are potentially more interesting than the similarities, in that they can allow product and service differentiation as well as new approaches to segmentation and mar‑
keting communications. To take advantage of such opportunities, businesses have to have a clear insight into how and why consumers in one market may differ from ones in another.
Feelings of anti‑ Americanisation are a strong under‑
current in Europe. Businesses have to plan how to coun‑
ter such a groundswell of feeling if planning on entering new markets – given that some 50% of Europeans believe that ‘our society is too Americanised’ and such an attitude has increased over the past 10 years. While the degree of agreement varies within Europe (e.g. 67%
of Spaniards agreeing with the statement, as compared with 44% of Brits), it is a significant influence of cus‑
tomer behaviour. To compound matters, multinational companies are the least trusted of 27 entities when European consumers have been asked to state which they trust to be honest and fair.
As a result, not only have we seen an increase in con‑
sumer activism (such as anti‑ WTO protests, growth of the slow food movement in Europe etc.), but also we have seen global brands coming under threat from emergent local brands which are gaining in currency.
We would expect this to continue. This is not to say that there is no room for global brands! Many global brands have successfully tapped into local culture and tastes and recognised the need to either modify the product/
service completely or change different elements of the offer and how it is ultimately marketed. Thus companies expanding into new geographic markets have to ensure that their strategies are based on a real understanding of regional and local markets.
Globalisation is not making the world a smaller, homogeneous place. While this presents many oppor‑
tunities for businesses, it also implies a need for a clear understanding of what shapes consumer needs and
desires in the different nations. Not surprising perhaps that many businesses found the notion of a ‘globalised’
world compelling, given the significant implications for researching a multitude of different markets in terms of time and money budgets. Similarly, it is easy to under‑
stand the temptation of taking well‑ established national stereotypes and assuming that they are representative of the truth.
Recent attitudinal studies in Europe and the US undertaken by the Henley Centre show the complex‑
ity of attempting to categorise consumers on a broad scale. Let’s take an example. At one level, results show that all consumers take pride in their family, so a global advertising campaign using the ‘family’ as a theme may feel like safe territory. To some extent it is. Dig down a bit deeper, however, and you find that different people define ‘family’ in very different ways, so what people take pride in will be subtly different.
At a country level, many more differences expose themselves.
Businesses wanting to broaden their geographic reach have to consider at a strategic level what level of understanding of consumer needs they require.
Generalisations are important and are a good place to start, but it is critical to then delve further – national stereotypes are too simplistic. Differences, rather than similarities, have to be considered, and interrogated in terms of how these will impact customer needs.
Question
Based on this article and your experiences, debate the statement: ‘Site localisation is essential for each country for an e‑commerce offering to be success‑
ful in that country.’
Activity 4.5 Overcoming SME resistance to international e‑commerce
Purpose
To highlight barriers to exporting amongst SMEs and suggest measures by which they may be overcome by governments.
Activity
For each of the four barriers to internationalisation given in Table 4.5 , suggest the man‑
agement reasons why the barriers may exist and actions that governments can take to overcome these barriers. Evaluate how well the government in your country communi‑
cates the benefits of e‑commerce through education and training.
Answers to activities can be found at www.pearsoned.co.uk/chaffey
Barrier Management issues How can barrier be overcome?
1 Psychological
2 Operational
3 Organisational
4 Product/market
Source : Barriers from Hamill and Gregory (1997) and Poon and Jevons (1997).
Table 4.5 Issues in SME resistance to exporting
More recent research suggests that SMEs have been relatively slow to adopt the Internet.
Research by Arnott and Bridgewater (2002) tests the level of sophistication by which SMEs are using the Internet (see stage models in Chapter 5 ). They find that the majority of firms are using the Internet for information provision rather than interactive, relationship- building or transactional facilities. Smaller firms are using significantly fewer Internet tools than their larger counterparts. Quayle (2002) has assessed issues considered by SMEs to be strategically important. In the UK, 298 SMEs were surveyed. Issues of marketing, leadership and waste reduction were given highest priority, and supplier development, financial management, time to market and supply chain management were medium priority. Perhaps unsurprisingly, the lowest priority was given to technology, research and development, e-commerce, customer management and purchasing – all closely related to e-business. In further research, Meckel et al. (2004) analysed e-business adoption by several hundred SMEs in the northwest of England and found that fewer than 15% had formal, documented e-business strategies.
