International Marketing - A Cultural Metaphor for Greece (Part 2)

Agon

When it comes to Agon, we refer to the manner the comedy-like activities are performed in the daily life of the Greeks. Agon refers to the formal convention according to which the struggle between the characters should be scripted in order to supply the basis of the action. Agon is a formal debate which takes place between the chief characters in a Greek play, protagonist and antagonist, usually with the chorus acting as judge.

We can easily spot the motives suggested by Agon in all aspects of Greek society. Politics, political actions and debates, social arenas, collectivistic activities, TV programs, etcetera are often organized like Agon.

A modern Greek debate that reminds us of Agon

Greece is a country of spectacle, music and discussion and public critic. Greeks revel when communicating in an expressive manner, while the level of noise tends to be high in public spaces. People tend to congregate rather than be isolated from one another. Bystanders do not mind becoming part of the action like the audience of the ancient theater either. Thus, the externalities of Agon on everyday Greek life and activities are more than obvious.

Chorus

The Chorus, though it no longer told the story, was very important, for it set the atmosphere of the play. The Chorus also served another purpose. Even today, in extreme occasions, when the intensity of a situation (perceived as a lifestyle, political, cultural change etc threat) becomes almost too great for any Greek to bear, relief is often found in some very comic episode which is introduced to slacken the tension. The Chorus executed this by a song of purest poetry.

Chorus, Lysistrata

In addition, the mission of the Chorus was to preconceive the audience that the comedy is acceptable and pleasant, in other terms that it was “safe”. Greeks are not at all comfortable in ambiguous situations: the unforeseen is always there ready to “lay an ambush”. In Greece, as in all high uncertainty avoidance societies, bureaucracy, laws and rules are very important to make the world a safer place to live in, even though they do not always work.

Greeks need to have good and relaxing moments in their everyday life, chatting with colleagues, enjoying a long meal or dancing with guests and friends. Due to their high score in this dimension Greeks are very passionate and demonstrative people: emotions are easily shown in their body language, small group behavior, greeting behavior, even in their traditions. The Chorus respected these exteriority characteristics and reproduced them during its actions, as a micrography of the Greek society.

Last but not least, in Thesmophoriazusae there are two Choruses. The doubling of the Chorus is a phenomenon that is repeated both in The Frogs and in Lysistrata, where the two choruses (Old Men and Old Women), appear on stage together after entering separately. The interconnection of the two choruses with the direction of the collective unconscious (as suggested by both Plato and Carl Jung) for both ancient and modern Greeks is more than obvious. The Greek people still pay attention to the elders, since they subconsciously form an archetype for wisdom and respect. Masculinity and femininity social Greek models are also exposed here; If we try to visualize the double Chorus process, it shows that Greek women have the dynamics to be equal to men in terms of social activities, even though, since ancient times, they often tended to stay in the house and define their social status by satisfying their family needs. A controversy that still exists in modern society.

Does the Greek woman still heterodefine her social role?

Conclusion

In short, a cultural metaphor represents a way to obtain new and deep insights into a group's or nation's culture. Cultural metaphors also provide a method for discussing cross-cultural issues, differences, and similarities in a collegial rather than a stereotypical and perhaps hostile fashion. In developing such insights, it is critical that the cross-cultural research be taken into consideration, and it is for this reason that both the dimensional perspective and the communication perspective should supplement cultural metaphors.  Cultural metaphors represent only a starting point for understanding a culture; they are easy to use, but do require much thought to avoid inaccurate stereotyping; and they can be supplemented by other methods.  Most importantly, cultural metaphors allow managers with limited time to gain some understanding of a group or nation's culture that they can apply quickly to the myriad problems that they face daily in international activities.

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International Marketing - A Cultural Metaphor for Greece

Within the field of international marketing, cross-cultural consumer behavior, organization and management studies, Prof. Martin J. Gannon uses cultural metaphors to describe, compare, and analyze national cultures worldwide. In order to explore in-depth the unique cultural characteristics of a nation, Gannon adopts an emic approach, focusing on the qualitative examination of cultural symbols, practices, and institutions within their local context.

For the existing cross-cultural research into a country or a nation, the most influential one is the three-dimensional approach developed by Kluckholn, Strodtbeck, Hall and Hofstede. Their dimensions of culture, such as power distance, uncertainty avoidance, individualism-collectivism, masculinity, time orientation constitute a base upon which a majority of more recent studies have been built. Their works have been invaluable in the area of cross-cultural studies. However, their works are somewhat incomplete. Gannon noticed that the dimensional approach had weaknesses like :

•  We should not look at a dimension separately, since culture is a complex whole, and psychological phenomena are multiply determined.
• Can be atheoretical (i.e., always need theory regarding why dimensions exist).
• Research in cross-cultural psychology tends to examine one dimension
• Are extremely broad, and miss important elements.
• Can obfuscate within culture diversity and dynamics of culture.

