Many countries view foreign investment as a necessity for their economic advancement. These nations encourage foreign investment through tax incentives or providing breaks on infrastructure investment costs. Channel members operating in such nations find it easier to coordinate their exchange relationships. In nations that have a historical basis for distrusting foreign corporations, attempts to restrict or curtail their involvement through regulations, punitive taxes or outright expropriation are often initiated. No matter how large or powerful the channel member is, it cannot always avoid the effects of punitive national politics. Sociocultural Factors The beliefs, values and lifestyles that prevail within a target nation should be evaluated before an international marketing channel is developed. All exchange activity occurs within the boundaries of a social system. That social system reflects the values and norms native to the, marketplace. Thus, all marketing channels are affected by the social system in which they do business. Channel members are wrong in treating an international market as an entity to be conquered. The fact is that virtually all countries’ populations are made up of several different homogenous consumer segments that jointly define the social system of that country. These consumer segments often differ from one another. International marketers must, therefore, deal with the norms and values associated with the different market segments within the countries they pursue. Because of the varying desires of these often different segments, these varying exchange relationships become rather complex. Culture is the shared meaning assigned to the individual’s shared beliefs, values and customs that result from those individual’s interactions with the social system. This shared meaning allows members of the social system to feel unified as part of a larger whole. Culture helps members of any society define the appropriateness of their behaviours. It also simplifies behaviours by telling people what they can and cannot do.
Many countries view foreign investment as a necessity for their economic advancement. These nations encourage foreign investment through tax incentives or providing breaks on infrastructure investment costs. Channel members operating in such nations find it easier to coordinate their exchange relationships. In nations that have a historical basis for distrusting foreign corporations, attempts to restrict or curtail their involvement through regulations, punitive taxes or outright expropriation are often initiated. No matter how large or powerful the channel member is, it cannot always avoid the effects of punitive national politics. Sociocultural Factors The beliefs, values and lifestyles that prevail within a target nation should be evaluated before an international marketing channel is developed. All exchange activity occurs within the boundaries of a social system. That social system reflects the values and norms native to the, marketplace. Thus, all marketing channels are affected by the social system in which they do business. Channel members are wrong in treating an international market as an entity to be conquered. The fact is that virtually all countries’ populations are made up of several different homogenous consumer segments that jointly define the social system of that country. These consumer segments often differ from one another. International marketers must, therefore, deal with the norms and values associated with the different market segments within the countries they pursue. Because of the varying desires of these often different segments, these varying exchange relationships become rather complex. Culture is the shared meaning assigned to the individual’s shared beliefs, values and customs that result from those individual’s interactions with the social system. This shared meaning allows members of the social system to feel unified as part of a larger whole. Culture helps members of any society define the appropriateness of their behaviours. It also simplifies behaviours by telling people what they can and cannot do.