Existence or Absence of Cultural And Other Barrier in Introducing New Fashion Item in Europe: the Case of Tommy Hilfiger
Chapter 2
Review of Related Literature
This chapter tries to sort out the pre-conceived cultural and other barrier being confronted by US-based fashion companies in penetrating in the European market. In finding whether there is such an obvious cultural barrier existing in this business between the two, a definition of culture is first discussed, then several important study on culture, then followed by the cultural background of Europe. There is also a comparison, if there is a difference, between the culture of United States with that of Europe. Then a short case study on one popular and well-known US-based fashion company Tommy Hilfiger on its business life in Europe is discussed.
Are there cultural and other barriers for US-based fashion companies in introducing fashion items in Europe? Do introduction of fashion collections for men and women like sportswear, tailored clothing and dress furnishings, athletic apparel and fragrance, jeans, accessories, and fragrance in the European market pose a great difficulty for US companies that specializes in this business? At a swift glance there seems to be a cultural difference between United States and European nations for the two are situated far apart around the globe, almost halfway in fact.
Responding to an increasing global demand for men and women fashionable cloth designs, sportswear including junior jeans line, robes and sleepwear, socks, sunglasses, footwear, handbags, major fashion companies based in United States have been venturing in the European fashion market for a long time now.
There are many numbers of US-based corporations that exist in Europe that offer goods and services in different businesses like pharmaceuticals, car marketing, household accessories, architecture, advertising and other slew of businesses. And then there is fashion. The big question is "Is there a different kind of behavior coming from the European consumers in reacting to the fashion sense exported by United States to the European market?" Is there a cultural basis for such reaction, if there is such?
There might be a pre-conceived idea from some sectors that there are cultural and other barriers US-based fashion companies experience that confronts and challenge their business-sense in penetrating the European market.
First let us define culture and then look closely at culture of Europe then compare it with that of the United States.
Definition of Culture
According to Simpson (cited in Trompenaars & Hampden-Turner, 1999) a fish when it is out of the water only realizes its need for water during this time. It is the same with culture; it's like water to a fish. What one regards as essential, for example material health, may not be so important to other cultures.
There are over a hundred definitions of "culture" ranging from broad to extended ones, extrapolating the myriad aspects of culture as written by Kroeber and Kluckhohn (1985).
Kanter & Corn (1994) describe culture as the collective understanding of meaning that is the core stability in society. These cultural factors fan the flames of intergroup conflict or encourage the acceptance of differences. Analysing the literature of the subject results in finding two very popular definitions.
The first is anthropological and that culture is a body learned behaviour, a collection of beliefs, habits and traditions, shared by a group of people and learned by people who enter the society. The second is by Hofstede (1991) that says it is the collective programming of the mind of one human group that distinguishes the member from another group. Culture, adds Hofstede, includes systems of values.
This suggests that culture is learned, not inherited and can be learned so as to integrate cultural differences. The elements creating this cultural programming of the mind are as follows: Language – verbal and non verbal; Religion; Economics; Politics; Social; institutions (social classes, family structure); Values; Customs; Attitudes; Manners; Education; Material items; and Aesthetics.
Some of these elements, according to Hofstede, can be observed by our senses as material items – food, buildings, monuments, places of religion cult, agriculture, markets, shops, art, language, music, manners and fashion, etc.
This outer layer of culture consists of explicit culture that is observable and called generally artefacts and products. The other elements are not so easy to perceive like norms, values, customs and attitudes. They are called the middle layer of culture.
The Culture of Europe
In several cross-cultural studies done by various scholars, Europe's culture has been assessed and imbues with certain characteristics, which is important and vital in doing business and interacting with them.
An early study by two American anthropologists Kluckhonh & Strodtbeck's (1961) explained cultural similarities and differences in terms of a number of fundamental dilemmas that all societies face. What they find as the core of European's culture are:
1) relationship to nature which can be perceived as subjugation, harmony or mastery of nature. This society is convinced that there is the supremacy of the human race in the World and that is why people can harness the forces of nature. This attitude can be observed in the English-speaking nations (like Britain) and many other European countries.
