Sunday, April 13, 2014

The Age of the Customer

The age of the customer has began! A nice painting for at your office.

The age of the customer will transform marketing and business. Remind yourself of that every day with this painting.

Sunday, February 16, 2014

Book Review: Global Marketing and Advertising - understanding cultural paradoxes-

I was at holiday, a few weeks ago. Traveling to Hong Kong, mainland China, Cambodia and Thailand. Time to read a few books. One of the books I read was "Global Marketing and Advertising" from Marieke de Mooij. A very interesting book about cultural differences in advertising and marketing. The book is not an "online" book, it focuses at marketing and advertising in general, many offline marketing cases are described as well. The book consists of many in depth research of cultural aspects. I recognize a lot of cultural aspects described in the book from traveling, now it is related to advertising. I will not do a complete review of the book this time. I will highlight a few interesting parts of the book instead. Just go and by the book. You won't regret.
Global Marketing and Advertising from Marieke de Mooij, very intresting book, I read at a recent holiday as you can see...the book traveled with me across many cultures...:)

  • There may be global products, but there are no global people. There may be global brands, but there are no global motivations for buying those brands. 
  •  US advertising professor "John Philip Jones" is highlighted. Economic convergents is assumed to lead to better educated customers, resulting in rational choice behavior. Even in Europe there are many cultural differences between countries. The Belgians drink 10 times as much mineral water as the British and 6 times as much as the Dutch, their neighbours. Altough the quality of tap water has improved all over Europe, the consumption of mineral water has increased in some area's and remained the same in others. These differences cannot be explaiend by differences in national wealth. Only by culture. The wealthier countries become, the more manifest is the influence of culture on consumption and consumer behavior. 
  •  The member countries of the European Union are culturally very different and these cultural differences cause differences in consumer needs. Understanding culture is the first step to take by global companies when deciding on the type of strategy for their global brands. Youths from Stockholm to Seville may use the same type of mobile phone or computer, but they might have bought it for different reasons. 16% of the respondents in Amsterdam said entertainment was their primary reason for using technology, compared with 9% in Helsinki and London and only 4% in Milan. 
  • Numerous variables influence the decision to standardize or adapt.Various strategic aspects can be analyzed. 
    •  The product, including product category and product lifecycle 
    • The company, it's organizational culture, the culture of the country of origin of the company and it's export dependence 
    • The business environment: the competition, economic development of markets, marketing infrastructure, environmental factors such as laws and government regulations and media infrastructure 
    • The consumer: spending power, and cultural and social variables including local tastes, habits and conditions of use.
  • In most categories, today's companies do not compete with products but with brands. A brand is something made to appear unique. A brand is trust, a brand is not merely a product: It's the feeling a product evokes. A brand is why people will pay more for a product. A brand is the proprietary visual, emotional, rational image that people associate with a company or product.
  • Pepsi and Coca Cola increased the sweetness of their drinks in the Middle East, where consumers prefer a sweeter drink. Mc Donalds has standard specifications for it's technology, client service, hygiene and operational systems, but everything else is localized such as products and communication. Example of localised products are the Kiwi Burger in New Zealand, the Teriyaki Burger in Japan the McLaks in Norway. In France advertising for McDonalds was linked to Asterix et Obelix, in China McDonals is the place to go for a "date"  because the most typical Chinese restaurants do not provide the privacy couples want. McDonalds has lot's of tables for "two" in China. 
  • Global brands develop in several ways. Companies can use basically six strategies for internationalizing their brands.
    • Cultivate established, local brands. Develop a national brand into an international brand, transporting brand value and strategy to more countries. (coca cola, Timotei)
    • Global concept, local adaptions. Develop one formula, a concept for the world that can carry local products with local values. (McDonalds)
    • Create new global brands. Recognize a global need or want and develop a new product for it. (Zara, Apple, Nokia)
    • Purchase local brands and internationalze. (strategy often used by Unilver)
    • Develop brand extensions. Extend a brand name to other related categories. Gilette now also hoas shaving foam, after shave etc.
    • Emply a multilocal strategy. Different strategies are developed for different countries for local reasons. (Nestle, the best of Australia)
  • A core problem in global advertising is a cultural mismatch between the advertisement and the target groups, which is rarely included in advertising testes.
  • Germans raise their eyebrows in recognition of a clever idea. The same expression in the Netherlands and Germany is a sign of scepticism. The US sign OK means "zero" in France and Hungary and "money" in Japan. 
  • In individiualistic cultures a youth has to develop an identity that enables him or her to function independently in a variety of social groups apart from the family. In collectivistic cultures youth developement is based on encouragement of dependency needs in complex familial hierachical relationships and the group ideal is "being like others", not being different. The very first words of little children in China are people related, whereas children in the United States, start talking about objects. In Japan feeling good is more associated with interpersonal situations such as feeling friendly, whereas in the United States, feeling good is more frequently associated with interpersonal distance, such as feeling superior or proud.
  • Buying motives! Understanding the variations in what motivates people is important for positioning brands in different markets.
Cultural Differences and buying motives for luxury brands

