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4TH ASIA–PACIFIC EDITION

KOTABE
MARSHALL
ANG
GRIFFITHS
VOOLA
ROBERTS
HELSEN
PART 2Analysing international Reasons for international market
segmentation225
marketing opportunities 185 Country screening
International marketing research
226
227
Entry decisions 227
CHAPTER 6 International Positioning strategy 228
marketing research 187 Marketing mix policy
International market segmentation approaches
228
230
Scene setter Gauging the market at a distance 188 Segmentation scenarios 232
Overview189 Bases for country segmentation 234
International marketing research process 189 Demographic variables 234
Research problem formulation 190 International spotlight 7.1 Vying for the
Secondary marketing research 192 pink dollar 235
Secondary data sources 192 Socioeconomic variables 236
Problems with secondary data research 195 Behaviour-based segmentation 238
Primary marketing research 197 Lifestyle variables 238
Focus groups 197 International positioning strategies 240
International spotlight 6.1 Microblog coverage Uniform versus localised positioning strategies 241
of scandals and crises in China 198 International spotlight 7.2 The new face of
Survey methods for cross-cultural Singapore: arts and entertainment 242
marketing research 199 Universal positioning appeals 244
International spotlight 6.2 The changing face International spotlight 7.3 Finding a position in
of market research 204 the market: the international marketing
Market size assessment 204 challenge facing Chinese car manufacturers 245
Analogy method 205 Global, foreign and local consumer
Trade audits 207 culture positioning 246
Chain ratio method 207 Conclusions246
Cross-sectional regression analysis 208 Summary247
International spotlight 6.3 People meters in Key terms 248
New Zealand 209 Review questions 248
New market information technologies 210 Discussion questions 248
Managing international marketing research 212 Applied activities 249
Selecting a research agency 212 Appendix: Segmentation tools 250
Coordination of multi-country research 213 Cluster analysis 250
Ethical research considerations 214 Regression analysis 252
International spotlight 6.4 Market research: Further reading 253
the ethics of research with children 215 Endnotes 253
Conclusions216
Summary216
Key terms 217
CHAPTER 8 Market selection and
Review questions 217 entry strategies 257
Discussion questions 217
Applied activities 218 Scene setter Pie Face: making it on Broadway 258
Further reading 218 Overview259
Endnotes 219 Deciding to go overseas 259
Selecting a country to enter 259
Selecting a target market 259
CHAPTER 7 Segmentation and Choosing the mode of entry 262
positioning223 External decision criteria for mode of entry 262
Market size and growth 262
Scene setter Segmentation and multiple brands key to Internal decision criteria for mode of entry 265
Volkswagen’s global success 224 Choice of mode of entry: a transaction-cost
Overview225 explanation 266

vi CONTENTS
Exporting267
Indirect exporting 267 PART 3Developing international
Cooperative exporting
Direct exporting
268
268
marketing strategy 293
Internal exporting department 268
International spotlight 8.1 Exporting and CHAPTER 9 Developing new goods and
distributing Slim Secrets 269
Licensing270
services for international markets 295
Advantages 270 Scene setter The Campbell Soup Company 296
Disadvantages 270 Overview297
Franchising271 Standardisation versus customisation 297
International spotlight 8.2 Boost Juice’s Common customer needs 297
smooth move 272 Global customers 298
Advantages 272 Economies of scale 298
Disadvantages 272 Regional market agreements 299
Contract manufacturing 273 Degree of standardisation 299
Advantages 273 International spotlight 9.1 Confectionery:
Disadvantages 273 standardised manufacturing customised
Joint ventures 274 for local appeal 300
International spotlight 8.3 Joint ventures in International product strategies 300
the car industry in China 274 Strategic option 1: Product and communications
Advantages 275 extension — dual extension 301
Disadvantages 275 Strategic option 2: Product extension —
Drivers behind successful international communications adaptation 302
joint ventures 276 Strategic option 3: Product adaptation —
Wholly owned subsidiaries 278 communications extension 303
Advantages 278 Strategic option 4: Product and communications
Disadvantages 278 adaptation — dual adaptation 303
Acquisitions and mergers 279 Strategic option 5: Product invention 303
Advantages 279 Multinational diffusion 304
Disadvantages 279 Developing new products for international markets 306
Greenfield operations 279 Screening 307
Advantages 280 International spotlight 9.2 Swisse: innovation, testing
Disadvantages 280 and proven research supporting global growth 308
Strategic alliances 280 Test marketing 309
International spotlight 8.4 Cross-licensing Entry timing: waterfall versus sprinkler strategies 311
agreements281 International NPD and culture 312
Types of strategic alliances 281 Conclusions313
The logic behind strategic alliances 282 Summary313
Crossborder alliances that succeed 282 Key terms 314
Timing of entry 283 Review questions 314
Exit strategies 284 Discussion questions 314
Reasons for exit 284 Applied activities 314
Risks of exit 285 Further reading 315
Guidelines 285 Endnotes 316
Conclusions286
Summary287
Key terms 288 CHAPTER 10 Marketing goods
Review questions 288 and services 319
Discussion questions 288
Applied activities 288 Scene setter LG thinks locally, succeeds globally
320
Further reading 288 Overview320
Endnotes 289 Managing multinational product lines 321

