Research Topics: The Ketchup Company

Most business industries had gone through significant transitions

Reductionist Simplistic Dualism and International Marketing Introduction             With the introduction of global trade, modern companies and businesses have started to open their doors to markets found abroad. Through globalization, the goals and capabilities of most business industries had gone through significant transitions. In addition, other developments such as communication and transportation advancements have also contributed to globalization success. Though widening business reach through the globalization factor promises several advantages, business operators are aware that such strategic option involves a number of risks. Among the many significant concepts in globalization is international marketing; with this business principle, business organizations are able to distribute their products and services across borders. In this aspect however, the cultural factor must be taken into account. Considering that consumers abroad have different interests, preferences, beliefs, buying behaviors and cultural backgrounds, it is then imperative that business operators assess and study the cultures of their international market targets.               While this is already given, others still fail to see the real meaning behind this concept. Understanding individual cultures for successful international marketing is a known requirement; still other operators resort to applying a concept known as reductionist simplistic dualism. In this paper, focus will be centered on defining dualism, its relation to culture as well as how it is observed in actual business operations. This will then be compared to the international marketing theory. Finally, how business owners should appropriately apply the concepts stressed in the international marketing theory will also be discussed.   Reductionist Simplistic Dualism             Dualism is defined as the philosophical system that aims to explain all forms of phenomena through the development of two distinct concepts ( 2004). One of the famous examples of this principle is the mind-body or mind-matter dualism; the monistic and pluralism concepts are its counterparts (1996). Though dualism is often used to explain theological and philosophical factors, this also has some relation in business and marketing. Dualism is often observed in the field of international marketing and culture. Combining both factors, reductionist simplistic dualism is the tendency for business operators to limit their cultural understanding into two distinct concepts. Such practice however, is unacceptable considering the number of cultural variations.               In a more comprehensive definition, simplistic dualism in business and international marketing is synonymous to the development of cultural stereotypes. One good example is the development of too general characteristics to describe Western and Eastern cultures. In the article written by  (2002), American and Asian cultural backgrounds had been compared using a few points of difference. Based on general descriptions, Americans were described as a group that is more verbal and direct whereas Asians have higher context cultures that use gestures more to communicate. In terms of behavior, Americans tend to strive to stand out from the rest, while Asians prefer to maintain a low profile. In addition, Americans were described as a group that values legalities, whereas Asians are more on reciprocal relationships.               Reductionist simplistic dualism in international marketing is also observed when defining white individuals from blacks as well as male from female. Various authors had explained this cultural tendency. Culture is developed through the interaction of attitudes, behaviors and values of the members of a particular group ( 1991). As people interact, apply similar practices and pass these values on future generations, a cultural theme that makes certain groups distinct is formed. This development is stressed further in the investigations of (1994) where the researcher has concluded that groups of people belong to different cultural levels. The formation of cultural themes then led to the development of various common cultures that represent certain groups.               This however, partly led to certain drawbacks such as the development of cultural stereotypes. As emphasized in the research done by  (1961), previous analyses of culture had been significantly influenced by the groups’ dominant values; their variant values however had been disregarded. This clearly explains the application of dualism in international marketing where the study of the target markets’ cultural background is only limited to a few dominant values. Rather than recognize what makes China different from Taiwan or Singapore, businesses tend to analyze them as Chinese people in general. In the same way, Western culture is regarded as one when individual European nations has distinct cultural practices and values. Business then should not resort on reductionist simplistic dualism as it directly opposes the true concept of international marketing.               The experience of Kellogg’s in Indian marketing and product distribution is a good example of the effects of reductionist simplistic dualism. During the latter part of the 1990s, Kellogg, the American cereal giant, was attracted in extending its operations in India, primarily due to the country’s large population. Considering that its American business practices had succeeded in the United States and in other parts of Asia, the company then adapted the same practices for the Indian market. The production and distribution of the Western food product was also supported by advertisements patterned after western influences.   The strategy however failed to work. The Indian consumers do not find breakfast cereals as appetizing as their home-cooked meals or biscuits and tea sold at street stalls. Cereals were not recognized by the local market as a good breakfast food, resulting to Kellogg’s unimpressive sales and operations. Three years after the company has started to operate in India, total sales were not promising; the outcome was in fact far from what Kellogg’s was expecting. The advertisement did not cause any impact to the Indian market either (2003). While other consumers find the breakfast food appealing, a more in depth consumer research done by the company revealed that most of them cannot afford the product. With these findings Kellogg’s was then able to form a more distinct characterization of the Indian market. This encouraged the manufacturer to reconsider its marketing strategies. New products sold at lesser prices were also developed; the use of street food stalls also became the company’s primary product retailer ( 2003).   The initial failure of Kellog’s is brought about by its hasty and inappropriate presumption that a single strategy, which worked in most parts of Asia will also work for the Indian market. This example clearly suggests that reductionist simplistic dualism not only limits an operator’s market comprehension but could possibly contribute to international marketing failure as well.   International Marketing             The theory of international marketing provides a framework on how this business concept should be implemented and practiced. Marketing is defined as the process of developing long-term relationships with the consumers through effective planning and implementing proper pricing, distribution and promotional means (1988). The aim of marketing should not only to meet the goals of the business; operators should adapt marketing strategies and practices that satisfy the needs of the consumers. This definition of marketing suggests that this principle involves the establishment of a give-and-take relation between the business and the consumers. In order to do this, operators must then learn about their consumers as individuals and not just any general group. In the context of international marketing, the same principle is applied. This then suggest that though certain groups may be found within a general location, their cultural values make them distinct from others; hence, international business operators should exert effort in analyzing and learning them.               The theory of international marketing is also related to the local responsiveness theory. This theory explains that a balance between the global visions of the company and the interest of the local consumers must be established. Local responsiveness is often the term used to describe the international marketing concept.  (1986) once referred to this as the transnational solution. As discussed further by this author, the international efficiency among business firms in the 1990s can be achieved by means of meeting the different and specific demands of the local market and responding to their respective cultural frameworks.   With this, businesses should consider certain significant factors so as to apply the international marketing theory. In general, global companies should give due priority in learning the culture of the country where they intend to operate. Specifically, the language, education, religion, attitudes and values of a specific country should be learned by any international company. This local knowledge should serve as the basis of their major marketing approaches and strategies.   