Consumer Behavior Building Marketing Strategy 15th Edition By David, Susan, Kleiser, Delbert INSTRUC

INSTRUCTOR SOLUTIONS MANUAL Consumer Behavior Building Marketing Instructor Solution Manual For Strategy, 15th Edition By David, Susan, Kleiser and Delbert Consumer Behavior Building Marketing Strategy, 15th Edition By David Mothersbaugh, Susan Bardi Kleiser and Delbert Hawkins Chapter 1-20 With Cases [I II III IV V]

CHAPTER 1: CONSUMER BEHAVIOR AND MARKETING STRATEGY LEARNING OBJECTIVES LO1: LO2: LO3: LO4: LO5:

Define consumer behavior Summarize the applications of consumer behavior Explain how consumer behavior can be used to develop marketing strategy Explain the components that constitute a conceptual model of consumer behavior Discuss issues involving consumption meanings and firm attempts to influence them

SUMMARY LO1: Define consumer behavior The field of consumer behavior is the study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society.

LO2: Summarize the applications of consumer behavior Consumer behavior can be applied in four areas, namely (a) marketing strategy, (b) regulatory policy, (c) social marketing, and (d) creating informed individuals. Developing marketing strategy involves setting levels of the marketing mix based on an understanding of the market and segments involved to create desirable outcomes. Developing regulatory guidelines involves developing policies, guidelines, and laws to protect and aid consumers. Social marketing is the application of marketing strategies and tactics to alter or create behaviors that have a positive effect on the targeted individuals or society as a whole. Creating more informed individuals involves educating consumers about their own consumption behaviors as well as marketers’ efforts to influence it in such a way as to create a more sound citizenship, effective purchasing behavior, and reasoned business ethics.

LO3: Explain how consumer behavior can be used to develop marketing strategy The interplay between consumer behavior and marketing strategy involves five stages. First is market analysis which involves gathering data and tracking trends related to the company, competitors, conditions, and consumers. Second is market segmentation. A market segment is a portion of a larger market whose needs differ somewhat from the larger market. Firms segment their markets and choose a segment or segments that best fit their capabilities and market conditions. Third is marketing strategy which involves setting appropriate levels for the marketing mix as a function of the segments being targeted and the market conditions that exist. Fourth is the consumer decision process which is a series of steps starting with problem recognition and moving through information search, alternative evaluation, purchase, use, and post purchase evaluation. Marketing efforts can be targeted to these different stages. Fifth is 1-1 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

outcomes at the individual, firm, and societal level. And while profit maximization is often a goal at the firm level, possible adverse effects at the individual and societal level are of importance to firms, government organizations, and regulators. An understanding of consumer behavior theory and concepts is critical at each stage as marketers gather information, develop marketing strategies to influence consumer decisions, and evaluate the effects of their marketing efforts.

LO4: Explain the components that constitute a conceptual model of consumer behavior The conceptual model of consumer behavior developed here can be broken into four interrelated parts. External and internal influences affect the consumer’s self-concept and lifestyle which, in turn, affects the decision process. External influences (Part 2 of the text) include culture, reference groups, demographics, and marketing activities. Internal influences (Part 3) include perception, emotions, attitudes, and personality. Self-concept is the totality of an individual’s thoughts and feelings about oneself. Lifestyle is, quite simply, how one lives, including the products one buys, how one uses them, what one thinks about them, and how one feels about them. External and internal factors operate to influence self-concept and lifestyle which, in turn, influences the decision process (Part 4). Overlaying these basic components is organizations (Part 5) and regulation (Part 6). Organizations or businesses can also be consumers as when Mercedes-Benz purchases dashboard subcomponents from a supplier. This type of marketing is often termed business-to-business (B2B) marketing to differentiate it from business-to-consumer (B2C) marketing that is the focus of much of this text. The special nature of organizations and how they behave warrants special attention.

Regulation is an aspect of consumer behavior that permeates marketer actions relating to all parts of our model and it warrants special attention as well.

LO5: Discuss issues involving consumption meanings and firm attempts to influence them Consumption has meaning beyond the satisfaction of minimum or basic consumer needs.

Thus, consumers might purchase Nike sneakers not only to satisfy the functional needs associated with safety and support but also for symbolic needs associated with status, identity, and group acceptance. Some criticize marketers for their attempts to instill in, or amplify, consumer desires for products beyond minimum functional aspects. And while this criticism may hold true, it also seems likely that such desires and symbolic meanings are naturally assigned to objects even in the relative absence of marketing. Nonetheless, the ethical implications of marketers’ actions in this regard are important to consider.

LECTURE TIPS AND AIDS 1) It is important to get the student to believe that knowledge of consumer behavior can help managers understand why people behave as they do and that this understanding can help managers predict behavior. One rather simple ―gimmick‖ to help get this point across goes as follows: Before the start of class, pin up a card with the number 3 printed on it making sure that none of the students can see the number. Then, during the lecture, when you are pointing out that some behaviors can be predicted, ask the students to pick a number between 1 and 4 inclusive and record how many pick each number. A substantial majority should pick 3. You can then turn the card over and indicate that your prediction resulted from (1) past experience and/or (2) knowledge 1-2 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

that in situations such as this, when a person has no other clues to go on, they tend to pick a ―safe‖ middle number. (This is particularly true in multiple-choice tests!) The fact that not everyone in the class picked 3 allows you to explain that marketers will probably never be able to predict with 100 percent accuracy because human beings are unique. (Should the situation arise that more students choose a number other than 3, you could also use the example of imperfect prediction as well as the fact that sometimes even the best predictions are wrong!)

2) It should be pointed out that the model presented in the text is explanatory in nature, the purpose of which is to give the student an overall ―picture‖ of how the parts of behavior that they will study fit together. The analogy might be made to a graphical model of an internal combustion engine. It should also be pointed out that there are a number of consumer behavior models that one can use. However, it might also be noted that they all vary little in terms of real substantive issues and that none are really predictive in the managerial decision-making sense.

3) Have students select a product of interest and discuss how various components of the model could aid development of marketing strategies for various brands of the product.