CONTENTS vii
 Customer preferences 322 Merits of standardisation 359
International spotlight 10.1 Understanding and International spotlight 11.1 Louis Vuitton’s
adapting to customer preferences 322 core values 359
Price spectrum 323 Barriers to standardisation 362
Competitive climate 323 Approaches to creating advertising copy 363
Organisational structure 323 International spotlight 11.2 Patek Philippe’s
History 324 global advertising campaigns 365
Product piracy 325 International media decisions 366
Strategic options against product piracy 325 Media infrastructure 367
Country-of-origin stereotypes 326 Media limitations 367
Country-of-origin influences on consumers 327 Developments in the media landscape 368
Strategies to cope with country-of-origin stereotypes 328 Advertising regulation 369
International branding strategies 329 Advertising of ‘vice products’ and pharmaceuticals 370
Global brands 329 Advertising clutter 370
International spotlight 10.2 The happiest place Comparative advertising 370
on earth 330 Content of advertising messages 371
International spotlight 10.3 Samsung’s global Advertising targeting children 371
transformation332 Choosing an advertising agency 372
Local branding 333 Coordinating international advertising 373
Global or local brands? 335 Monetary incentives (cooperative advertising) 373
Brand name changeover strategies 336 Advertising manuals 374
Co-branding 338 International or global meetings 374
Umbrella (corporate) branding 338 Other elements of the marketing
Protecting brand names 338 communication mix 374
Global marketing of services 340 Integrated marketing communication 374
Challenges in marketing services internationally 340 Sales promotions 376
Opportunities in the global service industries 341 Direct and online marketing 377
Global service marketing strategies 342 Event sponsorships 377
Conclusions343 International spotlight 11.3 Going the distance
Summary344 to protect sponsors’ rights 378
Key terms 344 Trade shows 379
Review questions 344 Personal selling 380
Discussion questions 344 Conclusions380
Applied activities 345 Summary381
Further reading 345 Key terms 382
Endnotes 346 Review questions 382
Discussion questions 382
Applied activities 383
CHAPTER 11 International Further reading 383
marketing communication 351 Endnotes 384

Scene setter HSBC — The world’s local bank 352

Overview352 CHAPTER 12 Logistics: sourcing
International advertising and culture 353 and distribution389
Language barriers 353
Other cultural barriers 355 Scene setter The changing face of retailing
Setting the international advertising budget 357 in India 390
Percentage of sales method 357 Overview391
Competitive parity method 358 International logistics 392
Objective-and-task method 358 Modes of transportation 394
Resource allocation 358 International spotlight 12.1 The importance
Creative strategy 358 of channel deepening in Melbourne 395
The ‘standardisation’ versus ‘adaptation’ debate 358 Warehousing and inventory management 397

