Effect of Culture on Marketing Strategy

Effect of Culture on Marketing Strategy Current cultural diversity in Sri Lanka is evolvement from its rich history and commenced from the civilization of Yaksha and Naga tribes and more importantly nourishment from the Buddhism. Further, Sri Lankan culture is influenced by Indian invasions and from going through Portuguese, Dutch and British rules; Sri Lankan culture is diverse like its natural heritage.   In the early 19th century, the British rule introduced democracy, modern education, legal and commercial agriculture system. Now Sri Lanka is a mirror of its own ancient and modern cultures which is diverse from its cities to far villages across the island. Sinhalese and Tamil are the most widely spoken languages in Sri Lanka, with around 74% of population can speak in Sinhalese, while more than 18% can speak Tamil. Muslims also speaks Tamil as their main language. The colonization started with the Dutch followed by the Portuguese and finally long standing ruling by the British had an impact on the languages, as well as opening the history to the international trade. In addition to Sinhalese and Tamil, English is also used by the Sri Lankan population which was concentrated to urban areas initially are now expanding to rural areas with the more prominence to English is given in the education system and increased IT literacy. English is maily used for commercial and official purposes. Sri Lanka is a multi-religious and a multi-ethnic country and Buddhists account for approximately 69% of the population, followed by the Hindus with around 15% of the population. Also inherited from India, Hinduism too has a long and rich history in the country. Most Hindus are Tamils and they account for a majority in Northern Sri Lanka, as well as in the Eastern, Western and Central regions (up country) of the country. Islamic community accounts for around 8% with a majority are domiciled in the Eastern and Western regions; as well as around 8% followers of Christianity. Having a healthy literacy rate of around 90% (source: United Nations Development Program Report 2009) and around 83% of the population having secondary education ranks Sri Lanka on top among other developing nations. The complex ethnic and religious mix of Sri Lankan society and also traditions and rules inherited from colonization have given rise to a mixture of laws which include Roman-Dutch Law, English common law, , Kandyan, and Jaffna Tamil law (Thesawalamai Law). Accordingly, Sri Lanka is a country rich with culture and cultural diversity. Its people live their daily lives very close to their religious beliefs, adherence to traditional norms, family orientation (close bond with their families in all aspects of life from birth to death), mother centric society and attachment to native foods (mainly rice) and etc. can be considered as main cultural values. Hence, whatever the product or service that marketers are confronted of promoting, they will have to consider the Sri Lankan culture and cultural values to be a major influencing factors to the success of the product or service. Further, the fact that the culture is not static (dynamic) and change over time and people get adjusted puts the Marketer in a more challenging situation as he needs an understanding of all aspects. Cultural Values Societies have values that are shared by its members. As stated above, values serve as guiding principles for culturally acceptable behavior. It defines what is right? What is wrong? What is important or unimportant?. The values emphasize those objects, conditions that those members consider important. Values are more related to the norms of a culture, but can be more abstract than norms. For example raising of the national flag during nationally significant occasions or even in the case of a wedding or singing the National Anthem in national ceremonies and also government establishments (including some private entities) prior to commencement of work are values. Further, they reflect the value of patriotism. In the recent past in Sri Lanka patriotism has taken a new wing particularly in the aftermath of successful war and now it has extended to trading and commercial world with the theme Buy Ours (Ganna Ape De). Therefore this new trend has bearing on consumer behaviour. As an exampl e, recently launched KIK COLA (Elephant House) advertisement features that till the last drop Sri Lankan with primary focus on Coca Cola. Even Lanka Bell advertisements mainly based on the theme 100% Sri Lankan. Why are cultural values so important? The cultural values of a community give it a unique identity of its own. People are the driving force of this uniqueness. Culture is shared among the people in the community, society or sub group. Culture is passed down from one generation to the other and gets evolved over time. It links people of a region or society together. The customs and traditions the society follow, the clothing they wear, the festivals, the food they eat, and importantly, the cultural values they follow, binds them. Analysis of how Sri Lankan Cultural Values Affect the Consumption of Selected Products and Services First we will get a brief understanding of Sri Lanka as a Customer. According to the Annual Report of the Central bank of Sri Lanka (2009) the population statistics can be summarized as follows, Mid-year population (000) in 2009 : 20,450 Mn Age distribution (000) in 2009 0 14 years: 5,378 Mn 15 64 years: 13,784 