The Impact of Culture on Consumers’ Propensity to Innovate and Susceptibility to Interpersonal Influences
There is an increase in the number of businesses, which are becoming globalised, and this has provided a reason and need to have an understanding of the various cultural contexts with regards to consumer behavior. This paper will seek to investigate the impact that culture has on the propensity of consumers to innovate as well as their susceptibility to influences, which are interpersonal. This means that the research will focus upon informational and normative interpersonal influences. Previous research has been done in attempt to establish the factors that seek to influence the accepted rate of innovation. This means that culture is a key factor according to some researchers, but other researchers oppose this notion. Therefore, international marketers need to employ informational and normative interpersonal influences. This will assist them in attracting consumers who will accept innovations when marketing strategies are directed towards them. Some of the factors that the marketer should always consider include the long-term orientation, uncertainty avoidance, power distance and collectivism cultures.
Key Words: Culture, Consumer, Marketing, Interpersonal Influences, Innovate, Propensity, Normative Influences
Introduction
On an annual basis, a lot of money is spent in launching, developing and researching new services and products to consumers globally. Companies that constantly maintain a revenue growth that is higher than average are usually engaged in continuous and constant introduction of new services and products. Furthermore, these firms seek to expand and operate internationally as well. It has been found out that annually, the rate at which consumer products fail is at 90 percent. The nature of development and research is quite costly, as well as the expenses incurred when new products are launched into the market. This means that firms need to have a better understanding of all the innovators that they are involved with, as this is key when trying to understand about the concept of new product diffusion (Schuster & Harris 1999).
Innovators refer to consumers that have a high level of innovation in order to effectively adopt new services and products. Also, they are usually the first people to try out new offerings. Since innovators are responsible for determining the initial failure or success of various innovations, marketers have a goal to attract a large number of innovators during the introduction stage of services or products. When trying to obtain information about innovation, consumers tend to have differing propensities as they rely on interpersonal channels and media habits. This is in order to determine the speed which can be used to adopt innovation as interpersonal influences are extremely important. It is thus the reason why interpersonal influence is usually categorized as normative and informational interpersonal influence (Rorty, 1991).
There is an increasing trend that is directed towards business activities globalization and this provides a powerful reason that is useful in understanding the consumer behaviors’ cultural context. The trend has further more been heightened because of the importance associated with the impact of national cultural influences on the diffusion of innovations and consumers’ innovativeness. It is unfortunate that many authors have not researched about this issue to a large context. Some of the researchers who have provided their findings concerning the relationship between product diffusion and national culture rate tend not to be consistent. These researchers include; Sean Dwyer, Hani Mesak and Maxwell Hsu (2005), Detmar Straub (1994) and Jain and Takada (1991). They suggest that culture has an influence when it comes to diffusions of innovations. At the same time, Jedidi et al (1993) and Kumar et al (1998) all have a little support for the diffusion of innovations and culture correlation.
A comparison between the Eastern-Western culture influences on the propensity of a consumer to innovate as well as their interpersonal influences still does not have sufficient research on it. A lot of research has been focused on the cultural influence, which is western when referring to diffusions of innovations and innovativeness. This study will make a comparison between China and Sweden in attempting to find out the topic of interest.
Many Swedish companies depend on international business and this ensures that they have to find new markets that will increase their market share internationally. At the same time, China is a force to be reckoned with in the world’s economy. In turn, international companies in Sweden have planned and rushed to enter the Chinese market with their many new services and products. China is now known for being a global operations production site as well as being an extremely large market. According to a report on the Chinese business climate, the Swedish market has expanded rapidly into China (Tellefsen & Hirokazu 1998). There has been an increase in the number of people who have been employed in China based, Swedish firms. Also, an increase in revenues has been witnessed and this is mostly as a result of the sector involved in the production of industrial goods. The services sector has also experienced an increase, which has been of benefit to the two countries. Therefore, the cultural differences between China and Sweden have to be known. Based upon the presented information, it is vital to know about the impact that culture has on the propensity to innovate by consumers, as well as on interpersonal influences between China and Sweden. Marketers will benefit from the increased knowledge concerning this issue at hand.