viii CONTENTS
 Third-party logistics (3PL) 399 Managing imports 444
International spotlight 12.2 Some effects of Mechanics of importing 445
internet retailing 400 Import duties 446
International logistics and the internet 400 Grey markets 447
International sourcing 402 Conclusions448
Value chain and functional interfaces 402 Summary451
Types of sourcing strategy 404 Key terms 451
International distribution 407 Review questions 451
Channel configurations 408 Discussion questions 452
Channel management 409 Applied activities 452
International retailing 410 Further reading 452
‘Push’ versus ‘pull’ 411 Endnotes 453
International spotlight 12.3 Zara412
On-time retail information management
Retailing differences across the world
413
414
CHAPTER 14 International pricing 457
Online retailing 415 Scene setter Coping with currency fluctuations 458
Conclusions416 Overview460
Summary416 Drivers of foreign market pricing 461
Key terms 417 Organisation goals 461
Review questions 417 International spotlight 14.1 Setting prices in China 463
Discussion questions 418 Managing price escalation 467
Applied activities 418 Pricing in inflationary environments 468
Further reading 418 International pricing and currency movements 470
Endnotes 419 Currency gain/loss pass-through 471
International spotlight 14.2 The rise and rise of
Volkswagen471
CHAPTER 13Export and import Currency quotation 472
management423 Transfer pricing 473
Determinants of transfer prices 473
Scene setter The prospect of free trade Setting transfer prices 474
with China 424 Minimising the risk of transfer pricing tax audits 474
Overview426 International pricing and antidumping
The role of exporting for Australian organisations 426 regulation475
Organising for exports 429 Price coordination 477
Research for exports 429 Global-pricing contracts 478
International spotlight 13.1 Hard times for Aligning panregional prices 479
Australian wine internationally 430 Implementing price coordination 481
Segmentation and targeting in export markets 431 Pricing policies and the euro 481
Indirect exporting 432 Harmonisation of prices 482
Direct exporting 433 Price transparency 482
International spotlight 13.2 Freedom Furniture International spotlight 14.3 Petrol pricing 483
and the path to international growth 434 Countertrade483
Mechanics of exporting 435 Forms of countertrade 484
Legality of exports 436 Motives for countertrade 486
Export transactions 436 Shortcomings of countertrade 486
Terms of shipment and sale 437 Conclusions487
Payment terms 438 Summary488
Currency hedging 440 Key terms 488
Role of governments in promoting exports 440 Review questions 488
International spotlight 13.3 New Zealand Trade Discussion questions 489
and Enterprise and how it can help 441 Applied activities 489
Export regulations 442 Further reading 489
Overseas countries’ importation regulations 443 Endnotes 489

CONTENTS ix
PART 4 Trends in Consequences of globalisation
The global marketplace and global market segments
534
535
international marketing 493 International spotlight 16.1 Qantas and Virgin
Australia: surviving the future 539
Meeting local and regional customer needs 540
CHAPTER 15 International Changing political realities and world trade 542
International spotlight 16.2 The challenge of
marketing strategy495 manufacturing exports 542
A move towards regionalism 543
Scene setter One giant leap for Red Bull’s
ASEAN 545
international marketing strategy 496
International spotlight 16.3 Welcome back Burma 546
Overview497
Bilateral trade agreements 547
Global strategy 498
The changing face of international marketing 548
Global industry 499
The impact of terrorism 548
International spotlight 15.1 Tourism Australia
Industry consolidation 549
and Emirates Airline: global partnership 500
Faster product diffusion and product life cycles 550
Competitive structure 502 Ethics and governance 551
Hypercompetition 503 Conclusions552
International spotlight 15.2 Navigating the regulatory Summary553
environment505 Key terms 554
Global strategy approaches 506 Review questions 554
International marketing strategy 507 Discussion questions 555
International spotlight 15.3 Wired for success: Applied activities 555
Spotify’s social media strategy 508 Further reading 555
Benefits of an international marketing strategy 509 Endnotes 556
Planning an international marketing strategy 511
International marketing strategy choice 512
Regionalisation of international marketing
strategy515
PART 5Cases in international
Cross-subsidisation of markets
Identification of weak market segments
515
516
marketing561
Use of the ‘lead market’ concept 516 Case study 1 Using social networking tools for
Marketing strategies for emerging markets 517 international marketing 563
Conclusions518 Case study 2 The potential of global mango exports 567
Summary519 Case study 3 Bilateral relations: emerging friendships 574
Key terms 520 Case study 4 The Barbie doll in China 578
Review questions 520 Case study 5 Trying to do business in a quake zone:
Discussion questions 521 Christchurch and Canterbury Tourism 580
Applied activities 521 Case study 6 Market research and communications:
Further reading 521 what flies below the radar 585
Endnotes 522 Case study 7 Marketing halal meat products to
Indonesian consumers 589
Case study 8 The sleeping giant 594
CHAPTER 16 The evolving global Case study 9 Exporting Australian avocados 599
marketplace527 Case study 10 Banyan Tree hotels and resorts 604
Case study 11 Does Gourmet King translate well? 607
Scene setter The future for the tourism industry Case study 12 Distribution woes hobble start-ups in India 609
is Chinese 528 Case study 13 Exporting Australian wildflowers 611
Overview529 Case study 14 Reverse exports: cheese to France? 614
Information technology and global competition 530 Case study 15 Digicel: delivering ‘full service’ at
E-commerce 531 the bottom of the pyramid 618
Real-time management 533
Online communication 533 Glossary 623
‘Internet’ organisation 534 Index 630

