Advertising Decision Making in Asia: "Glocal" versus "Regcal" Approach

Abstract

The concept of started with the realization that Asia was not 'westernizing' but in fact was 'modernizing'. The key to modernization of consumer markets is their ability to adapt incoming influences and blend them into the fabric of their identity, not adopt the foreign influence wholesale. Glocalization is much more than the simplistic think global, act but requires identifying the degree to which needs and the stimuli which trigger them are universal or local (World Executives' Digest, February 1997). Due to higher income and education levels, greater travel opportunities and exposure to different cultures, individual Asian markets are becoming much more similar in terms of personal aspirations and spending behavior. Many multinational firms are applying regional strategies across Asian markets. Some scholars also emphasize plan globally and act (Blackwell et al., 1991) and think globally, act locally and manage regionally in the Asian markets. Regionalism is becoming a significant trend and it is therefore important for multinationals to rethink their Asian strategies. The advertising environment in Asia is also moving its focus towards a Chinese audience as the Chinese make up approximately 25% of the world's population. As Asian Chinese markets grow, multinationals need to gain a better understanding of these markets before formulating their advertising strategy. The major objective of this study is to propose new advertising process categories to be included in the traditional Global-Local continuum approach which will be useful for researchers and practitioners in understanding the decision-making structure in Asia and also to provide them with a new conceptual framework for future research. Other objectives are to investigate: (1) the degree to which a multinational's headquarters is involved in the advertising process for an Asian market, and (2) the relationship between the degree of commitment and the extent to which advertising is standardized in the region. The four Asian Chinese markets chosen for this study are mainland China, Taiwan, Hong Kong and Singapore. LITERATURE REVIEW One of the critical international advertising issues has been the locus of decision making. Multinational corporations (MNCs), which offer their products world-wide, are faced with the complex problem of deciding whether to standardize their advertising operations across countries, to individualize their campaigns within countries, or to pursue a mixture of both. They are required to employ a more decentralized, collaborative, and participatory (transnational) approach to the development and management of multicountry advertising strategies and campaigns (Banerjee, 1994). The management, at headquarters level, tends to be much more involved in establishing objectives and budgets than in creative and media decisions (Wills and Ryans, 1977). Many multinational companies, which consider the Asia-Pacific to be an important part of their global business, tend to delegate some of their managerial functions to the region by establishing a regional office or headquarters in Asia. The degree of decentralization affects the extent of regionalization as decentralized companies are more likely to have a local or regional presence than highly centralized ones (Hulbert and Brandt, 1980). Peebles et al. (1978) suggest that the multinational needs to have a certain degree of control over its subsidiaries in order to fully implement standardization. It is also agreed by Rau and Preble (1987) that the degree of standardization is determined by the extent of the multinational's control of international operations. If the foreign and home markets are similar, with close headquarters-subsidiary communications, marketing techniques tend to be more standardized. Hulbert and Brandt (1980) point out that the extent of control by the parent company over its subsidiaries depends on the degree of delegation, and the level of formalization and supervision. …

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