4) If you allow any free-ranging discussion, students will generally ask about particular ads that they find annoying or otherwise distasteful. Many will claim that they will never buy the product because of the ad. It is worth your while to cause this discussion to occur. Ask the class to discuss why such an ad is being run. Three points should emerge from the discussion. First, marketers sometimes make mistakes. Second, annoying ads can still induce learning (your students have learned about the product in the ad in question), which might influence subsequent behavior.

Third, and most important, the students are probably not part of the target market for the ad. The target market may find the ad quite acceptable. You need to drive hard the fact that college graduates with business degrees are very unique. When they use their tastes to judge marketing programs targeted at other groups, they are likely to make mistakes. This is one of the BIG takeaways from this class.

5) Initiate a discussion on injurious consumption and the responsibilities of marketers, consumers,

and the government. After the students discuss harmful products such as alcohol or tobacco, point out that improper diets and excess eating are the major causes of health problems in this country.

Should the advertising of snack food be limited or required to carry warning labels? What role should the education system play in teaching people how to be effective consumers?

REVIEW QUESTIONS 1) How is the field of consumer behavior defined?

It is the study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society.

2) What conclusions can be drawn from the examples at the beginning of this chapter?

Successful marketing decisions require extensive information on consumer behavior theory.

Consumer behavior theory provides the manager with the proper questions to ask. Managers, regulators, and others use consumer behavior and knowledge to make decisions.

3) What are the four major uses or applications of an understanding of consumer behavior?

(1) Developing marketing strategy, (2) developing regulatory policy for marketing actions, (3) social marketing, and (4) understanding how societies function.

4) What is social marketing?

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It is the applications of marketing strategies and tactics to alter or create behaviors that have a positive effect on the targeted individual and/or society as a whole.

5) What is customer value and why is it important to marketers?

It is the difference between all of the benefits derived from a total product and all the costs of acquiring those benefits. It is important because consumers choose those options that they believe will provide them the most value.

6) What is required to provide superior customer value?

The organization must do a better job of anticipating and reacting to customer needs than the competition. This requires knowledge of consumer behavior as well as technical and marketing skills.

7) What is a total product?

It is all aspects of the product including its price, package, distribution system, image, and so forth.

8) What is involved in the consumer analysis phase of market analysis in Figure 1–1?

The organization must be able to anticipate evolving consumer needs, which requires a complete understanding of the product-related behaviors of the market segments under consideration. This will often require extensive primary research.

9) What is involved in the company analysis phase of market analysis in Figure 1–1?

The firm must understand its ability to meet evolving customer needs better than the competition.

This involves evaluating all aspects of the firm ranging from its financial condition to its general management skills to its reputation. This will generally involve both internal analyses and outside assessments.

10) What is involved in the competitor analysis phase of market analysis in Figure 1–1?

A firm should know its key competitors as well as it knows itself (see #6 above). For particular initiatives, the firm needs to determine which competitors will be harmed and their capability and likely means of responding. The firm’s strategy should be evaluated in light of these probable responses.

11) What is involved in the conditions analysis phase of market analysis in Figure 1–1?

This is an analysis of the state of the relevant economies, government regulations, the physical environment, and technological developments.

12) Describe the process of market segmentation.

Market segmentation has four steps: (1) identify product-related need sets, (2) group consumers with similar need sets, (3) describe each group (in terms of demographics, media preferences, and lifestyles), and (4) select attractive segments to serve.

13) What is marketing strategy?

Marketing strategy is the answer to the question: ―How will we provide superior customer value to our target market at a profit?‖ It is deciding how to meet the needs of a defined target segment. It involves structuring the marketing mix.

14) What is a marketing mix?

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The marketing mix is the product, price, communications, distribution, and services provided to the target market. An important part of the concept is that these elements are deliberately blended to achieve a defined impact on the target market.

15) What is a product?

A product is anything a consumer acquires or could acquire to meet a perceived need. It is useful to think of a product in terms of the benefits it provides. It includes both physical products and primary services such as haircuts.

16) What does an effective communications strategy require?

It requires sound answers to these questions: (1) Who exactly do we want to communicate with?

(2) What effect do we want our communication to have on the target audience? (3) What message will achieve the desired effect on our audience? (4) What means and media should we use to reach the target audience? (5) When should we communicate with the target audience?

17) What is a price? How does the price of a product differ from the cost of the product to the consumer?

The price is the amount of money one must pay to obtain the right to use the product. The cost of the product to the consumer includes the price plus other costs such as time and effort to acquire the product, finance charges, and maintenance expenses.

18) How is service defined in the text?

Service is defined not as a primary service such as a haircut, which is treated as product, but as an auxiliary service, which is performed to enhance the primary product or service. Thus, we consider car repairs to be a product but free pickup and delivery to be services.

19) What is involved in creating satisfied customers?

Creating satisfied customers requires that customers continue to believe that the brand purchased offers superior value after they have used it. It must deliver as much or more value than customers originally expected.

20) What are the major outcomes for the firm of the marketing process and consumers’ responses to it?

(1) A product position or image in the minds of the consumers, (2) sales and profits, and (3) satisfied (at some level) customers.

21) What are the major outcomes for the individual of the marketing process and consumers’ responses to it?

Some level of need satisfaction and, on occasion, injurious consumption (consumption that harms the individual) 22) What are the major outcomes for society of the marketing process and consumers’ responses to it?

(1) Economic impacts, (2) environmental impacts, and (3) social impacts.

23) What is product position?

It is what consumers think of and feel about a brand in relation to competing brands.

24) What is meant by injurious consumption?

Consumption that has negative consequences for the long-run well-being of the consumer.

25) What is meant by consumer lifestyle?

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Lifestyle is how the consumer lives including the products that they purchase, how they use them, and what they think of them. It is the sum of past decisions and future plans.

26) Describe the consumer decision process.

Within the context of a situation, it involves some or all of the following sequence: problem recognition, information search, alternative evaluation and selection, outlet selection and purchase, and postpurchase processes.

DISCUSSION QUESTIONS 27) Why would someone shop online? Buy an iPad? Eat at Chili’s frequently? a) Why would someone else not make those purchases? b) How would you choose one outlet, brand, or model over the others? Would others make the same choice in the same way?

