Hofstede’s cultural dimensions theory in advertising: KFC, BMW and Heineken

Hofstede’s cultural dimensions theory is a framework for measuring cultural dimensions from a global perspective. It is a useful business tool which provides insights for organizations looking to extend their business internationally.

I was curious to know if this tool is relevant in advertising so I selected three brands, KFC Singapore, BMW China and Heineken Italy and analyzed one ad for each brand.

To learn the Hofstede rankings of each country, I used this tool.

KFC Singapore

Power distance 74
Watching this ad by KFC Singapore, I see three cultural dimensions at play: power distance, individualism vs collectivism and masculinity vs femininity.

According to Hofstede’s theory estimations, Singapore ranks 74 at power distance. Power distance is the extent to which the less powerful members of organizations and institutions accept and expect that power is distributed unequally.

Singapore’s high score on this dimension indicates that it is a society that values hierarchy. This can be seen in the Singaporeans’ family meals customs which say that no one eats until the oldest member of the family lifts the spoon. In Singapore, older people are respected and listened to.

Individualism 20
The individualism vs collectivism dimension shows to which extent people feel independent or interdependent as members of larger communities. As you can see, Singapore ranks low in individualism which makes the society a collectivist one.

In the collectivist culture, family is at the heart of everything. A person views himself as a member of the family rather than an individual.

Masculinity 48
In regards to the masculinity dimension, Singapore ranks 48. Masculinity is the extent to which the use of force is endorsed socially.

Singapore’s rank tips the scale a little bit more to the feminine side. This means that conflicts are avoided and reaching a consensus is more important than being right.

What do we see in this ad?

We see a family preparing to eat together with the oldest, probably the grandmother sitting at the head of the table. As per tradition, everyone is inviting the grandmother to start eating. Although polite, what their invites do is repeatedly interrupt the hungry woman who doesn’t need convincing in front of a delicious bowl of KFC chicken. Because she doesn’t want to tell them off and ruin everyone’s good mood, she puts on a pair of headphones and starts eating with great pleasure.

BMW China

Power distance 80
This ad for the car manufacturer’s Chinese market pulls the strings on the viewer’s heart. It is longer than the average ad and uses this time to tell the story of a modern Chinese family with a hard-working white-collar father.

His son is trying to understand why his father is sometimes late to pick him up from kindergarten or even goes back to the office to work through the night. The only good reason he can think of is that his dad is a superhero and he gets wrapped up in doing superhero stuff.

China ranks very high in power distance. It is a country where subordinate-superior relationships tend to be polarized and can lead to power abuse by superiors.

We see this aspect of Chinese culture through the kid’s eyes: he imagines his father’s superiors as villains demanding him to dedicate his free time to the job and to making money because making money is more important than his son.

In his imagination, his father is fighting to overcome every obstacle that keeps him from coming home using every ability in his power: kung-fu strikes, negotiation or his bare fists. Like any other hero, he needs a sidekick to be successful and his BMW fulfils this role with flying colours.

Individualism 20
Chinese society ranks low in individualism. Although the ad focuses mainly on the kid, we can still see how important and how dedicated the father is to his son. He may be late, but he eventually shows up.

Masculinity 66
China is a masculine society where individuals are success-oriented and career-driven. And people have traditionally established roles.

As we can see in this ad, the mother is the child’s main caretaker and possibly a stay-at-home parent with the father having a well-paid job. Also, it’s not a coincidence that he is portrayed as a hero winning at everything he sets his mind to.

Heineken Italy

Masculinity 70
In this ad, we see Nico Rosberg, winner of the 2016 F1 World Championship and his father, Keke Rosberg, who also won the F1 World Championship, but 34 years earlier.

Competition is in their blood, both on the race track and in their father-son relationship also. Everything is a competition and winning is everything for this duo, from fishing the largest salmon to playing a game of tennis or throwing a paper ball into the trash can. And the loser gets to drive the car.

In the Behind the scenes video, Nico shares that to some extent, the ad reflects their relationship in real life. Playing a few games of tennis was a way for him and his father to spend time together.

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China has just achieved a major breakthrough in nuclear fusion.

China made an artificial star that’s 6 times as hot as the sun.

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Online versus offline retail war ending soon?

“2018 will mark death of online versus offline retail war”, said Mariam Asmar, McCann London’s strategy and innovation director, for Campaign UK.

What is for certain is that both worlds willcontinue for sure to exists for a good while. In a demanding night and day economy, consumers want access to shopping at all times. They want to use price comparison sites, they want infinite choice in styles and sizes and they want to do it all from the comfort of their own home without the pressure of three different sales assistants hanging around waiting to bag some commission.