Gannon was based on all four aforementioned dimensional approaches but also on the following elements, which he suggests that should be carefully examined so that a the protocol for a cultural metaphor is applied. Usually, three to seven of these features of the metaphor, that include elements like below, are needed:

The Greek Comedy

Is the Greek Comedy a good cultural metaphor for Greece? Can it meet Gannon's criteria? Let's discover!

Humor & Komodia

The word komodia means literally in Greek "party (-komos-) song (-odi-)" and, if this is any indication of its origin, then comedy stems from revels (komoi) where partiers (komastai) sang songs (odai) in which they teased, mocked and made fools of spectators or public figures. Aristophanes used to target and mock Kleon, a famous Athenian demagogue, through its plays. Satira, the modern word of comedy, still dominant nowadays, is externalized in small-group discussions, organized team activities, modern Greek theatres and mass media communication channels, by teasing politicians, celebrities and in general influencing the public, social and political behavior in Greece.

Apart from teasing politicians and celebrities, in most Aristophanes comedies, Gods and goddesses were personified abstractions who seldom appeared in his plays. That means, comedies usually boosted the eternal need of the Greek people till today; Greeks like to feel free. They do not like to be dictated by superior forces and dislike the effects of any power mechanisms on their everyday life.

Prologue & Parodos

Introduction sets the mood and gives some idea as to what the audience can expect to occur. In Prologue - Parodos, the topic of discussion is set between the two debaters and it is implied to the audience that the debate will be refereed. This part of the comedy is representative of the ideas and the innovations that democracy and freedom of speech has established, as a public and politics activity. This concept is in fact the foundation of western civilization.

Furthermore, the Parodos process has a direct association with modern Greek entertainment. Parodos provided entertainment, accomplished with music, dance and extravagant spectacle, which is still what modern Greeks seek for, as regards their leisure pursuits and interests. In addition, the high noise levels produced during Parodos can be characterized as a prelude of the aural space of modern Greeks, who usually tolerate high noises as part of their routine.

Leisure interests and aural space in Greece.

Last but not least, Parodos reflects how Greek relationships, both professional and private, are early structured. Greeks tend to convey their feelings and thoughts, at least partially at the beginning of a relationship, usually the other party has some understanding of what will unfold, but it is only an imperfect preview, like Parodos suggested, because the unexpected frequently occurs.

                                                         ...To be continued...

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Neuromarketing for Companies: Can it help?

Neuromarketing is a relatively new field of marketing research which focuses on consumers' cognitive and affective response to marketing stimuli. Neuromarketing is actually a child of the eternal corporate need to sustain a decision by all possible means when the pressure is way over the possibility of a decident to fight failure. Google, Coca-Cola, BMW, Procter & Gamble, Motorola, CBS are a few of the companies who have experimented neuromarketing for the past years. We have previously referred to neuroscience and neuromarketing research here and here, yet academics are still sceptical when it comes to predicting the future of this new marketing method. As a matter of fact, when i asked Prof. Alan Wilson, University of Strathclyde, about neuromarketing research a couple of weeks ago, his cautious response brought me down to earth: "Well, can neuroscience and neuromarketing provide, in the long term, any unique additional value to marketeers, compared to other marketing methods?" Well, i think it's too early to know the answer, but, at least let's try to discover some opportunities that neuromarketing may provide for marketeers, if any.

Trust

Trust is an issue which has been increasing in prominence within marketing. However, while consumer trust in brands and products is off course vital, marketing research has investigated trust on many other levels. Inter-organisational dealings such as joint ventures, strategic alliances and B2B buyer-seller dyads depend on mutual trust between parties. On one hand, consumer trust in marketing claims is crucial if they are to be believed, and ultimately lead to purchase behavior from consumers. The social utility of trust is clear when one considers that firms selling ‘fair trade’, ‘organic’, or other socially beneficial products must rely on consumer trust in their claims for success. Furthermore, in an organisational context, relationships depend on mutual trust between the parties. Without trust, opportunistic behavior dominates interactions, negating the possibility of long-term relationships between parties and again leading to a suboptimal situation for all. Marketing research has commonly conceptualized trust as more than a simple rational economic calculation, and it seems likely that neuroscientific methods can provide considerable insight into the nature and development of trust.

Neuroeconomic research has begun to investigate concepts of trust beyond rationality in recent times. Neuromarketing research can also be insightful to the investigation of trust. First and foremost, it is clear that, despite the centrality of trust to marketing relationships at a number of levels, controversies over the very nature of trust still exist. Neuroimaging is likely to offer considerable insight here. Research suggests that the caudate nucleus, which is often active when learning about stimuli–response relations, is involved in experimental games requiring some kind of trust. Yet is trust a simple response to a repeated positive stimulus, or something more? More interestingly, is the trust a buyer says they have in a seller, or a consumer in a product claim, similar in terms of the nature and location of brain activity to the trust that individual says they have in a close friend or family member? 