Theoretical Utilization             From the discussion, it becomes apparent that reductionist simplistic dualism is very much different from the principle of international marketing. While simplistic dualism in business and marketing limits the distinction of market concepts into two main principles, the theory of international marketing is patterned more on pluralism or multiculturalism. This term suits the international marketing concept as it stresses the principle that several cultures do co-exist within a single locality without any one culture dominating the region ( 2004).   This major difference emphasizes why business operators should utilize the theory of international marketing rather than dualism. The theory of local responsiveness and global integration suggests that the differences of cultures in various aspects should be taken seriously. Business operators should not underestimate the value of local knowledge in international business as this will help them fulfill their international objectives. Multinational firms should then tailor their approaches in accordance to their foreign markets’ multiple cultures. Doing this strategy is where the challenge begins. Nonetheless, there are several ways on how the international marketing theory in relation to cultural differences can be applied.  (2004) noted that applying the theory of international marketing can be done through the modification of products and services offered by business operators. If a European company for instance, intends to enter the Japanese market, products produced and distributed in a Japanese province may not be as successful when offered in the city. In the same way, a single noodle recipe or dish may not be applicable to Asian consumers in general. In an American culture, fast service is essential; this cultural feature however, may not be the same in other parts of the Western region. These examples show that international companies should have sufficient background about their markets’ cultures and how these are distinct from others.   Adapting the international marketing theory can also be done by means of modified promotion techniques. As exemplified by the effects of Western advertising to the Indian market, certain socio-cultural factors must also be considered when developing advertisements. The use of top celebrities for endorsements for example may result to different levels of impact depending on the culture type of the audience. Communication channels should also be selected in accordance to the locals’ educational background as well as their access to these media. Means of promotion should also be adapted based on community interest. In using coupons for example, while this may be effective in the American setting, other cultures may not understand its purpose or probably take it as unacceptable ( 2004).    (2003) also stated that the utilization of the international marketing concept also involves the reconsideration of the businesses’ marketing strategies. Specifically, it is essential that a mass-marketing mindset should be developed. Here, focus of the operators should be on the identification of specific consumer needs and determination of price competitiveness.  (1999) developed an effective strategy in order to apply international marketing concepts effectively. Traditionally, business paradigm is concentrated on keeping prices and margins high. In addition, the conventional business pattern was made to suit the period of segmentation, where products or services are made for a specific target. This is the direct opposite of mass marketing that had introduced. In this new alternative strategy, the focus is on the production of simple yet good products that are appealing to the general masses.   The application of the international marketing concept, rather than resorting to simplistic dualism, has allowed a number of companies to flourish in their respective industries. McDonald’s is among these successful companies; the company has in fact been recognized for its high level of flexibility for its international operations. Product differentiation is one of the important strategies of the fast food corporation, which clearly shows how the international marketing concept should be applied. In order to adapt to the multiple cultures observed in Asia, McDonald’s opted to produce menu items that suit the consumers’ food and cultural preferences. Some examples of these products include McSpaghetti in the Philippines, McTempeh and McPork Burgers in Indonesia and Teriyaki burgers for the Japanese customers. The company also applies different menu items even if the international business location is within the Western region; in Norway for instance, McLox Salmon sandwiches are offered for the consumers so as to satisfy local tastes (2001).   The operation of the food company in India is also a clear exemplification of international marketing practice as it does not only involve cultural food preferences but religious beliefs as well. In the Indian setting, majority of the population are vegetarians and consider killing of cows as sacrilege. As McDonald’s typically serve beef burgers and non-spicy food items, the company would have to drastically change its menu for the Indian market. Hence, McDonald’s replace its beef menu items into mutton; spicier sauces and dressing were offered in place of mustard and ketchup. As majority of the population are Muslims, chicken kebabs and vegetable salads are served instead. In addition to product differentiation, regulation of the products’ prices is also a top priority. Considering that most of the country’s population still belongs to the poverty line, McDonald’s must ensure that its products are sold at affordable prices (2001).   Coca-Cola is yet another major company that has utilized the international marketing theory through local responsiveness and innovativeness.  In order to support the application of the international marketing theory, the company developed a Think Local, Act Local policy; this policy was developed so as to promote the importance of understanding individual cultures and consumers abroad. Similar to McDonald’s, Coca-Cola also tried to produce products that suit local tastes through constant experimentation. The company also applied the theoretical concept by employing local employees from its international sites. In this way, the company’s product developers have a strong background of the different cultural tastes of the population and apply them in the development of new products (2004).   In addition to these strategies, the company also established multinational innovation centers where its product experimentation can be conducted. These innovation centers are actually made of international innovation teams in charge of gathering country-specific customer data. Aside from helping the company develop successful new products, this strategy is also helpful in preventing major company losses due to product launch failures. More importantly, these cross geographical innovation centers, market shifts that typically occur in international settings can easily be anticipated. This helped the company to transform its strategies based on these sudden market changes (2004).   Conclusion             International marketing has been an important aspect of business mainly because it enables operators to achieve both profit and market growth. While business owners are aware that in-depth cultural studies and assessment must be done so as to successfully operate abroad, some still resort to reductionist simplistic dualism. This concept basically suggests that the application of international marketing can be limited to two basic principles. Thus, some marketing strategists analyze consumers and categorize them based on the gender, race or region. As some authors had explained, the presence of dominant cultural values appears to affect the effective analysis of individual cultures as less dominant values are often disregarded.               The use of cultural dualism in international marketing however, is not a good business practice due to several reasons. For one thing, the application of such practice inhibits international business success. With no well-established background on different cultures, products and services offered to foreign consumers may not always be successful. This in turn, will only lead to major company losses. The goal of achieving major profit and market growth is also hindered by simplistic dualism. Most importantly, as this involve less effort to obtain individual consumer group satisfaction, loyalty is not developed either; this makes it difficult for aspiring foreign companies to overcome major competitors abroad. While applying dualism in marketing would have made cultural analysis easier, companies achieve more disadvantages than benefits with this approach. Hence, it is important that the theory of international marketing, which is centered on achieving local responsiveness and customer satisfaction, should be employed in analyzing various cultures. Through the strategies utilized by actual companies, other businesses may be able to achieve international success.   Credit:ivythesis.typepad.com

