Executive Briefings

As Clothing Retailer Learned, One-Size-Fits-All Merchandising Plan Doesn't Work Globally

Appealing to the cultural and economic specifics of a foreign market is the key to getting consumers to shop more frequently and spend more.

In an era when having a global presence is vitally important, mounting evidence suggests that companies that expand into foreign countries need to adjust their operations and products to account for cultural differences. A nation's culture informs how consumers perceive products, when and where they shop, and how much they’re willing to spend. Deeply ingrained cultural viewpoints and customs also influence individuals' inclination to embrace innovative products, trust foreign brands, and rely on word of mouth.

The Dutch clothing retailer C&A provides a cautionary tale: After having a British presence for more than half a century, the firm had to shutter all its stores in the U.K. in 2000 as a result of having standardized its apparel in 1997. In effect, it refused to bend to particular cultural idiosyncrasies, and the taste of U.K. consumers clashed too markedly with the preferences of the rest of continental Europe for sales to flourish.

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In an era when having a global presence is vitally important, mounting evidence suggests that companies that expand into foreign countries need to adjust their operations and products to account for cultural differences. A nation's culture informs how consumers perceive products, when and where they shop, and how much they’re willing to spend. Deeply ingrained cultural viewpoints and customs also influence individuals' inclination to embrace innovative products, trust foreign brands, and rely on word of mouth.

The Dutch clothing retailer C&A provides a cautionary tale: After having a British presence for more than half a century, the firm had to shutter all its stores in the U.K. in 2000 as a result of having standardized its apparel in 1997. In effect, it refused to bend to particular cultural idiosyncrasies, and the taste of U.K. consumers clashed too markedly with the preferences of the rest of continental Europe for sales to flourish.

Read Full Article