At the same time, “physical brick and mortar stores will continue to have a place in a world that still requires, and desires, human connection. The current statistic is that 90% of purchases in the UK are still made in store, while 60% of Generation Z consumers value the store experience. Millennials even want to shop in places they can touch, feel and see their product. Not to mention for some, shopping is an experience and they appreciate input and care from the staff and in store experiences,” wrote liveandbreathe.com.

Last year, in the USA, according to “The Atlantic”, online shopping was having an offline moment, as more e-commerce companies, such as RentTheRunway and Bonobos, invested in the physical stores they once made seem obsolete. Leading the trend is Amazon, the undisputed king of online shopping, which spent $14 billion to buy Whole Foods and its nearly 500 physical locations. “According to internal documents, the company believes there is support for another 2,000 Amazon Fresh–branded grocery stores. This throwback revolution is happening in the midst of what otherwise feels like a “retail apocalypse.” Bankruptcies are rising among clothing chains, like Wet Seal, and retail icons, like Toys “R” Us, which are stuck with a glut of shopping space and squeezed between stagnating sales and large debt obligations,” wrote “The Atlantic”.

While Amazon did make a bigger splash with its $13.7 billion investment, Walmart beefed up an e-commerce stable that already includes the acquisitions of digital natives Jet.com, Shoebuy, ModCloth and Moosejaw. Collectively, these M&A deals have set Amazon, the world’s largest e-commerce company, on a direct collision with Walmart, the world’s largest retailer, to be the “everything store” in an omni-channel world — where consumers no longer distinguish between shopping online and offline.

In the future, Amazon could upgrade Whole Foods with innovative retail technologies in use at its fully automated experimental store, Amazon Go, where shoppers pick up their food and leave. There are no cashiers or checkout lines. Amazon tracks what’s taken, or put back, and charges their accounts.

Moreover, “several brick-and-mortar companies with large footprints are struggling while e-commerce companies that once launched pop-ups as mere marketing tools have realized the value of storefronts,”considers The Atlantic. For instance Amazon sees a growth in online shopping in regions where it’s opened a physical store, according to CNBC. “Five years from now, we won’t be debating whether ‘e-tailers’ are taking share from ‘brick & mortar retailers,’” Citi Research analysts recently wrote, “because they are all the same.” The trend even comes with an inevitable, and regrettable, catchphrase: “bricks and clicks.”

“Among the nation’s top 300 malls, brick-and-mortar space occupied by retailers that started online has grown by approximately 1,000 percent since 2012, according to the real-estate data company CoStar Group. While they currently account for a minuscule part of mall volume, landlords increasingly consider them critical to attracting Millennials to these malls in the first place,” adds “The Atlantic”.

In India, another big and important country, according to blog.markgrowth.com,  “the FMCG is vertical: 90% of sales happen via mom and pop stores (Kirana) which are plenty in number. The remaining 10% of sales is accounted for by Modern Trade outlets ( Large Retail format stores similar to Walmart ) and the online channel. Now, these mom and pop stores are not going to go anywhere ( Over 10 million outlets in every nook and corner of the country!). Technology will aid these stores in the near future which will arm retailers with data regarding consumption patterns for instance, which will prevent stock-outs leading to an enhanced experience on the whole.”

More about the e-commerce in India and the classic retail industry one can read here and here.

Meanwhile, in China, according to www.scmp.com, malls are starting their own digital stores as they hitch their bandwagon to the concept of “new retail” pioneered by the Alibaba Holding Group chairman, Jack Ma Yun. The “online-offline integrated experience” is increasingly being used by Chinese retail property operators, who see it as a critical way of gaining insight into consumers’ shopping patterns and responding to these quickly.

Meet Joe Escobedo, One of Singapore’s Brand Minds

Recognized as one of the “Top 20 Content Marketers” worldwide and awarded the “Most Influential Global Marketing Leader” at the World Marketing Congress, Joe has helped countless organizations and executives transform from relative unknowns to superheroes online. He has also created and led successful digital marketing, branding and PR campaigns for​ both​ ​startups​ ​and Fortune 500 firms. He is a contributor for both Forbes and the HuffPost, as well as an award-winning speaker.​ ​His articles, interviews and talks have been ​read or heard by nearly one million people.

What is the significance of Joe Escobedo “The Brand Builder” and what is the story behind it?

“The Brand Builder” is a moniker given to me by my colleagues when we were trying to create ‘superhero’ names for the team.

