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Marketing across different countries often implies understanding the cultures, in which the company is operating and thus striving to meet the needs and expectations of the customers in the new country. The learning is possible with concepts of Hofstede’s cultural dimensions and market analyses including Porter’s Five Forces, SWOT and PEST among other approaches. Havaianas is a Brazilian company that is famous for its flip-flops and other impressive footwear. The brand is internationally known; thus, a new venture into the German market seems to be a standard course of actions. However, Germany is a difficult market to enter, owing to the unique cultural status of the nation. The scores on their cultural dimensions set the Germans far apart from most of the other nations, especially from Brazil. Therefore, a successful venture into Germany would require the company to partner with a local organization that knows the German people and will be capable of delivering as per the needs and expectations of the German customers. In terms of the marketing mix, it is recommended that the company takes a customer-oriented perspective in order to meet the expectations of the German consumers, who can be described as modern, choosy and mostly high end.
The definition of culture remains rather different within the various disciplines as each side tries to make it relevant to the specific interests. Thus, culture has been defined as ‘learned attitudes’, ‘collective subconscious mechanism’, ‘subjective perception’, and even as a ‘generalized programming’ that influences the mindset of a given group of people. Therefore, it can be appreciated that examining culture in the context of marketing may require a specific focus on the aspects of culture that are relevant to marketing processes and outcomes. The current report critically examines how German’s social and cultural factors could influence consumer behavior towards Brazil’s Havaianas store products. Furthermore, the manual evaluates the strategic implications that the above factors could have on the marketing mix. Also, the report analyzes the marketing entry options available to Havaianas as it ventures into the German market. Finally, the paper offers recommendations that Havaianas should adopt as it enters Germany.
A Cross-Cultural Analysis
Cross-cultural analysis often entails comparing two or more different cultures as a way of understanding them. The approach implies examining human behavior within the cultures in question. It introduces an explanation of the discovered differences and uses them to define the cultures in relation to one another. The main aim here is to compare the cultures and understand their differences and similarities within a given contexts, including political, social, legal, economic or technological factors. In order to conduct a cross-cultural analysis, it is important to first identify the field of relevance so as to examine factors that are applicable to one’s interests. Having established that culture is a wide concept with numerous facets, it is important to be specific regarding the aspects that are of interest in a given study. In the current case, the concentration is in international marketing and the relevant aspects of culture affect the habits, needs and expectations of the consumers. Therefore, the available cross-cultural analysis approaches in the context include specified case studies and holocultural comparisons among others. The three relevant approaches are the Iceberg model, the Onion model and the Hofstede model.
Cross-Cultural Analysis Approaches
The Iceberg model as stated by Edward Hall explains that there are many aspects of culture that cannot be seen, which include values and thought patterns that dictate the ideologies embraced by a given society. While the behavior and beliefs are visible and above the water like the tip of the iceberg, it is the values and thought patterns that affect the trends in the community. Thus, the phenomena qualify as the larger part of the iceberg that is under water and cannot be seen easily.
On the other hand, the Onion model indicates that a country’s culture is divided into seven layers, where each dictates the lives of the people within that country. The layers include artifacts, behavior, feelings, values, beliefs, worldview and ultimate allegiance in that order from the top layer to the core. The suggestion is that the artifacts and behaviors of a given society are easily accessible and can be understood; but the rest of the layers are too deep to be evaluated easily.
Selected Cross-Cultural Model
The Hofstede model explains culture in terms of dimensions, which are relevant in comparing one country with the others in the world. The dimensions include power distance, individualism, masculinity, uncertainty avoidance, indulgence and long-term orientation. The model seeks to establish the position of each given country with respect to the other existing cultures, thus offering the best system for cross-cultural comparisons and analyses. Therefore, the Hofstede’s approach is used to compare Germany and Brazil in order to establish their differences and similarities by comparing their scores on the six cultural dimensions.