Mn 65 years and over: 1,288 Mn Also the Per Capita income is in the rage of USD 2,000 and is expected to double corresponding to the GDP growth by 2016. Having an understanding of what culture is, what cultural values are in general and the Sri Lankan culture and cultural values, we will now evaluate how those aspects have influenced the consumption of several products and a service in the Sri Lankan market. Herbal Soaps Sri Lankan culture is very much related to the nature. All most all the aspects of the Sri Lankan culture are linked with the wonders of the nature. Ayurvedic medicine is a treatment method unique to Sri Lanka and all Sri Lankans (irrespective of what religion they belong to) know and have faith on its healing capabilities. We did not see herbal soaps in the market at the beginning and until recent past only a few manufactures saw the opportunity in herbal products. Then we saw even foreign brands like Lux and Lifebuoy taking up the herbal route since the herbal soaps prove to be profitable and attract a larger target market segment because herbal soaps are very much in line with our values and beliefs particularly it reflects our attachment to nature. Generally Sri Lankans value old things. Ayurvedic medicine has been practiced in Sri Lanka for thousands of years and people still have faith in it and values it. This has been used by various marketers and now we can almost get anythi ng in its herbal format. Child Milk Powder The bond between the mother and her child is cherished and valued in almost in any civilized culture. When considering the modern era, generally the state of that bond in Sri Lanka and other South Asian countries much more stronger than in any other country. The bond between the child and the mother is built mainly through the nurturing aspect of that relationship. In the Sri Lankan context (mother centric culture) it is deeply believed that there is nothing more vital to child than the love and warmth of a mother and mothers milk (breast milk). Breast feeding is fading away in many European countries and getting used to supplement formulas, but in Sri Lanka it still holds strong. Sri Lankan mother generally breast feed their children for at least for two to three years. In this context child milk powders have an enormous challenge because it is widely believed that there is no replacement for breast milk. Hence, what the marketers approach has been to place the product as a suppleme ntary which provides the nutrition and protection from deceases. If it were to come as a replacement for breast milk, the product wouldnt have survived for long. This situation also facilitated with the increase in working women in Sri Lanka but culturally Sri Lankan women are mostly supposed to be housewives and to take care of the children. The Brands like Anchor Pediapro, Cow Gate, Nan, Enpro Grow, Enpro Lac are some of the child milk powder available in Sri Lanka market. Automobiles Sri Lanka has been using automobiles since the period in which British were in power. First automobiles seen on the Sri Lankan roads were European made. But now we can see automobiles from India, Japan, Indonesia, Malaysia, Korea, Taiwan and various other countries and also the assembly of vehicles was commenced in Sri Lanka in the recent past. At first, European vehicles were used by the higher end of the society and now also European vehicles are driven by upper class people in the country. Those vehicles are priced higher and can be afforded by only those people. But when the Japanese entered the market (in 1960s), they came up with economical vehicles that can be afforded by the middle class people as well. There is strong belief among the Sri Lankans still that if someone wants to buy a good vehicle with quality, economical fuel consumption, durability and moderate prices they would first select the Japanese vehicles among other countries which offer same features. This belief a nd attitude is further proven by the high prices in the second hand market for Japanese vehicles and people prepared to pay more for Japanese vehicles. European vehicles are relatively less valued in the second hand market. Hence the demand for Japanese vehicle is geared by the beliefs among the Sri Lankan people (adherence to traditional norms) that a Japanese vehicle is economical and gives value for money and trustworthy. However, we have recently seen Indian brands promoting their vehicles to be the most economical but still we cannot see the trust on Japanese vehicles going down. Pain Relief Balms Sri Lanka having a rich heritage in Ayurvedic medicine, people were used to applying Ayurvedhic oils and pastes to their every day bruises. The recipes and formulas have been passed down through generations and some recipes are household known facts. During the last decade or two we saw the market bombarded with various balms to be used for bruises and to relive pain. Wintegino, a famous UK brand, can be highlighted for usage among the people and now sprays (other than balm) with the same effect can be seen in the market. However, it is a known fact that Siddhalepa a brand which has its roots in the Ayurvedic medicine tops all such balms and oils in the market by sales, and it has been doing this for decades. The secret of this success is the faith/beliefs that Sri Lankan people have on Ayurvedic medicine which the effects have being proven over centuries. The people still has the faith (beliefs) that Ayurveda is the safest