As Evidenced in Wal-Mart and Starbucks
Introduction
- Conformity to consumption trend
- Soft-sell and hard-sell: advertising
- Country of Origin: global belonging
- “Good impression”
- Social prestige - CVI
Conclusion
Introduction:
When it comes to looking into and discussing how Wal-Mart should change their policies to increase their standing within the Global Consumer Culture Positioning (GCCP), few concepts have been developed and employed successfully. Globalization, an important concept in the business world and competitive market, is all about the combination and assimilation of local cultures as they compare to the masses, not the cultures individually. According to the Journal of Consumer Marketing, “buyer needs are converging in key markets across national boundaries.”. This implies that consumers are constantly reaching out with the intent to buy products anywhere globally. Global brand positioning is about a company’s individual position within local cultures; where they stand and what they provide to the economy. Popular culture, especially Western Culture, sets unwritten standards that are followed zealously. Western consumers are increasingly susceptible to Global Consumer Culture and its influence on brand values. In this paper, the literature review compared two companies, Starbucks and Wal-Mart, by analyzing multiple company strategies and how they could improve on each one. Research studies shows that a company’s respective brand positioning depends on their consumers Susceptibility to Global Consumer Culture (SGCC). This can be divided into three different categories: conformity to consumption trend, social prestige, and quality perception . This paper will only focus on the first two dimensions of how brands should make consumers feel and think about when looking at their brand/product, and how can companies grow while using their social prestige?
- Conformity to consumption trend
- Advertising: soft-sell vs. hard-sell
Shintaro, Barbara, and Charles define a brand as ‘a symbol of a given global culture’. In the Journal of International Marketing, studies show that international advertising is the best way to broadcast branding messages, signs and symbols of a particular company. There are different types of advertising methods that have been proven in consumer driven markets. Soft-sell and hard-sell are two patterns in proposing advertisement solutions to big corporations like Wal-Mart and Starbucks. Corporations need to analyze their target market and find the right pattern to fit the Local Consumer Culture Positioning (LCCP). Soft-sell advertising is considered an indirect and image-oriented approach; while in contrast, hard-sell is more a direct and information-based approach. Researchers from the Journal of International Marketing have conducted studies that have found that the most effective approach for GCCP is the soft-sell approach .
Wal-Mart and Starbucks are both the using soft-sell approach in their advertising. Whenever Starbucks promotes a new product, their first move is always to circulate images of the beverage to attract customer’s interest. In contrast, Wal-Mart is uses phrasing and slogans like “Everyday low prices” throughout their target market. This advertising method has proven successful in several countries. However, market research shows that this method has been ineffective in Germany. Because of the difference in culture and societal influences, Wal-Mart Corporation is using the wrong way to design a view the appeals to their market. Economically, Germans are more efficient than other countries. Wal-Mart has their promotion only in words as opposed to pictures. This arrangement requires customers spend more time on shopping when their interests lie elsewhere. The time consuming nature of this ideology contrasts with traditional German’s culture.
- Social prestige – Corporate Visual Identity (CVI)
According to Psychology and Marketing Magazine, social prestige is another important dimension associated with consumers advertising of SGCC. Brands should position themselves in local markets which associate with coordinated LCCP. One thing both Wal-Mart and Starbucks need to do is clearly define their Corporate Visual Identity (CVI). CVI is the technical term for what customers use to identify products or services of a company. Brands can define their CVI by different categories. The most central one is corporate features. This feature depends mostly on the corporation’s previous financial reports, corporate strategy, and international marketing issues. Furthermore, research also found that “companies that adopt a high degree of CVI standardization rate culture and nationalism significantly lower on influence in their CVI decisions than companies that adopt a low degree of CVI standardization.”
In regards to Wal-Mart’s presence in Germany, they failed in investigating German’s consumer attitude and behaviour. Wal-Mart mismanaged their LCCP. Research into the discrepancies showed that morning activities such as standing formation chants and the checkout agents proved one of the biggest LCCP issues. The final LCCP issue discovered was “ethnic problem,” which has been remedied in recent years. These business practices make consumers feel like strangers when they are shopping at Wal-Mart. Most Germans act on compulsive buying behaviour, which is defined as a “chronic, repetitive purchasing behaviour that becomes a primary response to negative events or feelings, is difficult to stop, and results in harmful consequences . With this knowledge, it is unsurprising that the economic and social German culture would not revisit a brand that they felt promoted these behaviours and inefficient practices.
References
Akaka, M. A., & Alden, D. L. (2010). Global brand positioning and perceptions: International advertising and global consumer culture. International Journal of Advertising, 29(1), 37-56. doi:10.2501/S0265048709201026
Hassan, S. S., & Craft, S. (2012). Examining world market segmentation and brand positiong strategies. Journal of Consumer Marketing, 29(5), 344-356. doi:10.1108/07363761211247460
Kwintessential. (2014). Retrieved from Walmart in Germany: Culture Problems: http://www.kwintessential.co.uk/resources/walmart-germany-cultural-problems.html
Macaray, D. (2011, August 29). Why did walmart leave Germany? Retrieved from Huffington post: http://www.huffingtonpost.com/david-macaray/why-did-walmart-leave-ger_b_940542.html
Melewar, T., & Saunders, J. (1999). International corporate visual identity: Standardization or localization? Journal of International Business Studies, 30(3), 583-598. Retrieved from http://search.proquest.com.proxy.lib.sfu.ca/docview/197158617?accountid=13800
Okazaki, S., Mueller, B., & Taylor, C. R. (2010). Global consumer culture positioning testing perceptions of soft-sell and hard-sell advertising appeals between U.S. and Japanese consumers. Journal of International Marketing, 18(2), 20-34. doi:10.1509/jimk.18.2.20
Raab, G., Elger, C. E., Neuner, M., & Weber, B. (2011, December). A neurological study of compulsive buying behaviour. Journal of Consumer Policy, 34(4), 401-413. doi:10.1007/s10603-011-9168-3
Walmart. (2013). Encyclopedia of Global Brands, 2. Retrieved from http://go.galegroup.com.proxy.lib.sfu.ca/ps/retrieve.do?sgHitCountType=None&sort=RELEVANCE&inPS=true&prodId=GVRL&userGroupName=sfu_z39&tabID=T003&searchId=R1&resultListType=RESULT_LIST&contentSegment=&searchType=AdvancedSearchForm¤tPosition=1&conten
Zhou, L., Teng, L., & Poon, P. S. (2008, April). Susceptibility to global consumer culture: A three-dimensional scale. Psychology & Marketing, 25(4), 336-351. doi:10.1002/mar.20212