2) human relationships -- are perceived as individual, lineal called hierarchical, or collateral – collectivist. Europeans are individual who believe that an individual human being should be independent. Individuals take responsibility for their own actions and behaviour. Anglo-Saxon societies tend to be individualistic, emphasising the significant role of the individual in society. According to Simpson (2001) human relationships are perceived as individual, lineal called hierarchical, or collateral – collectivist. Cultures that are individual believe that an individual human being should be independent. Individuals take responsibility for their own actions and behaviour. Anglo-Saxon societies tend to be individualistic, emphasising the significant role of the individual in society.
3) concept of space -- can be perceived as private, public or mixed. There are societies where space is treated privately with respect for personal ownership. Everything that is private is valued, including private meetings. Anglo-Saxon cultures belong to this category.
Hall's Cultural Contexts Model
Different societies and culture groups respond differently to their contexts when they maintain relationships. Hall (1976) was the author who found out that to understand the behavioural priorities of a particular group it is necessary to know their contexts and how members of the group experience them. He distinguished culture between: high-context cultures and low-context cultures.
People from high-context cultures depend mainly on the external environment, situation and non-verbal behaviour when they create and interpret communications. While low-context societies are characterised by quite different features. It means that:
Ø relationships between people are relatively shorter and usually there is no such deep involvement as in high-context cultures
Ø insiders and outsiders are less closely distinguished. It results in relatively easier adjustment of foreigners to the society. In some societies immigrants may be encouraged to take nationality
Ø cultural patterns are not as ingrained as in high-context societies and faster to change.
Hall's cultural model is based on qualitative insights rather than quantitative data. Examples of high-context countries are as follow: Asian countries as well as the Middle East and countries around the Mediterranean. Low-context countries are among Great Britain, New Zealand, Australia, Germany, Scandinavian countries etc.
Meanwhile Trompenaars & Hampden-Turner (1999) proposed a seven- dimension model of examining variety of cultures. They stated that cultures distinguish from each other by the specific solution of the problems that are treated as dilemmas. These fundamental problems belong to our relationships with other people, our attitude to the environment and time. In analysing relationships with people they take under consideration five dimensions or orientations: Universalism versus particularism; Individualism versus communitarianism; Neutral versus emotional; Specific versus diffuse; and Achievement versus ascription.
Universalism can be stressed in saying that it is possible to define things or ideas that are right and good, if so they should be always and everywhere implemented. The examples of this approach are among others Great Britain and Sweden.
Though the idea of individualism (Great Britain, Netherlands, Sweden) and communitarianism (France, Germany, Japan) is very similar to Hofstede's (1991) interpretation of individualism and collectivism.
The Neutral approach is preferred where people dealing officially are objective and rational. Expressing emotions is not treated as professional and what is more, impairs business. Great Britain and Germany can be given as examples of this attitude.
Another dimension is differentiation between the specific approach and the diffuse. The knowledge of the importance of this cross-cultural difference is very useful both in business and in other kinds of relationships. The specific approach focuses on a particular matter – in business on getting a contract signed and relationships between parties are limited to the negotiated points of the agreement. The examples of this attitude are Great Britain, Netherlands, Sweden. In the diffuse approach the personal relationships are very important and they enhance business relationships. This approach can be found in many Asian cultures, Latin America, and Arabian countries.
Achievement cultures believe that an individual should be judged on what he/she has recently achieved and the first question is "what did you study?" The examples of achievement cultures are Great Britain, Sweden, Germany, Netherlands, Japan. In ascription societies the questions is "where did you study?" Ascriptive cultures like France are convinced that social status is attributed to an individual by birth, kinship, gender, age, connections or educational record.
Another dimension is attitude to time similarly like in the Kluckhohn and Strodtbeck model. Some cultures perceived time as passing in a straight line and a sequence of different events. Past is not as important as present and future and consequently past achievements are not very much recognised and appreciated. This attitude is characteristic for Great Britain, Netherlands, Germany, Sweden.
Though Garreau (n.d.) noted one of the major cultural differences among European nations themselves. First Europe is divided by northern Europe (Scandinavian countries, Benelux, British Isles, Austria and Germany) and southern Europe (Italy, Spain, Portugal and Greece). One point Garreau observed is the way they conduct business. In the north there is much more concessus-type approach whereas it's a more autocratic and authoritarian in the south. Human nature may be the same everywhere but they do not think or act alike.