way of medication with minimal or almost no side effects. Si ddhalepa is proven product with real Ayurvedic essence. Unless it is to be used in quick and convenient manner (in a sport event to be treated to injured players, where most likely a spray would be used) Ayurvedic balms are preferred by Sri Lankans where the demand is directly linked to cultural beliefs and rich heritage. Pawning of Jewelry The provision of financing for immediate money needs by pawning jewelries has become a prominent business segment for financial services sector including the banks (formal banking sector). However, traditionally pawning business was dominated by the village merchants (Poli Mudalali) and despite the high interest rates and also the low security of jewelries pawned the people still used to go these village merchants simply due to reason that culturally the pawning were deemed as a sign of severe economic hardships and economic mismanagement of the particular person and family. Particularly in rural areas and areas close to Colombo, the people have a very close relationship with their families, relatives and neighbors and hence the negative points of view formed by others are considered to be very critical and long lasting. Therefore people used to go in times (especially night times) to the money lenders to ensure the confidentiality and did not turn up at banks. However, the money circulation on pawning is considered to be very high and which provided a new perspective to finance sector to expand this business segment. Accordingly, in the recent past all financial institutions are heavily promoting the pawning business as it is risk free (due to security in terms of gold) and profitable. For this purpose, the first initiative was to have separate areas for pawning customers to confidentially attend to the matter which was major relief from a severe cultural burden. This situation coupled with low interest rates and high security for the customers reduced the negative trends or beliefs towards pawning in Banks. In fact today the all banks and other financial institutions use advertising heavily and also sales promotions are in place to attract customers namely providing the highest amount per pound, facility to settle the amount in installments, giving gifts on each pawning, raffle draws and etc. Analysis on How Cultural Values are Important for Marketing Strategic Decisions Based on preceding sections it is obvious the impact of culture and cultural values on consumer behavior. Accordingly, cultural values has to be considered in marketing and developing marketing strategies as they have a significant impact on the purchasing behaviour of the consumers. How culture and cultural values could influence the buyers/consumers buying decisions? This is not a simple process which someone could easily conclude but rather it requires a detail examination. Since the consumers are culturally different, the processing of information in a cursory and spontaneous manner reflects culture-based differences. As an example when you go pass a roadside billboard or when you watch a TV advertisement, they will influence/persuade you provided it in line with your cultural values or norms. When coming up with a marketing strategy for a product, it is important to understand the level of the culture of the market since behavior at different levels of the culture varies. From the marketing perspective four levels of cultures could be identified and according to Srnka (2004) they are Supraculture, Macroculture, Mesoculture and Microculture as shown in Figure 1 in next page. Four Levels of Culture Based on a Marketing Perspective Source: Article by Dr. Katharina J. Srnka on Cultures Role in Marketers Ethical Decision Making: An Integrated Theoretical Framework 2004 As we move down the cultural levels the approach of the marketer needs to be customized to the target market, because when we move down the number of people in that level comes down as well as the detail of their preferences increases. It is not possible to assess the impact of a respective consumers cultural background on marketing strategies in general, because the specific elements of the marketing- mix, i.e., 1.price, 2. place, 3. product and 4. promotion strategies are all more or less affected by culture and hence each component of the marketing mix should be compatible with the cultural context as non compatibility of even one component may result in products or services being rejected by the target market. Pricing, which is the first element of the marketing- mix, refers to decisions about the actual product or service price the consumer has to pay and considers production costs, as well as the consumers willingness to pay, which might especially be affected by his or her cultural background. The willingness to pay represents the valuation of products. Since consumers learned during the process of which products they should approve of and which they should not, the culture influences the appreciation of certain products as well as the willingness to pay. On the other hand, decisions concerning pricing interact with the economic development of a country. Hence, cultural background might serve as a determinant of the target market and pricing mechanism. In the context of distribution policy (place), culture might also be important to differentiate between several target markets, even if the characteristics of the culture do not have a direct impact on decisions concerning