Cross-Cultural Marketing: American Firm in Japan

Introduction

Company A that produces engine components for heavy-duty trucks can try to enter the Japanese market because this country has a great industrial capacity. Moreover, various companies may be interested in purchasing spare parts that improve the work of truck engines. By establishing its reputation in this country, Company A can significantly increase its revenues. However, the marketing strategies of this organization should take into account the values, perceptions, and behavior of Japanese customers to succeed. To a great extent, they are determined the culture of this country. This American company should be aware of possible differences to gain the trust and loyalty of the local clients.

Cross-cultural issues and their impact on the marketing approach

Several cross-cultural issues may affect Company A’s marketing strategies. One of them is the attitude toward quality and price. The thing is that for many Japanese buyers, the perceived value of a product is the main determinant of its success or failure (Herbig, 1998, p. 206). Advertisements should demonstrate what kind of benefits a product can create for clients. Such an aspect as the price should not be emphasized.

More importantly, the reduction of the price can be associated with poor quality of the product (Herbig, 1998, p. 206). Such an interpretation can ruin the reputation of any business, especially if it is a company that manufactures components for truck engines. Thus, the marketing strategy of Company A should focus on the features of the product such as reliability or safety, rather than the price. Furthermore, they can mention that their products can save much money for their clients, but they should say that their engine components are cheaper than those manufactured by their competitors.

Certainly, one cannot say that Japanese customers completely neglect such a factor as price. They can compare prices when choosing among similar products. Yet, they can become suspicious when a company places too much emphasis on the price to differentiate their products or services among others. In this way, a company may easily lose a competitive advantage to other firms. Hence, this is one of the dangers that the management of Company A should be aware of.

Another issue that can influence the marketing approach is the attitude toward buyers and sellers. In Japanese culture, selling is not perceived as a highly respected activity (Herbig, 1998, p. 161). To some degree, this opinion can be explained by the ideology of Confucius who believed that merchants represented the lowest classes of society (Herbig, 1998, p. 161). Surely, one can disagree with this argument but it still affects the relationship between buyers and sellers. Salespeople are supposed the serve customers without trying to dictate their terms. So, in Japan, buyers occupy a higher position in the social hierarchy.

From a practical point of view, it means that Company A will have to pay much more attention to the needs of the clients. For example, they will have to offer customers better after-sale services and ensure that the engine components that they produce perform well. For example, they may even call buyers and ask if their products function properly, and if there are any concerns that customers may raise. Surely, some American companies also act in such a way when they operate in the United States, but such behavior is a common standard in Japan because it is essential for the sustainability of sellers and manufacturers.

Additionally, this organization should know that its marketing strategy should be based on an individualized approach. Their Japanese clients can be either corporate or individual, but in each case, they will want to learn more about their suppliers and establish more close relations with them. For instance, the management of Company A should know that Japanese clients attach more importance to face-to-face communication.

Admittedly, in Japan business partners can use phones or email, but the most important decisions are usually discussed in person. Overall, they should bear in mind that selling can take much more time in Japan, especially in comparison with the United States or Europe. Perhaps, the most dangerous error is to ask Japanese customers to sign a contract during the first round of negotiations. The most likely outcome is that buyers will refuse to have any relations with a foreign company. Therefore, Company A should avoid this pitfall, if they want to gain the trust of Japanese clients. It is quite possible to argue that patience will be essential during negotiations with customers.

On the whole, one should remember that Japanese customers value personalized services, and this is the reason why many foreign firms cannot win their loyalty only by offering them lower prices (Lamb, 2011, p. 125). The clients of Company A can be either individuals or organizations that own heavy-duty tracks. In each case, this organization must make sure that clients always have the opportunity to talk with the representatives of the company.

This is why this organization will have to open its offices in different parts of Japan so that they could contact customers as quickly as possible. Thus, this company will have to consider such an aspect of marketing as a distribution of products. They should also adopt a direct selling model. This means that there should not be any mediators between them and their clients. This issue is particularly important for businesses like Company A. They manufacture engine components, and they will have to explain the advantages of their products. This task can be better done when a customer can communicate with the representatives of the company, rather than external distributors who may not know much about the product and its strengths.

Cross-cultural communication and its effect on marketing strategies

The second issue that the management of Company A should consider is communication in Japanese culture. As it has been said before, sellers have a lower status than buyers in Japanese culture. Thus, companies should use more formal language when communicating with customers. This issue is particularly important when we are speaking about promotion and advertising. For instance, it is not polite to urge customers to buy products.