In particular, measuring both the spatial and temporal characteristics of neuronal activity may be important. For example does trust in an advertising claim or new business partner require increased information processing effort and time than trust in a long-term friend? This will have important implications as to the nature of trust. Furthermore, is consumer trust in claims relating to a product similar to a purchasing agent's trust in a contract with a supplier, and in turn is this of the same nature as the purchasing agent's trust in the individual sales executive they have negotiated with? Can trust be transferred from an organisation to a representative of that organisation? Finally, does trust evolve throughout the course of an inter-organisational relationship, or with continuing loyalty of a consumer to a single brand? Is trust ever truly existent in short-term marketing relationships? Exploring and understanding such questions about the nature of trust will then lead to greater ability to explore the antecedent factors to trust, and an ability to enhance firms' ability to build trust with customers and collaborators for mutually beneficial outcomes.

Pricing

Pricing is a key tool used by organisations in the positioning of their products. Marketing research has investigated the effects of price on consumers. Despite the amount of academic knowledge available, companies appear to use little of it when setting prices, leading to suboptimal situations for both consumers and firms. Understanding the psychology of pricing is of crucial importance if firms are to make optimal decisions and in fact has considerable utility in a broader sense. Pricing research has implications for how we understand information processing in any decision context where resources and information are scarce and costs must be weighed against benefits. Recent behavioral research for example has explored errors made by consumers when they process prices ending in 0.99 rather than a whole number -suggesting that individuals pay less attention to later numbers in a sequence. At this stage however, almost all pricing research is behavioral in nature, and relies on ‘assumptions’ about what actually occurs when individuals process pricing information.


In fact, pricing seems to lend itself almost perfectly to neuroimaging research. For example, simultaneously exploring the temporal and spatial nature of brain activity may help us understand exactly why prices such as ‘$4.99’ are perceived as significantly cheaper than those such as ‘$5.00’. Do individuals really ignore the final two digits, or are they processed in a different manner or at a later time - for example only when detailed comparative decisions must be made? Furthermore, do time or other pressures influence the processing of prices? 

Furthermore, neuroimaging looks likely to provide considerable insight into the nature of price information. Is the price of products a purely rational piece of information, or does it have emotional and/or reward-based connotations? It seems likely that the price of a basic product such as sugar is very different in nature from the price of a conspicuous product such as a Nike sports shoe, or a BMW sports car, which should be evidenced in changes in the location of brain activity when these prices are viewed alongside their associations (Source:UCLA). Research such as this will allow us not only to understand how prices are processed, but will afford insight into all situations where seemingly rational information is processed in decision-making situations.

Source: Forbes

Here is a recent pricing example of neuromarketing research: Kai-Markus Müller of Stuttgart-based The Neuromarketing Labs, using EEG brain wave measurement, gauged the emotional reaction of consumers to different prices for a small cup of coffee, which costs €1.80 ($2.45) at a Stuttgart Starbucks.The firm claims their results show that our brains reject prices that are too low or too high as being unrealistic, and says that the optimal price point for that small coffee in Stuttgart would be €2.40 ($3.25). Starbucks shareholders might like the idea that at least some of the firm’s products could be priced higher, but some caution is in order. For commodity items like coffee, lower prices tend to increase sales while higher prices discourage them. It would be quite unexpected for a higher price to increase unit sales for this type of product (Source:Forbes).

Conclusion

Trust and pricing were just two examples where neuromarketing/neuroimaging tools can assist marketeers and organizations further understand consumers. Neuromarketing research itself is constantly evolving, both in terms of technology as well as insights into exactly what activity and processes in various areas of the brain actually mean. As technology evolves, we will be able to measure frequency, temporal, and spatial characteristics of brain activity more accurately and in a complimentary fashion, potentially leading to new insight into what were previously well-accepted brain functions and areas of activity. I hope that neuromarketing will offer marketeers much insight into how humans behave during what is a large part of our modern lives.

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Monozukuri for Sustainable Brands in the 21st Century

The word Monozukuri has only been in use for almost 15 years. In 1998, the Japanese Prime Minister’s Office set up a "Monozukuri Kondankai", in order to reverse the trend of deindustrialization and hollowing out that Japan was experiencing after the end of the Japanese financial bubble by affirming Japan’s strengths in manufacturing. In general, monozukuri  is the "art, science and craft of making things." While monozukuri is used to describe technology and processes integrating sustainable development, production and procurement, it also includes intangible qualities such as unique craftsmanship and dedication to continuous improvement. In the Japanese tradition of Monozukuri, when an item or human effort is taken into use, there needs to be a benefit for the society as a result while, at the same time, the balance between production, resources and the society should be maintained. Monozukuri should therefore be an inspiration for most global organizations in the 21st century in their effort to create strong, innovative brands, which deliver compelling content through their media channels, especially then it comes to branding and brand storytelling.