Summary of Findings
Using Hofstede’s cultural dimensions, Germany is different from Brazil in many ways. On the scale of power distance, Brazil scores 69 while, Germany has 35. The discrepancy means that Germany is one of the few countries with a low power distance. The score can be interpreted that the Germans expect equality and inclusion in terms of decision making, whereas the Brazilians are used to subjection. Secondly, Brazil scores 38 at individualism, whereas Germany is at 67. The Brazilians think in terms of the ‘collective’ frameworks, like family and community, whereas Germans are more motivated by their individual needs and goals. Germany also has a higher masculinity score that Brazil, implying that Germans are all about achievement and competition, while the Brazilians value the quality of life, feelings and caring for others. In terms of uncertainty avoidance, it can be appreciated that Brazil scores higher (76) than Germany (65), meaning that the Germans are more relaxed when facing anxiety about the future compared to their Brazilian counterparts. Thus, Brazilians are more likely to avoid ambiguous situations with issues like employment and brand loyalty among other factors. With regards to the dimension of long-term orientation, Germany has a higher score at 83 compared to Brazil’s 44. The score means that Brazilians have preserved their links to history by upholding traditions, while the Germans have a more pragmatic perspective and are thus less inclined towards historical identity. Consequently, Germans are more modern, although Brazil’s score is intermediary in the sense that the country is both modern and tradition. On the contrary, German is entirely modern. As for indulgence, Brazil scores 59, while Germany is at 40. The Brazilians are more indulgent and thus often resist the urge to control their impulses. Therefore, they are always willing are ready to have some fun, unlike their German counterparts, who are less indulgent and are more likely to control their impulses and live a strict and predictable life.
Social and Cultural Factors and the Marketing Mix
There are many ways to look at culture, especially with respect to consumer behavior. In the given case, the main interest is on how the culture of the Germans will affect their reception of the Havaianas products. The strategy implies a need to examine the concept of culture and cultural framework as well as how it applies to the chosen marketing mix for the products in question.
Having contended that the applied definition of culture is dependent upon the contexts within which it is being studied, culture is seen through the lenses of marketing. In defining culture, it is expected that social factors of the country affect the marketing. Thus, the relevant definition of culture is borrowed from Hofstede’s work, in which he describes a culture as a ‘collective programming’ that distinguishes the people in one community from individuals in another. The programming thus dictates how the individuals process a certain kind of information, how they relate with one another and with others who may not belong to their particular grouping, how they make decisions, and the kind of expectations that they have in terms of quality and convenience among other product attributes.
The Cultural Framework as a Concept
Baum?ller also argues that there are eight scales with which a culture can be evaluated, which include communication, evaluation, leadership, decisions, trust, disagreements, schedules and persuasion. The scales determine the position of the culture in question and successful interaction of a given business with the people from the new culture. When using the Hofstede concept, it is often important to look at the specific dimensions of a culture that affect consumer behavior. The concepts include power distance, individualism, indulgence, long-term orientation, uncertainty avoidance and masculinity. Basically, the cultural dimensions featured in the Hofstede model are useful for Havaianas Company when determining their market entry strategy. Each cultural dimension affects the perceptions and attitudes of the people, which are often mandatory in determining whether they would be interested in a given product and how it should be marketed to ensure that the consumers pay attention. Moreover, Deresky offers a comprehensive way of assessing the social and cultural factors that determine the marketing approach used in a given country. The scales presented are the guidelines to developing a good business relationship with the people in a country.
The Cultural Framework Applied
Germany is a nation with a lot of unique aspects when compared to Brazil. The people of Germany are more modern, and thus are more likely to embrace new products that are able to enhance the quality of their life. However, they are not as impulsive as the Brazilians; thus, the company will have to work harder at persuading Germans to buy their products. Germans are more attracted to uncertain aspects like a new product and brand name, thus the country is a good place to expand the business. Individualism also dictates the kind of communications that would encourage the customers to purchase the products. The Germans prefer individual gains as seen in the high individualism score. Therefore, the only way to appeal to them is to state how the products will make their lives better or make them stand out as individuals. On the other hand, the Erin Meyer concept would require the company to consider the German way of life in terms of how they communicate, value things, define leadership, and make decisions. Moreover, important evaluation is how much trust they can give and how one can gain their trust, how they handle disagreements, how strict they are with their schedules, and how they can be persuaded. Germans are especially modern and busy, meaning that convenience is an important consideration for the market entry plan.
The Marketing Mix
A marketing mix is a strategy that is applied in order to sell the products to the target market and to deliver the items to the consumers. The company needs to base the decisions on the needs and expectations of the target market, while also ensuring that they are able to dominate the market and have great sales volumes. In order to penetrate the international market, most companies are likely to opt for the 4 Cs rather than the 4 Ps, especially as the consumers are more interested in companies that engage the market in order to meet their specific needs and preferences. The quality of the offered products may affect their reception in the market. However, if the products are not relevant to the consumers, then even the highest quality may not increase the sales fast enough for the company to remain sustainably profitable.
