information in communication. In a high-context culture, less information is

contained in the verbal part of a message, since much more information is in

the context of communication, which includes the background, associations,

and basic values of the communication (p. 115).

Low-context cultures primarily include westernized nations, such as the United States,

Great Britain and parts of northern Europe (e.g., Sweden and Germany). Countries in the Middle

East and Far East (e.g., China and Japan) are considered high-context. Cultures that are low-context

are often more litigious in nature and prefer binding legal contracts. High-context cultures are less

litigious and place more faith in the promises of parties involved in a business arrangement.

IV. Standardization vs. Localization

Once the culture of a desired market is understood, the pragmatic concerns of the

marketing program can be considered. Two approaches are available: standardization and

localization. Materials presented by Gordon (2002b) explain “a central issue in international

marketing is the degree to which it is necessary to modify and adapt products sold in global

markets,” (p. 422).

For a standardized campaign, a consistent creative vision is developed and managed from

one centralized office or agency for a diverse global audience. Conversely, a localized effort

empowers multiple agencies or offices of one agency in specific areas of opportunity to develop

programs that are relevant for their local market.

Strategically speaking, the decision between standardization and localization also affects

product development. Literature provided by Gordon (2002b) proposes that standardized

programs are often associated with ethnocentric, regiocentric and geocentric approaches – both of

which tend to homogenize cultures into one universal experience for which a single product is

developed and marketed. Localized efforts usually involve polycentric, multidomestic approaches

to product development and marketing (Gordon, 2002b) and are more customized.



Gordon (2002c) proposes an additional dimension: the cybercentric approach. Capitalizing

on the increased functionality of the Internet, cybercentrism embraces electronic commerce as a

means to global growth. Elements of a cybercentric approach include searchable online catalogs

and purchasing environments for customers in addition to networked production areas for

company personnel (Gordon, 2002c).

Serving as a “breakaway concept from company evolution realities of the last century,” (p.

1), the cybercentric model “supercedes the geocentric premise and embraces the management and

marketing concepts of e-commerce, e-business, e-manufacturing to include the new virtual

commerce environments of Business-to-Consumer (B2C), Business-to-Business (B2B) and Factory-

to-Business (F2B),” (p. 1). The cybercentric approach represents a 100 percent decentralized

marketing and production effort (Gordon, 2003c).

The choice of either localized or standardized programs depends on the goals of an

organization. Materials presented by Gordon (2002b) explain, “the relevance of standardization

versus localization strategies will be strongly influenced by the character of the firm’s international

marketing strategy and objectives and the nature of the global business and environment that the

firm is competing in,” (p. 424).

The materials further suggest that localization is recommended in cases where maximizing

market share is desired. When branding is the objective, standardization would be preferable.

According to Palmer (2003), localization is often more effective for service organizations:

In some service industries, the presence of front line expatriate serving staff

can add to the appeal of a service, for example a chain of traditional Irish

pubs established in mainland Europe may add to their appeal by employing

authentic Irish staff. (p. 2306)

Alternatively, “for relatively straightforward goods and services, a large proportion of staff

is likely to be recruited locally, leaving just senior management posts filled by expatriates,” (Palmer,

p. 2306). Sometimes, a localization effort might also require a formalized training program, “to

ensure that locally recruited staff perform in a manner which is consistent with the company’s

global image,” (Palmer, p. 2306).

An important point of clarification is the degree to which a standardized campaign might

actually preclude a local interpretation or, conversely, a localized effort might prevent inclusion of

consistent corporate branding requirements. Just as the needs of different cultures vary

significantly, so does the interpretation of these two opposing concepts. Indeed, materials

presented by Gordon (2002b) further comment:

Some interpret the standardization construct literally, which implies that

product and other marketing programs would have to be 100 percent

uniform in overseas markets to be considered as standard. Others classify

marketing programs as standard so long as they are substantially similar in

their key elements…Disagreement on the viability of standardization

strategies also reflects varying interpretations of the environment. (p. 423).



In addition, literature from Gordon (2002d) also defines the common course of traditional

businesses entering the international arena within the following three stages:

Stage 1 (International)

In this initial stage, it is assumed that a company has entered one international market.

Operating with a highly centralized structure, an organization in this situation is most likely to

pursue an ethnocentric strategy.

Stage 2 (Multinational)

By this stage, a company has expanded into more than one foreign market and embraces a

mixed centralized/decentralized management policy. In this case, a more polycentric approach is

followed.

Stage 3 (Global)

At this point, a company operates in numerous countries and has expanded its efforts in a

very geocentric manner. In order to capitalize on opportunity and to allow for the fastest means of

response to market conditions, a company in this situation has no set policy and defers to

whichever option works best in a given market.

Notably, when considering the cybercentric approach as proposed by Gordon (2002c),

organizations begin at Stage 3 (Global) as a result of a presence on the World Wide Web. This

reality simultaneously affords such an organization great opportunity while increasing the intensity

of their operations.

V. Avenues of Entry

Donnelly and Peter (2003) explain, “The role of the distribution network in facilitating the

transfer of goods and titles and in the demand stimulation process is as important in foreign

markets as it is at home,” (p. 214). Options available to a global marketing manager vary from those

that offer little control to those that afford maximum authority. The chart below, based on material

presented by Palmer (2003, p. 2307) outlines the seven entry and growth strategies:

Option Benefits Tradeoffs

• Exporting Directly to Customers • Maximized control. • Increased risk and cost.