Most business industries had gone through significant transitions

Reductionist Simplistic Dualism and International Marketing Introduction With the introduction of global trade, modern comp...

Research Assignment Report

McDonald’s Foreign Market Expansion in Tunisia Introduction             McDonald’s is practically a global household name. With its multiple operations worldwide, the fast food company was able to achieve considerable profit and market growth. However, entering foreign markets is a risky and challenging business strategy. In order to carry out this strategy successfully, the company must analyze and learn the different aspects of the target country. Through this, the company will be able to implement the business approaches that would provide the best outcomes. In this paper, focus will be on the possible strategies that McDonald’s should apply if it plans to enter the Tunisian market. By considering the political, economic and cultural aspects of Tunisia, it has been cited that the company’s strategies should prioritize product differentiation, low costs, employment of local workforce and customer relations. The application of these activities can then contribute to the success of the company in entering the diverse Tunisian market.   The Industry For years, McDonald’s has served millions of customers worldwide. With numerous outlets in other countries, the fast food company has learned to adapt with diverse cultures and customer preferences. The years of experience in food service had indeed made McDonald’s highly flexible to varying business requirements, making it one of the most successful food companies in the world. Nonetheless, the company still aims to operate to even more countries around the world. Tunisia is one of the countries that McDonald’s has yet to enter. With the company’s wide strategic experience and background on foreign market entry, McDonald’s must then apply similar tactics to operate effectively in Tunisia.   Target Country             Located in the northern Mediterranean coast of Africa, the Tunisian Republic is the smallest country found along the Atlas Mountains and bordered by Algeria and Libya. On the southern section of Tunisia is Africa’s Sahara desert, which takes up forty percent of the country’s total land area; the remaining land is made up of fertile soil with very accessible coasts. The location of Tunisia is strategically positioned as it became exposed to several historical civilizations including the Arabs, Phoenicians, Romans, Carthaginians and Ottoman Turks. Since 1881, Tunisia is a French colony; the nation eventually became independent in 1956. Modern Tunisia was led by  for thirty years; the country then has been considered as an oasis of stability within North Africa. At Present, Tunisia is a known destination by tourists due to its beautiful beaches, warm climate, scenery and preserved historical sites ( 2006). As the country had been influenced by modern times and has been a popular site for tourism, putting a world-renowned food establishment like McDonald’s can then expect consumers from both the local and foreign sectors. In order to ensure the success of the company and the efficacy of its foreign market strategies for Tunisia, it is essential to take note of the country’s important political, economic and cultural features.   Political             Since the provision of Tunisia’s 1959 constitution, the country has been regarded as an independent, sovereign and free republic. The nation is led by a strong presidential system that is dominated by only one political party. The elected president of Tunisia serves the country within a term of five years; it is also the responsibility of the president to appoint the cabinet members and the Prime Minister who serve as the main actors on policy execution. The central administration is also in charge of designating the local administrators and the regional governors, while the municipal councils and the mayors are placed in position through election.   As a republican nation, Tunisia has an executive, legislative and judiciary bodies. The Chamber of Deputies is in charge of Tunisia’s legislative power and is made up of 182 members. It is in Tunis, the country’s capital and largest city, where the highest court of Tunisia is situated. The Court of Cassation is made up of three civil and one criminal sections; the elected president is the one that assigns the court’s judges. Finally, the local government of Tunisia is comprised of 23 governorates; each governorate is led by a governor who has been appointed by the president ( 2006). A strong republic, stable government and established regulations are good factors that could contribute to McDonald’s success in Tunisia. Political stability is an important aspect for foreign business efforts, particularly in obtaining administrative support and maintaining security.   Economic             Most of the economic activities of Tunisia are concentrated on manufacturing, petroleum production and tourism; moreover, the country’s import ratio is higher than its export rate. The economic development in Tunisia is also centered on its northern section. The government also serves an important function in the country’s economic activities, specifically by owning major industries, directing economic development, regulating activities and setting priorities. State-owned industries had been privatized by the government since the latter part of 1980s and new market reforms had been implemented. However, this has worsened the unemployment rate in the country. When Tunisia agreed to be part of the European Union in 1996, tariffs for foreign investors had been reduced. This encouraged European investment to enter the nation. Though Tunisia’s economy is relatively active, unemployment and underemployment are considered major issues (2006). The entry of McDonald’s in the country can then contribute to the alleviation of these problems in Tunisia. It will greatly help the country should McDonald’s hire locals to operate the business. In additional, this will also facilitate the acculturation of the Western company in Tunisia.               Aside from labor opportunities, Tunisia’s major economic contributor is its tourism industry. Moreover, the local administration had done significant efforts to expand and enhance the nation’s tourist facilities and sites. Based on 2004 reports, about 6 million tourists had visited Tunisia, resulting to a profit gain of about .9 million ( 2006). This important economic factor for McDonald’s Tunisian market entry as it can provide a diverse market opportunities for the company. While the company would need to concentrate on attracting local consumers, the high rates of foreign tourists who recognize the McDonald’s brand can serve as an important marketing factor. It is then essential that McDonald’s choose locations in Tunisia where tourist levels are high; examples of possible sites would be the country’s beaches and resorts.   Cultural             The country had been exposed to a number of historical civilizations, including the black Africans, Romans, Arabs and Vandals. However, the people of the nation are of Arab and Berber origins; most of them consider themselves as Arabs. The main language used in the country is then Arabic. Several Tunisians speak French and use it as their second language. Within the country’s isolated regions, especially in its southern part, some locals also speak Berber. Most of the country’s population is centered on its coastal plains. In addition, about two-thirds of Tunisia’s total population is found in the urban areas. Less people reside in the south due to its arid plateau ( 2006).             One of the important cultural factors that McDonald’s has to consider should it enter the Tunisian market, is it religion. About 98% of the Tunisian population is Muslim; majority of the Muslims in Tunisia are part of the Sunni branch. Other religions observed in the country include Protestantism, Greek Orthodox and Roman Catholic. Judaism is considered as Tunisia’s second largest religion, which has about 1,500 members. In the southern island of Djerba, Jewish beliefs are still observed by some for the past 2,000 years. The Christian population is relatively small; moreover, indigenous minorities have already conformed to the practices of the larger population (2006).               