In Need of Understanding Cultures for Business

by PJWisaksono

Globalization has been pushing multinational companies to expand their business all across the world. They do research in order to find many countries which have lots of benefits for their business profits. These probably include location saving (for example low labor cost, property tax cost and material cost), and market premium (such as loyal customers and huge market).

Nevertheless, penetrating brands or products into a new country is not easy. Commonly, an international company has to understand the cultures of the destination country. These consist of many aspects ranging from language, manners, clothing, religion, rituals, norms of behavior and system of belief. The understanding of the cultures is very important because the cultures can be a medium through which all communications travel and also the best way for the company to market its products effectively and efficiently. In other words, culture is the one thing that enables the company, especially its marketers, to create greater engagement, relevance, and grow their business.

A case in point of understanding local cultures is reflected on my experience when I went for pilgrimage in Saudi Arabia. When I bought a fried-chicken package in an international fast-food restaurant, I found that the taste was really different with the one in my country, Indonesia. Under permission and supervision of the head office, the local office of the restaurant must have added Arabian local spices to the fried chicken so that the taste is more sour than that of in Indonesia. Besides, the advertisement was also not similar with the one commonly seen in my country or in the origin country of the restaurant. The actors, both male and female, mostly followed the norms and the Islamic values, such as wearing a veil and a long dress for the woman.

As a result, if a company does not catch on the local cultures, it must be very difficult to market its products. There will be ignorance of the local people to try the products even for the first time, or if the people have bought or tried the products for the first, they probably will not want to be loyal customers who always do repeat orders. As a result, the company will no longer survive and get bankrupt soon.

Hence, business and culture are correlated closely each other. A company, namely a multinational one, needs to understand cultures in order to develop its business and be accepted to local people.