Political factors
The political environment is shaped by the interplay of government agencies, public opinion, consumer pressure groups such as CAUCE (Coalition Against Unsolicited Email – www.
cauce.org ) and industry- backed organisations such as TRUSTe ( www.truste.org ) that pro- mote best practice amongst companies.
Political factors
Political action enacted through government agencies to control the adoption of the Internet can include:
● promoting the benefits of adopting the Internet for consumers and business to improve a country’s economic prosperity;
● enacting legislation to protect privacy or control taxation, as described in previous sections;
● providing organisations with guidelines and assistance for compliance with legislation;
● setting up international bodies to coordinate the Internet (see Chapter 3).
Political involvement in many of these activities is intended to improve the economic com- petitiveness of countries or groups of countries. Quayle (2002) summarises six strands of the UK government strategy for e-commerce which are intended to increase industry competitiveness:
1 Establish a brand in e-commerce both domestically and internationally.
2 Transform existing businesses.
3 Foster e-commerce creation and growth.
4 Expand the e-commerce talent pool (skills).
5 Provide leadership in international e-commerce policy development.
6 Government online should be a priority.
These goals are typical for many countries and specific targets are set for the proportion of people and businesses that have access, including public access points for those who can- not currently afford the technology. Managers who are aware of these initiatives can tap into sources of funding for development or free training to support their online initiatives.
Alternatively, there may be incentives such as tax breaks.
The European Commission (EC) provides some other examples of the role of government organisations in promoting and regulating e-commerce:
● The EC Information Society initiative was launched in 1998 with the aims of increasing public awareness of the impact of the information society and stimulating people’s moti- vation and ability to participate (reducing social exclusion); increasing socio- economic benefits and enhancing the role of Europe in influencing the global information society.
Information society was defined by the UK INSINC working party on social inclusion in the information society in 1997 as:
A society characterised by a high level of information intensity in the everyday life of most citizens, in most organisations and workplaces; by the use of common or compatible tech- nology for a wide range of personal, social, educational and business activities; and by the ability to transmit and receive digital data rapidly between places irrespective of distance.
● UNESCO has also been active in advancing the information society in less developed countries (http:// portal.unesco.org/ci).
● The European Community has set up ‘i2010’ (European Information Society in 2010) whose aims include:
providing an integrated approach to information society and audio- visual policies in the EU, covering regulation, research, and deployment and promoting cultural diversity.
(eEurope, 2005)
● In 1998, new data protection guidelines were enacted to help protect consumers and increase the adoption of e-commerce by reducing security fears. Since 2000, cross- Europe laws have been enacted to control online consumer privacy, electronic selling and taxation.
Booz Allen Hamilton (2002) review approaches used by governments to encourage use of the Internet. They identify five broad themes in policy:
1 Increasing the penetration of ‘access devices’. Approaches include either home access through Sweden’s PC Tax Reform, or in public places, as in France’s programme to
Information society A society with widespread access and transfer of digital information within business and the community.
develop 7,000 access points by a specific year/target date. France also offers a tax incentive scheme, where firms can make tax- free gifts of PCs to staff for personal use.
2 Increasing skills and confidence of target groups. These may target potentially excluded groups, as with France’s €150 million campaign to train the unemployed. Japan’s IT train- ing programmes use existing mentors.
3 Establishing ‘driving licences’ or ‘passport’ qualifications. France, Italy and the UK have schemes which grant simple IT qualifications, particularly aimed at low- skilled groups.
4 Building trust, or allaying fears. The US 1998 Child Online Protection Act used schemes to provide ‘kitemark’-type verification, or certification of safe services.
5 Direct marketing campaigns. According to the report, only the UK, with its UK Online campaign, is marketing directly to citizens on a large scale.