• Exporting through Agents • Reduced risk. • Reduced control over marketing.

• Direct Investment • Advantageous (required) for

services.

• Increased control and

involvement.

• Increased risk and cost.

• Local regulations.

• Licensing/Franchising • Accelerated global expansion.

• Lowered capital requirements.

• Reduced control over operations.

• Increased administrative costs.

• Joint Ventures • Greater access to local markets. • Less control for domestic



• Shared costs and risk.

• Division of labor.

company.

• Competing interests or conflicts.

• Reliance on local partner.

• Strategic Alliances • Control of specific program

element.

• Shared costs and risk.

• Increased

administration/politics.

• Reduced revenue (percentage).

• Global e-Commerce • Reduced costs and increased

reach.

• Centralized operations and

admin.

• Lowered cost of entry (website).

• Instant international presence.

• Reliance on shipping and

delivery.

• Global technological

inconsistency.

• Market segmentation and

strategy.

• Translation and cultural issues.

When considering which of the strategies above to pursue, Palmer (2003) recommends that

organizations pay particular attention to “differences in consumer behaviour, different social norms

and legislation which may prevent use of distribution channels commonly used in the home

market,” (p. 2306).

VI. Politics of the Pocketbook

Beyond the actual methods and media used to market a product or service to an

international market, pricing is also a pivotal component to a successful campaign. In some

countries, the price of a good or service directly correlates to the perception of that item’s value –

whether it is too costly or too inexpensive. There are also tangible issues to consider such as tariffs,

taxes and other expenses that may affect the profit margin of a product or service. All of these

challenges must be carefully considered by a marketing manager.

Indeed, Donnelly and Peter (2003) caution:

In domestic markets, pricing is a complex task…However, the pricing task is

often more complicated in foreign markets because of additional problems

associated with tariffs, antidumping laws, taxes, inflation, and currency

conversion (p. 215).

There also might be a competitive advantage (depending on an individual’s role in the

process) if the same product or service is priced at significantly different levels across nations

(excluding differences in exchange rates). Palmer (2003) addresses a unique dimension to pursuing

different pricing structures when he notes, “if wide differences in the pre-tax price of goods

emerges between countries, it is open to entrepreneurs to buy goods in the lower priced market

and sell them in the higher priced market,” (p. 2306).

Culturally, pricing is a very important part of product adoption and continued use. For

example, consider the case of China. Gong (2003) claims pricing strategies heavily influences



Chinese consumers. Concerned with “thrift” Chinese consumers nevertheless remain weary of

exceptionally inexpensive items – which they might perceive to be of poor quality.

Additionally, consumers in China do not respond well to price gimmicks or coupons for the

aforementioned reason and the fact that most prefer more humble, less effusive purchasing

experiences. Most Chinese would consider using a coupon embarrassing and petty.

VII. Final Thoughts

There is little doubt the world is becoming smaller. International commerce is becoming

much more accessible to organizations that would have never before even considered entering the

market. However, with the advent of new technology and faster means of travel, it is no longer

inconceivable for a home-based operation to engage in business around the world.

Consider eBay, in which sellers from all across the globe exchange money for goods (and

occasionally services) with buyers from virtually anywhere on the planet. Of course, the fact that

transacting business on a global scale is in some ways easier than it has been before, organizations

and individuals must remain aware of the salient points discussed in this paper.

While the fee of admission has been lowered, in many respects, the bar by which success

and failure are measure has been raised considerably. No matter how easily businesses can

communicate with one another (technically) or travel to facilities throughout the world, basic

business principles must still be understood and practiced.

References

Crossland, N. (2002, March). Backbone of global campaigns. Pharmaceutical Executive, 26-30.

Donnelly, J. & Peter, J. (2003). A Preface to Marketing Management, 9th Edition. New York, NY:

McGraw-Hill.

Gong, W. (2003, June 12). Chinese Consumer Behavior: A Cultural Framework and Implications.

Presented at the International Business and Management Research Conference, Honolulu,

Hawaii.

Gordon, L. (2002a). Social and Cultural Elements of the World Market Environment. Presented

October 1, 2002 in PC504: Global Marketing at Woodbury University School of Business and

Management.

Gordon, L. (2002b). The Standardization Versus Localization Debate. Presented November 19, 2002

in PC504: Global Marketing at Woodbury University School of Business and Management.

Gordon, L. (2002c). Cybercentrism. Presented November 19, 2002 in PC504: Global Marketing,

Woodbury University School of Business and Management.

Gordon, L. (2002d). Table 10-1, International Business Strategy: Three Alternatives. Presented

November 19, 2002 in PC504: Global Marketing, Woodbury University School of Business

and Management.

Grimshaw, C. (2003, May 15). Why global firms need local media. Marketing, 27-28.



Palmer, A. (2003). Principles of Marketing Supplements: Global Marketing. Oxford University Press.

Downloaded June 10, 2003 from

http://www.oup.co.uk/best.textbooks/business/palmer/supplements/ im23glob.pdf

Parmar, A. (2003, June 9). Objections to Indian ad not taken lightly. Marketing News, 37 (12), 4, 9.