Considering that McDonald’s is a fast food company, it is essential that its food products are patterned after the religious beliefs of the larger population. It is then imperative that the company analyzes the Islamic belief and develop means on how to adapt its operations to this religion. In particular, it should be noted that the Muslims tend to abstain from certain food items not only for the purpose of observing religious teaching but also for health reasons. The Muslims are only allowed to eat foods that are nourishing and clean; thus, foods like pork, it by-products and other animals that have not gone through the slaughtering ritual are considered haraam or unclean. For this reason, it is necessary for McDonald’s to consider its food products. Though beef is an acceptable meat item in the Muslim tradition, other foods like fish, which has been part of the company’s international menu board, are not considered clean by other Islam followers. Moreover, the meat that will be used by the food company should go through certain rituals. The company could then consider using kosher food ingredients to ensure that the menu items are clean and acceptable to the locals.   Literature and Relevant Theories             Since the focus of the discussion is on foreign market entry, literatures and theories on international business and marketing are the most related. The need to balance global visions with the interest of the local market is essential in international marketing. In order to successfully operate abroad, business owners should indeed act like a Frenchman in France as well as an Italian in Italy. Local responsiveness is the common term used to describe this international marketing concept.  (1986) once referred to this as the transnational solution. As discussed further by this author, the international efficiency among business firms in the 1990s can be achieved by means of meeting the differentiated demands of the local market and responding to their respective governmental pressures and regulations.               Perhaps one good example of this practice is the growing interest of Western businesses in operating in China. In order to operate successfully in China, Western firms would have to adjust to the Chinese ways and environment. Foreign business operators must have to familiarize themselves with the business norms and practices in China rather than just apply Western influences. In general, foreign investors would have to align their economic goals with that of the Chinese economic leaders ( 2003). In this way, a common business goal is established and harmonious relations are maintained.               The theory of local responsiveness and global integration suggests that the differences of countries in various aspects should be taken seriously. Business operators should not underestimate the value of local knowledge in global business as this will help them fulfill their international objectives. Multinational firms should then tailor their approaches in accordance to their local markets’ needs. Doing this strategy is where the challenge begins.               According to (2003), entering a foreign market should involve the reconsideration of the businesses’ marketing strategies. They must first develop a mass-marketing mindset. With this, the businesses should pay particular attention to local aspects such as consumer needs and price competitiveness. All the international marketing efforts of the business should then focus on how to reach out to these local markets. One way of doing so is through product modification. As discussed earlier, majority of the population of Tunisia are Muslims; thus, food taboos should be avoided. Multinational companies can transfer their developed global brands into a new market by means of changing their products’ formulation, prices or packaging. This in turn will increase the products’ appeal to both consumers and retailers. Doing this globalization strategy however, naturally requires considerable investment. Still, this will make multinational companies at par with the local companies.               Aside from modifying the products, entering a foreign market can be made more successful by means of hiring the locals. In an article by  (2004), the success of Coca-Cola was emphasized by relating it to the company’s high level of local responsiveness. By its effective strategy of adapting with the needs of the local market as well as its innovativeness, Coca-Cola continues to prosper all over the world. One of the important international marketing strategies of the company is its “Think local. Act local” policy. With this, the company gives the locals the opportunity to handle its main operations. This practice is based on the belief that the local workforce knows what consumers need and seek. The local workforce understands the consumers’ various issues more than anyone else. This then resulted to the creation of relationship-based Coca-Cola products. Aside from the local workforce, the company also has multinational innovation centers. These are focused on the experimentation of various new products that suit local tastes.               In the case of McDonald’s entering Tunisia, the target country has a different cultural setting; hence, it is important that the company adopts the target country’s cultural background and preferences in order to penetrate the foreign market.   Appropriate Strategies             McDonald’s already has a long list of foreign markets; it must then consider adapting its business and marketing strategies in relation to foreign market entry. One of the related strategies that have been applied by the company in entering foreign markets is product differentiation. Teriyaki burgers in Japan, McPork Burgers and McTempeh in Indonesia, McSpaghetti in the Philippines and McLox Salmon sandwiches in Norway are some of the concrete examples of McDonald’s ability to modify its products based on international tastes and preferences. This is an important strategy for McDonald’s in Tunisia since the target consumers’ observe certain dietary laws.               McDonald’s actually encountered a similar challenge when its entered the Indian market. In this country, majority of the population are vegetarians and consider killing of cows as a sacrilege act. As McDonald’s typically serve beef burgers and non-spicy food items, the company would have to drastically change its menu for the Indian market. Mutton was used in place of beef; ordinary ketchup and mustard dressings were replaced with spicier sauces; vegetable salads and chicken kebabs were also served to cater to the Muslim population. These are some of the many changes that McDonald’s did in order to gain entry to the Indian market (2001).               One of the strategies that helped McDonald’s to enter India is the integrated cost leadership and differentiation strategy. As a global corporation, McDonald’s has long been capable of providing food products at low cost with differentiated characteristics. Through the company’s global coverage, franchise relations as well as standardized processes, McDonald’s is able to lower the prices of its food items. On the other hand, by means of the company’s strong brand name and product consistency, McDonald’s is able to apply the differentiation strategy, allowing the company to charge slightly higher prices. In other words, the integrated cost leadership and differentiation strategy that is applied by the company allows it to balance out its important business elements (2003). The company can then consider the adaptation of a similar strategy. Considering that the status of the Tunisians are affected by the high unemployment rates in the country, offering a differentiated product at lower prices can probably work for the new foreign market. By doing so, the company will not only have a higher chance of success but will also comply with the theory of local responsiveness.               In addition to modifying the nature and cost of the products, the company should also consider employing the locals for its operations. Through these, the company can help reduce unemployment rates in the country, especially once multiple branches are established in Tunisia. The McDonald’s should also ensure that feedbacks from the consumers are obtained; this will help in improving the service of the company in the future. One way of doing so is through customer relationship management (CRM). CRM is concentrated on the use of information technology so as to aid the organization to stay abreast of its customers’ needs and concerns. This also helps the organization to respond in time and appropriately to their customers’ concerns. This will be helpful for the company in entering Tunisia, especially since the country a rich and diverse cultural background.   Credit:ivythesis.typepad.com

