2.2. Diffusion theory and adaptation process

For marketers a crucial value is a culture’s attitude toward change. Adopter categories are classifications of individuals within a market on the basis of their innovativeness. In this case is very useful to remember E.Rogers diffusion theory and his concept of an adaptation process (the mental stages through which an individual passes from the time of his or her first knowledge of an innovation to the time of product purchase). An individual passes through 5 stages:

Awareness ⇒ Interest ⇒ Evaluation ⇒ Trial ⇒ Adaptation (3)

But of course in different cultures this process lasts different time. Wal-Mart marketing managers were ready and used this theory perfectly. Asians are likely to be fewer innovators than in Western countries. That is why Wal-Mart used different entry technologies. As for Western countries (Canada, UK), they just bought stores or built new and started to work. But in Asia situation is different. Asian people are not ready to adapt quickly to new that’s why Wal-Mart made a contract with 2 Japanese retailers to sell American low-cost products in their shops. These stores worked not only in Japan, but in Singapore, Hong Kong, Malaysia, Thailand, Indonesia and Philippines. It took time for consumers to become accustomed to these products. However, after that Wal-Mart could enter the market itself. Even now company preferred to make a joint venture with domestic one. Due to this accuracy Wal-Mart started to make profit immediately, entering market when «early majority» was ready to buy their stuff. Named 5 stages continued longer, but did not cause any losses. Consumers saw Wal-Mart’s products in their local shops. First they were surprised to see something new, after that they become interested in them, asked what it is, than followed first purchase and final adaptation. Asian consumers were not shocked, when Wal-Mart opened its first shop. That is, partly, why Wal-Mart became so popular in Asia.

2.3. Self-reference criterion

To function in the global market you need to become sensitive to cultural biases that influence consumer behavior and decision making. Cultural adaptation is necessary in managing marketing in the host culture. During the process of adaptation it is really convenient to use J.A. Lee’s term – self-reference criterion (SRC). There are 4 steps to correct company’s marketing strategy (4):

• Define the business problem or goal in terms of your own culture traits, customs, or values;

• Define the business problem or goal in terms of host culture’s traits, customs, or values;

• Isolate the SRC influence in the problem and examine it scrupulously to see how it interferes with the business problem;

• Redefine the business problem, but this time without the SRC influence, and solve for the «optimal» business goal situation.

Let’s look through this theory with help of Wal-Mart growth in Latin America, especially Mexico. First of all, Wal-Mart understood that they should make their store not just a shop, but a place to visit. That is why born Sam’s Club. Mexican target group is very desperate, and a big part of it is young people (14-24 years old – 55% of population). So a plan was to make Wal-Mart a place where collectivistic and sociable Mexicans can meet, feel them like at home and referred to some group. Latin Americas buy a lot, because thy have big families and often invite friends to have dinner together. Culturally Latin’s fridge cannot be empty, because every moment can come guests or neighbors. They like to by big packs, go shopping together by car and make reserve for the whole week. Besides, they are likely to save money, because average income is not really high. But number of potential consumers was very attractive. So Wal-Mart decided to «play» with Latin’s sense of collectivity and make its shops a part of everyday leisure culture. In addition to Sam’s Club warehouses, Wal-Mart took new name Wal-Mex in Mexico for a number of stores and also opened Bodega food, Superama supermarkets, Suburbia apparel stores, VIPs and El Porton restaurants. After that company created its own bank. In the situation when 75% of citizens never had bank accounts because of high fees. It was the best idea ever! There is the best loyalty program.

Wal-Mart analyzed the culture of Latin America and made some conclusions: they like to be together; they are very collectivistic; they need a lot of products, but do not have big money; they used to go shopping once per week with the whole family and spend here a lot of time; society is rather young and Wal-Mart can become a part of their leisure time culture. It is seen that culturally ruled consumer behavior is very common to Wal-Mart’s home strategy, but this behavior is caused by different cultural preconditions (collectivism, group-reference, value of leisure, e.t.c.). All these findings were meticulously analyzed with the help of SRC and right adaptation was made. Well-elaborated international marketing strategy’s adaptation leads them to success.