Toyota and Nissan lead the way

Companies such as Toyota and Nissan have already tried to elevate their brands or the company’s core interests by creating unique content that exceeds infomercial-like self reverence.

Back in 2011, Toyota chairman Fujio Cho said that Toyota’s mission is to “preserve the Japanese Monozukuri". What does "monozukuri" mean here? It probably captures the Toyota perception of sustainability. According to Toyota monokuzuri, the person doing the making is de-emphasized and the attention is on the ‘thing’ being made. This subtle difference reflects the Japanese sense of responsibility for using ‘things’ in production and their deep respect for the world around them both animate and inanimate. In its application of Monozukuri to the production of automobiles, Toyota has pursued a sustainable method of making its cars ever more safe, environmentally friendly, reliable and comfortable and circulating this perception to its customers.

At Nissan, brand storytelling has been dubbed “kotozukuri,” complementing the Japanese manufacturers’ mantra of “monozukuri”. Brand agnostic stories, intentionally omitting reference to the parent firm or its competitors, or in Nissan’s case, look to raise the profile of the people, products, technologies and relationships as part of infotainment. 

 

Why? Actually, it's about Nissan's recognition that traditional media and consumer engagement face more challenges as well as expense amid a growing range of choice. Meanwhile, internal communications, often constituting corporate media or house TV units until now, have expanded from a parochial approach to include more content for mass distribution. The relationship with broadcasters and print media, who often have their own on-line presence, has evolved to include video embeds, undeniably showing return on investment versus the cost of similar paid media exposure. Use by the blogosphere or consumers also has powered the metrics of successful marketing, as “shares” and “likes” offer potential for viral exposure.

It seems that every organization may perceive Monozukuri in a different way. However, "Many names now describe the trend such as brand journalism, corporate narrative or 21st Century Kotozukuri, but all require more sophisticated storytelling and delivery, making ties to traditional agencies"  (Dan Sloan, Nissan Global Media Chief).

Back to storytelling

Storytelling is a well known and ancient art form. Persona-focused storytelling is essential to branding. When it comes to creating a powerful brand narrative, the persona – the articulated form of the brand’s character and personality – comes first, and all other elements unfold from there. A compelling brand starts with a strong, well-drawn, and quickly recognized persona, the essential connection between what a company says and what it does.

This brand persona creates a long-lasting emotional bond with the audience because it is instantly recognizable and memorable, it is something that people can relate to, and it is consistent. Nike, McDonald’s, FedEx are all examples of brands with personas that fit these criteria. In each case, there is a clear personality associated with the brand. These companies understand that it is their clear articulation of their brand persona and their discipline in placing that persona into stories that work with and help strengthen that brand persona is what makes the difference between strong and weak brand associations.

That long-lasting and implicit trust is what distinguishes the great brands from the rest of the pack. It will also protect the brand when it makes a misstep. Nike has a strong brand persona that is all about performance and winning. Their long-used tagline, ‘‘Just do it,’’ is instantly recognizable as is their logo, the swoosh. In 2006, Nike teamed up with skier Bode Miller, which seemed like a good idea at the time. After all, he had won two silver medals at the Olympics in 2002, four gold medals and a silver medal at the World Championship in 2003, and in 2005, he became the first American in 22 years to win the World Cup title. His performance trajectory was clear. If anything, it seemed that the difficulty would be in finding words to match his expected performance.

There was no shortage of words: in TV spots for the 2006 Winter Olympics, Miller was shown talking about performance, talking about his attitude, and talking some more. But there was not much ‘‘doing’’ – he fell short in all five medal attempts. Worse, he did not even seem concerned with winning, an attitude that did not match well with the Nike brand persona. This created a disconnect between the audience and the brand, since the fit between Bode and Nike clearly was not right. Monozukuri here, as a unique value proposition for the consumer, through storytelling, went wrong.

Brand my brain

Brain studies have shown dramatic effects of branding. In one famous study, researchers used functional magnetic resonance imaging (fMRI) to see how subjects’ brains responded when they were given Coke or Pepsi. Some of the subjects were given the soda without knowing which brand it was, and were asked to give their preference on taste alone. Others were given the soda and then an image of Coke or Pepsi was flashed at them before they took a sip.