Research Assignment Report

McDonald’s Foreign Market Expansion in Tunisia Introduction McDonald’s is practically a global household name. With its mul...

RESEARCH ASSIGNMENT REPORT: MCDONALD

McDonald’s Foreign Market Expansion in Tunisia Introduction             McDonald’s is practically a global household name. With its multiple operations worldwide, the fast food company was able to achieve considerable profit and market growth. However, entering foreign markets is a risky and challenging business strategy. In order to carry out this strategy successfully, the company must analyze and learn the different aspects of the target country. Through this, the company will be able to implement the business approaches that would provide the best outcomes. In this paper, focus will be on the possible strategies that McDonald’s should apply if it plans to enter the Tunisian market. By considering the political, economic and cultural aspects of Tunisia, it has been cited that the company’s strategies should prioritize product differentiation, low costs, employment of local workforce and customer relations. The application of these activities can then contribute to the success of the company in entering the diverse Tunisian market.   The Industry For years, McDonald’s has served millions of customers worldwide. With numerous outlets in other countries, the fast food company has learned to adapt with diverse cultures and customer preferences. The years of experience in food service had indeed made McDonald’s highly flexible to varying business requirements, making it one of the most successful food companies in the world. Nonetheless, the company still aims to operate to even more countries around the world. Tunisia is one of the countries that McDonald’s has yet to enter. With the company’s wide strategic experience and background on foreign market entry, McDonald’s must then apply similar tactics to operate effectively in Tunisia.   Target Country             Located in the northern Mediterranean coast of Africa, the Tunisian Republic is the smallest country found along the Atlas Mountains and bordered by Algeria and Libya. On the southern section of Tunisia is Africa’s Sahara desert, which takes up forty percent of the country’s total land area; the remaining land is made up of fertile soil with very accessible coasts. The location of Tunisia is strategically positioned as it became exposed to several historical civilizations including the Arabs, Phoenicians, Romans, Carthaginians and Ottoman Turks. Since 1881, Tunisia is a French colony; the nation eventually became independent in 1956. Modern Tunisia was led by Habib Bourguiba for thirty years; the country then has been considered as an oasis of stability within North Africa. At Present, Tunisia is a known destination by tourists due to its beautiful beaches, warm climate, scenery and preserved historical sites (2006). As the country had been influenced by modern times and has been a popular site for tourism, putting a world-renowned food establishment like McDonald’s can then expect consumers from both the local and foreign sectors. In order to ensure the success of the company and the efficacy of its foreign market strategies for Tunisia, it is essential to take note of the country’s important political, economic and cultural features.   Political             Since the provision of Tunisia’s 1959 constitution, the country has been regarded as an independent, sovereign and free republic. The nation is led by a strong presidential system that is dominated by only one political party. The elected president of Tunisia serves the country within a term of five years; it is also the responsibility of the president to appoint the cabinet members and the Prime Minister who serve as the main actors on policy execution. The central administration is also in charge of designating the local administrators and the regional governors, while the municipal councils and the mayors are placed in position through election.   As a republican nation, Tunisia has an executive, legislative and judiciary bodies. The Chamber of Deputies is in charge of Tunisia’s legislative power and is made up of 182 members. It is in Tunis, the country’s capital and largest city, where the highest court of Tunisia is situated. The Court of Cassation is made up of three civil and one criminal sections; the elected president is the one that assigns the court’s judges. Finally, the local government of Tunisia is comprised of 23 governorates; each governorate is led by a governor who has been appointed by the president (2006). A strong republic, stable government and established regulations are good factors that could contribute to McDonald’s success in Tunisia. Political stability is an important aspect for foreign business efforts, particularly in obtaining administrative support and maintaining security.   Economic             Most of the economic activities of Tunisia are concentrated on manufacturing, petroleum production and tourism; moreover, the country’s import ratio is higher than its export rate. The economic development in Tunisia is also centered on its northern section. The government also serves an important function in the country’s economic activities, specifically by owning major industries, directing economic development, regulating activities and setting priorities. State-owned industries had been privatized by the government since the latter part of 1980s and new market reforms had been implemented. However, this has worsened the unemployment rate in the country. When Tunisia agreed to be part of the European Union in 1996, tariffs for foreign investors had been reduced. This encouraged European investment to enter the nation. Though Tunisia’s economy is relatively active, unemployment and underemployment are considered major issues (2006). The entry of McDonald’s in the country can then contribute to the alleviation of these problems in Tunisia. It will greatly help the country should McDonald’s hire locals to operate the business. In additional, this will also facilitate the acculturation of the Western company in Tunisia.               Aside from labor opportunities, Tunisia’s major economic contributor is its tourism industry. Moreover, the local administration had done significant efforts to expand and enhance the nation’s tourist facilities and sites. Based on 2004 reports, about 6 million tourists had visited Tunisia, resulting to a profit gain of about .9 million (2006). This important economic factor for McDonald’s Tunisian market entry as it can provide a diverse market opportunities for the company. While the company would need to concentrate on attracting local consumers, the high rates of foreign tourists who recognize the McDonald’s brand can serve as an important marketing factor. It is then essential that McDonald’s choose locations in Tunisia where tourist levels are high; examples of possible sites would be the country’s beaches and resorts.   Cultural             The country had been exposed to a number of historical civilizations, including the black Africans, Romans, Arabs and Vandals. However, the people of the nation are of Arab and Berber origins; most of them consider themselves as Arabs. The main language used in the country is then Arabic. Several Tunisians speak French and use it as their second language. Within the country’s isolated regions, especially in its southern part, some locals also speak Berber. Most of the country’s population is centered on its coastal plains. In addition, about two-thirds of Tunisia’s total population is found in the urban areas. Less people reside in the south due to its arid plateau (2006).             One of the important cultural factors that McDonald’s has to consider should it enter the Tunisian market, is it religion. About 98% of the Tunisian population is Muslim; majority of the Muslims in Tunisia are part of the Sunni branch. Other religions observed in the country include Protestantism, Greek Orthodox and Roman Catholic. Judaism is considered as Tunisia’s second largest religion, which has about 1,500 members. In the southern island of Djerba, Jewish beliefs are still observed by some for the past 2,000 years. The Christian population is relatively small; moreover, indigenous minorities have already conformed to the practices of the larger population (2006).               