One can mention that in their advertisements many American or European companies claim their products are of superior quality and that they will certainly appeal to the buyers. On the whole, Company A should not use such a method of persuasion because it will produce the opposite results. It is quite probable that customers will completely disregard their products.

Secondly, the management of this organization should remember that Japanese customers expect sellers to communicate with them in person. For instance, if a certain business is not able to deliver the products on time, the representatives of this company should pay a personal visit to the client and explain everything. It is not sufficient to give a phone call or send an email (Herbig, 1998, p. 163). Such behavior can be interpreted as a lack of politeness.

These examples show that Japanese customers may determine the value of a product in a slightly different way. They pay attention not only to its quality, price, or functionality; they are also concerned with the services that a seller can offer. Provided that they are absent, even the most generous offer can be declined. Thus, the company should not separate products from services; instead, they should be regarded as a single entity. Only in this way, they can achieve success in this market. Thus, the quality of pre-sales and after-sales services can be of crucial importance for Company A.

Ethics differences and marketing

Another aspect that one should not overlook is the ethical differences in marketing. Certainly, one cannot speak about the difference in moral standards. In this case, the values of individuals play a more important role. One should keep in mind that Japanese culture is characterized by a higher degree of uncertainty and risk avoidance. This means that people are less likely to make decisions that can potentially harm the group, for instance, a company (Hein, 2011, p. 16).

In contrast, American culture is a more tolerant risk. This is why American and Japanese business partners may fail to reach an agreement. Even, if this risk is extremely low, American companies should not expect that their Japanese partners will easily take important decisions. Such behavior is viewed as unethical in Japan. This idea has several important implications for Company A. First, the management of this business should know they may have to hold any negotiations with the same customer. In the beginning, Japanese clients can be skeptical about the products of Company A, and they should be ready for such an attitude.

Secondly, one can assume that the components manufactured by Company A will be purchased mostly by other organizations that own heavy-duty trucks. It is quite possible that the decision to buy or not to buy the components for the engine can be discussed with many managers of the company. The thing is that in Japanese organizations the power distance between employees is longer than in the United States (Hein, 2011, p. 17). Sometimes, taking initiatives or independent decisions can be regarded as disrespect for authority, and this form of behavior is not ethically acceptable in Japan (Hein, 2011, p. 17). In other words, employees can be unwilling to take decisions without the permission of top management.

Thus, American businesses such as Company A should be patient when conducting negotiations. Overall, it will be necessary to convince the customers the use of these engine components will not do any harm. Only then, they should speak about the advantages of their products. Risk aversion of Japanese clients can be the main challenge that they will have to overcome.

Furthermore, Japanese culture emphasizes loyalty to the group (Hein, 2011, p. 17). Its interests have to be the main priority for an individual. This premise may be the most important element of Japanese culture. In turn, American and European cultures attach more importance to individualism. This ethical norm affects the business culture of this country. In Japan, the actions that are driven only by personal interests and needs can be condemned from an ethical point of view. This is why Company A should stress the idea that its products can create benefits for the groups, for instance, the company, its employees, and other stakeholders such as the community. This approach can make their products more appealing to clients.

Additionally, Japanese culture attaches more importance to long-term development. The pursuit of quick results and short-term profits can be condemned from an ethical point of view. This issue can be also relevant to Company A. While advertising their products, they should stress the idea their products and service can contribute to the long-term development of their Japanese partners. For example, they can say that their components for engines can save time, effort, and money for their customers in the long term. More importantly, they should not overemphasize the price of their products, because the low price can be associated with poor quality.

Conclusion

Overall, this discussion shows that every organization that attempts to enter a foreign market should consider the cultural environment in which it will operate. Failure to do can ruin the most sophisticated marketing strategy. The hypothetical company that has been discussed should pay attention to such issues as personalized services and emphasis on the quality of the products, rather than its price.

Secondly, the company should focus on pre-sales and after-sales services since many Japanese clients value those companies that show concern about the well-being of their clients. Finally, they should be ready that selling can become more time-consuming because of the ethical norms and value system adopted in Japan. Thus, cultural differences can have significant implications for the marketing strategies of this hypothetical company.

Reference List

Hein, N. (2011). Japanese Cultural Concepts and Business Practices as a Basis for Management and Commerce Recommendations. Munich: GRIN Verlag.

Herbig, P. (1998). Handbook of Cross-Cultural Marketing. New York: International Business Press.

Lamb, C. (2011). Marketing. London: Cengage Learning.