x CONTENTS
PREFACE
This fourth Asia–Pacific Edition of International Marketing is a thorough revision
reflecting contemporary developments and examples in international marketing.
The text maintains the strengths of the original text by Masaaki Kotabe and Kristiaan
Helsen, and is presented in an engaging and accessible style. The intended readership
for this Asia–Pacific adaptation is undergraduate students who are studying interna-
tional marketing in Australia, New Zealand and South-East Asia. The text aims to pre-
pare the student to become an effective international marketing manager, overseeing
international marketing activities in an increasingly competitive environment.
A strong theoretical and conceptual foundation in international and global mar-
keting perspectives is provided through the use of ‘real-world’ examples of small and
medium-sized enterprises (SMEs) and multinational companies (MNCs) operating in
the Asia–Pacific region. International marketing is presented from an interdisciplinary,
cross-functional perspective, giving students an appreciation of all aspects of inter­
national business operations and the interface they have with marketing.
The text provides detailed coverage of international marketing at all levels: from
the SME primarily engaged in importing and exporting activities country by country
through to larger organisations striving to coordinate their international marketing activ-
ities regionally and globally. A key underlying theme of the text is that while it may not
be possible for all firms in the Asia–Pacific region to market their goods and services on a
truly global scale, all firms that operate in any international marketplace need to under-
stand and be aware of competition from both the local SMEs and the larger MNCs that
are increasingly attempting to operate globally. In this edition, a ­significant focus has
been placed on ethics, sustainability and the impact of social media.
Features
The text has several key features, including:
• 16 chapters chosen and sequenced to reflect the topics traditionally taught in a typ-
ical undergraduate 12- or 13-week international marketing course
• specific chapters on both international consumers and segmentation and positioning
• Australasian and Asia–Pacific data, research and examples, used alongside relevant
international examples
• strong chapter pedagogy to aid understanding of key international marketing concepts.
Structure
The text is divided into four parts. Part 1, International marketing environment, gives stu-
dents a broad overview of the dynamics of the discipline with a particular emphasis on
the Asia–Pacific region. Part 2, Analysing international marketing opportunities, focuses on
the key issues of researching and selecting methods of international market entry. Part 3,
Developing international marketing strategy, builds on the foundations laid in the first two
parts to give students a solid understanding of how to develop and implement effective
international marketing campaigns. Part 4, Trends in international marketing, looks at the
implications for international marketers of the constantly evolving international market­
place. In recent decades, factors such as increased technological and communication
capabilities have forever transformed the international marketplace for both SMEs and
MNCs. The text concludes with 15 major case studies that have been cross-referenced to
specific chapters in the text, for use where appropriate throughout the teaching semester.
Al Marshall
Swee Hoon Ang
Kathleen Griffiths
Ranjit Voola
Robin E. Roberts
August 2013

PREFACE xi
 ABOUT THE AUTHORS
Masaaki ‘Mike’ Kotabe holds the Washburn Chair Professorship in International Busi-
ness and Marketing, and is Director of Research at the Institute of Global Management
Studies at the Fox School of Business at Temple University. Prior to joining Temple
University in 1998, he was Ambassador Edward Clark Centennial Endowed Fellow and
Professor of Marketing and International Business at the University of Texas at Austin.
Dr Kotabe also served as the Vice President of the Academy of International Business
in the 1997–98 term. He received his PhD in Marketing and International Business at
Michigan State University. Dr Kotabe teaches international marketing, global sourcing
strategy (R&D, manufacturing, and marketing interfaces), and Asian business practices
at the undergraduate and MBA levels and theories of international business at the PhD
level. He has lectured widely at various business schools around the world, including
Austria, Germany, Finland, Norway, Brazil, Colombia, Mexico, China, Japan, Korea,
Indonesia and Turkey. For his research, he has worked closely with leading companies
such as AT&T, NEC, Nissan, Philips, Sony, and Seven & I Holdings (parent of 7-Eleven
stores), and served as adviser to the United Nations and World Trade Organization’s
Executive Forum on National Export Strategies.
Dr Kotabe has written many scholarly publications. His numerous research works
have appeared in such journals as Journal of Marketing, Journal of International B ­ usiness
Studies, Strategic Management Journal and Academy of Management Journal. His books
include Global Sourcing Strategy: R&D, Manufacturing, Marketing Interfaces (1992),
­Japanese Distribution System (1993), Anticompetitive Practices in Japan (1996), M
­ ERCOSUR
and Beyond (1997), Marketing Management (2001), Market Revolution in Latin America:
Beyond Mexico (2001), Emerging Issues in International Business Research (2002) and
Global Supply Chain Management (2006).