Considering that McDonald’s is a fast food company, it is essential that its food products are patterned after the religious beliefs of the larger population. It is then imperative that the company analyzes the Islamic belief and develop means on how to adapt its operations to this religion. In particular, it should be noted that the Muslims tend to abstain from certain food items not only for the purpose of observing religious teaching but also for health reasons. The Muslims are only allowed to eat foods that are nourishing and clean; thus, foods like pork, it by-products and other animals that have not gone through the slaughtering ritual are considered haraam or unclean. For this reason, it is necessary for McDonald’s to consider its food products. Though beef is an acceptable meat item in the Muslim tradition, other foods like fish, which has been part of the company’s international menu board, are not considered clean by other Islam followers. Moreover, the meat that will be used by the food company should go through certain rituals. The company could then consider using kosher food ingredients to ensure that the menu items are clean and acceptable to the locals.   Literature and Relevant Theories             Since the focus of the discussion is on foreign market entry, literatures and theories on international business and marketing are the most related. The need to balance global visions with the interest of the local market is essential in international marketing. In order to successfully operate abroad, business owners should indeed act like a Frenchman in France as well as an Italian in Italy. Local responsiveness is the common term used to describe this international marketing concept. (1986) once referred to this as the transnational solution. As discussed further by this author, the international efficiency among business firms in the 1990s can be achieved by means of meeting the differentiated demands of the local market and responding to their respective governmental pressures and regulations.               Perhaps one good example of this practice is the growing interest of Western businesses in operating in China. In order to operate successfully in China, Western firms would have to adjust to the Chinese ways and environment. Foreign business operators must have to familiarize themselves with the business norms and practices in China rather than just apply Western influences. In general, foreign investors would have to align their economic goals with that of the Chinese economic leaders (2003). In this way, a common business goal is established and harmonious relations are maintained.               The theory of local responsiveness and global integration suggests that the differences of countries in various aspects should be taken seriously. Business operators should not underestimate the value of local knowledge in global business as this will help them fulfill their international objectives. Multinational firms should then tailor their approaches in accordance to their local markets’ needs. Doing this strategy is where the challenge begins.               According to (2003), entering a foreign market should involve the reconsideration of the businesses’ marketing strategies. They must first develop a mass-marketing mindset. With this, the businesses should pay particular attention to local aspects such as consumer needs and price competitiveness. All the international marketing efforts of the business should then focus on how to reach out to these local markets. One way of doing so is through product modification. As discussed earlier, majority of the population of Tunisia are Muslims; thus, food taboos should be avoided. Multinational companies can transfer their developed global brands into a new market by means of changing their products’ formulation, prices or packaging. This in turn will increase the products’ appeal to both consumers and retailers. Doing this globalization strategy however, naturally requires considerable investment. Still, this will make multinational companies at par with the local companies.               Aside from modifying the products, entering a foreign market can be made more successful by means of hiring the locals. In an article by (2004), the success of Coca-Cola was emphasized by relating it to the company’s high level of local responsiveness. By its effective strategy of adapting with the needs of the local market as well as its innovativeness, Coca-Cola continues to prosper all over the world. One of the important international marketing strategies of the company is its “Think local. Act local” policy. With this, the company gives the locals the opportunity to handle its main operations. This practice is based on the belief that the local workforce knows what consumers need and seek. The local workforce understands the consumers’ various issues more than anyone else. This then resulted to the creation of relationship-based Coca-Cola products. Aside from the local workforce, the company also has multinational innovation centers. These are focused on the experimentation of various new products that suit local tastes.               In the case of McDonald’s entering Tunisia, the target country has a different cultural setting; hence, it is important that the company adopts the target country’s cultural background and preferences in order to penetrate the foreign market.   Appropriate Strategies             McDonald’s already has a long list of foreign markets; it must then consider adapting its business and marketing strategies in relation to foreign market entry. One of the related strategies that have been applied by the company in entering foreign markets is product differentiation. Teriyaki burgers in Japan, McPork Burgers and McTempeh in Indonesia, McSpaghetti in the Philippines and Mclock Salmon sandwiches in Norway are some of the concrete examples of McDonald’s ability to modify its products based on international tastes and preferences. This is an important strategy for McDonald’s in Tunisia since the target consumers’ observe certain dietary laws.               McDonald’s actually encountered a similar challenge when its entered the Indian market. In this country, majority of the population are vegetarians and consider killing of cows as a sacrilege act. As McDonald’s typically serve beef burgers and non-spicy food items, the company would have to drastically change its menu for the Indian market. Mutton was used in place of beef; ordinary ketchup and mustard dressings were replaced with spicier sauces; vegetable salads and chicken kebabs were also served to cater to the Muslim population. These are some of the many changes that McDonald’s did in order to gain entry to the Indian market (2001).               One of the strategies that helped McDonald’s to enter India is the integrated cost leadership and differentiation strategy. As a global corporation, McDonald’s has long been capable of providing food products at low cost with differentiated characteristics. Through the company’s global coverage, franchise relations as well as standardized processes, McDonald’s is able to lower the prices of its food items. On the other hand, by means of the company’s strong brand name and product consistency, McDonald’s is able to apply the differentiation strategy, allowing the company to charge slightly higher prices. In other words, the integrated cost leadership and differentiation strategy that is applied by the company allows it to balance out its important business elements (2003). The company can then consider the adaptation of a similar strategy. Considering that the status of the Tunisians are affected by the high unemployment rates in the country, offering a differentiated product at lower prices can probably work for the new foreign market. By doing so, the company will not only have a higher chance of success but will also comply with the theory of local responsiveness.               In addition to modifying the nature and cost of the products, the company should also consider employing the locals for its operations. Through these, the company can help reduce unemployment rates in the country, especially once multiple branches are established in Tunisia. The McDonald’s should also ensure that feedbacks from the consumers are obtained; this will help in improving the service of the company in the future. One way of doing so is through customer relationship management (CRM). CRM is concentrated on the use of information technology so as to aid the organization to stay abreast of its customers’ needs and concerns. This also helps the organization to respond in time and appropriately to their customers’ concerns. This will be helpful for the company in entering Tunisia, especially since the country a rich and diverse cultural background.   References: . Credit:ivythesis.typepad.com

