Case Study:
Cultural Backlash in India
A company that is looking to do business overseas cannot ignore cultural differences if it is to be successful.
As you look at the latest quarterly earnings report of your clothing and accessories company, you think to yourself “You are a genius!” It was your idea to move manufacturing to India last year, and it was your idea to partner with a local retail chain to get your products to Indian consumers. So even though your U.S. sales fell 5 percent, much in part due to the recession, your company’s profits actually rose 35 percent, thanks to all the money you made in India. Almost every day, you walk through the city and you see young, affluent Indians wearing your jeans, clutching your purses, donning your sunglasses, and you are unbelievably glad that you decided to come into this dynamic, fast-growing market that really likes Western fashion styles.
There are many people, however, who aren’t so fond of your styles, and of Western culture in general. Various religious and political conservative groups have recently been protesting the growing influence of Western culture in India, sometimes in quite violent ways. During a recent Valentine’s Day, a group of men publicly beat young couples who were holding hands or having a romantic dinner. In another city, a group of people attacked women who were at restaurants. And just the other day, you saw a crowd of people throwing your jeans, purses, and sunglasses into a big bonfire as a statement against Western fashion. Even businesses are getting into the anti-American sentiment; a local beverage company announced that they would take on the popularity of Coke and Pepsi by selling a beverage based on cow urine, which is considered a holy, medicinal drink by Hindus.
When you came up with the idea of expanding into India, you certainly didn’t think that you would find yourself in the middle of a cultural clash. “I’m just here to sell jeans,” you think, “not to tell people how to live.” But clearly, many people view companies like yours as a threat to their culture and heritage.
Q1. How would you as the manager of this company, deal with the risk associated with doing business in countries that feel threatened by American culture?
Q2. How might your company use an alliance with local companies to adapt to local concerns about American culture?
Your answer must be typed, double-spaced, Times New Roman font (size 12), one-inch margins on all sides, APA format and also include references.