You worked with companies from U.S., China and Singapore, which market did you like the most and why so?

The safe answer would be Singapore, but my five years in the gauntlet known as China made me what I am today. It taught me humility and the importance of guanxi (relationships).

Name one situation that made you want to quit and change your career.

I want to learn something everyday so there were times in my career where I felt like I wasn’t learning anything new or pushing myself hard enough. It’s during those times that I’ve transitioned to a completely new field or market. Sometimes I’ve failed miserably, but I learned from each experience and have grown from it.

Name one situation that made you want to go forward.

I’m driven when people tell me I can’t do something. I’ve been told that more times than I can count throughout my career. During those times, I think in my head, “hold on a second and watch this!”

What do you think are the most difficult challenges marketeers have to face in Asian markets nowadays?

Taking a long-term view. Too often, global headquarters look to the regional office in Asia and say, “You’re our growth engine now so you should be growing at a double-digit rate.” The problem with that is that it forces marketers to look only at the month ahead, rather than what’s going to rise up and disrupt their industry next year.

Investment matters. If you would invest in one particular business field nowadays. What would that be?

If I were looking for some quick cash, I’d say anything A.I. related. But I generally play the long game so I’d invest in things people always need, like food and toilet paper.

If you could change something about Singapore’s marketing community to improve it in any way what would that be?

I’d encourage the Community to take risks and invest more in digital. An ad plastered over the MRT may look great but what’s the return on your investment?

What made you settle down in Singapore?

The short answer: love. I followed my wife who received a job offer before I did.

Meet Joe Escobedo, The Man behind the suit

Name one good habit that helps you deal with your active life.

Reading to my daughter, because in that moment, I’m not Joe “The Brand Builder.” I’m whichever character I’m reading in the book.

Name one bad habit you can’t quit.

Speed walking. I tend to walk like I’m always 15 minutes late to a meeting.

If you could be anything else but a marketing leader, what would you be?

In another life, I would’ve been a film director. I wrote, directed and edited a sketch comedy movie when I was in college. I loved the experience and think I could’ve been a third-rate Christopher Nolan.

You are recognized as “One of the Most Influential Global Marketing Leaders”. What’s your favorite movie of a global marketing leader?

Don’t know if it’s about a global marketing leader per se, but Game of Thrones. After over a decade as a marketer, I see too many similarities between that show and the marketing world, albeit slightly less violent. For instances, strong alliances with the “right” groups can help you get closer to the corporate Iron Throne.

Tell us your favorite book. What’s the best thing you learned from it?

“How To Win Friends & Influence People,” by Dale Carnegie. I’ve read the book at least 10 times and everytime I ‘learn’ something new. My favorite lesson is about putting yourself in the other’s shoes – thinking about what they would want rather than what you’d want them to do.

Name the most important value you have.

Grit. It’s the only reason I’m still around and kickin’ in the professional world. Because even when I get battered to the ground, I claw my way back up. It’s an invaluable trait for any marketer or entrepreneur.

Name the most important value a leader should have.

Empathy. Every boss wants to make the most profit they can but they can only do so with a strong team behind them. And the only way to build and retain a strong team is to empathize with your staff’s situation. If they get demotivated because a client scolded them, then give them a pep talk. If there are unseen circumstances that caused them to miss a deadline then be understanding to their situation.

If you could compare your journey as an entrepreneur with a song, what song would you choose?

“Highway To Hell.” Just kidding! Instead of a song, my journey can be best described by “The Road Not Taken” by Robert Frost. From my move to China when I was 22, my career has been characterized by these lines: “Two roads diverged in a wood, and I— I took the one less traveled by, and that has made all the difference.”

Tell us the funniest experience you had this year related to your work.

Some of the funniest moments during the past year happen behind-the-scenes. For instance, we use to have “Happy Friday” dance parties at my company. And I’m not one to brag but my rendition of “Hotline Bling” by Drake stole the show.

If you would give our readers one advice from your professional experience, what would that advice be?

To quote the great Conan O’Brien, “If you work really hard, and you’re kind, amazing things will happen.” I truly believe that. Because everyone wants to help the hardworking nice guy or gal.

 What is your biggest expectation for the Brand Minds ASIA event?

I’m looking forward to seeing Gary V walk on stage to a deafening cheer, unleash some savage knowledge and drop the mic.

