Eccles School research: Sales go up when product is seen as exotic

SALT LAKE CITY, Dec. 13, 2016 /PRNewswire/ -- As Oscar contenders are set to hit the big screen this month, understanding how well films will fare with an international audience is increasingly important.

With a global marketplace, it's important for companies to understand how well their products will sell around the world and target their marketing to get the most value.

A new study co-authored by Sangkil Moon (UNC), Arul Mishra and Himanshu Mishra of the David Eccles School of Business, and Moon Young Kang (KAIST) researched movie ticket sales and found an interesting relationship between how well the culture of the movie matched that of its viewers.

"When there is a cultural match the influence of cultural distance on product sales is U-shaped. That is, when cultural distance is small, consumers understand the culture depicted in the movie and there is acceptance. As that cultural distance increases from small to medium, the culture is less understandable and the sales fall," said Himanshu Mishra. "However, when cultural distance becomes very large an interesting reversal occurs and sales now go up because the product appears quite alien and exotic."

For example, if studio executives were marketing a King Arthur movie, they likely would want to target European countries first. Culturally middle-distance nations, such as Central America, may not be as keen to watch such a film, but far-distant cultures such as those found in the East Asia, may like it more because it depicts a culture exotic from viewers' own.

The study, called "Cultural and Economic Impacts on Global Cultural Products: Evidence from U.S. Movies" and published in the Journal of International Marketing, could help companies target their marketing to the consumers most likely to purchase their goods.

"Understanding what are the economic and cultural factors that might influence consumer perception and buying behavior for global products is important to many firms that sell across countries. The common notion supported by research is that the influence is linear. In our research we demonstrate that this is not so," Arul Mishra said.

The article also found an inverse-U relationship between the economic prosperity of a country and how likely they are to purchase globally imported products.

"As economic prosperity increases, consumption of global products increases. But as it further increases, the quality of domestic products also increases, and so the consumption of imported global products go down," Himanshu Mishra said.

About the David Eccles School of Business

The Eccles School is synonymous with 'doing.' The Eccles experience provides a world-class business education with a unique, entrepreneurial focus on real-world scenarios where students put what they learn into practice long before graduation. Founded in 1917 and educating more than 6,000 students annually, the University of Utah David Eccles School of Business offers eight undergraduate majors, four MBAs, five other graduate programs, a Ph.D. in seven areas and executive education curricula. The School is also home to eight institutes, centers and initiatives that deliver academic research and support an ecosystem of entrepreneurship and innovation. For more information, visit Eccles.Utah.edu or call 801-581-7676.

SOURCE David Eccles School of Business