Culture,Attitudes, and Media Patterns in China,Taiwan, and the U.S.: Balancing Standardization and Localization Decisions

ABSTRACT

A study was undertaken to examine cultural orientations, attitudes toward advertising, and media use patterns across China, Taiwan, and the United States. China and Taiwan share similar cultural backgrounds, yet their economies and advertising industries have evolved quite differently due to different social and political settings. The United States was included to provide a point of comparison. Understanding media patterns, cultural orientations, and attitudes can help better ascertain the potential for using standardized strategies by international advertisers across different markets. Industry and consumer trends in evolving markets can also be monitored. Consumers in China and Taiwan were found to be more similar than different. For example, consumers in both markets were less individualistic and more collectivistic than their counterparts in the U.S. They also exhibited more favorable attitudes toward advertising than American consumers. Furthermore, Chinese and Taiwanese respondents spent significantly more time with print media than American respondents. Implications of the findings for balancing standardization and localization decisions are discussed.     

The U.S. Multinational Advertising Agency and Public Policy

The overseas activities of U.S. multinational advertising agencies raise several important public policy issues. Host governments are likely to watch U.S. advertising agencies for unwanted signs of domination over local firms. They will also be sensitive to undesirable cultural influence along with several other real or imagined evils.

The U.S. government is unlikely to have significant interest in the specific activities of multinational advertising agencies. But. advertising agencies should be very wary of the impact of indirect regulation. Agency operation is going to be caught up in the increasing web of legislation designed for general regulation of multinational businesses.     

William L. Rivers and William T. Slater,Aspen Handbook on the Media,Aspen Institute Program on Communications and Society,Palo Alto,California, 1975, 182 pp.

Abstract

A study of the use of humor in U.S. and U.K. television advertising was developed by surveying ad agency executives in the two countries and then by conducting a content analysis of television commercials. The survey of executives revealed a more accepting attitude toward the use of humor, and a broader view of the potential uses of humor among the British agencies. The content analysis showed a significant increase in the use of humor in the U.S. since the last major benchmark study, but less humor than in the U.K. sample of advertising. An examination of the content analysis data using the Foote, Cone and Belding (FCB) planning matrix revealed a situational use of humor in both countries, with humor most often used with low involvement/ feeling products and least often used with high involvement/feeling and thinking products. For the most part, the views of agency executives reflect the incidence and use of humor in their respective countries.     

A Cross Cultural Analysis of the Geographical Knowledge of U.S., Irish,Israeli, Mexican,and South Korean Business School Students

ABSTRACT

Geographical knowledge about foreign countries is considered to be a significant factor related to the successful marketing of goods and services in international markets-a not insignificant conclusion by experts given the sizable trade deficits run up by the United States in 2000 ($365 billion), 2001 ($346 billion), and 2002 ($435 billion).

Unfortunately, previous research has concluded that U.S. business school students-tomorrow's executives who will make decisions that will impact their firms' international operations-have inadequate levels of international geographical knowledge.

This article compares the geographical knowledge of U.S. business school students to that of business school students in four countries: Ireland, Israel, Mexico, and South Korea. The sub-par performance exhibited by the U.S. students and the impact of six independent variables on global geographical knowledge are used to develop a number of pedagogical conclusions designed to enhance the international geographical knowledge of U.S. business school students and students in foreign business schools and overcome the antipathy toward this subject matter that apparently exists within business schools and their various external constituencies.     

Examining the Longevity of New Agency Accounts: A Comparative Study of U.S. and U.K. Advertising Experiences

Abstract

Since the typical account longevity is short, agencies should anticipate their likelihood of loss, seek to forestall and invest in their client relationships. A model is proposed for examining account lifetimes, which can offer guidance on the likely retention of future accounts. The impact of agency structural characteristics on longevity is also examined, and compared for both U.S. and U.K. markets. Results for both markets indicate that cumulative account dissolution increases at a decreasing rate over time. Greater account longevity is associated with larger agency size (both in terms of agency billings and employees), and agency age but not with stability of billings growth. Evidence suggests that several structural characteristics of agencies reflect the motivation and / or ability to maintain accounts.     

The Effect of the World Wide Web on Agency—Advertiser Relationships: Towards A Strategic Framework

Buffeted by the fragmentation of media and markets, the World Wide Web has started transforming the competitive landscape in the advertising industry. Increasingly, advertising agencies are forced to compete with in-house CIS/MIS departments, public relations agencies and computer graphic studios and boutiques for Web-related accounts. Vis-à-vis the immediacy of the challenge, agencies are forced to either broaden their business horizon to include all aspects of communications or to stay focused on their core business-making advertisements for traditional media. This article examines the possible effects of the World Wide Web on the blurring of boundaries in advertiser- agency performed promotional activities, analyses the similarities in the strategies adopted in the transition from radio to television, and appraises the options which agencies face in adopting the Web.     

