A Marketing Plan To Enter China - Essay Example

A Marketing Plan To Enter China Introduction It is common in the international business world, firms expanding their operations to other nations and distant geographical locations without giving much attention to the possibility of cultural differences. This work intends to look into the possible cultural issues that deserve attention while preparing a marketing plan to enter China. China is one of the fastest growing economies in the world. However, it varies greatly from its Western counterparts in the fact that it is a developing country with a predominantly low-income rural society. It also varies from its Asian neighbors in the fact that there are hurdles imposed by the government control over enterprises. Chinese Values that Influence Marketing Decisions Admittedly, the very first thing that is noticed about Chinese culture is the importance they give to relationships and connections. In other words, there is a term ‘Guanxi’ in Chinese that means ‘relationship’. Evidently, the Chinese give too much stress on having relationships based on trust and cooperation. In other words, for them, business promotion will not merely run on publicity but it will depend on developing trust and cooperation in China. Another sensitive area in business marketing in China is the personal pride. In this nation, humiliation; either private or public, has a seriously negative impact. However, in this nation, praising can do wonders even if done in moderation. It brings respect, loyalty and negotiations. Another important point is the use of ‘Keqi’, which means ‘courteous and refined behavior’. Generally, in China, exaggerated claims are often viewed with suspicion and disdain. On the other hand, modesty and humility always manage to win hearts easily, as they are recognized as the indications of truthfulness. Probability of Contradictions One important point where contradiction can arise is the speed of negotiations. As Zhao (1991) points out, while Americans are known for their fast pace and the eagerness to get immediate result, Chinese believe in long term relationships and they generally dislike hurried transactions. Evidently, the American marketing strategy should aim first at developing trust and then at praising the Chinese culture in a way that does not arouse suspicion. Efforts to exaggerate the company’s credentials in the very beginning may not get the kind of response it can reasonably expect in the West. The second point of consideration is that the marketing and business negotiations should aim at the right person. Often, US marketing people engage in negotiations with people and finally realize that they were addressing the wrong persons who have no authority to take decisions. One can see this influence of culture in writing contracts and agreements too. Normally, the contract is written in both English and Chinese. However, the manager should remember that if a legal dispute arises later on, the Chinese version gets more attention. Another important area of consideration is the poor possibility of e-commerce that is evident from the fact that before 1990, the use of credit for purchase was nearly zero though it reached more than 15% at present. Even if it improves, one cannot ignore the poor security internet enjoys in China. According to Wong and Maher (1997), another important point that deserves attention is that Chinese people often think about their own personal interest and might give preference to own family than to the firm. Admittedly, there is a bureaucratic government in China that results in poor decision-making. While Chinese organizations often resort to bribing to overcome this hurdle, the US organizations that try this may be frowned upon. A study by Ackennan and Tellis (2001) shows that Chinese shoppers have multiple senses while making purchase decisions, and are more price-conscious. However, there is something that is favorable at the end. In the opinion of Ackenan and Tellis (2001), in China, US brands are evaluated more favorably than Chinese brands in factors such as design innovation, brand image, service, and display, though Chinese items are rated better in the case of price. Impact on the Strategies to be Adopted From the above analysis, it becomes evident that the most important factor that affects the marketing strategies in China will be the strong emphasis Chinese people give on relationships that often mar their relationship with their own organization. In other words, studies prove that Chinese people tend to consider their closeness to a wrongdoer more important than their commitment to their organisation. As a result, often, they fail to blow the whistle when they find something wrong from the part of their associates. Jijie Wang and Lih-Bin Oh prove that this tendency is closely associated with the Confucian ethics. For example, Chinese society is known for collectivism, and for them, the most important thing is good interpersonal relationships. So, Chinese people develop strong interpersonal contacts in the workplace too. As a result, it becomes a difficult task for them to show their commitment to their organisation when they find any wrongdoing from their close friends, and unfortunately, Chinese have a large number of close friends everywhere. This situation can be explained using the tenets of Confucianism. According to Confucianism, there are five basic human relationships. They are affection between father and son, loyalty between sovereign and subject, distinction between the roles of husband and wife, courtesy of the young for the old, and lastly, trust between friends. Admittedly, the last point has negative impact on the employees’ commitment towards the organization. On the other hand, Americans do not tend to develop such deep, long-lasting relationships, and they have no such ethical restrictions. Yet another point is the presence of the notion of harmony. This need to see harmony makes the Chinese see changes as disruptive. So, for them, non-action is much better than action. On the other hand, for Americans, efficiency and effectiveness are the most important things. So, American business calls for competition and action instead of maintaining relations and existing patterns. This will be in sharp contradiction with the Chinese norms. Another serious contradiction arises between the Chinese subtlety and American explicitness. Chinese do not like to engage in direct confrontation even when there is discord, and in the Chinese culture, speaking rudely is considered unethical. While Chinese do not like to reveal their real feelings even when there is discontent, the Americans prefer to speak explicitly. This too will have serious impact on the marketing strategy. References Ackenan, D. & Tellis, G. (2001). Can culture affect prices? A cross-cultural study of shopping and retail sales, Journal of Retailing, 77(1), 1-24. Wong, Y. Y & Maher, T. E (1997). Trading with China is not like trading with Japan: A cultural comparison for foreign investors. Management Research News, 20(4) 11-20. Zhao, J. (1991). Doing business with China: Cultural aspects. East Asian Executive Reports, 13(1), 10-12. Read More