The Culture of United States vis-à-vis the Europeans
It is stereotypical knowledge that two major cultures that seemed never to meet is the culture of the West and the East. For centuries this simple knowledge has been the issue of cultural clash, barriers that block the two cultures that many writers and historians have put tons of studies and chapters of books discussing the difference. But examining closely this immemorial culture division that civilization knows, United States and European nations are clustered in the same culture called the West!
Putting together the cultural studies and researches done by Kluckhonh & Strodtbeck's, Hall, Trompenaars & Hampden-Turner, and Hofstede, we can only see one major obvious similarity between United States and European nations.
First all the cultural undercurrent of European nations is the same with that of the United States.
Basing from Kluckhonh & Strodtbeck's study about the cultural similarities and differences in terms of a number of fundamental dilemmas that all societies face – relationship to nature, human relationship and concept of space – the Americans is very the same way with their European counterparts. Their relationship to nature can be perceived as subjugation, harmony or mastery of nature. This is a society convinced on human supremacy over the World and believes that people can harness the forces of nature. As Kluckhonh & Strodtbeck's noted this attitude can be observed in the English-speaking nations and many other European countries. Obviously, United States is an English-speaking nation.
Hall's Cultural Contexts Model, that distinguished culture between: high-context cultures and low-context cultures, finds that low-context countries are among Great Britain, New Zealand, Australia, Germany, Scandinavian countries etc. Including United States. Low-context culture means relationships between people are relatively shorter; insiders and outsiders are less closely distinguished and results in easier adjustment of foreigners to the society; and cultural patterns are not as ingrained that culture is faster to change.
Likewise Trompenaars & Hampden-Turner's seven- dimension model of examining variety of cultures clusters United States with the European nations. (See the above the seven-dimension model formulated by two and in all of these seven factors, United States and European nations fare similarly with each other.
The same can be said with that of Hofstede's study.
Probably one remaining possible barrier that one can think of between the United States and other European nations is the language barrier. But on the second thought, fashion sense is not dictated by language.
Tommy Hilfiger in Europe
According to Bomersheim (2001) that from the perspective of marketers, it's better to be in the fashion business (in Europe) than to sell humdrum old commodities. This is on the conclusion that people will pay good money to get that special look.
And that is exactly what fashion companies are doing.
From a humble beginning of designer Tommy Hilfiger according to www.tommy.com with only a retail career of $150 and 20 pairs of bell bottom jeans, Tommy Hilfiger is now a household names around the globe with profit reaching $1 billion earning a year and know known for trendy fashion designed clothes for men and women, sportswear, tailored clothing and dress furnishings, athletic apparel and fragrance, jeans, and fashion accessories.
In a Press Release on July 6, 2001 www.tommy.com announced the complete acquisition of Tommy Hilfiger Corporation of T.H. International N.V., the owner of its European licensee, for $200 m. Tommy Europe markets and distributes Tommy Hilfiger men's, women's and children's sportswear and jeans wear in Europe and the Middle East through diverse channels, including wholesale sales to quality retailers, franchisees and regional distributors, and retail sales through a limited number of company-operated specialty and factory outlet stores.
Then according to www.fashionunited.co.uk Hilfiger profits rise due to European business, where 15 of its stores are located. The fashion company posted better than expected second-quarter profits, mainly due to the acquisition of Tommy Hilfiger Europe. The net profit in the 3 months to September was up to $47.9m (EUR 52.9) compared to $ 44.9m in the same period of 2000. In the first half year, net profit amounted to 56.9m. Tommy Hilfiger Europe is expected to contribute $115m to Hilfiger's financial year. Turnover in the first half declined from $ 933.2m to $901.1m. Women's wear is continuing to perform strongly, while children's wear and sales declined.
Going back to the research of scholar Hofstede who states that culture is learned, not inherited and can be learned so as to integrate cultural differences. Where some elements creating this cultural programming of the mind (Language, Religion, Economics, Politics, Social, institutions, Values, Customs, Attitudes, Manners, Education, Material items, and Aesthetics) can be observed as material items, specifically like fashion.