  • Blogging has become a global phenomenon, but the degree to which people blog, their motives and their topics vary by country. In 2006 there were more blogs in the Japanese language then in the English language and the French spent five times as much time blogging as the Americans. For the French the blog is like the cafe, where they discuss everyday life and politics. Japanese tend to care less whether their blog influences others, and they are reluctant to reveal their identity.
  • In order to analyse differences in advertising styles across cultures, four elements of advertising styles can be distinguished. Each will vary by culture.
    • Appeal (including motives and values)
    • Communication style (e.g. explicit, implicit, direct, indirect)
    • Basic advertising form (e.g. testimonial, drama, entertainment)
    • Execution (e.g. how people are dressed, the look of kitchens or male-female roles)
  • Website design: A striking feature of Chinese websites is the recurrent image of the family theme. Japanese websites exhibit clear gender roles and are rich in colors and esthetics with pictures of butterflies, cherry blossoms etc. Indian websites prominently depict the titles of the employees to demonstrate hierarchy, US websites are low context, direct, informative, logical and success orientated. 
  • Generally, people watch mobile TV when they are bored, waiting or using public transport. But this all depends at national habits. Japanese people spend a lot of time riding trains to their work. In individualistic cultures like the United States, United Kingdom or the Netherlands, people are not used to doing much in the public domain and many people drive to their work by car. In asia, mobile TV developed faster then other parts of the world. ONe reason for young people to use mobile TV was to be able to watch one's own programs when other family members were watching other programs on the main home television screen.
  • E-commerce. Chinese websites show collectivistic community activities like group buying that you will not find on US websites. Differences in what people buy online, across cultures reflect the same differences in products or services people buy in regular stores. For example, more event tickets or video games are bouhgt online in individualistic than i ncollectivistic cultures. The internet offers the opportunity to compare products. Across Europe in the individualistic, low uncertanty avoidance and low power distance cultures where decision making is more inforamtion based, more people tend to search for information and compare products on the internet even when they do not buy online or buy in the shop. Collectivists prefer shopping to compare products and they visit different shops.
Social media and culture (Hofstede)
  • Another use of social media is customer care. One characteristic of social media in collectivistic cultures is that people may complain or ventilate discontent with companies more online than they will do in person, because of digital display of negative feelings is easier than in personal communication. This offers an opportunity to companies in collectivistic cultures to get feedback. In Brazil, for example social media usage related to brands is focused at customer care. Also in China people express complaints via social media, which they would not do so in person. 

Well, these quotes from the book are just a few highlights. I recommend the book for everybody who is interested in cultural differences and advertising. Lot's of theory's are described. There is no such thing as a "framework" for global marketing and advertising. And that's good! That makes this field so interesting. The book helps to get a broader view at the world and advertising possibilities.

It is good to read that cultural differences can have high impact at the effectiveness of campaigns and that is also one of the reasons I started this blog, to discover and learn from these aspects in both on and offline communication. I feel the need for (partly) localising strategy's, localising online campaigns, localising websites and localising customer experiences only increases after reading this book.

For online marketing the book gives a few handles and lot's of things to think about. Culture has en enormous effect at the use of media in general. Culture has an enormous effect at how people see your brand. The book zooms in at usability and cultures and lot's of information about that can be found at the web currently.

Other online marketing questions like:

  • How to use online marketing to get the best brand perception/personality across countries? 
  • Do my customer journey touch points needs to be (totally) different in country A. than in country B? 
  • Does my social media (content) strategy has to be totally different between country's or continents?
  • Is my content driven e-commerce giving a totally different brand perception in country A, than it has in country B? 
  • Is my "marketplace" e-commerce website aiming at the right "buying motives" when I expand it to other countries?
  • How to translate my interactive advertising campaign so it fits the culture in this new country I try to setup business.

are not answered, but the book gives handles to help solve these questions.

