Carlos M. P. Sousa and Frank Bradley
Executive Summary
Managers relate to psychic and cultural distance to bypass the complexities of assessing international markets, but in this article, Sousa and Bradley argue that because the distinction between the two concepts is poorly understood, guidance to managers is often confusing. By focusing on psychic and cultural distance separately, Sousa and Bradley show that the two concepts capture different phenomena: Psychic distance captures the manager’s individual perception of the differences between the home and the host country; it is an interpretation of reality that is highly subjective. Conversely, cultural distance refers to the degree to which cultural values in one country are different from those in another country; it is measured at the cultural level.
This article analyzes a sample of more than 300 export managers in Portugal, a member of the European Union that has long being dependent on international trade. The small size of the domestic market has lead to a strong international orientation among Portuguese firms; in the sample studied, 35 different countries are identified as principal export markets.
The theoretical underpinnings of this work are based on models of individual and cultural values. Psychic distance exists in the individual’s mind and depends on how he or she perceives the world; the individual’s perceptions shape the psychic distance concept. Measures of psychic distance are derived from respondent scores at the individual level, whereas cultural distance is assessed at the cultural level on the basis of mean scores for each country. Sousa and Bradley use reliable and valid quantitative scales to measure the constructs in their model, which they then analyze using structural equation modeling.
Sousa and Bradley conclude that the distinction between psychic and cultural distance is important for managers. Because psychic distance reflects managers’ perceived differences in observed phenomena, it is an important determinant of international marketing strategy. Psychic distance influences how managers formulate international marketing strategies and how they adapt marketing programs to different circumstances. Therefore, managers should be aware of the impact of their psychic distance toward a foreign market on their strategic decisions. Treating psychic distance as an individual-level phenomenon enables the firm to select sales and marketing people that are more likely to be successful in a particular foreign market by considering the person’s psychic distance toward that market. An appropriate match should increase the firm’s probability of success. The consequences of psychic distance may be addressed by the firm, but this is not the case with cultural distance, which is outside the firm’s control.
Biography
Carlos M.P. Sousa is Lecturer (Assistant Professor) of Marketing in the Michael Smurfit School of Business at the University College Dublin. He received his doctoral degree from the University College Dublin in 2003. His areas of interest include culture and international marketing, international marketing strategies, and export marketing. He has published in Academy of Marketing Science Review, Journal of Strategic Marketing, Irish Journal of Management, and Revista Portuguesa de Marketing.
Frank Bradley is R&A Bailey Professor of Marketing in the Michael Smurfit School of Business at the University College Dublin. He received his PhD from Cornell University (1973) and his MSc (1969) and BA (1967) from the National University of Ireland. Professor Bradley’s research addresses international marketing strategies, focusing on foreign market entry and the impact of culture and personal values on the firm’s international competitive advantage. His focus is on the firm in open economies. His research has been published in the books International Marketing Strategy, Strategic Marketing in the Customer Driven Organisation, and Marketing Management: Providing, Communicating and Delivering Value, and in journals such as Journal of International Marketing, Industrial Marketing Management, Journal of Business Research, Journal of Strategic Marketing, Irish Marketing Review, and Irish Journal of Management. Professor Bradley advises national and multinational companies on global marketing and staff development in the agribusiness, food-processing, and alcoholic beverages sectors. He has served as Dean of the Michael Smurfit School of Business at the University College Dublin, as President of the Institute of International Trade of Ireland, and, currently, as Chairman of the Advisory Council of the Irish Health Services Accreditation Board.
Journal of International Marketing, Vol. 14, No. 1, March 2006
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