Al Marshall is a lecturer in marketing at the Australian Catholic University. He previ-

ously lectured at the University of NSW. He has a doctorate in marketing from Southern
Cross University. His specialist areas are international marketing, marketing commu-
nications and marketing research. He is a regular visiting academic at ESG School
of M ­ anagement, in France. He has also been a visiting academic at universities in
­Germany and Austria. He is the co-author of forthcoming books on marketing commu-
nications, and marketing research. Al is also a case author and has written an ­extensive
number of cases for textbooks in his three specialist areas. He is also the Editor of Carpe
Diem, the Australian Journal of Business, and the Editorial Coordinator for the Asia-Pacific
Journal of Business Administration. His most recent journal articles and ­ conference
­publications focus on advertising content analysis, high involvement l­eisure consump-
tion, and cross-cultural learning. He is also the principal of Brand Life, a research
and planning agency. Al has also worked for market research a­gencies in Hong Kong,
Taiwan, Singapore and Malaysia. He is a member of the A ­ ustralian ­Marketing & Social
Research Society, has QPMR (Qualified Practicing Market Researcher) accreditation
and regularly presents at academic conferences in Britain and Australia.

Swee Hoon Ang is an associate professor at the National University of Singapore Busi-
ness School and has a PhD from the University of British Columbia. She has taught
MBA classes at the China Europe International Business School (CEIBS), Helsinki
School of Economics and Business Administration, and the University of California,
Berkeley. She is also a co-author of the leading textbooks, Marketing Management: An
Asian ­Perspective and Principles of Marketing: A Global Perspective. As an active researcher,
she has published and reviewed for journals including the Journal of Advertising, the

xii ABOUT THE AUTHORS

Journal of Marketing, the Journal of International Business Studies, Marketing Letters, Long
Range Planning and the Journal of Pragmatics. Her teaching and research interests are
in advertising and consumer behaviour, especially pertaining to Asia. As a consultant
and trainer, Professor Ang has worked with organisations such as Caterpillar, Glaxo
Wellcome, Johnson & Johnson Medical, Nokia and Wipro.

Kathleen Griffiths has been a lecturer in the School of Economics, Finance and Mar-
keting at RMIT University, Melbourne, since 2000. Prior to joining RMIT, Kathleen
was at Monash University in the School of Marketing for two years. Kathleen held
various senior corporate roles at Jacqui E (a member of the Just Group of Companies),
Daimaru Melbourne and Myer before becoming an academic. Her corporate experience
spanned more than 17 years. Kathleen’s research and teaching interests include inter-
national marketing and experiential education in Marketing. She is also the Academic
Manager for RMIT’s Work Integrated Learning (WIL) year for Marketing students. She
also coordinates the L’Oreal Brandstorm Marketing competition for the RMIT students
each year, and was lucky enough to accompany the winning Australian team to Paris to
compete in the International Finals in 2012. Kathleen was a recipient of two teaching
awards in 2005 for the work done by the Business Faculty’s WIL team in enhancing the
quality of teaching and learning at RMIT. She has also collected Good Teaching Awards
every year since 2007. Kathleen has a Bachelor of Economics from Monash University,
a Master of Business Administration and Masters in Education from RMIT University.
She is currently completing her PhD in Marketing at RMIT University. Her current
research is on changing consumer shopping behaviours and rituals in Australia and
internationally. Kathleen has been a visiting lecturer in Lille, France, as well as being a
regular visiting lecturer in Hong Kong, Singapore and Shanghai.