The result? The blinded tasting resulted in no preference for one brand over the other in the group, some preferred Pepsi, others preferred Coke, but they did not know which was which, so the overall results were what you would expect in two chemically and physically similar drinks. The unblinded tasting was something else altogether. While there was no influence of brand knowledge for people who thought they were drinking Pepsi, there was a very strong brand influence when they were shown an image of Coke. Their belief that they were drinking Coke actually altered their experience to the point where some areas of the brain lit up only when they believed it was a Coke that they were drinking. Clearly, branding is a real, measurable effect. Coke lit up the hippocampus and the dorsolateral prefrontal cortex, areas of the brain related to memory, control of action, and self-image. Our brains love Coke even more than our taste buds do.

How is it connected to storytelling? Actually, a lot of it has to do with the fact that Coke has been telling a good story, using an exciting yet accessible brand persona that people easily relate to. Storytelling has been engaging listeners and readers for ages and Coke figured out how to make that work to their advantage. Researchers have shown that successful storytelling (as a correct Monozukuri version) strengthens the connections consumers have to brands to a great extent.

Conclusion

When it comes to brand development, a unique perception of Monozukuri for each organization may lead our audience in the brand story and its actions. Marketing strategists should always perceive and apply Monozukuri in the optimum way to genuinely connect with the audience and ultimately convert them into loyal customers.

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Smart Brands - Economic Depressions 1-0

An economic depression affects everyone. During the Panic of 1857, the Post World-War I Crisis, the Wall Street Crash of 1929, the Great Recession of 2008-2009 or even the "Greek Crisis", the basic mechanisms of consumer attitudes were similar. Both the value perceived by consumers and shareholder value were heavily influenced by brand. Brand can drive growth in an up market or protect the company’s value in a down market. But, what really happens we enter a recession phase and what are the impacts? Actually:

• Investors become very risk-averse. They are quick to criticize companies’ performance, resulting in decreasing share prices.

• The labor market is easily depressed causing employees to regard the organizations they work for with a more critical eye.

• Falling consumer confidence leads to heralding either lower prices or sales, but in either case falling profits.

Just steal

Brand development reaches far beyond traditional forms of consumer advertising. However, most still confuse the discipline of branding with ad communications. This interpretation ignores that:

• Brands are strategic assets rather than purely symbolic tools.

• Effective branding is a matter of profit, not just market share.

• Competitive advantage branding is a matter of sustainable investment rather than cost.

During a recession, brands that focus on value, rather than price, can reassure consumers with greater confidence. The moral support that is provided by brands during a recession helps to rebuild that enduring bond between brand and former consumer. As consumers begin evaluating their purchases on a different set of priorities, heritage brands can use the emotional connections that already exist to regain past consumers that have moved on to “higher end” brands. A recession can unlock the relevance trapped within the brands of people’s youth.

The necessity for a clear brand proposition is more important than ever as consumers recognize the need for new ways to work within their shrinking budgets. The companies who recognize and seize the opportunity to steal market share while others are in shutdown mode, will find the benefits far outweigh the costs.

The Buy Down Effect

A comScore survey revealed that one in five shoppers converted to less expensive, generally private label brands to save money. The figures below show the change by market segment after the end of the Great Recession of 2008-2009. Housewares realized no net shift for buying less expensive brands, but a prominent 6 point gain in buying other brands on sale. It is possible that in the case of durables consumers are more hesitant to try a cheaper brand but are still looking to save money by buying premium brands when they are on sale.

comScore, SymphonyIRI

Losing money to other brands? Invest in your brand. Decisions should be focused on spending wisely, but too often companies do nothing at all. A company’s typical reaction to a slowing economy is to cut back and wait things out. Ironically, those companies end up damaging their most valuable assets—their brands. Actually, research concerning economic depressions reveals some interesting findings:

• 1.5 point increase in market share among businesses increasing ad spending during recessionary periods (Cahners)

• 2.5 times increase in market share vs average of all businesses in post-recession period for those who aggressively increased media expenditures during last recession (CARR Report)

• 256 percent relative sales growth for businesses which maintained or increased media spend over those who did not (McGraw-Hill research analysis)

In times of recession it is better to tighten the belt and cut marketing and branding expenditures. However, when companies cut their outreach, they also begin to cut the ties that bond consumers to those brands. For smart companies, opportunity beckons. As we see competitors cutting back, we must now recognize that is the time to strike. If funds are too tight to make an all-out attack,we should just cut less than the competitors. Remember, in a recession both our marketing money and our message go further.

Consumers and Cost Control

Recessions usually trap brands between low priced competition and rising raw material costs.  Faced with narrowing margins, such brands may consider raising their unit prices, reducing the quantity or size of the product, or reducing the quality of the ingredients used.  Consumers-respondents in the aforementioned survey by comScore were asked to choose between these three options.  Specifically, they were asked, "Which action would you most want your preferred brand within each category to take, if it had to take a cost controlling action?"