Discussion should focus on lifestyles and the role these products play in relation to various lifestyles. It is important to move the discussion beyond demographics. Students should be encouraged to discuss the needs and motives that lead to the benefits these products offer being desired. The reasons why some individuals have these needs and other individuals do not should be discussed. The ability to purchase as well as the time to use the product will play a role in Part b as will situational influences. The choice discussion should cover each stage of the decision process. You will probably need to force coverage of each stage.

28) Respond to the questions in Consumer Insight 1–1.

1. Answers will vary, but this question should get students thinking about the segments and applying these concepts to various people in their lives. Surely, all of them should be able to relate and contribute something to a discussion based on this question. This is a good activity for students to discuss in a small group.

2. Answers will vary. Most likely, the basic need sets of consumers will be similar whether in a holiday shopping time or general shopping time. For example, cost-conscious consumers would value bargains and deals throughout any time of the year and then fit in with the Black Friday shoppers during the holiday shopping season. a. Steady Shoppers: Retailers should try to keep their brand at the top-of-mind awareness throughout the season through advertising and promotions like cash-back deals for return trips. b. Early-bird shoppers: Retailers should emphasize that their inventory is diverse enough that shopping for consumers’ entire list can be done quickly and efficiently in their stores so that it does not take longer for consumers to shop around at different places. c. Black Friday shoppers: Retailers should focus on this group’s need to find the best deal possible through special promotions with even bigger discounts for loyalty program members or e-mail subscribers. Since Black Friday shopping is often a social event, having shareable, friends and family discounts could be advantageous as well. d. Last-minute shoppers: Retailers should make the shopping experience as easy as possible because these consumers are pressed for time. This can be done by emphasizing extended store hours, expedited ―Buy Online, Pickup in Store‖ (BOPIS) for brick-and-mortar retailers, and expedited free shipping and late shipping guarantees for online retailers.

29) Of what use, if any, are models such as the one in Figure 1–3 to managers?

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Even though the model does not allow for prediction, point out the value of understanding how all of the parts of consumer behavior fit together. The practicing marketing manager needs to be aware of the relationships and interrelationships of the concepts of consumer behavior in order to develop an effective marketing strategy. It provides a guide to areas to investigate and questions to ask.

30) What changes would you suggest in the model in Figure 1–3? Why? Students will probably find this to be a difficult question. Ask them whether it would be a better model if it were more specific. Then, point out the relative advantages and disadvantages of specificity. (Note that the marketing manager for a product sold to well-defined market segments can make the model specific to their marketing situation.) You might also discuss whether or not internal and external factors should both be considered as lifestyle determinants.

31) Describe your lifestyle. How does it differ from your parents’ lifestyle?

As this question will arise early in the semester, it may be difficult to get students to ―volunteer‖ this kind of information about themselves. If you are brave, use yourself as the example. (One of the authors does this using a great deal of literary license!) Or construct a ―typical student‖ such as Leonard Moffit.

Leonard is a senior majoring in marketing at a major state university. He lives in a fraternity and sees himself as an upper-middle-class person. He drives a 3-year-old Mustang convertible and likes to think of himself as somewhat of a sophisticated yet ―studly‖ guy. He drinks Michelob beer and lately has begun drinking wine, particularly at restaurants on dates. He likes popular music but has developed a small interest in classical music as the result of a class in music appreciation. He played football and ran track in high school but after coming to college has learned to play tennis and golf.

Leonard is from a small town in Illinois where his parents have a rather large pig farm.

Neither of his parents went to college (in fact his dad did not graduate from high school), but they are relatively well-off financially. Both parents are fairly conservative and strongly religious people.

Ask the class what differences there might be in Leonard’s and his parents’ lifestyles and why they might have occurred (school, religion, and so forth). Also, ask them how Leonard’s lifestyle differs from their own. Encourage students to be creative.

32) Do you anticipate any changes in your lifestyle in the next five years? What will cause these changes? What new products or brands will you consume because of these changes?

The most obvious cause for change will be the taking of a job and/or the beginning of a family.

Ask students how they see life changing if they become an IBM salesperson, a spouse, and so forth. Push for specific responses in terms of purchases for clothing, cars, and so forth. Also, have them describe how they think their hobbies, general attitudes, political beliefs, and so on will change.

33) Describe a recent purchase you made. To what extent did you follow the consumer decisionmaking process described in this chapter? How would you explain any differences?

Again, you may have to lead this discussion off with a purchase of your own. Be sure to pick a product relevant to students (e.g., most students aren’t buying homes at this stage in their life) such as a camera, a suit or dress for interviewing, and a spring vacation trip. Go through the process, indicating when and how you recognized a problem existed. It is important to point out that the decision process will vary even for the same person depending on the product, problem, and situation faced. This is another good opportunity to establish rapport with the class.

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34) Describe several ―total products‖ that are more than their direct physical features.

Products such as Coca-Cola or Bayer are good products to lead with. Point out that most consumers cannot easily tell Coke from private label beverages, yet Coke cost more and greatly still outsells private label brands. The same is true for Bayer aspirin. Push the students to analyze why this occurs and the implications it has for marketing strategy.

35) Describe the needs that the following items might satisfy and the total cost to the consumer of obtaining the benefits of the total product. a) Digital video recorder (DVR) b) Lasik eye surgery c) Motorcycle d) SUV This is a fun question. The point is to illustrate how the same product can meet multiple needs of the same or different people. For example, a motorcycle could meet functional needs for some consumers interested in inexpensive transportation (they may choose a moped). Or, it could meet value-expressive needs for those wanting to look ―cool‖ or impress their friends (they may choose a Harley). The same is true for costs. Those who already know how to ride may find it easy to acquire and use a motorcycle, while those who don’t will likely have to invest time and money (lessons) to learn. Discuss the implications of this for market segmentation and strategy.

36) How would you define the product that the Hard Rock Cafe provides? What needs does it meet?

You can use a fun-oriented local restaurant or bar if your students are not familiar with Hard Rock Cafe. The product is much more than food; it is food and entertainment. Needs would include physiological (food and drink), fun, excitement, novelty, social interaction, and a host of others.