International Marketing (14th edition), by Philip R. Cateora,Mary C. Gilly,and John I. Graham

Abstract

The trend toward internationalizing business curriculum at American colleges and universities should be incorporated as a strategy throughout the United States. The catalyst that has led most business schools to adopt a systematic acceptance of the internationalization of their curriculum was the American Assembly of Collegiate Schools of Business (AACSB) 1984-1985 Standards and Guidelines for business school accreditation. Most would agree that without AACSB mandates, the transition would be slower, but inevitable, due to the focus on worldwide business issues. The global economy is rapidly evolving and the needs for competencies in international business are becoming very important to the U.S. and its economic well-being. Because of this, industry is looking for a new kind of employee, the kind that understands both the importance of international business and how to operate within it successfully. The halls of academia must respond to this pressing need by going much further than providing a sporadic array of “elective” international topics. Their response has to be synergistic with university presidents, deans and faculties fully supportive of an organizational design change that promotes a new way of thinking. The new organization is one in which there must be an international focus throughout the business school. With that synergy in place, the process of internationalizing students, the university, curriculum and faculty can move forward.     

Advertising industry evolution: agency creativity,fluid teams and diversity. An exploratory investigation

ABSTRACT

The advertising industry is in a state of flux, where the agency model is evolving alongside todays’ fast paced digital environment. This paper reviews the drivers of change in the industry and explores how creative advertising agencies are evolving and developing their team resources to improve the creative product using the resource based view (RBV) as a theoretical lens. The study adopted a qualitative approach using a key informant strategy with 16 interviews with Creative Directors, Chief Executive Officer’s and Heads of Planning and Account Directors. The findings suggest that agencies who embrace team functional diversity, include external stakeholders and develop team fluidity as a dynamic capability will enhance agency creativity.     

Advertising and Public Utilities 1900–1917

Abstract

During the period from 1900 to 1917, utility companies led in the expansion of the legitimate use of advertising in the political arena. Under the leadership of men such as Theodore Vail, President of AT&T, they openly invited the advertising business to help establish a public climate conducive to private, monopolistic utility service. Consequently, a growing number of advertising agencies found themselves engaged in political persuasion decades before the widespread use of advertising to elect candidates for public office. Early utility advertising thus prefigured the many types of advocacy and corporate image advertising widely used in the 1970s. It showed a willingness on the part of some agencies to develop non-product campaigns for clients involved in controversial public issues.     

Standardized Advertising Campaigns

This empirical study examined U.S. advertising agencies' practices in Europe to decide whether they were promoting products and services the same way everywhere. Information regarding environmental factors and advertising strategy were gathered from 160 European affiliates of U.S. advertising agencies in 16 countries. It was found that in general, agencies were neither standardizing nor customizing their sales platforms and creative contexts. Instead they tended to utilize the adaptive approach-a strategy that seems to viewed as the ontimal approach when dealing in multiple foreign markets. Legal restrictions abroad was one of the major motivators for usage of adaptative strategies. More specifically, restrictions on claims their ads could make and limitations on hiring foreigners were stated as the two top problems facing agencies' operations. Surprisingly, cultural factors presented much lesser problems to agencies.     

The Use of Humor in Asian and Western Television Advertising:

Researchers frequently cite the importance of testing the validity of Western business theory in other regions of the world such as Asia. In response, this study seeks to determine whether US.-based theory concerning the use of humor in television adver- tising has predictive validity in two rapidly emerging Asian markets (Korea and Thailand) and one European market (Germany). Of par- ticular interest are hypothesized relationships between product type and marketers' use of humor to communicate brand information. While some evidence of predictive validity is found, the overall pattern of results suggests that international business managers should exercise caution before assuming that U.S. advertising suate- gies apply in other national markets.     

Participation by U.S. Agencies in International Brand Advertising: An Empirical Study

Abstract

Marry ad agency executives have proclaimed the era of the global advertising agency. They observe that corporations are moving towards placement of their worldwide advertising through a single agency, and they predict that a few large “mega-agencies” will take over a majority of international advertising accounts. Yet, no published studies have examined how many brands are actually handled by the same ad agency worldwide. This paper presents the results of a survey examining the extent to which U.S. companies use the same agency to advertise abroad and in the home market. The study found that of the brands sold abroad, only about one-third are handled by the same agency both at home and abroad. This proportion does not vary significantly with advertising budgets, by product class, or between standardized and non-standardized brands. In addition, no single-agency group or “mega-agency” handles more than eight percent of the sample brands, and no agency handles a majority of its U.S. brands abroad.     