Consumers prefer, if necessary

Consumers  indicate a preference for quantity reduction vs the other stated alternatives.  However, this strategy is not without risk. One additional question in the survey explored the reported effect that this downsizing of products had on consumers‘ buying behavior.  Four out of five respondents indicated they had noticed product downsizing in the categories they regularly shop. Perhaps more concerning, more than half of the respondents reported occasionally changing their behavior.  Thus, while consumers claim to prefer product downsizing, it does appear to have at least an occasional effect on brand choice for many shoppers and should be approached with caution.

Conclusion

Finally, brands can win economic depressions by successfully differentiating their product versus lower priced competitors in order to maintain preference and reduce price sensitivity of consumers. Decades of research on advertising have demonstrated that the use of brand differentiating messages is highly effective at increasing preference for the brand. Therefore, to optimize the impact of continued marketing support during hard economic times, advertisers need to make sure their efforts are effective at differentiating the brand from the competition. Yes, i know, Porter is always right!

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Facebook Likes and Human Behavior

Earlier in 2013, the Psychometrics Centre of the University of Cambridge conducted an impressive research about how private attributes are predictable from digital records of human behavior, like Facebook likes. Digitally mediated behaviors like Facebook likes can easily be recorded and analyzed, fueling the emergence of computational social science and new services such as personalized search engines and targeted online marketing. However, the widespread availability of extensive records of individual behavior, together with the desire to learn more about customers and citizens, presents serious challenges related to privacy and data ownership. 

The researchers (Kosinski, Stinwell & Graepel) showed that easily accessible digital records of behavior, Facebook Likes, can be used to automatically and accurately predict a range of highly sensitive personal attributes including sexual orientation,ethnicity, religious and political views, personality traits, intelligence, happiness, use of addictive substances, parental separation, age, and gender. The analysis presented is based on a dataset of over 58,000 volunteers who provided their Facebook Likes, detailed demographic profiles, and the results of several psychometric tests. The proposed model uses dimensionality reduction for preprocessing the Likes data, which are then entered into linear regression to predict individual psychodemographic profiles from Likes. The model correctly discriminates between homosexual and heterosexual men in 88% of cases, African Americans and Caucasian Americans in 95% of cases, and between Democrat and Republican in 85% of cases.

Predicting individual traits and attributes based on various cues, such as samples of written text, answers to a psychometric test, or the appearance of spaces people inhabit, has a long history. Human migration to digital environment renders it possible to base such predictions on digital records of human behavior. It has been shown that age, gender, occupation, education level and even personality can be predicted from people’s Web site browsing logs. Similarly, it has been shown that personality can be predicted based on the contents of personal web sites, music collections, properties of Facebook or Twitter profiles such as the number of friends or the density of friendship networks, or language used by their users. Furthermore, location within a friendship network at Facebook was shown to be predictive of sexual orientation.

The research 

The Psychometrics Centre, University of Cambridge

The study was based on a sample of 58,466 volunteers from the United States, obtained through the my Personality Facebook application, which included their Facebook profile information, a list of their Likes (n = 170 Likes per person on average), psychometric test scores, and survey information. Users and their Likes were represented as a sparse user–Like matrix, the entries of which were set to 1 if there existed an association between a user and a Like and 0 otherwise. The dimensionility of the user–Like matrix was reduced using singular-value decomposition (SVD). 
Numeric variables such as age or intelligence were predicted using a linear regression model, whereas dichotomous variables such as gender or sexual orientation were predicted using logistic regression. In both cases,the researchers applied 10-fold cross-validation and used the k =100 top SVD components. For sexual orientation, parents’ relationship status, and drug consumption only k = 30 top SVD components were used because of the smaller number of users for which this information was available.

Prediction of Dichotomous Variables

The Psychometrics Centre, University of Cambridge

The aforementioned figure shows the prediction accuracy of dichotomous variables expressed in terms of the area under the receiver-operating characteristic curve (AUC), which is equivalent to the probability of correctly classifying two randomly selected users one from each class (e.g., male and female). The highest accuracy was achieved for ethnic origin and gender. African Americans and Caucasian Americans were correctly classified in 95% of cases, and males and females were correctly classified in 93% of cases, suggesting that patterns of online behavior as expressed by Likes significantly differ between those groups allowing for nearly perfect classification. Christians and Muslims were correctly classified in 82% of cases, and similar results were achieved for Democrats and Republicans (85%). Sexual orientation was easier to distinguish among males (88%) than females (75%), which may suggest a wider behavioral divide (as observed from online behavior) between hetero and homosexual males.
Good prediction accuracy was achieved for relationship status and substance use (between 65% and 73%). The relatively lower accuracy for relationship status may be explained by its temporal variability compared with other dichotomous variables (e.g., gender or sexual orientation).

