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Friday, February 17, 2006

Does Values Research Explain Where Global Opportunity Lies?

Again with the holiday side effects.

In the past week, I consumed zero news, but got into some deeper reading, including this piece -- Mapping America's Values -- in The Atlantic (sorry, mostly behind a wall). As every second article in magazines like this instils a Syriana-like sense of the cultural differences between America and -- in particular -- highly traditional societies, the research on global values seemed particularly timely.

I remember Ronald Inglehart's research to when it was first hot about 15 years ago. The rough upshot of this attitude research was that as societies grew prosperous, they were able to focus on "post-material" values. Around 1990, the icon for "post-material" was environmentalism. On one hand, you could look at it in a positive light -- environmentalism followed from prosperity. Or looking at it cynically, it was a way of suggesting that "middle classes" pursue status values, a kind of political bling-bling for people who have most of their main needs satisfied -- thus these values could be disparaged as "luxuries."

As time has marched on, it's obvious that the post-materialist theme really resonates, and in a lot more ways than those kinds of narrow debates.


Today, Inglehart's team of researchers has more data, and are looking at more countries. What's really interesting is the longitudinal nature of the study, now that all this time has gone by. Russia moves backwards towards "survival values" due to recent economic woes. Pakistan, as we can see, is the most traditional and most survival-oriented place in the world. Most nations move up and to the right, as prosperity grew in the 1990's. Mexico is an interesting exception. Self-expression values grew, but traditional religious values also grew, making it more like the United States. And check out Sweden!

So what's also interesting is how the researchers map clusters of values on two dimensions: survival vs. self-expression values, but also secular-rational values vs. traditional values.

We see in the diagram, as we so often do, American exceptionalism. In places like France, religiosity (traditional values) has dropped off sharply since the 1950's, though it appears not to have dropped any lower in the past ten years. (In a related story about the new Pope's assessment of the prospects for Christianity in the world in the same Atlantic, was his list of places like this -- "Quebec is lost" he said (I'm paraphrasing).) Yet of all the prosperous countries well to the right-hand side of the continuum towards "self-expression values" (people who love choice, freedom, etc.), the United States is also the most religious. As the article put it, the U.S. is both the most religious and the most liberated country in the world. An apparent paradox. Countries that are similar on both counts are Canada and the UK.

Thinking about the paradox got me thinking about markets and customers.

And it suddenly didn't seem like such a paradox at all. To have markets and customers in most industries, you need a level of prosperity, choice, and freedom. This goes all the way back to Hobbes' need for a "social contract" to put aside civil war in order that conditions for "commodious living" be in place. That dimension does most of the talking as far as the overall, broad-brush economy goes. The kind of economy I'm talking about is the ability to talk to a big market -- let's say online -- and have them make decisions to try new things, and adopt and embrace your better or more exciting solution (or just buy your art). A free-flowing, functional, efficient, and prosperous economy.

The other dimension doesn't matter nearly as much to "buyability" in consumers and "growability" of companies. Religiosity clearly does not hurt business in the U.S., and many might argue that it helps. (I'd like to think it's a neutral value -- I'm not religious -- but I don't speak for the market.) And extremely "hyper-rational" groups of consumers might well be the scariest customers of all. "Sceptics" don't sound like such great customers. If you're into Continental philosophy, or have a society full of engineers and holders of postgraduate degrees, how are you going to build a detergent brand or sell people a flashy car? Who would buy an SUV that got ten miles to the gallon? At some point, many big-company marketers wish for a lenient customer base who are willing to buy on faith.

Maybe then Godin's Free Prize Inside -- which asserts that the key to marketing is to build a better product and expect that savvy consumers will share the information in a radically "informed" word-of-mouth world -- is really the book for the Swedes and the Dutch on the graph, along with of course the e-terati who can comparison shop, blog, and do background research til they drop.

His other (more recent) book -- All Marketers Are Liars -- is the yang to that ying. Here, he argues that customers want a story, a narrative. They want your reality, but they want to be swept away by it. This book is the marketing book for the rest of the world.

Both are true, but All Marketers Are Liars is more true?

In the end, it looks like the dimension from traditionalism to rational-scepticism doesn't matter nearly as much to markets and growth as the dimension from "survival" to "self-expression." The parts of populations -- the top 20% of the top 10% of nations -- that have self-expression values (and money) to burn can buy lots and lots and lots of products in nearly any category. It doesn't matter if they also hold fast to traditional religious values, although depending on what they buy, it probably leaves some 'splainin to do.

Sell to prosperous nations, and sell to the middle classes of emerging nations? Absolutely. Trying to get in early on huge markets where there is very little money or infrastructure? You could be ten, twenty, fifty, a hundred years too early. And I'm just talking about selling patio furniture, pet toys, air conditioners, and Brita filters... nothing complicated like constitutional democracy.

The question does remain, if American exceptionalism on the faith dimension dissipates and she begins looking more like Sweden someday, will the marketer face a brutal, sceptical, Free Prize Inside world, where the marketing is the product, period?

Posted by Andrew Goodman




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