How Does the Cultural Background Affect the International Business: A Readable Case Study of Costco in China Mainland

Research Article
Open access

How Does the Cultural Background Affect the International Business: A Readable Case Study of Costco in China Mainland

Zihao Wang 1*
  • 1 The University of New Mexico    
  • *corresponding author wzihao58@gmail.com
Published on 13 September 2023 | https://doi.org/10.54254/2754-1169/19/20230129
AEMPS Vol.19
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-915371-81-2
ISBN (Online): 978-1-915371-82-9

Abstract

When an international corporate enters a foreign business, it has to classify cultural differences to adapt to the new condition. For instance, customers with different cultural backgrounds would have different reactions to a new business. Cultural background may affect customer behavior and even further, international business. In 2019, one of the largest chains of the membership-only wholesale club, Costco, opened its first store in China in Shanghai. As an American multinational corporation, it is a typical case for researching the difference between consumers with different backgrounds, hence, this paper chooses Costco as the sample and makes a readable case study. The research of this study is mainly based on a questionnaire survey of 211 Costco customers and analysis of several events in China related to Costco. The result of the case study reflected the cultural attributes of foreign brands in the view of Chinese consumers and suggested how the international enterprises could attract Chinese consumers by their cultural attributes. The goal of this paper is to provide a reference for multinational enterprises, especially the enterprises of retail trade, consumer nondurables, and consumer durables, to plan their operations, branding, and marketing in China.

Keywords:

Costco, international business, cultural background analysis, multinational corporation

Wang,Z. (2023). How Does the Cultural Background Affect the International Business: A Readable Case Study of Costco in China Mainland. Advances in Economics, Management and Political Sciences,19,135-143.
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References

[1]. Cheng, A.: Think the fervor around Costco's first store in China is fleeting? think again. Forbes. Retrieved November 15, 2022, from https://www.forbes.com/sites/andriacheng/2019/08/28/why-the-fervor-behind-costcos-first-china-store-wont-be-short-lived/?sh=4d0ecf0415ab

[2]. National Bureau of Statistics. The twelfth report on the social and economy after the 18th National Congress of the Communist Party of China. Open Government Information. Retrieved December 11, 2022, from http://www.stats.gov.cn/xxgk/jd/sjj d2020/202209/t20220929_1888803.html

[3]. National Bureau of Statistics. The analysis of the urban employed by the senior officer of the Population and Employment Statistics Division in the National Bureau of Statistics. Open Government Information. Retrieved December 11, 2022, from http://www.stats.gov.cn/xxgk/jd/sjjd2020/202205/t20220520_1857633.html

[4]. Alexander, R.: American Fast Food as Cultural and Politics: The Introduction of Pepsi and McDonald’s into the USSR. [Master’s thesis, University of Oregon] Department of History. Retrieved December 30, (2013). http://hdl.handle.net/1794/13299

[5]. Gan, N. & Steve George.: Why Chinese influencers are flocking to a Costco in Shanghai (and no, it’s not for the discounts). CNN Travel. Retrieved January 3, 2023 from https://www.cnn.com/2021/10/29/china/chinese-influencers-costco-mic-intl-hnk/index.html

[6]. Giorgio.: [@giorgiomomurder]. Chinese influencers pretending to be in Los Angeles by taking pictures at the Shanghai Costco. [Tweet]. Twitter (2021). https://twitter.com/giorgiomomurder/status/1452856391803146249?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1452856391803146249%7Ctwgr%5E4b6de7dea9e866f3c88f69f28ec391cb13766783%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fnews.yahoo.com%2Fchinese-influencers-head-costco-pretend-222237940.html

[7]. Wegmans is Top Supermarket, and Costco is the Favorite Mass Grocer - According to Market Force Consumer Survey. Marketing Weekly News, 177 (2010). https://link.gale.com/apps/doc/A219269659/STND?u=albu78484&sid=ebsco&xid=8cdbabc2

[8]. Li, P.: Why does Biyao challenge Costco?. China Newsweek. (2019). Retrieved January 3rd, 2023 from https://mp.weixin.qq.com/s/tBDHFc0XymTo-YmPaABepQ

[9]. Foxconn Online Recruiting Center. (2022, December 10). Assembler hiring. Retrieved December 4, 2022 from https://foxconn-job.cn/operator/?type=detail&id=92

