Resistance to Cultural Change sample essay
1) Please explain: How “resistance to cultural change” can influence international product introduction? Culture in the context of marketing can be seen an aggregate of customs and habits shared by a group of people. It affects consumption patterns of consumers considerably. These practices in concrete market can’t be changed easily by any brand. Brands need to adopt their strategies and communications to cultural philosophy and find the balance between standardization and customization. If they do not, they are likely to fail in Internationalization of products.
2) Please provide 2 detailed examples of real companies that have faced this situation and have failed. Why their strategies didn’t work? Failure of IKEA in Japan (1970s)
IKEA is Swedish furniture retail company famous all around the world. It has stores in 38 countries by now and offers well designed and functional products at low prices. This strategy was the key of success in most of its international markets. This strategy was the key of success in most of its international markets. Japan was the first country in Asia that IKEA tried to enter in the 1970s. However, IKEA had to leave the Japanese market in 1986. The failure of the strategy can be explained by significant differences between Swedish and Japanese culture. The success of company on in so many markets reduced the level of uncertainty and led to early expansion. Japanese market is unique and requires the the high level of adaptation, which IKEA underestimated. For example, consumers weren’t used to the IKEA concept of do-it-yourself. IKEA should have spend more time on understanding local specifics and employee. For instance, they could employee local people from the very beginning.
Failure of Kellogg’s in India
Kellogg’s is a popular producer of cereals, cookies and snacks and one of the leaders in the cereal industry. In 1994 the company decided to launch its most successful brand, Corn Flakes, in India. However, dietary customs of Indian consumers were totally different. They were used to start a day with hot vegetable, this concept was of breakfast was new for them. The promotion included not only the product, but the idea of breakfast as well. Even though people got used to the concept and like the taste, the price of the product was too high. Kellogg’s has been unwilling to reduce the price and launched other products, without doing any further research of the market. Although the company adapted the taste to the market, the price prevented Kellogg’s from further market growth.
3) Describe 2 examples of real companies that have succeeded going internationally. Success of IKEA in Japan (2000s)
In 2006 IKEA re-entried into the Japanese market. By this time, the company had more international experiences from other key markets, such as Russia or China. It was also aware of the cultural barriers and learned from the previous mistakes. The company spent 5 years on the studies of the market and visited many Japanese homes to understand better of their needs. IKEA finally adapted its products to Japanese small space living and adjusted store and employee management to the Japanese cultural pattern.
Starbucks’s success in China
Starbucks entered China in 1999. By that time, nobody could have believed that it is possible to make Chinese to drink anything different then tea, which is one of the most recognizable features in Chinese history. In the beginning Starbucks demonstrated clearly that is its enter doesn’t represent any threat for tea-drinking culture. It localized menu of beverages using popular local ingredients such as green tea. Starbucks also provided customers with an exceptional experience using unique interior or design chairs which guaranteed exceptional brand position to the company far away from the competitors.
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