The digital out-of-home advertising is already blooming

The share of global advertising spend going to out-of-home (OOH) advertising remains stable at 6 percent, shows ‘Why Out Of Home Performs’, a joint study by Magna Intelligence and Rapport, IPG Mediabrand’s out-of-home agency, into OOH’s continued growth and impact. The report was based on findings from an analysis of the global OOH industry and OOH advertising in 70 countries. This is largely down to major investment in digital OOH (or DOOH), which is growing in every environment and has seen unit numbers jump 70,000 to 300,000 worldwide in two years, and revenue increase by 30 percent.

Digital OOH is boosting advertising revenues by creating more opportunities for marketers in premium locations like airports or malls, thus increasing the revenue per panel multiple times. Although digital units account for only 5% of the global OOH inventory, they already generate 14% of total advertising revenues. In fact, DOOH already accounts for 30% of revenues in some markets like the UK and Australia, and the global share is predicted to grow to 24% globally by 2021.

“With the explosive growth of digital-out-of-home (DOOH), the diversified lifestyle touch points it reaches, and the veritable mountain of mobile driven audience data, we are best positioned to accurately, and in real-time, track audiences and deliver contextually relevant messages through out-of-home media. OOH’s sustained growth on a global scale will further enable us to create engaging consumer experiences,” said Mike Cooper, Global CEO Rapport.

source: Campaign Asia

“The digital-out-of-home market is a return to advertising’s roots, quietly shifting the industry by way of re-imagining the classic advertising experience. Nearly $4.5 billion is expected to be spent on DOOH advertising in the U.S. by 2019, an increase of approximately $1.2 billion from 2016. Zenith forecasts that DOOH will grow faster globally than all other buying methods, and PricewaterhouseCoopers predicts that DOOH advertising revenues will overtake traditional media spend in 2020, growing at a rate of 15% a year for the next four years,” writes AdAge.com.

According to MAGNA, OOH advertising is now a $29 billion market, responsible for approximately 6% of the $500 billion global advertising spending. However, OOH market share increases to 10% to 12% in some countries, including France and Russia, compared with other media categories including Internet, TV, print and radio. OOH market share has remained stable in the last five years, hovering around 6%. However, as part of its increasing importance in the media mix, OOH market share has increased from 8% to 10% of traditional media advertising spend, which includes TV, print, radio and out-of-home, among other categories.

MAGNA Intelligence, in partnership with Rapport, conducted an in-depth survey in 22 key markets including Argentina, Australia, Belgium, Canada, China, Denmark, France, Germany, India, Italy, Japan, Malaysia, Mexico, Netherlands, Norway, Philippines, Russia, Singapore, Spain, Thailand, United Kingdom and the United States. The objective of the survey was to assess OOH advertising’s sustained growth and impact during a period where offline marketing budgets are stagnating and other media categories are struggling.

Moreover, MAGNA showed in another study launched in June, that in the USA, Out-of-Home (OOH) advertising is expected to grow +2% to $7.9 billion in 2017, including cinema. MAGNA reduces its 2017 growth forecast following weak first quarter advertising sales, which grew by just +0.3% in a sudden slowdown, as seven of the last eight quarters had shown year-over-year growth of +3% or more. The 1Q17 stagnation occurred as a result of several key verticals reducing spend, including both automotive and food & beverage, which both experienced double-digit declines. This offset the continued growth from tech brands (e.g. Google, Apple, Hulu and Netflix) that have driven OOH sales over the last two years.

The DOOH market encapsulates everything from digital billboards to screens in elevators to screens on jukeboxes. Unlike internet or mobile advertising, it allows advertisers to reach target audiences in a specific, real-world context. Instead of interrupting an internet user’s online experience with an ad, it’s focused on marketing to consumers when they are “on the go” in public places or in transit. Due to its specifications, the technology has the opportunity to give to its target the message in a format that’s automated, dynamic and interactive.

“The DOOH space presents a major opportunity for creatives, technologists and consumers alike. We see DOOH’s effectiveness in the numbers: the 2016 Nielsen OOH ad study found 91% of U.S. residents age 16 or older, who have traveled in a vehicle in the past month, noticed some form of OOH, and 79% noticed OOH in the past week. The same Nielsen digital billboards study found 71% of digital billboard viewers find those ads to stand out more than online ads. Ultimately, the emerging digital-out-of-home market is groundbreaking in its interactive technology, but it’s also a return to advertising’s roots and the original purpose around advertising: to provide an engaging and useful service to the public,” writes AdAge.