Thesis: This paper will seek to establish the impact that culture has on interpersonal influences and innovativeness of the two cultural groups, which are diverse. Furthermore, this paper will ensure that marketers have an understanding about the impact of national culture on product diffusion. This will in turn guide marketers that want to launch new services and products cross-nationally between Eastern and Western countries.
Research Questions: This paper will attempt to answer the following questions in order to gain insight into the topic being discussed:
What impact does culture have on the consumers’ propensity to imitate or innovate between China and Sweden?
What impact does culture have on the consumers’ susceptibility to informational and normative interpersonal influence between China and Sweden?
Literature Review
Two Propensities and Adopter Categories- This refers to a known classification scheme which indicates the position of a consumer with regards to the other consumers based on time. Also, it is the same as finding out how a consumer adopts to new products. In the literature involving diffusion, there are five known adopter categories. They are laggards, late majority, early majority, early adopters and innovators, and innovativeness is what is used in this particular adopter categorization. This adopter categorization is often depicted as one of the normal distribution characteristics, which describe a known total population that will adopt a product. It is estimated through a percentage of the entire population, Laggards (16%), Late Majority (34%), Early Majority (34%), Early Adopters (13.5%) and innovators will be at 2.5%. Roger has described certain dominant characteristics that exist in all the named categories. They are traditional laggards, skeptical late majority, deliberate early majority, respectable early adopters and venturesome innovates.
(Roger, 2003)
According to Bass, adopters can often be categorized into two unique groups of imitators and innovators. The laggards, late majority, early majority and early adopters make up the imitators. On the other hand, the group that has the innovators has relations with part of the population, which tends to innovate. These people act mainly based upon purchasing independency and sources that have external influence in their social system. The imitators make their decision to adopt based upon the influence they receive from others. According to Gatigon et al these two groups are referred to as the ‘Propensity to imitate’ and ‘Propensity to innovate’. The provided classification is well in accordance with an earlier conceptualization. It claimed that a predisposition occurs when innovation is adopted and it is not a consumer personality trait, which is inherent.
Innovativeness and Innovators- Consumer innovators refer to small populations of consumers that are early purchasers of any innovation. According to Roger (2003), innovators are the initial 2.5 % of people in a social system that adapt to innovations. According to other researchers, innovation has been defined with regards to innovativeness. For example, innovators can be described as people who fall into an arbitrary proportion of the entire market. In this paper, innovators will be consumers that are characterized by the highest level of innovativeness. Innovators are extremely important because they are responsible for initiating cash flow processes and also, early adopters copy them. These innovators use products quite intensively and they represent a significant market with reference to product volume. It is thus why they are referred to as being opinion leaders. Roger goes ahead to describe innovativeness as being the degree at which individuals or other units of adoption are relatively early when adopting to innovation as compared to other members of any social system. Midgley and Dowling (1978) describe innovativeness as being innate in individuals, as well as being different and that it is a key component of the innovation diffusion theory.
Interpersonal Influence- Traditionally, the diffusion theory has been referred to as the theory of communications. It tends to focus on certain communication channels and this means that information concerning innovation is usually transmitted among or to members in a social system. The available means are interpersonal communications and mass media. The members of any given society have various propensities that rely on interpersonal channels or media habits. This is when they want to find out about information, which relates to innovation. Interpersonal influences are mostly used when trying to find out about the speed of the adoption of innovation. This influence is extremely significant when new products are being diffused as it the driving force that promotes the spread of many new things.
It is already known that interpersonal influence is categorized into normative and interpersonal influence. Informational influence exists as a result of individuals having the tendency to accept and believe that information is evidence that exists from others. At the same time, normative influences refer to the tendency among people to conform to other people’s expectations. On the other hand, when referring to informational influence susceptibility, it means that there is a tendency to always trust the information that is received from others as being the accurate truth. Therefore, information influence results from observing other people’s behaviors or research obtained from people who are thought to have knowledge on certain issues. The tendency of an individual to conform positively relates to normative interpersonal influence.
In the year 1989, Netemeyer Teel and Bearden (1986) tested and developed an informational and normative (two-factor), 12 items measure of the issue of consumer susceptibility with regards to interpersonal influence. They wanted to find out some of the personality traits that vary across certain individuals. In the year 2002, it was claimed that most of the high scores of susceptibility to interpersonal influence signify the tendency that people have to be influenced in making decisions by others. This means that if the score is low, it suggests that there is more independence when people are making decisions.