For example this interesting chart:

Advertising Styles 

"The advertising styles in the two right quadrants, where cultures are individualisitc is direct and explicit, more verbal than visual and it uses argumentation. Direct style communication  uses the personal pronoun (you, we)." So translating this to online marketing, will probably make this interactive advertisement from Grolsch effective at the right two quadrants, but not so at the left quadrants. The campaign is directly aimed at YOU, what kind of character are you.....

"In cultures of strong uncertainty avoidance, advertising is more serious and structured. The execution of the visuals will be detailed, often including a demonstration of how the product works." If you look at this map, you will see that Russia, has a strong uncertainty avoidance.
Does this mean that  in Russia, your e-commerce site can be more succesfull with in depth explanation of product usage at every product detail page? Maybe even by using interactive video? Or step by step interactive guides? And that the chance is high that this will not be the case in Norway?

"Direct style communication also tends to be more verbal whereas indirect style tends to be more visual. Where US advertising utilizes more copy, Japanese advertising uses more visual elements. Chinese-speaking consumers tend to judge a brand name based on it's visual appeal, whereas English speakers judge a brand name based on wether the name sounds appealing".

We see in the quadrant that in Australia, facts and text are probably more effective in a display advertising campaign than in Thailand where showing emotions are more effective.

"In weak uncertainty avoidance cultures, more humor is used in advertising". So a humorous viral marketing campaign or adding humour to your social media content calendar, can be more effective in these cultures.

Interesting and lot's of things to think about!


Alex Baar

Sunday, December 29, 2013

Happy Cross Border E-commerce 2014

I wish everybody a happy , healthy and especially a great cross border e-commerce and marketing year.
I have combined a few presentations about digital trends for 2014 in this combined slideshare presentation so everybody can keep up with the trends and be prepared for a great digital 2014!!

Friday, December 27, 2013

Cultural differences, marketing and management

Just because it is such an interesting subject, a short video about cultural dilemma's, management and marketing.

Thursday, December 26, 2013

Top 30 world's most attractive e-commerce countries

It is almost 2014. So, one of my last posts this year about 2013 figures.. But an interesting post!

ATKearney released an interesting report a few weeks ago. The so called "Global retail e-commerce index 2013".For everybody who is interested in cross border marketing and e-commerce, this is a must read report. Very useful for those who are busy with a global e-commerce strategy.
The report ranks the top 30 countries for their online market attractiveness and it explains differences in e-commerce approach for a few major e-commerce countries.

China tops the report, as ATKearny expect China e-commerce to explode in the next few years, thanks to improvements in infrastructure, urbanisation and the increase in consumption inside China. This article for example explains a path to a consumer led grow in China and explains about improving consumer protection (and thus more trust in online sales)

China tops list of top 30 e-commerce countries

AtKearney describes three groups of e-commerce markets in their report:
  • Digital DNA markets
Countries that have digital and e-commerce in their DNA. High technology adoption rates and a very mature e-commerce market. Don't forget they might have a very different approach (due to possibilities) for e-commerce even compared to the "Established and growing markets". On my travels in for example Japan and Hong Kong I saw a really different way of doing online business compared to Western-Europe.
  • The Next generation markets
“Consumer online practices in those countries are well developed, but each of these markets lacks one of the big three capabilities—Internet accessibility, logistical infrastructure, or financial systems. Developing these capabilities (as each of these markets is working hard to do) will quickly make these countries critical e-
commerce targets for global retailers,”
  • Established and Growing markets
Established and Growing markets, have high Internet penetration and use. However, there is still considerable room for growth in these markets. Markets like the USA and Canada or Western-Europe.

Developing Countries

Interesting is that developing countries are extremely rapid in adapting to e-commerce. Consumers are less tied to traditional retail then in developed countries. Often e-commerce via mobile devices is much more common then in developed countries. This report (e-commerce in developing countries) from the world trade organisation has more details.

Smaller countries and e-commerce

It's always nice to see the potential that ecommerce has in smaller countries with a high GDP. Often these countries are skipped in expanding online business abroad, but there are huge possibilities, consumers are very online mature, but also expect webshops to be mature. Match their expectations! Offer excellent service, provide exciting online offers and be sophisticated.
The average order value in these countries is high. Think about countries like Norway, Hong Kong, Singapore, all high at the global ecommerce list and most of them marked by ATkearney as countries with a "Digital DNA".