RESEARCH ASSIGNMENT REPORT: MCDONALD

McDonald’s Foreign Market Expansion in Tunisia Introduction McDonald’s is practically a global household name. With its mul...

Reductionist Simplistic Dualism and International Marketing

Introduction             With the introduction of global trade, modern companies and businesses have started to open their doors to markets found abroad. Through globalization, the goals and capabilities of most business industries had gone through significant transitions. In addition, other developments such as communication and transportation advancements have also contributed to globalization success. Though widening business reach through the globalization factor promises several advantages, business operators are aware that such strategic option involves a number of risks. Among the many significant concepts in globalization is international marketing; with this business principle, business organizations are able to distribute their products and services across borders. In this aspect however, the cultural factor must be taken into account. Considering that consumers abroad have different interests, preferences, beliefs, buying behaviors and cultural backgrounds, it is then imperative that business operators assess and study the cultures of their international market targets.               While this is already given, others still fail to see the real meaning behind this concept. Understanding individual cultures for successful international marketing is a known requirement; still other operators resort to applying a concept known as reductionist simplistic dualism. In this paper, focus will be centered on defining dualism, its relation to culture as well as how it is observed in actual business operations. This will then be compared to the international marketing theory. Finally, how business owners should appropriately apply the concepts stressed in the international marketing theory will also be discussed.   Reductionist Simplistic Dualism             Dualism is defined as the philosophical system that aims to explain all forms of phenomena through the development of two distinct concepts (The Columbia Encyclopedia 2004a). One of the famous examples of this principle is the mind-body or mind-matter dualism; the monistic and pluralism concepts are its counterparts (Blackburn 1996). Though dualism is often used to explain theological and philosophical factors, this also has some relation in business and marketing. Dualism is often observed in the field of international marketing and culture. Combining both factors, reductionist simplistic dualism is the tendency for business operators to limit their cultural understanding into two distinct concepts. Such practice however, is unacceptable considering the number of cultural variations.               In a more comprehensive definition, simplistic dualism in business and international marketing is synonymous to the development of cultural stereotypes. One good example is the development of too general characteristics to describe Western and Eastern cultures. In the article written by McCormack (2002), American and Asian cultural backgrounds had been compared using a few points of difference. Based on general descriptions, Americans were described as a group that is more verbal and direct whereas Asians have higher context cultures that use gestures more to communicate. In terms of behavior, Americans tend to strive to stand out from the rest, while Asians prefer to maintain a low profile. In addition, Americans were described as a group that values legalities, whereas Asians are more on reciprocal relationships.               Reductionist simplistic dualism in international marketing is also observed when defining white individuals from blacks as well as male from female. Various authors had explained this cultural tendency. Culture is developed through the interaction of attitudes, behaviors and values of the members of a particular group (Adler 1991). As people interact, apply similar practices and pass these values on future generations, a cultural theme that makes certain groups distinct is formed. This development is stressed further in the investigations of Hofstede (1994) where the researcher has concluded that groups of people belong to different cultural levels. The formation of cultural themes then led to the development of various common cultures that represent certain groups.               This however, partly led to certain drawbacks such as the development of cultural stereotypes. As emphasized in the research done by Kluckhohn and Strodtbeck (1961), previous analyses of culture had been significantly influenced by the groups’ dominant values; their variant values however had been disregarded. This clearly explains the application of dualism in international marketing where the study of the target markets’ cultural background is only limited to a few dominant values. Rather than recognize what makes China different from Taiwan or Singapore, businesses tend to analyse them as Chinese people in general. In the same way, Western culture is regarded as one when individual European nations has distinct cultural practices and values. Business then should not resort on reductionist simplistic dualism as it directly opposes the true concept of international marketing.               The experience of Kellogg’s in Indian marketing and product distribution is a good example of the effects of reductionist simplistic dualism. During the latter part of the 1990s, Kellogg, the American cereal giant, was attracted in extending its operations in India, primarily due to the country’s large population. Considering that its American business practices had succeeded in the United States and in other parts of Asia, the company then adapted the same practices for the Indian market. The production and distribution of the Western food product was also supported by advertisements patterned after western influences.   The strategy however failed to work. The Indian consumers do not find breakfast cereals as appetizing as their home-cooked meals or biscuits and tea sold at street stalls. Cereals were not recognized by the local market as a good breakfast food, resulting to Kellogg’s unimpressive sales and operations. Three years after the company has started to operate in India, total sales were not promising; the outcome was in fact far from what Kellogg’s was expecting. The advertisement did not cause any impact to the Indian market either (Arnold 2003). While other consumers find the breakfast food appealing, a more in depth consumer research done by the company revealed that most of them cannot afford the product. With these findings Kellogg’s was then able to form a more distinct characterization of the Indian market. This encouraged the manufacturer to reconsider its marketing strategies. New products sold at lesser prices were also developed; the use of street food stalls also became the company’s primary product retailer (Arnold 2003).   The initial failure of Kellog’s is brought about by its hasty and inappropriate presumption that a single strategy, which worked in most parts of Asia will also work for the Indian market. This example clearly suggests that reductionist simplistic dualism not only limits an operator’s market comprehension but could possibly contribute to international marketing failure as well.   International Marketing             The theory of international marketing provides a framework on how this business concept should be implemented and practiced. Marketing is defined as the process of developing long-term relationships with the consumers through effective planning and implementing proper pricing, distribution and promotional means (Carter 1988). The aim of marketing should not only to meet the goals of the business; operators should adapt marketing strategies and practices that satisfy the needs of the consumers. This definition of marketing suggests that this principle involves the establishment of a give-and-take relation between the business and the consumers. In order to do this, operators must then learn about their consumers as individuals and not just any general group. In the context of international marketing, the same principle is applied. This then suggest that though certain groups may be found within a general location, their cultural values make them distinct from others; hence, international business operators should exert effort in analyzing and learning them.               The theory of international marketing is also related to the local responsiveness theory. This theory explains that a balance between the global visions of the company and the interest of the local consumers must be established. Local responsiveness is often the term used to describe the international marketing concept. Bartlett (1986) once referred to this as the transnational solution. As discussed further by this author, the international efficiency among business firms in the 1990s can be achieved by means of meeting the different and specific demands of the local market and responding to their respective cultural frameworks.   With this, businesses should consider certain significant factors so as to apply the international marketing theory. In general, global companies should give due priority in learning the culture of the country where they intend to operate. Specifically, the language, education, religion, attitudes and values of a specific country should be learned by any international company. This local knowledge should serve as the basis of their major marketing approaches and strategies.   