product distribution. Nevertheless, different cultural values have to be considered when distributing products because consumers from different cultures have different buying habits. For example, in Sri Lanka liquor is prohibited to be sold near any religious places due to the strong religious foundation followed by Sri Lankans. Thus, cultural background has to be taken into account in determining the distribution channel of products, but the differences between cultures that are of interest for decisions on distribution policy are observable, which makes it easier to consider these differences in product distribution. The third element of the marketing- mix, product development, is much more affected by the consumer s cultural background. As the product attributes are expected to bring about solutions which should satisfy different cultural background of consumers, culture has to be considered in the development of products. Otherwise, products may not be in accordance with what the consumers expect the products to be. Moreover, products which are preferred in certain usage situations such as religious ceremonies vary because of culture and as an example in a Hindu wedding which mostly conduct in Hindu Kowil are served with vegetarian foods. The PIZZA HUT had pizzas made out of all meats namely chicken, beef, pork and mutton. However, Muslims due to their religious preaching do not eat pork and also do not turn up in places where pork is served. Also having Halal certification is a must for Muslims to have chicken. Accordingly, PIZAA HUT has now stopped serving pizza made out of pork and got certi fication from All Ceylon Jamiyyathul Ulama Committee for Halal Certification. The fourth element of the marketing- mix is the development of communication strategies (promotion) which broadly consists of Integrated Marketing Communication (IMC) tools such as advertising, personal selling, sales promotion, direct marketing and publicity. It is argued that even the branding and packaging also form part of IMC. IMC are very much culture sensitive and hence should be designed properly. As an example, Anchor always uses the theme Trusted by Mothers for its milk powder and it is a powerful communication strategy. Whereas once Nespray (full cream milk powder) had an advertisement featured by famous Actress Sriyani Amarasena and in that it was emphasized that she was given Nespray milk by her parents which she did for her daughter and now same milk is given for her granddaughter. But this advertisement was not popular as it was considered as an insult to motherhood. Further, if a Marketer wants to communicate that its product is particularly appropriate to certain usa ge situations, it is not satisfactory to only observe consumption patterns, it is also necessary to get to know the reasons for culture specific consumption habits. Hence, in order to convince consumers of the appropriateness of certain products, it is of major importance to know the reasons why consumers prefer some products over the others. Generally IMC strategy should consider differences in religions, languages, differences in infrastructure and legal parameters. The interdependency between culture specific buying motives and the development of communication strategies is due to the main elements of culture such as symbols, heroes, rituals and values. As advertising plays a major role in a companys communication strategy (IMC) and is affected by all kinds of cultural dimensions and hence advertising especially has to consider cultural values and cross cultural differences. As an example the Avenger mens perfume advertising included that after applying the perfume the person appeared for the advertisement become violent or very emotional with girls. However, this promotional strategy was not successful as it was not culturally acceptable in the Sri Lankan context. Also the recent advertisement on Provado, an agro chemical produced by Heyleys Agro Products Limited, has an advertisement for which famous musician Sunil Perera appeared and it had double meaning phrases and there were many complaints against this from all levels from agricultural community and hence certain parts were edited/deleted and the new version is probably acceptable. Further, the Ceylinco Insurance which uses negative approach in advertising is not culturally viable though the norm that all things including human lives are uncertain since culturally we are still not prepared to accept or think of a death or other form of hazard. Conclusion If a marketing strategy is able to influence the behaviour of a potential customer in manner that makes potential customer convert to an actual customer (makes him to buy) the marketing strategy can be judged to be a success. To do that effectively it is required to understand what makes people behave in the manner they do especially their buying behaviour. Many studies have proven the behaviour of a person is mainly influenced by that persons culture and the cultural values that person holds. According to this study it is clear that the demand for products and services are created by the influences of cultural values pertaining to the respective culture. Further it can be stated that a successful marketing strategy adopted in Sri Lanka needs to address and consider the cultural diversity and uniqueness aspects in the Sri Lankan culture which influence the Sri Lankan customers purchase of products or use of services in a continuing manner.