Scholars claim that there is a preference among innovators to rely and use interpersonal sources, rather than obtaining information from interpersonal sources. Sangeeta Singh (2005) came up with four dimensions that were derived from Hofstede in an attempt to distinguish the influences that national cultures have on consumer’s interpersonal choices and behavior. She found out in her study that the consumers from the various national cultures have varying levels of susceptibility to interpersonal communications and normative influence. She focused on consumers that come from a culture with a power distance that is large, are feminine as well as strong uncertainty avoidance. These people will most likely be influenced by the existing interpersonal communications. The effect of innovativeness and attention to information for social comparison on normative and informational was examined by Clark and Goldsmith (2003). Their respondents were from American public universities and they were a total of 326 students that were administered with self-report surveys. They found out that innovativeness has a negative relation to susceptibility to interpersonal influences.
Culture- This word originated from ‘cultura’ a Latin word that means spiritual cultivation or ennoble. This concept is of great interest and diversity and quite a number of researchers have come forward to try and define it based on the world’s cultural aspects. Hofstede (2001) is one such researcher who came up with the definition of culture. He referred to culture as being a collective programming that assists the mind to distinguish the members of a certain category with each other. In matters that concern culture, Hofstede is referred to as a famous researcher and this study will focus on his five dimensions. Another prominent researcher that came up with his definition of culture is Kluckhohn. He suggested that culture tends to consist of different uniform ways of reacting, feeling and thinking. Later on, this ways are transmitted and acquired through symbols that constitute human achievements (Lowrey, 1991).
Cultural differences between China and Sweden- Hofstede’s cultural dimensions will be used when clarifying the differences between Sweden and China. The comparison will be based upon the scores of the cultural dimension. China (20) has lower scores in individualism as compared to Sweden (71), and this means that the Chinese people have a culture that is collectivist. This means that that Sweden is not highly likely to have cooperative ventures. The power distance in Sweden (31) is not as high as that in China (80). Power distance is used to measure how unequally or equally power can be distributed in a society and how it is accepted unequally. Since China has an extremely high power distance, it means that it has a centralized system, while that of Sweden is decentralized.
Sweden (5) has a lower value than China (50) with regards to femininity or masculinity. This means that the society of China is quite masculine as compared to Sweden. This dimension refers to the social manifestation of behavior and individual personality elements related to human gender. With regards to uncertainty avoidance, Sweden (29) has a lower value when compared to China (60). This shows that Swedish people are more likely to take risks as compared to the Chinese. The high values means that the particular society puts a lot of effort in order to reduce risks than compared to the one, which has a low value. Chinese consumers with high levels of uncertainty avoidance do not have an adventurous spirit as well as having a sense or risk. This is contrary to Swedish consumers with low-uncertainty avoidance that will take risks because they believe that risks are natural. Lastly, China (118) has an extremely strong traditional orientation as compared to Sweden (33). This is based upon the dimension of short-term versus long-term orientation. The Chinese tend to focus on the long-term view of some outcomes as compared to the Swedish who focus on the short-term (Leon& Lazar, 2004).
Methodology
This study has used a deductive approach that involves using an already established theoretical framework. Furthermore, it has established certain predictions and hypotheses before coming up with practical solutions. A quantitative method has been used in this research because it has many advantages as compared to a qualitative method (Mugenda & Mugenda, 2003). It is easy to formulate questions that will be based upon the existing theory and when using a statistical analysis. Questionnaires have been used in order to test the presented theory. Furthermore, the quantitative method will be used to collect information concerning the customers from the two countries. The most appropriate sample design in this study is the snowball and convenience samples.
Secondary sources and primary sources have been to collect information. The primary data will assist in addressing certain specific research questions or objectives. The secondary data has already been obtained from other researchers who earlier on did a similar study. Secondary and primary sources have been employed in this research in the most effective manner. The secondary data has been obtained from internet sources, scientific articles and written literature (Sekaran, 2003). They have been used in order to provide an in-depth knowledge, and gain information on data and improved methods to be used in this research. The university data base has been quite useful in providing credible sources. Since it was not possible to go to Sweden and China, the respondents were students from this university, and were Chinese and Swedish nationals (Berg, 2001). This analysis was to ensure that more knowledge about the impact of culture on the propensity of consumers to innovate and their susceptibility to various forms of personal influences.