Predictive Power of Likes

Individual traits and attributes can be predicted to a high degree of accuracy based on records of users’ Likes. The best predictors of high intelligence include “Thunderstorms,” “The Colbert Report,” “Science,” and “Curly Fries,” whereas low intelligence was indicated by “Sephora,” “I Love Being A Mom,” “Harley Davidson,” and “Lady Antebellum.” Good predictors of male homosexuality included “No H8 Campaign,” “Mac Cosmetics,” and “Wicked The Musical,” whereas strong predictors of male heterosexuality included “Wu-Tang Clan,” “Shaq,” and “Being Confused After Waking Up From Naps.” 

Accuracy of selected predictions as a function of the number of available Likes. Accuracy is expressed as AUC (gender) and Pearson’s correlation coefficient (age and openness). About 50% of users in this sample had at least 100 Likes and about 20% had at least 250 Likes. Note, that for gender (dichotomous variable) the random guessing baseline corresponds to an AUC = 0.50. The Psychometrics Centre, University of Cambridge.

Moreover, note that few users were associated with Likes explicitly revealing their attributes. For example, less than 5% of users labeled as gay were connected with explicitly gay groups, such as No H8 Campaign, “Being Gay,” “Gay Marriage,” “I love Being Gay,” “We Didn’t Choose To Be Gay We Were Chosen.” Consequently, predictions rely on less informative but more popular Likes, such as “Britney Spears” or “Desperate Housewives” (both moderately indicative of being gay).

Conclusions

Similarity between Facebook Likes and other widespread kinds of digital records, such as browsing histories, search queries, or purchase histories suggests that the potential to reveal users’ attributes is unlikely to be limited to Likes. Moreover, the wide variety of attributes predicted in this study indicates that, given appropriate training data, it may be possible to reveal other attributes as well.
Predicting users’ individual attributes and preferences can be used to improve numerous products and services. For instance, digital systems and devices (such as online stores or cars) could be designed to adjust their behavior to best fit each user’s inferred profile. Also, the relevance of marketing and product recommendations could be improved by adding psychological dimensions to current user models. For example, online insurance advertisements might emphasize security when facing emotionally unstable (neurotic) users but stress potential threats when dealing with emotionally stable ones. 

Moreover, digital records of behavior may provide a convenient and reliable way to measure psychological traits. Automated assessment based on large samples of behavior may not only be more accurate and less prone to cheating and misrepresentation but may also permit assessment across time to detect trends. Moreover, inference based on observations of digitally recorded behavior may open new doors for research in human psychology.

On the other hand, the predictability of individual attributes from digital records of behavior may have considerable negative implications, because it can easily be applied to large numbers of people without obtaining their individual consent and without them noticing. Commercial companies, governmental institutions, or even one’s Facebook friends could use software to infer attributes such as intelligence, sexual orientation, or political views that an individual may not have intended to share. One can imagine situations in which such predictions, even if incorrect, could pose a threat to an individual’s well-being, freedom, or even life. Importantly, given the ever-increasing amount of digital traces people leave behind, it becomes difficult for individuals to control which of their attributes are being revealed.

There is a risk that the growing awareness of digital exposure may negatively affect people’s experience of digital technologies, decrease their trust in online services, or even completely deter them from using digital technology. It is our hope, however, that the trust and goodwill among parties interacting in the digital environment can be maintained by providing users with transparency and control over their information, leading to an individually controlled balance between the promises and perils of the Digital Age.

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Cross-Cultural Consumer Behavior

What are the key cultural constructs or dimension?

The constructs of individualism and collectivism represent the 
most broadly used dimensions of cultural variability for cross-cultural comparison. In individualistic (IND) cultures, people tend to prefer independent relationships to others and to subordinate the goals of their ingroups to their own personal goals. In collectivistic (COL) cultures, in contrast, individuals tend to prefer interdependent relationships to others and to subordinate their personal goals to those of their ingroups. The key distinction involves the extent to which one defines the self in relation to others. The focus is on whether the self is defined as autonomous and unique or seen as inextricably and fundamentally embedded within a larger social network. This distinction has also been referred to as egocentric versus sociocentric selves (Shweder & Bourne,1982), or independence vs interdependence.

In sum, the distinctions between IND and COL societies, and independent and interdependent self-construals, are crucial to the cross-cultural understanding of consumer behavior. Indeed, whereas the 1980s were labeled the decade of individualism/collectivism in cross-cultural psychology, similar distinctions represent the dominant structural approach in cross-cultural consumer research in 1990s and 2000s. The studies to be reviewed in this chapter offer a wealth of evidence that these cultural classifications have fundamental implications for consumption-related outcomes.

