About AMA

Executive Summary
When new products and brands are introduced into other cultures, the speed and extent of the product’s acceptance are important concerns for marketers. The spread of positive word of mouth (WOM) and the lack of negative WOM about the product or brand by early adopter groups are critical to the product’s successful diffusion in the marketplace. Although many studies have examined marketing in different cultures, few have investigated the influence of cultural values on consumers’ WOM about products and brands. A better understanding of how cultural factors affect WOM transmission helps marketers create more effective promotional programs that improve product and brand acceptance in international markets.

Lam, Lee, and Mizerski’s study is the first to investigate the effects of consumers’ cultural values on their WOM behavior. The authors use Hofstede’s four cultural dimensions to test the effects of cultural values in WOM behavior on social in- and out-groups. Both in-group and out-group WOM are important to product diffusion. Strong ties among in-group members encourage the exchange of product information within a group, and WOM with an out-group facilitates information flow from one in-group to another. The latter is critical in product diffusion because it spreads information from the in-group level to the entire marketplace.

The authors employ a survey method to assess the diffusion of WOM. The survey comprised 28 questions on cultural values and WOM activity. It was pretested on a group of 100 respondents before the main survey. In the main survey, the sample consisted of 228 student respondents who were enrolled in the same university and course but studying in different cities (i.e., Singapore and Perth, Australia). Data analysis shows that the pattern, type, and target receivers of consumers’ WOM activity depend on their cultural values. The authors find that all four cultural dimensions have significant effects on WOM engagement to in- and/or out-groups. Individualism is positively correlated to out-group WOM, while high uncertainty avoidance leads to lower in-group WOM. Masculinity and power distance are both positively associated with in-group WOM.

Although the authors could not determine the causal nature of the relationships because of the sample design used, the study reveals that cultural values may affect consumers’ WOM behavior. Thus, marketers should monitor the cultural values of their international markets to anticipate in- and out-group discussions. Companies that can identify how their customer segments initiate in-group and out-group WOM will manage them more successfully. The knowledge of how WOM works in groups can help these companies create a more conducive environment that leads to additional customer referrals and higher product diffusion rates. This knowledge is also important to marketers targeting specific ethnic markets in multicultural societies, such as the United States and the United Kingdom.

Biography
Desmond Lam is a visiting senior research fellow at the School of Marketing, University of South Australia. He holds a PhD (marketing) from the University of Western Australia and MBA from the University of Melbourne. Desmond has more than six years of university teaching experience across Australia, Macau (China), Malaysia and Singapore. He currently serves in the editorial board of the Journal of Hospitality Marketing and Management (formerly Journal of Hospitality and Leisure Marketing). In addition, Desmond has reviewed papers for Journal of Gambling Studies, Tourism Management, Journal of Social and Personal Relationships, Asia Pacific Journal of Marketing and Logistics, and Association for Consumer Research and American Marketing Association conferences. His research has been published in a number of journals including Marketing Letters, Psychology & Marketing, Journal of International Consumer Marketing, Journal of Marketing Communications, and Journal of Gambling Studies.

Alvin Lee is a visiting Assistant Professor at The University of Western Australia.  His research interests are in international marketing, marketing communications, quantitative modeling and methodologies, econometric theory, marketing strategy and consumer behavior.  Dr. Lee studies how marketing communications affects adolescents and their decision making, and how origin, culture and geography affect their choices.

Dick Mizerski is a Winthrop Professor and University Chair in Marketing at the University of Western Australia in Perth Australia. His research primarily focuses on the effects of the marketing communications of consumer vices (tobacco, alcohol and gambling) on buyers and consumers; in particular adolescents and very young children. Professor Mizerski is also studying how different cultures form equity towards brands, and the use of imagery and premiums in that process.