International Catalog Mix Adaptation

Abstract

Striking the right balance of adaptation of the international catalog mix may be the key to profitability. U.S. catalog firms, new to international markets, have less experience in adapting than firms in more globalized industries. The literature on international marketing strategy adaptation reveals that this decision depends on the environment, industry, market, product, and characteristics of the firm. This paper examines the influence of market similarity, type of business and the firm's international experience on international catalog adaptation, and explores the effects of catalog adaptation on a firm's performance. We hypothesize that the greater the market similarity, the less likely it is that firms will adjust their catalog. We also argue than adaptation is greater for consumer catalogs than for business-to-business catalogs. A third hypothesis is that more internationally experienced firms will adapt more and a final hypothesis is that a greater degree of adaptation will increase the international catalog performance. The results did not support the association of international catalog adjustment and market similarity, experience, and type of catalog. Findings are mixed both on catalog adaptations and firm performance. We found that some but not all adaptations in the catalog lead to improved performance. We speculate that U.S. catalog firms are making adaptations to reduce the costs of international marketing operations. This cost reduction strategy may not necessarily lead to profitability, thereby discouraging other firms from entering international markets.     

A Five-Year Regional Review of Advertising and Public Relations Education at U.S. Colleges and Universities

Abstract

This study is an investigation of advertising and public relations education over the past five years, presenting a regional analysis using data from the annual research project Where Shall I Go to Study Advertising and Public Relations? The results show the American Midwest, heartland and birthplace of advertising education, holding forth as the major region for advertising preparation. The Southeastern U.S. currently ranks first in public relations enrollment while the Midwest awards more PR degrees. In combined advertising/public relations programs, the Eastern U.S. leads in degrees awarded and student enrollment. Nationwide, all regions have experienced varying degrees of growth, reflecting the increased numbers seen in the national aggregate.     

Cone,Fairfax M. The Blue Streak. Chicago: Crain Communication, 1976

Abstract

This survey, conducted among 17 of the 25 largest advertising agencies, highlights the reduction of entry-level employment opportunities, for college graduates, when 1974 is compared to 1973. The survey also gives indication of the relative popularity various schools enjoy as preparers of future advertising executives. The author closes with an appeal to the advertising industry concerning the need to increase the number of entry-level opportunities.     

Some Economic Issues and Policy Implications of Studies on the Competitive Effects of Advertising Expenditures

Abstract

The purpose of this article is to examine some of the litersture in Economics that concerns itself with the economics of advertising and to present some of the public policy implications of the results of these studies.

It is found that it is unlikely that advertising expenditures are subject to increasing returns to scale, thus probably do not lead to an increased concentration of industry for this reason.

A study is presented that deals with competition by advertising expenditures and product differentiation in the U.S. cigarette industry. It is found that advertising expenditures. during the 1956–68 period, were not effective in obtaining sales from competitors, although they may have had the affect of inducing new customers to buy the product. The effect of anti-smoking commercials is examined, and it is found that. although they may have had some effect on cigarette smoking. it is doubtful that they provide the impetus for the decreases in advertising expenditures in this particular industry.     

Impacts of Generic and Brand Advertising in the U.S. Potato Market

Abstract

The impacts of generic and branded advertising in the U.S. fresh potato, retail frozen potato, and potato chip markets are examined under exogenous and endogenous raw potato supply. The Almost Ideal Demand System is used to estimate the demand components. The general equilibrium elasticities derived from the complete model are used in a simulation analysis to assess the cross-commodity effects of incremental increases in advertising expenditures on equilibrium prices, quantities, revenues, and profits in each sector. The endogeneity of grower supply mitigate the impacts of advertising in the raw commodity sector and in the retail sectors.     

The Determinants and Consequences of Multinational Advertising Agencies

This article examines the determinants of multinational advertising agencies (MNAs) within the framework of foreign direct investment theory (FDI). The essence of FDI theory is that in deciding to go international, a company must have an advantage. Key advantages discussed here include the huge size of MNAs, their access to capital, the loyalty given to them by multinational advertisers, their knowledge and skill, and their ability to use their foreign locations to service regional markets. Internalization, the advantage of being able to coordinate markets better, provides another relevant strand to FDI theory. The key factors for MNAs involve protecting the home market as well as reacting to competition abroad, escaping contracts which forbid competitive accounts and constrain growth, maintaining quality control over international advertising, and raising profits and efficiency by controlling all or a significant part of the business of a multinational advertiser. A discussion of the consequences of MNAs is also provided.