Following the argument of Hofstede, fashion therefore can be learned and can be integrated, and at some point with relative ease fuse with the culture of other nations.
This is best exemplified by the case of fashion company like Tommy Hilfiger in Europe. The collection of clothes offer by Tommy Hilfiger are easily adapted and patronized by Europeans and can be seen on the high sales of stores in Europe.
On the contrary, back to where Tommy Hilfiger is based, United States, the company according to its website www.tommyhilfiger.com press release dated November 1, 2002, Tommy Hilfiger announced plans to close most of its U.S. full-priced retail stores, saddled by declining sales in its men's wear and children's wear. The company gave off warning that profit for the second half of its fiscal year will be well short of expectations.
According to Time Europe writer, Thigpen (2000) Tommy Hilfiger may be a victim of its own successes. After ten long years in which the company's average growth sizzled at 48% a year, some business pundits fear Tommy's recent expansions into women's wear, perfumes and baby gear may have pushed the brand to a saturation point since Tommy products are already in 10,000 stores across the U.S.
Tommy Hilfiger Europe might be experiencing minor barrier for its fashion items to be introduced in Europe, like dealing with business people from the north and south Europe where there is a slight different business working ethics, but overall the Tommy Hilfiger fashion business is a success and well supported by consumers.
Probably we can conclude that with the fact in hand that the stores in the United States are the ones closing, cultural barrier is no longer an issue but business acumen of how to sustain financial growth in a competitive fashion market plays already a fundamental issue.
Summary
Analysing all the study and researches done by scholars on the issue of culture and the different cultures in world, their models can be useful for close scrutiny and understanding of cross-cultural issues. From the study, they give clear view on different approaches and attitudes of people originating from different countries and regions, and at some point their similarities. The issue between the difference of culture between United States and European countries, on the aspect that it can affect doing business between the two, particularly on fashion business in introducing new fashion item in the European market.
There are loud similarities in the culture of United States and European, and why then they are clustered in the term The West. They maybe minor difficulties that may pose some problems doing business for US-based companies, particularly in fashion business, but they are usual and not out of cultural barrier, as some may say.
The case of Tommy Hilfiger is given as a study on the success of US-based fashion company in Europe only if the company will play its cards well and practice sound business acumen. So far there is no obvious cultural barrier US fashion companies experience in Europe as this paper shows. Doing fashion business between United States and European nations is like doing any business for that matter. Fashion companies can be either with relative ease penetrate the fashion market of Europe since fashion is not restricted by language, and people has a inclination to look good without consideration on where the fashion company is based.
References:
Bomersheim, W.P. (2001). Making American Hardwoods Fashionable in Europe: The Role of Public Relations, Accessed: 2003/04/02 http://www.fas.usda.gov/info/agexporter/2001/jan/AmericanHardwoods.ht
Garreau, J.E., (n.d.), The Languages of Europe: A Cultural Introduction
A Cultural Introduction to the Languages of Europe, Accessed: 2003/04/02
Hall, E.T. (1976). Beyond Culture, Anchor Press, Doubleday
Hofstede, G. (1991). Cultures and Organisations, Software of the Mind Intercultural Co-operation and its Importance for Survival, McGraw-Hill Book Company, London
Kanter, R.M. & Corn, R.I. (1994). Do cultural differences make a business
difference? Contextual factors affecting cross-cultural relationship
success. Journal of Management Development, 13, p.p. 5-23.
Kluckhohn, C., & Strodtbeck, F. (1961). Variations in Value Orientations,
Westport, CT, Greenwood Press
Simpson, D. (2001). Cross-cultural studies as a way of improving, promoting and
enhancing contacts between countries and businesses
Thigpen, D.E. (2000). From New Wave to Wavering, Time Europe, Vol. 155, no. 18
Trompenaars, F. & Hampden-Turner, C. (1999). Riding the Waves of Culture,
Understanding Cultural Diversity, Nicholas Brealey Publishing, London
2001, Tommy Hilfiger Corporation Completes Acquisition of its European
Licensee. Tommy Hilfiger. Accessed: 2003/04/02 www.tommy.com
2002, Hilfiger forced to close 37 U.S. retail stores. Tommy Hilfiger. Accessed: 2003/04/02 www.tommyhilfiger.com
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