37) To what extent, if any, are marketers responsible for injurious consumption involving their products?

You can spend a large part of a class on this. If your students are mostly conservative, you may need to play a liberal role to encourage debate and thinking. You can keep discussion moving by debating or posing the opposite of whatever position your students take. Move them off of the obvious products such as tobacco. Point out that improper diets and excess eating are the major causes of health problems in this country. What are the responsibilities of the makers of Oreos or potato chips? Should the advertising of snack food be limited or required to carry warning labels?

38) How could social marketing help alleviate some of society’s problems?

Pick a particular problem such as improper diets among teenagers. After the class realizes the potential of social marketing (be sure they focus first on using consumer behavior theory and research to understand the causes of the problem and use this as a basis for the solution), move the discussion to the issue of funding social marketing. Suggest a tax on advertising as a means to create a fund to pay for social advertising and see how the students respond.

39) Respond to the questions in Consumer Insight 1–2.

Q1—There are many answers to this question. Consumers naturally imbue brands with personlike traits that are inferred from such aspects as packaging, design, and brand name. Experiences associated with a product (first gig played with a certain guitar) can create meaning. People associated with a product (a watch used by one’s grandfather) can create meaning. Chapters 10 and 12 in particular deal with these issues.

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Q2—Students should be able to articulate such aspects as financial (debt and personal bankruptcy) to physical (too much plastic surgery, skin cancer associated with tanning salons).

This can be linked to the issue of the regulation of marketing (Chapter 20) and how much, if any, regulation is warranted (a question on which answers will vary greatly).

Q3—Here, it can be useful to talk about what we mean by ―need.‖ Often, while a product doesn’t fulfill a physically necessary need to survive, it does serve a psychological or social need to fit in, stand out, or feel more fulfilled in one’s life. Getting students to talk about these alternative needs and their validity is useful. The ethical issues of using marketing to play off of these alternative ―needs‖ and motivations is an additional pathway for discussion.

40) Is the criticism of Nike for creating a shoe that is symbolic of success to some groups valid? Why or why not?

Most students will not see this as a problem, and many should point out that most societies throughout history have used expensive items as status symbols. However, push them to think what this means to low-income parents who cannot afford such products or what it might do to the self-image of children who do not have them.

41) Hershey-owned Robert’s American Gourmet Snack Foods (currently owned by Hershey) has produced herbal-based snacks such as Spirulina Spirals and St. John’s Wort Tortilla Chips, as well as Pirate’s Booty baked snacks. According to the company president, ―We’re selling like crazy. We don’t do research. We react as sort of a karma thing.‖i How would you explain the firm’s success?

What are the advantages and risks of this approach?

The focus of this discussion should be on the trends that occur in consumer needs and desires and the use of intuition versus research to predict each. In the discussion of advantages and risks, it would be useful to direct the discussion toward the elements of the consumer behavior model. It is important that students recognize that for every successful intuitive business there are many, many unsuccessful ones that they don’t get to read about because they are no longer in business. i

M. W. Fellman, ―New Age Dawns for Product Niche,‖ Marketing News, April 27, 1998, p. 1, www.piratesbooty.com, accessed May 15, 2018; A. Gasparro,―Hershey To Buy Pirate’s Booty Maker for $420 Million,‖ September 12, 2018, www.wsj.com, accessed August 17, 2021.

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CHAPTER 2: CROSS-CULTURAL VARIATIONSIN CONSUMER BEHAVIOR LEARNING OBJECTIVES LO1: LO2: LO3: LO4: LO5: LO6:

Define the concept of culture Describe core values that vary across culture and influence behaviors Understand cross-cultural variations in nonverbal communications Summarize key aspects of the global youth culture Understand the role of global demographics List the key dimensions in deciding to enter a foreign market

SUMMARY LO1: Define the concept of culture

Culture is defined as the complex whole that includes knowledge, beliefs, art, law, morals, customs, and any other capabilities acquired by humans as members of society. It includes almost everything that influences an individual’s thought processes and behaviors. Culture operates primarily by setting boundaries for individual behavior and by influencing the functioning of such institutions as the family and mass media. The boundaries, or norms, are derived from cultural values. Values are widely held beliefs that affirm what is desirable.

LO2: Describe core values that vary across culture and influence behaviors

Cultural values are classified into three categories: other, environment, and self. Other-oriented values reflect a society’s view of the appropriate relationships between individuals and groups within that society. Relevant values of this nature include individual/collective, youth/age, extended/limited family, masculine/feminine, competitive/cooperative, and diversity/uniformity. Environment-oriented values prescribe a society’s relationships with its economic, technical, and physical environments.

Examples of environment values are cleanliness, performance/status, tradition/change, risk taking/security, problem solving/fatalistic, and nature. Self-oriented values reflect the objectives and approaches to life that individual members of society find desirable. These include active/passive, sensual gratification/abstinence, material/nonmaterial, hard work/leisure, postponed gratification/immediate gratification, and religious/secular.

LO3: Understand cross-cultural variations in nonverbal communications Nonverbal communication systems are the arbitrary meanings a culture assigns actions, events, and things other than words. Major examples of nonverbal communication variables that affect marketers are time, space, symbols, relationships, agreements, things, and etiquette.

LO4: Summarize key aspects of the global youth culture There is evidence that urban youth around the world share at least some aspects of a common culture.

This culture is driven by worldwide mass media and common music and sports stars. Emerging aspects include the importance of technology and the fact that U.S. teens and brands are no longer leading the way.

LO5: Understand the role of global demographics

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Demographics describe a population in terms of its size, structure, and distribution. Demographics differ widely across cultures and influence cultural values (and are influenced by them) as well as consumption patterns.

LO6: List the key dimensions in deciding to enter a foreign market Seven questions are relevant for developing a cross-cultural marketing strategy: (1) Is the geographic area homogeneous or heterogeneous with respect to culture? (2) What needs can this product fill in this culture? (3) Can enough people afford the product? (4) What values are relevant to the purchase and use of the product? (5) What are the distribution, political, and legal structures for the product? (6) How can we communicate about the product? (7) What are the ethical implications of marketing this product in this country?

