Foreign markets: Integration

Beware Cultural Business differences

Foreign markets: IntegrationIn business it can often be that the case of trying to transpose the same business model to other subcultures or cultures. This can lead minor or multimillion losses. It can be a case of arrogance or simply an oversight on behalf of the business in question. As the world becomes more a global village, particularly with the exponential rise of information technology, cultures are increasingly merging. However significant differences can prove to be seriously problematic, even disastrous for business. Parochial business plans simply don’t translate in some circumstances. Even within regions of the same country.

A multinational supermarket chain that had expanded on a massive national level, and looked to a foreign market to expand its chain. It was decided to launch on a multi-million level, to have a huge impact straight away. The country chosen to expand into was Germany. The huge launch was made on the basis of its local national business model, with its relative price range remaining the same. What was overlooked was the Germans preferred to largely shop at the lowest budget supermarkets. By the time this was realized the supermarket chain had lost millions, and had to pull out of Germany.

 

Watch your language

An Advertsising campaign by a western company launched a campaign on billboards for a soap powder in an Arabic country. Given that many of the locals were illiterate it was decided to use just pictures. On the left dirty washing, central a picture of the soap powder, and on the right a picture of clean washing. Sales slumped. Then it became clear that the English language reads from left to right, whereas the Arabic language reads right to left. Seemingly clean washing became filthy by using the washing powder!

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