Cultural factors that influence international business

There are numerous macro-factors that influence international business, such as politics and economic climate of the region involved.

Differences in social conditions, religion and material culture all affects consumer’s perception and patterns of buying behavior.

Because society is composed of people and their culture, it is not possible to speak of one without relating to the other.

Social and culture affect employer-employee relations, buyer-seller interaction, business to business interchange, and government to business negotiations.

Cultural factors definitely influence consumer values and preferences. Areas most often impacted by cultural factors include this consumer products that must conform to local dietary needs, health practices, and religious guidelines.

Ideally, the internal culture of a firm should fit more or less with the culture of the region or nation where firm is located.

Host factors and policies may be managerial principles that are operational at home but may be ineffective in other countries or a manager may have to initiate policies and procedures that were not necessarily appropriate in the home country.

Cultural factors that influence international business

Product and Market Development Across Cultures

Product and Market Development Across Cultures
Although some companies view themselves as pure marketing organizations that only focus on branding, the basis of existence of a global company is its product or services and the ability to develop or adapt product concepts for different markets. The most important decisi0n of a company is which products or product variations to market to which markets, therefore, marketers would work in close contact with research and development.

Many products sell better in some markets than in others, the cause of such variations can be wealth or culture. If the cause of low penetration of a specific product in a specific country is culturally defined, products should be adapted to better fit that culture.

New product market combination must be developed when products enter new markets of different configurations. Life insurance, for example, is a product for individualistic cultures; entering a market with a collectivistic culture demands different products. An example could be offering parent related pension insurance to the Singapore yuppies whose new mobile lifestyles make it more difficult to fulfill their obligations to look after their parents, a strong element of their collectivistic and Confusion values.

Well defined cultural differences can help to develop more appropriate products or product adaptations for different cultures. If certain do-it-yourself products do not sell as well in strong as in weak uncertainty avoidance cultures, adapt the product to the need for competence. Add instructions, offer training, whatever helps the market to feel more competent. Similarly, electronic appliances such as remote control devices should be easy to use for weak uncertainty avoidance cultures, but may have complicated details for strong uncertainty avoidance cultures where people want to control the process.
Product and Market Development Across Cultures