LECTURE TIPS AND AIDS 1) Culture is a difficult concept for students to fully understand though they enjoy reading about it. It is difficult for them to see what culture is and what its influences are because they are typically unaware of their own culture. It is often best to start the culture lecture with an example of some completely different behavior in another culture (e.g., the necessity of women being veiled in strict Muslim cultures) to point up how culture ―tells‖ us what to do. However, it is important to move beyond amusing examples of cultural snafus and into an understanding of how culture functions.

2) Students from other cultures should be encouraged to describe the differences between their home cultures and the one they are in now. Domestic students who have lived in another culture should do likewise.

3) This is an excellent time to use a guest speaker. A professor from cultural anthropology or sociology, an executive with substantial international experience, or anyone who has lived at least one year in a different culture can provide a valuable learning experience.

4) Student Handout 1: TRANSLATION PROBLEMS IN INTERNATIONAL MARKETING 5) Student Handout 2: FEDEX CUSTOMIZES FOR THE LATIN AMERICAN MARKET 6) Student Handout 3: CULTURAL VARIATIONS IN HOLIDAY TRADITIONS 7) Student Handout 4: BOLLYWOOD GOES GLOBAL

STUDENT HANDOUT 1: TRANSLATION PROBLEMS IN INTERNATIONAL MARKETING Chevrolet’s Nova is an inappropriate brand name in Spanish-speaking countries where ―no va‖ means ―it doesn’t go.‖ Chrysler couldn’t use its U.K. theme ―the Original‖ in Germany because ―Die Original‖ in German implies peculiar.

An American manufacturer of heavy-duty wrapping paper inadvertently translated its brand name into Japanese as ―He who envelops himself in 10 tons of rice paper.‖

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American Motors ―Matador‖ translated as ―killer‖ in Puerto Rico—a country with a high traffic fatality rate.

Johnson Wax introduced ―Pledge‖ in the Netherlands as ―Pliz.‖ Pliz is pronounced very much like ―piss‖ in Dutch. Since most Dutch also speak English, this caused serious problems.

Vicks is the most crude slang term for sexual intercourse in German. The company goes by Wicks in Germany.

The Dairy Association’s ―Got Milk?‖ heading was translated as ―Are you lactating?‖ in Spanish.

Other Examples may be found in S. Schooley, ―Lost in Translation: 10 International Marketing Fails,‖ Business News Daily, August 12, 2019, www.businessnewsdaily.com

STUDENT HANDOUT 2: FEDEX CUSTOMIZES FOR THE LATIN AMERICAN MARKET The following describes how FedEx used a customized strategy to successfully target the Latin American market: In the late 1990s, FedEx was not nearly as well known in Latin America and the Caribbean as it was in other parts of the world. Therefore, it decided to launch an ad campaign to build brand awareness among small- and medium-sized shippers. The ad agency was challenged to create a commercial that would work across this broad region with its differing cultures and languages. In addition, it would need to be presented in English and Portuguese in addition to Spanish without looking ―dubbed,‖ since shooting multiple commercials would be too expensive.

The 30-second commercial showed a young equipment manager for a soccer team, the dominant sport in the region, worried about the delivery of five boxes of uniforms he had shipped to Madrid for a major match. An older man assures him that all will be fine as long as he had shipped them via FedEx, which he had not. The next scene is a soccer field where the opponents are about to attempt a penalty kick. As the camera reveals the defenders, the audience sees that they are defending the goal without their uniforms or any other clothing.

The tagline for the ad is: ―Let FedEx take the load off your shoulders.‖ Two versions of the last scene were shot, the nude version and a version with the men in their underwear. The underwear version was run in Mexico due to local restrictions on nudity in prime time. The theme (soccer), which resonates in most Latin American markets, along with a realistic situation and a humorous ending made this commercial memorable and successful.

For example, awareness went up between 7 and 17 percent depending on the specific market.

Source: P. L. Andruss, ―FedEx Kicks Up Brand,‖ Marketing News, July 30, 2001, pp. 4-5.

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STUDENT HANDOUT 3: CULTURAL VARIATIONS IN HOLIDAY TRADITIONS Various holiday traditions get translated differently from country to country. Companies must understand cultural differences related to the celebration of such holidays when marketing across country.

For example, Halloween originated in Ireland, Britain, and northwest France. Over time, its celebration became limited to the United States, Canada, and Ireland. Now, however, it has gone global:   

The Abominable Giant Man Eating Zombie Tea Party is the theme for a costume bash at a Singapore nightclub.

Japan held a Hello Halloween Pumpkin Parade in Tokyo.

In Paris, shops decorate their windows with goblins, spider webs, and skeletons; pumpkins are on sale at open-air markets; bakeries produce decorated Halloween cakes; McDonald’s gives out masks with kids’ meals; and some children go trick-or-treating.

When such holidays do not replace local traditions and are adapted to the local culture, they can enrich the lives of the populations that adopt them. However, such imports can also be disruptive or controversial. For example, American-style celebrations of Valentine’s Day are spreading throughout the world; but in countries such as India, they have been met with protests. Hindu and Indian beliefs generally restrict public displays of affection, and many find Valentine cards that show young couples embracing to be offensive.

Source: S. Gutkin, ―Spooky Fun Creeping around Globe,‖ Register-Guard, October 29, 2000, p. 16A.

STUDENT HANDOUT 4: BOLLYWOOD GOES GLOBAL Bollywood. India’s Hollywood. India is the leading movie producer and consumer in the world (the United States is a distant second). No wonder then that Indian culture is hot stuff, especially among global teens. Consider the following: With riffs off India’s cultural cachet showing up everywhere—from Madonna’s use of mendhi, the traditional Indian henna art, to bhangra rhythms from northern India mixed into a Britney Spears single, advertisers are far from alone in embracing the colors and sounds of the subcontinent. The trend is even more entrenched overseas, where major campaigns with Bollywood themes are popping up from the Mediterranean to the South China Sea. Marketers have not been shy about tapping this global hip status to market to teens in the United States, Asia, and Europe. A few examples include:

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 



In the United States, Absolut vodka has a 12-minute online ―Bollywood ad‖ called Absolut Mulit.