[10]. Egorov, B.: How the USSR’s first McDonald’s drove Russians crazy. Russia Beyond. Retrieved January 9, 2023 from https://www.rbth.com/history/329911 -ussrs-first-mcdonalds

[11]. CEO Magazine.: From the basketball court to the C-suite: Richard Chang. Retrieved January 10, 2023, from https://www.theceomagazine.com/ex ecutive-interviews/retail-wholesale/from-the-basketball-court-to-the-c-suite-richard-chang/

Cite this article

Wang,Z. (2023). How Does the Cultural Background Affect the International Business: A Readable Case Study of Costco in China Mainland. Advances in Economics, Management and Political Sciences,19,135-143.

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About volume

Volume title: Proceedings of the 2023 International Conference on Management Research and Economic Development

ISBN：978-1-915371-81-2(Print) / 978-1-915371-82-9(Online)
Editor：Javier Cifuentes-Faura, Canh Thien Dang
Conference website: https://2023.icmred.org/
Conference date: 28 April 2023
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.19
ISSN：2754-1169(Print) / 2754-1177(Online)

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References

[1]. Cheng, A.: Think the fervor around Costco's first store in China is fleeting? think again. Forbes. Retrieved November 15, 2022, from https://www.forbes.com/sites/andriacheng/2019/08/28/why-the-fervor-behind-costcos-first-china-store-wont-be-short-lived/?sh=4d0ecf0415ab

[2]. National Bureau of Statistics. The twelfth report on the social and economy after the 18th National Congress of the Communist Party of China. Open Government Information. Retrieved December 11, 2022, from http://www.stats.gov.cn/xxgk/jd/sjj d2020/202209/t20220929_1888803.html

[3]. National Bureau of Statistics. The analysis of the urban employed by the senior officer of the Population and Employment Statistics Division in the National Bureau of Statistics. Open Government Information. Retrieved December 11, 2022, from http://www.stats.gov.cn/xxgk/jd/sjjd2020/202205/t20220520_1857633.html

[4]. Alexander, R.: American Fast Food as Cultural and Politics: The Introduction of Pepsi and McDonald’s into the USSR. [Master’s thesis, University of Oregon] Department of History. Retrieved December 30, (2013). http://hdl.handle.net/1794/13299

[5]. Gan, N. & Steve George.: Why Chinese influencers are flocking to a Costco in Shanghai (and no, it’s not for the discounts). CNN Travel. Retrieved January 3, 2023 from https://www.cnn.com/2021/10/29/china/chinese-influencers-costco-mic-intl-hnk/index.html

[6]. Giorgio.: [@giorgiomomurder]. Chinese influencers pretending to be in Los Angeles by taking pictures at the Shanghai Costco. [Tweet]. Twitter (2021). https://twitter.com/giorgiomomurder/status/1452856391803146249?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1452856391803146249%7Ctwgr%5E4b6de7dea9e866f3c88f69f28ec391cb13766783%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fnews.yahoo.com%2Fchinese-influencers-head-costco-pretend-222237940.html

[7]. Wegmans is Top Supermarket, and Costco is the Favorite Mass Grocer - According to Market Force Consumer Survey. Marketing Weekly News, 177 (2010). https://link.gale.com/apps/doc/A219269659/STND?u=albu78484&sid=ebsco&xid=8cdbabc2

[8]. Li, P.: Why does Biyao challenge Costco?. China Newsweek. (2019). Retrieved January 3rd, 2023 from https://mp.weixin.qq.com/s/tBDHFc0XymTo-YmPaABepQ

[9]. Foxconn Online Recruiting Center. (2022, December 10). Assembler hiring. Retrieved December 4, 2022 from https://foxconn-job.cn/operator/?type=detail&id=92

[10]. Egorov, B.: How the USSR’s first McDonald’s drove Russians crazy. Russia Beyond. Retrieved January 9, 2023 from https://www.rbth.com/history/329911 -ussrs-first-mcdonalds

[11]. CEO Magazine.: From the basketball court to the C-suite: Richard Chang. Retrieved January 10, 2023, from https://www.theceomagazine.com/ex ecutive-interviews/retail-wholesale/from-the-basketball-court-to-the-c-suite-richard-chang/

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