The influence of adaptation and standardization of the marketing mix on performance: a meta-analysis.
| Autor | Brei, Vinicius Andrade |
| Cargo | Report |
Introduction
Considering the current globalized market, companies have seen the internationalization of their activities as a way to remain competitive. Decision-making concerning the international marketing mix has become critical, especially because of the influence this arrangement has on performance. Thus, many authors have pointed out the need for research that relates standardization and adaptation to performance (Calantone, Cavusgil, Schmidt, & Shin, 2004; Dow, 2006; Florin & Ogbuehi, 2004; Julian & O'Cass, 2004; Shoham, 2002). Despite such encouragement, no consensus on the relationship between the two former and the latter has yet been reached.
The literature as to which is the best decision is still inconclusive, considering the type of effect (positive or negative) of standardization and adaptation on performance. Some authors believe that a relationship between standardization and performance does not exist (Samiee & Roth, 1992). Others, in contrast, have found a positive link between the adaptation of the product and its performance (e.g. Calantone et al., 2004; Calantone, Kim, Schmidt, & Cavusgil, 2006; Cavusgil & Zou, 1994; Lee & Griffith, 2004). Hence, the agreement about the effects of these strategies on performance represents a gap in the literature (Zou & Cavusgil, 2002), which this research aims to fulfill.
Although companies' strategies may influence performance, the findings so far are not conclusive, especially those that deal with the relationships between the marketing mix and performance (Shoham, 2002). Besides, contradictory and confusing results have emerged from the literature, turning marketers' decision making into a difficult course of action. This discrepancy clamors for the development of more concise and accurate theories, methods, and strategic frameworks, since marketers need to understand under which circumstances each strategy turns out to be more suitable, and under which conjunctures such strategies lead to positive performance (Calantone et al., 2004).
Also, we identify the need for a statistical analysis of a large collection of analyzed data (that is, previous primary research) for the purpose of integrating the findings, and providing methodological rigor to the literature on this specific subject. These are the goals of meta-analyses, a statistical method generally centered on the relationship between one explanatory and one response variable. This relationship, the effect of X on Y, defines the analysis (DeCoster, 2004).
Therefore, the aims of this study are: (a) to carry on a meta-analysis of previous empirical research pertaining to the role of the strategies of standardization and adaptation of the marketing mix and performance in an international context; and (b) suggest to marketers courses of action based on the analysis of these strategies and their relationships with performance.
Other studies have previously tried to understand the relationships between the marketing mix elements and performance (e.g. Leonidou, Katsikeas, & Samiee, 2002; Shoham, 2002; Theodosiou & Leonidou, 2003), but they had different goals from ours. Leonidou, Katsikeas and Samiee (2002) proposed a study in which a meta-analysis was also conducted to evaluate the relationships between the marketing mix elements and performance, but their study did not consider adaptation and standardization of the mix elements, and was also based on a more complex framework, which included other variables and antecedents. Shoham (2002) analyzed the degree of standardization of the marketing mix in relation to a satisfaction-based performance measure; but he specifically considered the export marketing mix's degree of standardization and export planning impact on export performance. That is, as opposed to our study, he tested the degree of standardization/adaptation strategy, and not as a distinct strategy, as we treat it. Finally, Theodosiou and Leonidou (2003) have also studied the relationships between the marketing mix and performance. However, their article is an integrative view of the literature, not a meta-analysis. Besides, they evaluate the antecedents of the marketing mix and their impact on performance through a more complex combination of these elements. In short, our study is different from these previous ones because we carry on a meta-analysis that investigates the relationship between the role of the strategies of standardization and adaptation of the marketing mix and performance in an international context.
This paper unfolds as follows: we first briefly review the literature on standardization and adaptation of the marketing mix, and also on organizational performance. Based on this literature review we draw the paper's hypotheses, followed by the methodology, main descriptive and quantitative results. Next we discuss our findings, drawing conclusions for the theory and for the practice of marketing. Finally, we discuss the limitations of our work, and present some suggestions for future research.