Expanding the Set of Cultural Dimensions

The nature and meaning of IND and COL (or of independent and interdependent self-construals) appear to vary across cultural, institutional, gender, and ethnic lines. Although the breadth of the INDCOL constructs lends integrative strengths, further refinement of these categories holds the potential to enhance prediction of consumer behavior.

The Horizontal/Vertical Distinction: Which additional cultural categories offer value in the prediction of cross-cultural consumer behavior? Within the INDCOL framework, Triandis and his colleagues have recently introduced a further distinction between societies that are horizontal (valuing equality) and those that are vertical (emphasizing hierarchy). The horizontal/vertical distinction emerges from the observation that American or British individualism differs from, say, Norwegian or Danish individualism in much the same way that Japanese or Korean collectivism differs from the collectivism of the Israeli kibbutz. Specifically, in vertical individualist societies (U.S.,Great Britain, France), people tend to be concerned with improving their individual status and distinguishing themselves from others via competition. In contrast, in horizontal individualist societies (HI; e.g., Sweden, Norway, Australia), where people prefer to view themselves as equal to others in status, the focus is on expressing one’s uniqueness, capability, and self-reliance. In vertical collectivist societies (Japan, Korea, India), people focus on fulfilling obligations to others, and on enhancing the status of their ingroups in competition with outgroups, even when that entails sacrificing their own personal goals. In horizontal collectivist societies (like exemplified historically by the Israeli kibbutz), the focus is on sociability, benevolence, and interdependence with others in an egalitarian context.

When such distinctions are taken into account, however, it becomes apparent that the societies chosen to represent IND and COL cultural syndromes in consumer research have almost exclusively been vertically oriented. Specifically, the modal comparisons are between the United States (VI) and any of a number of Pacific Rim countries (VC). It may be argued, therefore, that much of what is known about consumer behavior in individualistic and collectivistic societies reflects vertical forms of these syndromes and may not generalize, for example, to comparisons between Sweden (HI) and Israel (HC) or other sets of horizontal cultures. As an example, conformity in product choice, as examined by Kim and Markus (1999), may be a tendency specific to VC cultures, in which deference to authority and to ingroup wishes is stressed. Much lower levels of conformity may be observed in HC cultures, which emphasize sociability but not deference. Thus, it may be inappropriate to ascribe differences in consumers’ conformity between Korea (VC) and the United States (VI) solely to the role of IND/COL or independence/interdependence, because such conformity might not be prevalent in horizontal societies. In particular, levels of product conformity in HC contexts might not exceed those in HI contexts.

Predicting new consumer psychology phenomena

Several recent studies examining the implications of this horizontal/vertical cultural distinction have provided evidence for its value as a predictor of new consumer psychology phenomena and as a basis for refining the understanding of known phenomena. For instance, Gürhan-Canli and Maheswaran (2000) demonstrated that the tendency to favor products from one’s own country over foreign products (a country-of-origin effect) emerged more strongly in Japan (a VC culture) than in the United States (a VI culture). This fits well with a conceptualization of collectivists as being oriented toward their ingroups. However, mediational analyses using individual consumers’ self-rated cultural values indicated that only the vertical dimension of IND and COL accounted for the country-of-origin effects in Japan. In other words, the collectivistic tendency to favor one’s own country’s products appeared to be driven by cultural values that stress hierarchy, competition, and deference to ingroup wishes, not by values that stress interdependence more generally.

In line with this, research suggests that advertising messages with themes that emphasize status, prestige, hierarchy, and distinction may be more prevalent and persuasive in vertical cultural contexts. Such advertisements also appear to be generally more persuasive for those with a vertical cultural orientation, and may be inappropriate for those with a horizontal one. Shavitt, Zhang, and Johnson (2006) asked U.S. respondents to write advertisements that they personally would find persuasive. The extent to which the ad appeals that they wrote emphasized status themes was positively correlated with respondents’ vertical cultural orientation (and negatively correlated with their horizontal cultural orientation). Moreover, content analyses of magazine advertisements in several countries suggested that status-oriented themes of hierarchy, luxury, prominence, and distinction were generally more prevalent in societies presumed to have vertical cultural profiles (Korea, Russia) than a horizontal cultural profile (Denmark).

Last but not least,the horizontal/vertical distinction provides a basis for refining our understanding of individualism/collectivism effects. Their studies showed that individualism/collectivism differences in socially desirable responding appear to be mediated at the individual level by horizontal (but not vertical) IND and COL values. These findings shed light on the motivational drivers linking culture with socially desirable response styles. The main point here is that these dimensions of cultural comparison have multiple implications for advertising and marketing processes. Attention to a broader set of cultural dimensions will not only expand the range of independent variables in our research, but will also prompt consideration of cultural consequences hitherto unexamined in cross-cultural studies (based on publication by Sharon Shavitt-University of Illinois & Angela Lee, Northwestern University).

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