Marketing Relativism: Glocalized Tea Vs Globalized Coffee

The hallmarks of a potentially successful copywriter include: obsessive curiosity about products, people and advertising. A sense of humor. A habit of hard work. The ability to write interesting prose for printed media, and natural dialogue for television. The ability to think visually. Commercials depend more on pictures than words.

- David Ogilvy, Ogilvy on Advertising -

 

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In a recent post about ethnocentrism vs cultural relativism we’ve examined some of the differences between the two approaches: here, we are going to briefly explore the differences between their outcomes in cross-cultural marketing/sales scenarios (note: the following material is included in the courses "An Introduction to Intercultural Communication" and "Psychographic Segmentation: The Importance of Cultural Values In Global Marketing And Sales").
 

 

 

Glocalised (*) tea for the Chinese customers: when tradition meets innovation
 

"I am in no way interested in immortality, but only in the taste of tea."

- Lu T’ung -
 

In 2003, Unilever China - that had entered the Chinese tea market in 1992 - was getting ready for a new challenge: selling green tea bags to customers that at the time were not prepared to accept such novelty. 

Mrs Wang Hui, a Unilever (owner of the Lipton brand) employee interviewed at the time by the South China Morning Post, claimed that "Traditionally, Chinese like green tea in the form of leaves and believe that the quality of bags is not good".

Two years later, former advertising agency J. Walter Thompson (currently"Wunderman Thompson") launched a subtle advertising campaign that was meant to emphasize China’s national identity and values: as shown in the following examples, not only the tea bag was not visible in the pictures, but the tea flowing from the cup formed images resembling key elements of the Chinese culture such as mountains and flowers.

 

 

 

(Images from: https://www.topys.cn/article/870)

 

Fast forward twelve years, and China Daily USA confirmed that Unilever kept expanding in China and "signed agreements with the governments of Guizhou and Anhui provinces to advance sustainable tea development projects".

Although this particular campaign was not the only reason why Unilever succeeded in the task of selling green tea bags to its Chinese consumers, the message - tailored to appeal to different customer segments -, was well received and it contributed to the overall success of the commercial initiative.

[Note: in terms of customer segmentation, as highlighted by Santander Trade, "The base of Chinese consumers is made up of relatively young people (between 20 and 35 years old): generally educated, they tend to save less, spend more on leisure than their parents, make increasing purchases online, prioritise more quality over low prices [the tea bag was perceived as more hygienic and safer for consumption than traditional tea leaves]. The areas of higher consumption are concentrated in major cities such as Beijing, Shanghai, Shenzhen and other Chinese urban areas with high per capita income and high purchasing power", while, according to GMA (a Shanghai based digital marketing and advertising agency), "Chinese consumers, and also the new generation, have a sense of national pride and it would be a mistake for any brand to think they are neglecting previous traditions and cultures."

The Unilever campaign did therefore target relatively young consumers, living in urban areas, who would appreciate the convenience of a modern teabag (the previously cited SCMP article stated that "Most Chinese like to brew green tea slowly with leaves and boiled water. But an increasing number use bags because they are quick, convenient and suit the fast urban life, like instant noodles and coffee and lunch boxes."), while still valuing tradition and China’s national identity].

Globalised coffee for the Israeli customers: bringing Frappuccino to the Holy Land (not).

 

"I have only two wishes," said Jean. "The first is for strong coffee, and the second is for stronger coffee." 

- Scott Lynch, The Republic of Thieves -

 

During a trip to Israel back in 1998, Starbucks CEO Howard Schultz had a bad cup of coffee at the King David Hotel and quickly assumed that the country needed to be educated to the taste of good quality coffee. "People will taste the difference in Starbucks’ coffee", he reportedly stated at the time. After a long and painful research for a local partner, in 2001 Starbucks did finally set the first of six stores in Tel Aviv: two years and -$6 million later, the stores were closed and the plan to conquer the Israeli market abandoned.

What went wrong in the attempt to bring frappuccino to the Holy Land?

Little did Schultz know about the habits and the taste of his new customers: while the coffee he had in King David might have been unremarkable, "One market study estimated that 500 new coffee branches had opened in Israel in the three years before Schultz’s visit. And one thing they really had in common was that they all had really good coffee, good espresso, good cappuccino, relatively strong, especially compared to what Americans are used to.", and "In Israel, Italian cafe offerings like espresso and macchiato coexist with strong, flavorful Turkish coffee made simply by brewing coffee grinds in hot water and letting them settle into 'mud' at the bottom of the cup. It’s rare to see standard American filter coffee — in my experience it tastes like weakly flavored hot water."

Coffee taste aside, what Schultz failed to noticed was that the Israeli customers prefer to have their coffee sitting, having something to eat, chatting with friends. Coffee-to-go made them feel rushed and unwelcome, and, after trying Starbucks once, they failed to turn into repeat customers:

"Rarer still is America’s culture of coffee to go. Rather than walk with their coffee in a paper cup, Israelis, especially Tel Aviv residents, are notorious for sitting down with their ceramic espresso cup and not budging for hours — taking the time to catch up, talk politics or grow their startup. So prevalent is Tel Aviv’s cafe culture that Yedioth Ahronoth, a leading daily, investigated why so many of the city’s residents seem to laze at cafes instead of working."

(*) Glocalisation, a concept that combines the words "globalisation" and "localisation", means that "in order to produce goods for a market of diverse consumers, it is necessary for any producer…to adapt his/her product in some way to particular features of the envisaged set of consumers in a foreign market" [1]) that took into consideration values and preferences of the local audience". (R. Robertson, 1994)
 

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SOURCES

 

Barnea, A. (2011). "Lack of peripheral vision – How Starbucks failed in Israel". African Journal of Marketing Management, vol.3, 78-88

Hopkins, Claude C. (1960). "Scientific Advertising ". New York: Bell

Kalnins, A., & Stroock, L. (2011). "Pouring Israel into a Starbucks cup" [Electronic version]. Cornell Hospitality Quarterly, 52(2), 135-143 - http://scholarship.sha.cornell.edu/articles/226/

Ogilvy, D. (2011). "Ogilvy on advertising". London: Prion

Online: https://tlv1.fm/business/2016/08/15/why-starbucks-failed-in-israel/

Online: https://www.scmp.com/article/424251/lipton-hopes-bag-china-tea-market

Online: http://usa.chinadaily.com.cn/epaper/2017-06/07/content_29654613.htm

Online: https://www.haaretz.com/israel-news/business/why-you-wont-find-starbucks-in-israel-1.5407403

Online: https://www.marketingtochina.com/chinese-consumers-behaviors-you-need-to-know-to-succeed-in-china/

Online: https://santandertrade.com/en/portal/analyse-markets/china/reaching-the-consumers

Robertson, Roland (1994)."Globalisation or glocalisation?" The Journal of International Communication, 1:1, 33-52, DOI: 10.1080/13216597.1994.9751780
 

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