The Impact of the Cultural Framework (and the Cross Cultural Analysis) on the Marketing Mix
A marketing mix is a strategy that a company needs to implement in order to get their products to the target customers. On the other hand, the applied cultural framework dictates how the company understands the target market. Thus, the cultural framework used in a given situation will determine the marketing mix since it affects how the Havaianas Company understands the market. The cross-cultural analysis also impacts the marketing mix by determining the changes that will be made by the company with regards to their market strategy within the new cultural domain.
Market Entry Strategies
In order to sell flip-flops in Germany, there are a number of marketing alternatives that the company can choose. First, it must be noted that the flip-flops are mainly seen as summer shoes and thus more popular during summer in the countries with moderate climate. Second, the German market is very vibrant with respect to popular brands like Havaianas. In the modern culture, the people are exposed to the international community and are aware of the existing international brands. The factor gives the company an advantage as they enter the German market.
Criteria for Market Entry Strategy Selection
In order to enter the German market, the first step is to establish the existing factors that may affect the product’s performance in the country. In this case, the company will have to consider influences of the risk, control, involvement and cost of the market strategy they choose to adapt. The organization will be introducing a new product with an already existing competition in the country. Thus, they will have to start with direct exports as the selected market entry strategy. The approach will require a joint venture; however, the German government encourages partnerships as a way of attracting foreign investments while also supporting local entrepreneurs.
The German nation is highly developed in terms of the politics and economy of the area. The nation is generally capable of ensuring that their business environment is fully functional and tailored to meet the needs of both local and foreign investors. Therefore, investing in the country has minimal risks considering that politics and the economy are the typical greatest sources of risk for investors. The company can choose to invest in Germany, given that the country is financially stable. However, as a part of the Euro zone, Germany is subjected to the economic risks of the larger region, which may pose some challenges especially in terms of the unified currency.
Germany has a very low power distance, meaning that the people are used to making all the major decisions. Thus, it is very unlikely that the company will be able to exercise maximum control over their German locations. If Havaianas Company intends to have full control over their operations in the new market, they will have to consider going in on their own rather than franchising. A partnership will also not be as effective as a sole proprietorship, since the partner will require effective participation in the business. As a result, it may affect the performance of the company with respect to the consistency of their international marketing.
Similarly to control, the company’s need for involvement in the business also greatly affects the mode of entry that they will choose in Germany. The individualistic tendencies of the German population will imply a need for the company to be fully involved in their operations in order to protect their interests in the market. If they delegate the responsibility to the local investor, they may be unable to meet their objectives as an international business organization.
Cost is also crucial as a market entry criterion, especially considering that the company needs to be able to finance the chosen marketing strategy. Germany is a developed nation with an effective economic system. The company could franchise or seek a local investor to partner with on the venture, if they are unable to finance the entry into the country. Also, considering that Havaianas is an international company with a need for both an online and off line store location in Germany, they should be able to invest heavily on their own.
Selection, Application and Implications
A joint venture for the direct exports will imply that the company will have a local partner for their German business. A SWOT analysis of the company with regards to the German market shows that the company has a chance of success, especially if they open an online store. Germans like convenience and quality, and Havaianas is an international brand that is renowned for its longevity. The strengths include the reputable international brand name and the financial backing of a successful Brazilian business. The main threat on the other hand would be the competition in the flip-flop market. However, the company has a significant competitive advantage with their brand name and impressive market following internationally. The PEST analysis of the German market also supports the joint venture as the best way for Havaianas to minimize risk and ensure significant returns in a unique and complicated culture like Germany’s.
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Conclusion and Recommendations
In order to market the Havaianas brand in Germany, the main considerations are the customers’ needs and expectations. The cultural dimensions of the two countries established that Brazil and Germany are very different and the company cannot apply their Brazilian strategy when venturing into Germany. Also, the German culture was proven to be complex scoring high on masculinity and individualism among other critical dimensions. Therefore, the company will require a German partner in order to ensure that they are able to fully maximize their potential. Havaianas is a great brand with a lot of potential in most parts of the world. However, in Germany, the market is distinct and requires the input of a local business for better performance. As such, it will be more productive for the company to engage the expertise of a local partner in their venture. As a new market entrant, they will have significant competition, and the only way to ensure that they have another unique selling point would be to have some experience in the German market. It can also be suggested that the company requires a customer-oriented perspective in the venture. The management will have to organize the marketing mix in a way that focuses on the needs and preferences of the consumers. Thus, the best strategy would be to have an online store with effective delivery services as well. The exports option in Havaianas case will present the company with the opportunity to expand their production in Brazil as they get into the German market. Finally, Havaianas can start production in Germany later, once they are consolidated in the market in terms of customer loyalty.
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