Theoretical Background
The expansion of a company into foreign markets demands a precise decision making process, because there are many aspects that influence such an internationalization process (1). One of the most important decisions concerns the marketing mix. By developing an adequate marketing mix, organizations can satisfy the needs of their target market and reach their organizational objectives, improving performance. Therefore, products that enter a market for the first time have to be tailored to the characteristics of that country, since it is not likely that a single strategy will be able to satisfy all consumers, especially taking into account the existing heterogeneity of the markets (Vignali, 2001). So the company deliberates on which is the best strategy for the marketing mix--adaptation or standardization.
Adaptation versus standardization
The main goal of a global strategy is management of the great differences that emerge beyond domestic borders (Ghemawat, 2007a). Global marketing is not a synonym for standardization in marketing processes. Although each element of this process is susceptible to standardization, this can be only one of the strategies adopted by the company.
The strategies of international marketing follow three different perspectives. The first is the concentration-dispersion perspective, which analyzes the organizational structure of the company. The second is the integration-independence perspective, which has to do with the competitive process faced by companies. The third--the focus of this article--deals with the adaptation-standardization perspective, which is related to the degree of adjustment or standardization of the marketing mix elements (Lim, Acito, & Rusetski, 2006; Zou & Cavusgil, 2002).
From the moment a company decides to extend its activities into foreign markets, it should settle on either standardizing or adapting the marketing mix. This can be done when the organization applies a single strategy in all the countries, or customizes the elements to each market (Jain, 2007; Vrontis & Kitchen, 2005; Vrontis & Papasolomou, 2005). The company's decision to standardize or to adapt its strategies is fundamental, since it influences the organization's fundamental approach to business and how it will compete (Ang & Massingham, 2007).
The debate concerning the standardization or adaptation of the marketing mix in different markets has been object of many studies (see, for example, Levitt, 1983, 1986; Quelch & Hoff, 1986; Sorenson & Wiechmann, 1975; Vrontis & Kitchen, 2005; Vrontis & Papasolomou, 2005). Studies about standardization started in the 1960s, when Elinder (1965) first analyzed the standardization of promotion, been followed by studies about product. Nowadays standardization studies comprise all elements of the marketing mix--product, promotion, price and distribution (Ozsomer & Simonin, 2004; Vrontis & Kitchen, 2005), although promotion and product have received more attention (e.g. Baalbaki & Malhotra, 1993; Kotler, 1986; Laroche, Kirpalani, Pons, & Zhou, 2001; Levitt, 1983; Papavassiliou & Stathakopoulos, 1997; Samiee & Roth, 1992).
Broadly speaking, standardization has been analyzed under two perspectives--standardization of marketing processes and marketing programs. The former is concerned with the philosophy, principles, and technology used in planning and implementing marketing decisions. The latter--the purpose of this study--refers to the elements of the marketing mix.
Despite some studies that have analyzed the standardization concept (e.g. Jain, 1989; Ozsomer, Bodur, & Cavusgil, 1991), its consensual understanding has yet to be established (Ryans, Griffith, & White, 2003). Standardization is the use of the same marketing program in different countries or regions, regarding the product offered, the promotion employed, the price established and the distribution process chosen (Elinder, 1965; Jain, 1989, 2007; Levitt, 1983; Ozsomer & Simonin, 2004; Roostal, 1963; Sands, 1979; Szymanski, Bharadwaj, & Varadara, 1993; Viswanathan & Dickson 2007).
The main argument supporting the standardization strategy is the belief that the world is becoming more and more homogeneous, especially as a result of the advances in communication and technology (Jain, 1989; Levitt, 1983). As a consequence, tastes and cultures are becoming homogeneous; world consumers are sharing preferences, needs, desires and demands (Jain, 1989, 2007; Levitt, 1983; Vrontis & Papasolomou, 2005). This similarity of demands, along with convergent cultures and the lowering of barriers, would make it possible for companies to sell more standardized products, with standardized marketing programs (Zou & Cavusgil 2002).
Standardization, thus, allows focus on common segments, bringing economy of scale and more consistent promotions. Papavassiliou and Stathakopoulos (1997) and Levitt (1983, 1986) offer four main reasons for such benefits: (a)...
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