Two trillion dollars-That’s about 200 trillion yen. Either ay you count, it’s a lot of money, American brokerage houses such as Fidelity investments, Goldman Sachs and Merrill Lynch rushed new investment products and services to market in Japan to try to capture the huge capital outflow expected from 10 year time deposits then held in the Japanese postal system. Liberalization of Japan’s capital markets in recent years now gives Japanese more freedom of choice in their investments. Post office time deposits still yield about a 2 percent return in Japan and bank savings yields have been around zero. By American e-trading standards, that means an electronic flood of money moving out of the post offices and into the stock markets.
However, Japan is not America. There is no American-style risk taking culture among Japanese investors. The volume of stock trading in Japan is about one sixth that of the United States. In Japan only 9 percent financial assets are directly invested in stocks and a mere 2 percent in mutual funds. In contrast, about 50 percent of US households own stock. Most of the population [in Japan] doesn’t know what a mutual fund is. So will the flood be just a trickle? And what about online stock trading? Internet use in Japan has burgeoned, there are now some 75 million users in Japan. That’s about the same percentage as in the United States. But the expected deluge into equities has been a dribble. Merrill Lynch and others are cutting back staff now as fast as they built it just a couple of year ago.
A French firm is trying to break through a similar aversion to both e-trading and equities in France. That is, only about 10 million adults use the Internet in France and half that number own stocks. The French have long shied away from stock market investments seeing them as schemes to enrich insiders while fleecing invoices. Given the Enron and Worldcom scandals here, you can almost hear the chortling in the sidewalk cafes there.
e-bay, the personal online auction site so successful in the United States is running into comparable difficulties in both Japan and France. The relatively low rate of Internet use in France is just part of the problems. For Japanese it has been embarrassing to sell cast offs to anyone, much less buy the from strangers. Garage sales are unheard of. In France, company founder Pierre Omidyar’s home country e-Bay runs into French laws restricting operations to a few government certified auctioneers.
Based on a knowledge of differences in cultural values between the United States and both Japan and France we should expect a slower diffusion of these high tech Inter net services in the latter two countries. E-trading and e-auctions have both exploded on the American scene compared with those in many uncertainties of equity investments or the impersonal interactions of online transactions.
Culture deals with a group’s design for living. It is pertinent to the study of marketing, especially international marketing. If you consider the scope of the marketing concept the satisfaction of consumer needs and want at a profit – the successful marketer clearly must be a student of culture. For example when a promotional message is written, symbols recognizable and meaningful to the market (the culture) must be used. When designing a product the style used and other related marketing activities must be made culturally acceptable to the present society if they are to be operative and meaningful. In fact culture is pervasive in all marketing activities – in pricing, promotion, channels of distribution, product, packaging and styling and the marketer’s efforts actually become a part of the fabric of culture, The marketer’s efforts are judged in a cultural context for acceptance, resistance, or rejection. How such efforts interact with a culture determines the degree of success or failure of the marketing effort.