In Asia, Nokia has a TV spot in which ―dozens of women clad in brightly colored saris … leap from a plane and skydive toward a bored-looking man standing on the side of the road. Alighting, they start gyrating to pulsating Indian music, while the man looks on in astonishment.‖ In Spain, Italy, and Portugal, Coca-Cola runs an ad in which a Hindu waiter gets everyone at a stuffy European party to dance and liven up by singing a Bollywood-style song after drinking a Coke.

Not everything coming out of Bollywood is good, however. A World Health Organization (WHO) study finds that over three-quarters of films coming out of Bollywood over the past 10 years contain smoking of some sort. In a country that accounts for one in three smoking-related deaths, WHO appears to have valid concerns.

Source: C. Prystay, ―It Is a Walk of Fame for Bollywood,‖ Wall Street Journal Online, December 24, 2004, www.wsj.com.

REVIEW QUESTIONS 1) What are some of the ethical issues involved in cross-cultural marketing?

Obvious issues include exporting potential harmful products such as cigarettes as well as products or services that disrupt the local economy. Altering cultural values and the lifestyles of countries in ways that may diminish the overall quality of life in the country are also issues.

2) What is meant by the term culture?

Culture is that complex whole that includes knowledge, belief, art, law, morals, custom, and any other capabilities and habits acquired by an individual as a member of society. It is important to marketing because culture indicates the approved ways of solving product-related problems for consumers.

3) What does the statement ―Culture sets boundaries on behaviors‖ mean?

Normally, the boundaries of behavior are outlined by the culture, and even some of these boundaries for certain kinds of behavior are vague. On the other hand, very important behaviors, such as the ways in which one person may force behavior in others, are very well defined.

Consumptive behaviors also run the gamut from vague (purchase and use of food products for entertaining) to fairly specific (what clothes one should wear for specific occasions such as weddings or funerals).

4) What is a norm? From what are norms derived?

Norms are rules that specify or prohibit certain behaviors in specific situations and are based on or derived from cultural values.

5) What is a cultural value?

Cultural values are widely held beliefs that affirm what is desirable.

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6) What is a sanction?

Sanctions are penalties ranging from mild social disapproval to banishment from the group and are imposed on those who violate cultural norms.

7) Cultural values can be classified as affecting one of three types of relationships—other, environment, or self. Describe each of these, and differentiate each one from the others.

Other: Reflect a society’s view of appropriate relationships between individuals and groups.

Environment: Prescribe a society’s relationship to its economic, technical, and physical environments.

Self: Reflect the objectives and approaches to life that members of society find desirable.

8) How does the first of the following paired orientations differ from the second? a. Individual/collective: Individual emphasizes individual initiative and activity, while collective appreciates group cooperation and conformity. b. Performance/status: In performance orientation, opportunities, rewards, and prestige are based on an individual’s performance, while in a status orientation those things are based on the status associated with the person’s family, position, or class. c. Tradition/change: Tradition values no or little change, while a change orientation sees change or progress as good. d. Limited/extended family: Limited defines a family more tightly in terms of immediate relatives and imposes fewer obligations to respond to the needs of other family members than does an extended family orientation. e. Active/passive: An active orientation reflects the expectation that people will take a physically active approach to work and play. Passive simply means much less of that expectation. f.

Material/nonmaterial: Whether the accumulation of material wealth is valued (material) or not (nonmaterial).

g. Hard work/leisure: Is work valued for itself, independent of external rewards (hard work), or is work merely a ―means to an end‖ (leisure)? h. Risk-taking/security: Is the person who risks their established position or wealth on a new venture admired (risk taking) or considered fool hardy (security)? i.

Masculine/feminine: Are rank, prestige, and important social roles assigned primarily to men (masculine) or women (feminine)?

j.

Competitive/cooperative: Is the path to success found by outdoing other individuals or groups, or is success to be achieved by forming alliances with other individuals and groups?

k. Youth/age: Are prestige, rank, and important social roles assigned to younger (youth) or older (age) members of society? l.

Problem-solving/fatalistic: Do people react to obstacles and disasters as challenges to be overcome (problem-solving), or do they take a ―what will be, will be‖ attitude (fatalistic)?

m. Diversity/uniformity: Does the culture embrace variation in religious beliefs, ethnic background, political views, and so forth?

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n. Postponed gratification/immediate gratification: Is one encouraged to ―save for a rainy day‖ (postponed), or should you ―live for today‖ (immediate)? o. Sensual gratification/abstinence: Is it acceptable to pamper oneself, to satisfy one’s desires for food, drink, or sex beyond the minimum requirement (sensual) or not (abstinence)? p. Religious/secular: To what extent are daily activities determined by religious doctrine?

9) What is meant by nonverbal communications? Why is this a difficult area to adjust to?

Nonverbal communication refers to the transfer of information from one person to another without the use of language, spoken or written, such as using the size of an individual’s office as an indication of status. It is difficult to adjust to because we assign our own culture’s meanings to the nonverbal signs being utilized by another culture.

10) What is meant by each of the following as a form of nonverbal communication? a. Time: The culture’s overall orientation to time and the way in which the meaning of time varies. b. Space: The use people make of space and the meanings they assign to it. c. Symbols: Different colors, numbers, and shapes acquire different symbolic meanings across cultures. d. Relationships: The degree of rights and obligations imposed by relationships and friendships. e. Agreements: The need to rely (or not to rely) on an extensive and, generally, highly efficient legal system for ensuring that business obligations are honored and for resolving disagreements. f.

Things: The assigning of meaning to the possession of various objects and the degree to which acquisition of goods themselves is valued.

g. Etiquette: Generally accepted ways of behaving in defined social situations.

11) What is guanxi?

Guanxi is literally translated as personal connections/relationships on which an individual can draw to secure resources or advantages when doing business as well as in the course of social life.

12) What is the difference between instrumental and terminal materialism?

Instrumental materialism involves the acquisition of products in order to achieve a goal (skis to allow skiing). Terminal materialism is the acquisition of products for the pleasure of owning the product (e.g., art).

13) What are the differences between a monochronic time perspective and a polychronic time perspective?

