2009 Global Business Forum - Session Papers
Cultures, Brands and Globalization
PAPER (PDF) |
TV and digital media are penetrating Latin American homes, changing and expanding consumers’ desires and expectations, said Paiz, chairman of the board of directors for Wal-Mart Centroamérica, who participated in the discussion on “Brands, Culture and Globalization” at the University of Miami Global Business Forum Jan. 15 – 16, 2009. The panelists examined the effects of brand and culture through the prism of Latin America in particular.
Consumer demand for a greater variety of products is opening the door in Latin America and elsewhere to multinational companies like Wal-Mart. But creating a brand for the global marketplace poses significant challenges, the hardest being crafting a message that sets the brand apart yet works across geographies and time zones, said Hayes Roth, chief marketing officer of the San Francisco-based branding consultancy Landor Associates.
“The challenge is to understand constituents and make sure you have a message that is both differentiating and relevant on a macro scale, and tailorable on a local scale,” Roth said. “That isn’t easy to do.”
That means being in touch with the attitudes and needs of people around the world — something Landor does by moving its employees to different offices around the world to immerse them in other cultures. It also means being well versed in the culture of the company being branded, to make sure the message rings true.Still, establishing a brand globally has many benefits. For example, Roth cited Land Rover: Despite its recent acquisition by an Indian company, he believes consumers will expect to receive the same quality of vehicle because of the automaker’s brand reputation.
Other factors play into international branding decisions as well. When Wal-Mart acquired Paiz’s 80-year-old Guatemalan supermarket chain, he said he took a hard look at his own brand — and decided to keep it. Although owned by Wal-Mart and subject to the multinational company’s standards and policies, the stores continue to operate under their original names, like Hiper Paiz. His competitors, though, try to depict Paiz’s stores as “American” while they are true “Guatemalan” stores.
“As retailers we are being attacked by our competitors who say they are the ‘nationals,’ the real Guatemalans, and we are not,” Paiz said. The company had to “address these issues of how we are perceived by the community,” he added.
But being a part of the Wal-Mart empire has distinct advantages, he said, not the least of which is access to goods at a cheaper price, which can be passed on to consumers. Paiz said it has also allowed the Guatemalan stores to save on energy costs and its carbon footprint.
“We have today 40 percent more stores than two years ago, and we consume the same amount of energy as we did two years ago. That’s because of the technology Wal-Mart has brought in,” he said.
While the entry of international brands has brought some benefits, said George Yudice, the influx of commercial goods from a globalized culture (like all those slingshots emblazoned Xena) often leaves little room for local products, commercial or cultural.
For example, Yudice, professor of modern languages and literatures at the University of Miami’s College of Arts and Sciences, has conducted research in Costa Rica on music played on major radio stations. He found that royalties from 95 percent of the music played go to the U.S., Mexico or Spain. Only 5 percent stayed in Costa Rica. In no Central American country did the royalties for national singers exceed 7 percent.
“Musicians complained about a virtual blackout on the airwaves,” Yudice said.
“It’s not that people are crazy about Britney Spears and Mexican pop stars,” he explained. Central American singers can’t compete with the studio marketing machines of bigger countries like Mexico and the U.S.
“Saturation of the airwaves makes it impossible for Central Americans to circulate their own narratives, images and sounds to their own country, and beyond their borders,” which has an important effect on shaping identity, Yudice said.
To illustrate his point, he asked the audience if anyone could name a Guatemalan singer. No one raised a hand.
Ethicist Ken Goodman, co-director of the UM Ethics Programs and director of the University’s Bioethics Program, explored questions of moral relativism surrounding brands and culture. “One of the greatest challenges in philosophy is this: How do you tell what is right or wrong, and whether or not that might shift by culture or region?” he asked. “That’s a great and ancient question.”
Goodman suggested that Paiz had gotten it right by adopting what are widely regarded as international moral standards regarding the treatment of workers. “There are good reasons to believe that what is right or wrong does not vary by region,” he said. “If you are exploiting people on the basis of gender or indigenous status, for example, it will not do to say that you have always done so, or that it is what defines your culture. It is wrong — and wrong everywhere.”
Goodman also invoked a stance that has come to be widely accepted in the world of business ethics – the position that sound business and solid ethics can be compatible. “Doing well does not preclude doing good,” he said. “From Wal-Mart to the commercialization of popular culture, we’ve seen that there’s plenty of room to make a buck, or peso, without exploitation, deception or vulgar rip-offs.”
By Marika Lynch