Globally, in 2016, the OOH market was worth $28 billion in net advertising, according to Magna’s report, and is predicted to grow by 4 percent per year to reach $33 billion by 2021. Behind this growth is an ever-more concentrated supply-side market, in which the top international OOH media owners are continuing to expand their influence: the six main global vendors (in order of 2016 revenue size, JCDecaux, Clear Channel, Outfront, Lamar, Stroer and Exterior) now control almost 40 percent of the whole market. By 2021, the report predicts small, but significant changes, in the environments most used for OOH. Use of billboards, currently the top revenue-generating segment and performing particularly well in India, Russia and the US, will drop 4 percent from 45 to 41 in the next five years. Street furniture and transit, meanwhile, are due to grow, respectively, from 31 to 34 percent and from 14 to 15 percent as local authorities become more willing to partner with OOH vendors. A series of major contracts—typically over 10 years long—in big cities are also in the process of renewal, the first time this has happened in the era of DOOH and programmatic opportunities, which partly explains DOOH’s recent giant revenue leap.

According to APAC, while the US is the largest OOH market, valued at $7.1 billion last year, APAC countries Japan ($4.7 billion) and China ($3.1 billion) come in at second and third position and per capita spending on OOH amounts to a record $38 per year in Japan, compared to $22 in the US. Singapore spends the second highest amount per capita at $36 a year. In the Philippines, meanwhile, OOH accounts for one of the highest percentage shares of overall ad spend in the world, at 15 percent compared to the global share of 6 percent. Singapore (12 percent) and Thailand (9 percent) also exceed the worldwide average.

Singapore’s OOH ads have the highest reach range of any other APAC market, with a penetration of 70 to 80 percent of the relevant population, due to its concentrated levels of urbanisation. Australia’s have the second highest, reaching 60 to 70 percent, but neither matches the reach of OOH ads in Argentina, which are considered seen by a huge 85 to 95 percent of the population.

In Australia, DOOH represents more than a third of total OOH spend, which the report attributes to a sophisticated advertising market and a population relatively concentrated in a few urban centers.

In China, the total OOH spend about matches other markets, it is one of the top five global markets in terms of penetration of digital, led by the transit segment. By 2021, MAGNA predicts that digital growth will have doubled, while OOH growth will be stagnating, partly due to lack of interest in non-digital inventory.

“OOH’s natural convergence with other digital media has hurt most other ad forms. OOH complements digital media by amplifying and enhancing it. This phenomenon has brought additional ad revenue to OOH, while most other media have experienced revenue losses as a result of the growth in digital.OOH has benefited from other new technologies, too, such as social media and mobile. Many OOH media campaigns are now picked up on social media, which greatly amplifies the total viewership. When consumers are on mobile devices, OOH is typically one of the last ad forms they’re exposed to just before important path-to-purchase decisions,” explained Steve Nicklin, Vice President of Marketing, OAAA, for  billboardinsider.com.

The innovative opportunities provided by the digital platform have provided the OOH industry with new thinking and new ideas. Moreover, in the USA, as shown by the  USA Touchpoints/RealityMine study, OOH and Today’s Mobile Consumer, consumers spend more time with OOH than any other form of advertising media except TV. The findings are supported by the  2016 Nielsen OOH ad study that found that 91% of US residents age 16 or older, who have traveled in a vehicle in the past month, noticed some form of OOH, and 79% have noticed OOH in the past week. Their research also discovered impressive levels of engagement, with 82% of billboard viewers reporting they look at the advertising message at least some of the time; and over one-third looking at the billboard ad each time or almost each time they noticed one. The  Nielsen digital billboards study found 71% of digital billboard viewers find them to stand out more than online ads.

OOH is expanding to brand new environments. Digital screens have allowed OOH advertising vendors to penetration niche environment allowing to reach young urban population that is otherwise hard to reach by traditional media: offices, elevators, taxi, gyms, bars, retail etc. The “Digital Place-Based” segment offers targeting capabilities and programmatic opportunities. Moreover, OOH becomes addressable and experiments with programmatic. Initially developed to automate the trading of online display ads, the programmatic technologies are now being used in to buy and optimize ad campaigns on connected DOOH units.

Programmatic techniques not only optimize the workflow of media-buying but help brands deliver the right ad in the right place and at the right time, using consumer data and mobile location data. Giving advertisers the ability to plan, buy, optimize and measure the effectiveness of their outdoor campaigns through an online platform represents the natural evolution of OOH’s technology-driven transformation with many vendors developing Private Marketplaces (PMP).

Besides that, DOOH is going social. “There are two main avenues DOOH is being used to complement social campaigns, either through integration or through content creation,” says Neil Morris, founder and CEO of UK-based creative production house Grand Visual.