Answers for your Digital Strategy

According to the report in any globalization strategy, these questions have to be asked:
  • How big is the market
  • How fast is the market growing
  • How do consumers behave within the market
  • Is there sufficient infrastructure in place to deliver the online consumer promise

The report answers with this figure:

Ecommerce growth potential per online market group
I would have expected, Norway, Finland, Switzerland and maybe even Germany a little bit more to the right.

Download the complete report here. Or read it via slideshare below:

Thursday, November 21, 2013

Internationalise your online business

You are a (small) retailer, and you want to expand your online business abroad. But how to start? In a series of blog posts, I will try to find some answers at questions like this. However every retailer has it's own current situation and a "one answer fits all" is impossible: If you do not have enormous budgets, for developing new websites and hiring international e-commerce experts, you can do things yourself.
In my opinion a localized site and localised promotions are absolutely the ideal situation. There are to many differences in culture, legal and commerce, to just copy paste your website.

First make sure you have (or find someone who has) e-commerce or website experience in your home country. It will give you many insights that will help you make you succesfull abroad. It is not of any use to sent traffic to your website, if the website is not delivering what you want it to deliver (orders, leads, brand value etc).
If your current website is not performing, do not start expanding abroad, first get experience in optimizing your current website.

The 11 C internationalisation framework

Newman and Lake developed the "11 C's of Internationalization" a framework that will help people to review the opportunities and challenges for specific markets.
  1. Country
There are many potential countries you might want to expand to. But which country is a good choice? If you do not have any idea yet, try to do online research.
A few links to help you out:

Google Trends. Google Trends is a free tool that will help you to identify "trends". Type in some "keywords" that are relevant to your products or services in a local language and see the popularity of these products in a time frame. 
Google Consumer Barometer. Google's consumer Barometer gives you free market research data, about products and services, all around the globe. 
Google's Global Market Finder. Google's Global Market finder helps you finding popular keywords all around the globe. But be aware. This tool is made for selling adwords advertisement, use it for analysis only if you do not have Adwords Experience. Auto translating, (that is available in the tool) is often not correct.
DHL Global Connectedness Index. DHL's global connectedness index, is released every year and will help you analysing the e-commerce maturity and possibilities of nations.
ICT Facts and Figures 2013. What is the internet penetration in area's around the world? How many people use mobile internet? Find answers to these questions and more in the ICT Facts and Figures report.
Asia Digital Marketing Report. Planning to expand to Asia? Read this interesting Asia Digital Marketing Report.

More C's after the break!

Wednesday, November 20, 2013

International e-business and online marketing channels: some quick thoughts

Today, I am in the mood for writing something. Just a quick blog post today about international e-business. A few things to take into account when practicing international e-commerce.
  • Email marketing
E-mail marketing is an excellent channel to use for generating traffic to your website. A lot of people often forget about "deliverability". Deliverability means the percentage of the e-mails you sent out, that arrives at the subscribers. I won't go into details now. But if you go abroad with your email marketing campaigns, make sure you focus at deliverability.

If your  e-mail does not arrive at many people of your database, you lose a lot of money! Make sure your e-mail service provider can help you with e-mail deliverability in the countries you are active.
  • Affiliate marketing
Affiliate marketing can be a good alternative source for traffic and sales.
At this moment there are no global affiliate marketing agency's. Note that the affiliate marketing matureness can differ enormously per country and per branch. Make sure you investigate this before you sign a contract. Maybe small local affiliate marketing agency's have better publishers then the big agency, you already are in contact with.
  • Search Engine Optimization
Coming from Western Europe or the USA, people often think, Google is the only search engine that really matters. This is not true. Several local (and international) search engines, you might have never heard of, are very important if you look at it from an international perspective. Think of "Baidu" in China, "Seznam" in the Czech Republic or "Yandex" in Russia. Make sure you follow their guidelines and do research in the possibilities.
  • Search Engine Advertising
The same that goes for Search Engine Optimization, as written above, is also valid for search engine advertising. There are many different options to advertise at international and local search engines. Also keywords that you advertise at, might be a lot cheaper or more expensive in another country even with the same search engine. The same word you advertise at in Google Germany, might be 50% cheaper in Sweden.
  • Social Media Marketing
There are many social media networks, besides Facebook. Investigate the usage of the social networks in the countries you focus at, but also study the culture of these users. Especially in social media, cultural differences and cultural dilemma's appear in the open. Be prepared.

Global penetration of social media networks in 2013