It is essential that companies take into account the lifestyles and culture of countries to which they are considering exporting. Cultural factors can be used to determine whether a product or service would be considered essential, useful, a luxury or even undesirable in a target country. Some products and services might even be found culturally unacceptable.
Research into culture and lifestyle can also identify potential problems with translation, marketing and advertising.
Package colours, sizes and styles, and product functions can all require adaptation because of cultural requirements.
Exporters of consumer products will be affected by a country’s culture more than exporters of industrial goods or components because consumer products must be designed to meet needs, values and beliefs.
The cultural and lifestyle information about a country can be broken down into several areas of research:
1. Material culture
This includes the technological goods used by the majority of the population, personal transport (including car ownership) and the availability of resources such as electricity, natural gas, telephone, Internet and wireless communication.
2. Cultural preferences
Each international market will have varying preferences for products, foods, product/food quality levels, and even brands. The meaning of shapes, colours and iconic features can also have different cultural significance.
These cultural differences must be taken into account to determine whether products are suitable for a market or whether they can be adapted for greater business success.
For example, Fanta soda is orange flavoured for the North American market. However, the Coca-Cola company, which produces Fanta, has adapted the flavouring for certain markets to take cultural taste preferences into account. Fanta is peach flavoured in Botswana, tastes of passion fruit in France and is flavoured to taste like flowers in Japan.
The languages spoken and used in a country have an impact on marketing, brand names, the collection of information through surveys and interviews, advertising and the conduct of business relationships.
Languages might vary between regions of a country, and some countries have more than one official language.
For example, Canada has two official languages, and a third or fourth is spoken in several areas of the country. Switzerland has four main languages, and Kenya has 22.
The number of languages spoken in a country usually gives a very clear indication of the level of diversity in culture and attitudes. However, even countries where only one language is spoken can have regions of wide cultural diversity.
The typical level of completed education in a region can indicate the quality of a potential work force and the status of consumers.
Religion is a major cultural influencer that can affect many aspects of life, including the role of women in society, rules about food and beverage consumption, clothing habits and holiday activities.
6. Ethics and values
These can have an impact on international business, especially when conducted from within another country.
Researchers must remember that the same ethics and values are not held by everyone in a target market. They are always dependent on status, region, ethnicity and religion.
Researchers should also consider the human-rights conduct of any potential market.
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7. Social organization
The composition of family groups, the prevalence of special-interest groups and attitudes toward them, racial diversity and recreational lifestyles are all important to consider when a country is being investigated as a potential export market.
Case study—Lifestyle changes in South Korea create a market for exports
Until 2004, South Koreans worked a six-day workweek. In 2004, the South Korean government started shortening the workweek from six days to five. In 2007, all companies with 50 or more employees had to provide two days of free time a week.
As of 2011, all companies in South Korea comply with the five-day workweek.
This major shift in lifestyle has led to a boom in hotels, tourism and the consumption of Western-style leisure-time products.
It has even changed eating habits; between 2005 and 2007, two hundred restaurants opened in the capital city of Seoul to provide Western-style brunch foods including blueberry pancakes, bagels, steaks, and bacon and eggs.
Product or service potential
The information gathered from cultural research will help a company identify whether a market is a promising one or not.
When one or more international markets appear to be suitable for a company to export to, international trade researchers need to gather more information to eliminate any opportunities where the risk level is too high or the returns will be too low to justify the business expense of exporting.
They must also focus on the actual potential for the company’s product or service in the markets that appear promising.
If a company has a wide range of products or services, research can help identify which product has the greatest potential and where it is most likely to succeed.
Research can also identify potential pitfalls with packaging, marketing, brand names and advertising.