People are monochronic if they have a strong orientation toward the present and the short-term future. A person who is polychronic has a strong orientation toward the present and past. As a result of different time orientations, each type of person has a different orientation toward time, situations, and relationships.

14) What forces seem to be creating a global teenage culture?

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The emergence of worldwide mass media is the strongest influence. Entertainers and sports heroes as superstars and the universal appeal of a variety of sports are also important.

15) What are demographics? Why are they important to international marketers?

Demographics describe a population in terms of its size, structure, and distribution. Demographics differ sharply across countries and cause needs to differ, as well as influence the ability of consumers to fulfill needs.

16) What is purchasing power parity?

It is a measure of the ability of consumers in different countries with various income levels to purchase a set of goods. Basically, it equates the income level in a country to the income in American dollars that could buy the same set of goods that the income will buy in its home country. It answers the question, ―how much would it cost in U.S. dollars to live the lifestyle that a given income will buy in another country?‖ This allows meaningful cross-country income comparisons.

17) What is glocalization? What factors affect the need to adapt to local considerations?

Glocalization is generally meant to refer to global localization. This generally pertains to the notion that global brands must adapt to local market considerations. And while there is debate as to the extent of local customization necessary, factors such as differing cultural values, verbal and nonverbal communication, and demographics are major factors influencing the need for customization.

18) What are the seven key considerations in deciding whether or not to enter a given international market?

a. Is the geographic area homogeneous or heterogeneous with respect to culture? b. What needs can this product fill in this culture? c. Can enough of the group(s) needing this product afford the product? d. What values or patterns of values are relevant to the purchase and use of the product? e. What are the distribution, political, and legal structure of this product? f. In what ways can we communicate about the product? g. What are the ethical implications of marketing this product in this country?

DISCUSSION QUESTIONS 19) Why should we study foreign cultures if we do not plan to engage in international or export marketing?

To better understand our own culture and the kinds of impacts it has on our consumers. In addition, all business is international or is at least affected by international business conditions and trends. Finally, one can hardly be considered educated without at least an appreciation of cultural differences.

20) Is a country’s culture more likely to be reflected in its art museums or its TV commercials? Why?

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Probably in its TV commercials. They are more likely to show how people actually think, feel, behave, and act over a wider variety of real situations. Note that when archaeologists describe the culture of an ancient civilization, they probably do so more by its products (dishes, furniture, tools) than by its art.

21) Are the cultures of the world becoming more similar or more distinct?

There is no answer to this one, but it is a good vehicle to bring out questions about standardization of marketing strategies. Some students will argue that increased travel and communication, higher levels of education and income, and so forth cause breakdown in cultural boundaries. Others argue that there is an increased emphasis on retaining those boundaries with increased nationalism in many parts of the world. I believe that we are seeing some increase in similarity but not to the extent many students imagine.

22) Why do values differ across cultures?

Different social histories, physical environments, and religious influences create different values.

It is fun to have students from different cultures describe their view of the forces that have shaped their cultural values.

23) The text lists 18 cultural values (in three categories) of relevance to marketing practice. Describe and place into one of the three categories two additional cultural values that have some relevance to marketing practice.

Simplicity/complexity: Are simple or complex stimuli, situations, and lifestyles preferred?

Environment.

Health: Are individuals deeply concerned with their short- and long-run health? Self.

Involvement/noninvolvement: Are individuals deeply concerned or indifferent about occurrences that don’t affect them directly? Environment.

24) Select two cultural values from each of the three categories. Describe the boundaries (norms) relevant to that value in your society and the sanctions for violating those norms.

It is probably easiest to ask students to do this first for the masculine/feminine value and then let them volunteer other values that interest them. The masculine/feminine value is well known to them, and they are aware of the sanctions for violations. There are also noticeable differences across cultures that the students are likely to have noticed.

25) What are the most relevant cultural values affecting the consumption of each of the following?

Describe how and why these values are particularly important. a) Internet b) Video games/consoles c) Milk d) Fast food e) Luxury cars f) Mobile phones

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This question is a good way to cover the concept of values and their role in product consumption.

Almost any value can affect consumption, but some will have a stronger or more logical relationship. Push the students to justify their answers and to explain how a manager could utilize knowledge of those values to improve the marketing program.

26) What variations between the United States and other societies, other than cultural variations, may affect the relative level of usage of the following? a) Internet b) Video games/consoles c) Milk d) Fast food e) Luxury cars f) Mobile phones Any aspect of demographics could be relevant. Clearly, age and income are important across many of the products. Presence of children likely plays a role in fast food and milk, and so on. It is useful to have students rate the relative importance of demographic factors relative to cultural factors (from Question 25).

27) Why is materialism higher in Korea than in the United States, where given its collectivist culture one might expect materialism to be lower?

This requires students to see that certain aspects of materialism can reinforce collectivist values. In this case, Korea scores higher on the success dimension, which can be very important in uplifting the family. Such a focus on the family unit (rather than individuals) is a key aspect of collectivist cultures. Therefore, materialism, or different aspects of it, may act to reinforce different values in collectivist versus individualist cultures.

28) What values underlie the differences between Fiji Island and U.S. children in terms of the strategies they use to influence their parents’ decisions? What marketing implications emerge?

This relates to the youth/age distinction but goes deeper to differences in collectivism, respect for authority, and seniority. The Fiji culture is less individualistic and places a higher value on respect and seniority compared to the United States. And this translates into differences in dealing with children in which Fiji parents are less tolerant and responsive to purchase ―demands‖ on the part of children than U.S. parents. At a minimum, parent and child portrayals in ads would need to be sensitive to these differences.

29) What are the marketing implications of the differences in the masculine/feminine orientation across countries?

Looking at the data on participating in sports and exercise indicates that Mexico, France, and South Korea show the largest differences in frequent participation based on gender. More specifically, the data show the changing orientation of women in traditionally masculine countries.

30) Respond to the questions in Consumer Insight 2–1. a) Core values that can be discussed include both ―other-oriented‖ and ―self-oriented‖ values.