Discussion
It is evident that from this research there are no cultural differences with regards to consumers’ susceptibility to informational and normative interpersonal influence. There are no significant or note-worthy differences with regards to consumers’ propensity to engage in innovation. None of the five cultural dimensions by Hofstede have a correlation with innovativeness. This finding is different from the one Sangeeta Singh had in the year 2005. She had found out that masculinity, weak uncertainty avoidance and small power distance effectively demonstrates innovativeness. Similar findings as the ones that I have found are supported by Echambadi and Ganesh (1998) as they found out that culture cannot be easily identified as being a variable, which affects the process of diffusion.
Cultures have no impact on the imitation of propensity that is present among consumers. Furthermore, China and Sweden have significant differences with reference to normative influence. It means that there is a link between the four cultural dimensions except for the Femininity and Masculinity dimension with normative influence (Herbig, 1998). Consumers that come from cultures that have long-term, strong uncertainty avoidance, large power distance and collectivist orientation usually are highly likely to be susceptible to normative influences.
Informational influence is greatly affected by culture based on this research. Informational influence is used in measuring the extent at which consumers seek information and observe others. There are four dimensions of culture that have an association with the influence degree that people derive from others except for the Femininity and Masculinity dimension. Cultures that are more masculine tend to be easily influenced by the informational influence. Therefore, consumers who are from cultures that have long-term, strong uncertainty avoidance, large power distance and collectivist orientations are susceptible to the informational influence (Keith. & Housden, 1998).
It was possible to identify the fact that culture acts as a variable, which affects consumers’ propensity to imitate and consumer innovativeness. Additionally, consumers that are from various national cultures have varying sensitivity levels to informational and normative influence. Specifically, consumers from cultures that have long-term, strong uncertainty avoidance, large power distance and collectivist orientations are easily persuaded to adopt new products. This is as a result of informational and normative influence. Females and males have significant differences with regards to innovativeness as this element is quite high among females. Also, the occupation of an individual has an impact on interpersonal influences. This means that employees will be swayed by informational and normative influences.
Conclusion
Research that focuses consumers’ innovativeness and innovators is extremely beneficial to the marketing theory. Also, it is helpful in the practice of marketing because many firms rely on their new product’s success in order to promote profitability and future growth. The Eastern and Western cultures have different susceptibility to interpersonal influences among consumers. This has a strong implication for marketers especially those who want to have a career in the international market. The findings of this research prove that firms have high chances of coming up with effective strategies, which will be implemented to ensure that innovations are successful. Consumers should not be extremely sensitive to interpersonal influences. When coming up with a marketing strategy that is aimed at a specific culture, a lot of research needs to be done. For example, cultures that have long-term, strong uncertainty avoidance, large power distance and collectivist orientations, information on interpersonal influences need to be known. This will assist in attracting consumers that will be willing to accept new ideas and products.
In cultures that have a collectivist orientation, consumers tend to be integrated into groups, which are cohesive and are characterized by trust and loyalty. They have a spirit that advocates for teamwork and they are most likely to continue with their usual behaviors when making purchases. The required strategy when marketing to such cultures is to focus on interpersonal communication. This will ensure that new services and products are diffused into the various markets. In cultures, where the power distance is high, the relationships of consumers with regards to communication tend to be closer. Here, consumers will make the decision to purchase items based on the suggestion of other people. A communication strategy that is targeted towards this culture needs to ensure that role models are included so that they persuade people to accept products, which are new.
Lastly, in cultures where uncertainty avoidance is strong, consumers’ concern themselves with information regarding the risks associated with certain new products. This sort of orientation is often quite appropriate when trying to provide information and encourage the feelings that will influence cognitive control which will in turn reduce stress levels among consumers. When marketers want to introduce their new products in cultures with a long-term orientation they should be informed about influences. They should keep in mind that fact that consumers tend to be influenced by the informational and normative influences and thus they should be taken advantage of. Indeed, this research has provided me with more insights concerning how marketers need to be aware of the culture that they intend to penetrate new products into.
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