Theoretical Utilization             From the discussion, it becomes apparent that reductionist simplistic dualism is very much different from the principle of international marketing. While simplistic dualism in business and marketing limits the distinction of market concepts into two main principles, the theory of international marketing is patterned more on pluralism or multiculturalism. This term suits the international marketing concept as it stresses the principle that several cultures do co-exist within a single locality without any one culture dominating the region (The Columbia Encyclopedia 2004b).   This major difference emphasizes why business operators should utilize the theory of international marketing rather than dualism. The theory of local responsiveness and global integration suggests that the differences of cultures in various aspects should be taken seriously. Business operators should not underestimate the value of local knowledge in international business as this will help them fulfill their international objectives. Multinational firms should then tailor their approaches in accordance to their foreign markets’ multiple cultures. Doing this strategy is where the challenge begins. Nonetheless, there are several ways on how the international marketing theory in relation to cultural differences can be applied. Sherman and Levine (2004) noted that applying the theory of international marketing can be done through the modification of products and services offered by business operators. If a European company for instance, intends to enter the Japanese market, products produced and distributed in a Japanese province may not be as successful when offered in the city. In the same way, a single noodle recipe or dish may not be applicable to Asian consumers in general. In an American culture, fast service is essential; this cultural feature however, may not be the same in other parts of the Western region. These examples show that international companies should have sufficient background about their markets’ cultures and how these are distinct from others.   Adapting the international marketing theory can also be done by means of modified promotion techniques. As exemplified by the effects of Western advertising to the Indian market, certain socio-cultural factors must also be considered when developing advertisements. The use of top celebrities for endorsements for example may result to different levels of impact depending on the culture type of the audience. Communication channels should also be selected in accordance to the locals’ educational background as well as their access to these media. Means of promotion should also be adapted based on community interest. In using coupons for example, while this may be effective in the American setting, other cultures may not understand its purpose or probably take it as unacceptable (Sherman & Levine 2004).   Arnold (2003) also stated that the utilization of the international marketing concept also involves the reconsideration of the businesses’ marketing strategies. Specifically, it is essential that a mass-marketing mindset should be developed. Here, focus of the operators should be on the identification of specific consumer needs and determination of price competitiveness. Tedlow (1999) developed an effective strategy in order to apply international marketing concepts effectively. Traditionally, business paradigm is concentrated on keeping prices and margins high. In addition, the conventional business pattern was made to suit the period of segmentation, where products or services are made for a specific target. This is the direct opposite of mass marketing that Tedlow had introduced. In this new alternative strategy, the focus is on the production of simple yet good products that are appealing to the general masses.   The application of the international marketing concept, rather than resorting to simplistic dualism, has allowed a number of companies to flourish in their respective industries. McDonald’s is among these successful companies; the company has in fact been recognized for its high level of flexibility for its international operations. Product differentiation is one of the important strategies of the fast food corporation, which clearly shows how the international marketing concept should be applied. In order to adapt to the multiple cultures observed in Asia, McDonald’s opted to produce menu items that suit the consumers’ food and cultural preferences. Some examples of these products include McSpaghetti in the Philippines, McTempeh and McPork Burgers in Indonesia and Teriyaki burgers for the Japanese customers. The company also applies different menu items even if the international business location is within the Western region; in Norway for instance, McLox Salmon sandwiches are offered for the consumers so as to satisfy local tastes (Singh et al. 2001).   The operation of the food company in India is also a clear exemplification of international marketing practice as it does not only involve cultural food preferences but religious beliefs as well. In the Indian setting, majority of the population are vegetarians and consider killing of cows as sacrilege. As McDonald’s typically serve beef burgers and non-spicy food items, the company would have to drastically change its menu for the Indian market. Hence, McDonald’s replace its beef menu items into mutton; spicier sauces and dressing were offered in place of mustard and ketchup. As majority of the population are Muslims, chicken kebabs and vegetable salads are served instead. In addition to product differentiation, regulation of the products’ prices is also a top priority. Considering that most of the country’s population still belongs to the poverty line, McDonald’s must ensure that its products are sold at affordable prices (Singh et al. 2001).   Coca-Cola is yet another major company that has utilized the international marketing theory through local responsiveness and innovativeness.  In order to support the application of the international marketing theory, the company developed a Think Local, Act Local policy; this policy was developed so as to promote the importance of understanding individual cultures and consumers abroad. Similar to McDonald’s, Coca-Cola also tried to produce products that suit local tastes through constant experimentation. The company also applied the theoretical concept by employing local employees from its international sites. In this way, the company’s product developers have a strong background of the different cultural tastes of the population and apply them in the development of new products (Michaels 2004).   In addition to these strategies, the company also established multinational innovation centers where its product experimentation can be conducted. These innovation centers are actually made of international innovation teams in charge of gathering country-specific customer data. Aside from helping the company develop successful new products, this strategy is also helpful in preventing major company losses due to product launch failures. More importantly, these cross geographical innovation centers, market shifts that typically occur in international settings can easily be anticipated. This helped the company to transform its strategies based on these sudden market changes (Michaels 2004).   Conclusion             International marketing has been an important aspect of business mainly because it enables operators to achieve both profit and market growth. While business owners are aware that in-depth cultural studies and assessment must be done so as to successfully operate abroad, some still resort to reductionist simplistic dualism. This concept basically suggests that the application of international marketing can be limited to two basic principles. Thus, some marketing strategists analyze consumers and categorize them based on the gender, race or region. As some authors had explained, the presence of dominant cultural values appears to affect the effective analysis of individual cultures as less dominant values are often disregarded.               The use of cultural dualism in international marketing however, is not a good business practice due to several reasons. For one thing, the application of such practice inhibits international business success. With no well-established background on different cultures, products and services offered to foreign consumers may not always be successful. This in turn, will only lead to major company losses. The goal of achieving major profit and market growth is also hindered by simplistic dualism. Most importantly, as this involve less effort to obtain individual consumer group satisfaction, loyalty is not developed either; this makes it difficult for aspiring foreign companies to overcome major competitors abroad. While applying dualism in marketing would have made cultural analysis easier, companies achieve more disadvantages than benefits with this approach. Hence, it is important that the theory of international marketing, which is centered on achieving local responsiveness and customer satisfaction, should be employed in analyzing various cultures. Through the strategies utilized by actual companies, other businesses may be able to achieve international success.   Credit:ivythesis.typepad.com

Reductionist Simplistic Dualism and International Marketing

Introduction With the introduction of global trade, modern companies and businesses have started to open their doors to mark...

Reductionist Simplistic Dualism and International Marketing

Reductionist Simplistic Dualism and International Marketing

Introduction With the introduction of global trade, modern companies and businesses have started to open their doors to mark...