For example, with ―other-oriented,‖ Coca-Cola’s global message may be better received in 1-19 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

cultures that are more collectivist and uniform. With ―self-oriented,‖ Cola-Cola appeals to different tastes (sensual gratification) by tailoring its products locally. Also, the company’s Ramadan campaign appealed to Turkey’s religious values. b) Seven Global Considerations i) Cultural homogeneity: Despite a global message, Coca-Cola does customize to local markets. Coca-Cola will use the same message if successful in one market in other local markets with same cultural tastes and preferences (e.g., Ramadan campaign in Turkey was replicated in other Muslim countries). ii) Needs: Coca-Cola does offer flagship brands like Coca-Cola Classic and Sprite in most markets but customizes its products to meet the tastes and preferences within each culture.

Innovations are created, such as Maaza Milkshakes in India, to adapt to the local culture’s tastes. iii) Affordability: Coca-Cola products are sold in over 200 countries, varying in economic wealth. iv) Relevant values: Values were discussed in Question 1 of this Consumer Insight. v) Infrastructure: Coca-Cola uses local bottling and distribution operations in countries where the product is sold. In addition, local ingredients are used. vi) Communication: Coca-Cola uses a global message, such as ―Taste the Feeling,‖ but then tailors the message locally. During the World Cup, the company had a consistent brand message but adapted each country’s web page with a local message incorporating local celebrities and culture. vii) Ethical implications: Ethically, Coca-Cola considers the community by using local ingredients and local infrastructure. b) Discussion by students to share their experiences with purchasing Coca-Cola and other beverages in different countries: Questions to be asked to prompt the discussion: i) Have they tried a local variant of Coca-Cola in a foreign country? ii) If they have tried Coca-Cola Classic or another flagship brand in a different country, how did it taste?

31) Why do nonverbal communication systems vary across cultures?

Different social histories, physical environments, and religious influences over time create different nonverbal communications systems. However, I am unaware of any systematic attempt to classify cultures and/or regions in terms of their nonverbal systems and to ―determine‖ ex post facto the causes of the differences.

32) Which, if any, nonverbal communication factors might be relevant in the marketing of the following? a) Watches b) Jewelry c) Facial tissue d) Laundry detergent e) Lip balm 1-20 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

f)

Women’s clothing

Students should discuss each of the nonverbal communication factors (time, space, relationships, agreements, things, symbols, and etiquette) for each of the products listed in the question. They need to consider each element of the marketing mix as well. The easiest discussion will be around advertising, and you may want to limit it to that area if time is short.

33) What are the implications of guanxi for a Western firm entering the Chinese market?

The most important issue is developing a deep understanding that these complex relationships exist. This understanding will emphasize the importance and value of guanxi and modify the approach a Western firm will use in penetrating the Chinese market. In most cases, a reevaluation of resources (relationships, time, agreements, etc.) is required.

34) To what extent do you think youth are truly becoming a single, global culture?

While there is no absolutely correct answer, the author’s experience of living in a variety of cultures with and without his teenage (at that time) children leads him to believe that this is indeed true for middle and upper class teenagers in urban areas.

35) Will today’s youth still be a ―global culture‖ when they are 40? Why or why not?

This is a very good way to explore what a culture truly is and how it develops and changes. It may also cause some to reconsider their answer to Question 34. If teenagers do indeed have a common culture including values, this is not likely to change radically as they enter adulthood.

36) How do demographics affect a culture’s values? How do a culture’s values affect its demographics?

Values have a stronger, more direct impact on demographics than vice versa. However, values are formed and evolve based on the history and environment of a culture. Demographics are part of that environment. Cultures with dense populations are likely to develop a collective orientation due to the requirements of living in close proximity. Societies that value risk-taking, hard work, and postponed gratification are likely to have high income and education levels.

37) What causes the differences between purchasing power parity and income as shown in the text?

Local cost structures, governmental provided health care, taxes, and other cost of living factors associated with the economic status of a particular country causes difference between raw income numbers and purchasing power.

38) The text provides a seven-step procedure for analyzing a foreign market. Using this procedure, analyze your country as a market for : a) Laptop computers from Japan b) Automobiles from Korea c) Sunglasses from Italy d) Wine from Chile

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This question can provide an excellent method for presenting the material on cross-cultural marketing strategy. We recommend splitting the class into a multiple of seven groups and assigning each group one of the seven considerations listed in the text. Then, have each group evaluate one or more of the products listed above with respect to the key consideration it was assigned. When given time to prepare, a very good discussion that involves the entire class can be generated.

39) What are the major ethical issues in introducing prepared foods such as fast foods to developing countries?

The consumption of this product might divert resources from other, more important, food purchases. For example, high-fat, high-sodium burgers and fries may cost more and be less nutritious than fruits and vegetables. Disposal of the product may be more difficult and therefore create an environmental problem.

40) Should U.S. tobacco firms be allowed to market cigarettes or e-cigarettes in developing countries?

Why or why not?

The answer depends more on one’s value system than on any set of facts. It is critically important to respect the views of all students in such discussions. You can play devil’s advocate, but it is sometimes easy to intimidate students this early in the term. If no one mentions it, an interesting point is that it is somewhat condescending for the United States to attempt to govern what occurs in another country.

41) How can developing countries keep their cultures from being overly Westernized or Americanized?

There is no answer to this question. Legal restrictions can have a modest impact. However, cultural change (or lack of change) cannot be legislated in the long run. Fortunately, while there are many trends toward Americanization, there are increasing forces supporting local traditions and cultures (including the increased sensitivity of at least some multinationals to local custom and values).

CHAPTER 3: THE CHANGING AMERICAN SOCIETY: VALUES LEARNING OBJECTIVES LO1: LO2: LO3: LO4: LO5: LO6:

Understand core American cultural values Summarize changes in self, environment, and other-oriented values Discuss values as they relate to green marketing Discuss values as they relate to cause-related marketing Discuss values as they relate to marketing to LGBTQ+ consumers Discuss values as they relate to gender-based marketing SUMMARY

LO1: Understand core American cultural values

Cultural values are widely held beliefs that affirm what is desirable. Three categories of values that affect behaviors are those related to the self, others, and the environment. Sometimes, numerous 1-22 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.