Ranjit Voola obtained his PhD and Masters of Marketing from the University of New-
castle, Graduate Certificate in Educational Studies (Higher Ed.) from the University
of Sydney and Bachelor of Business Administration from Griffith University. Ranjit’s
research revolves around strategic marketing and the application of strategic marketing
concepts in various contexts; including international marketing and market-based pov-
erty alleviation strategies. He is the Director of the Poverty Alleviation and Profitability
Research Group at the University of Sydney Business School, which examines the role
of businesses in poverty alleviation. He has published in Journal of Public Policy and
Marketing, European Journal of Marketing, Journal of Marketing Management, Journal of
Marketing Education, Australasian Marketing Journal and the Wiley International Ency-
clopaedia of Marketing, amongst others. Ranjit’s teaching revolves around marketing
strategy and international marketing. He has won numerous teaching and learning
awards including the ANZMAC Emerging Marketing Educator Award.

Robin E. Roberts is currently a lecturer at Griffith University in Brisbane, Australia, and

a visiting professor at Shenyang University of Technology, China. She holds a Master
of International Business with Honours and a Master of Business Administration, and
received her PhD in international marketing strategy from Griffith University.
For more than twenty years, Robin worked in a diverse range of international
product management and consumer marketing roles within the fast-moving consumer
goods sector. As an active consultant, she has developed and presented seminars to
government and private organisations in the wider agrifood industry. Her current
research concentrates on export development within the agribusiness sector in Asia,

ABOUT THE AUTHORS xiii

 value chain analysis, Studies in Chinese consumer decision making and developing
marketing strategies for emerging markets.

Kristiaan Helsen has been an associate professor of marketing at the Hong Kong Uni-
versity of Science and Technology (HKUST) since 1995. Prior to joining HKUST, he was
on the faculty of the University of Chicago for five years. He has lectured at Nijenrode
University (Netherlands), the International University of Japan, Purdue University,
the Catholic University of Lisbon, and CEIBS (Shanghai). Dr Helsen received his BA
in quantitative economics at the University of Antwerp and his PhD in Marketing at
the Wharton School of the University of Pennsylvania. His research areas include pro-
motional strategy, competitive strategy, and hazard rate modelling. His articles have
appeared in journals such as Marketing Science, Journal of Marketing, Journal of ­Marketing
Research and European Journal of Operations Research, among others. Dr Helsen is on
the editorial board of the International Journal of Research in Marketing.

xiv ABOUT THE AUTHORS

ACKNOWLEDGEMENTS
The authors and publisher would like to thank the authors from the third edition of
this text for their valuable contribution in the past. Our thanks go to Ass. Prof. Swee
Hoon Ang (NUS Business School, National University of Singapore), Dr Fred C. W. Chao
(Newcastle Business School, University of Newcastle), Edith Gomez (Trade and Invest-
ment Queensland, Queensland Government), Heather Gray (School of Information and
Communication Technology, Griffith University), Dr Luke Houghton (­Department of
International Business & Asian Studies, Griffith University), Salvador Macagno (Depart-
ment of International Business & Asian Studies, Griffith University), Dr Al Mar­shall
(School of Business, Australian Catholic University), Dr Lucie K. Ozanne (­College of
Business and Economics, University of Canterbury), Samir Patil, Dr Robin E. ­Roberts
(Department of International Business & Asian Studies, Griffith University), and
Dr Ranjit Voola (University of Sydney Business School), whose case studies have
enriched and helped shape this edition.
We would also like to extend our thanks to the authors and contributors of the sup-
plementary resources that accompany this text:
• PowerPoint presentation slides — Nicole Feetham (University of South Australia)
• Instructor Resource Guides — Fred Chao (University of Newcastle)
• Testbanks — Ping Kattiyapornpong (University of Wollongong)
Our appreciation goes to the John Wiley & Sons team for their contribution to
this book: Terry Burkitt (Publishing Editor), Dan Logovik (Content Editor), Shukla
Chakraborty (Managing Editor), Tara Seeto (Publishing Assistant), Renee Bryon (Copy-
right and Image Research Supervisor), Jenny Watson (Senior Graphic Designer) and Jo
Hawthorne (External Composition Coordinator).
The authors and publisher would also like to thank the following copyright holders,
organisations and individuals for their assistance and for permission to reproduce
­copyright material in this book.

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• Copyright Clearance Center: 17 © Reprinted from Journal of World Business, vol. 24, ‘Evolution
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a Global Business’, p. 6, 1985, with permission from Copyright Clearance Center; 88 /Reprinted
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Trade’, p. 66, Copyright 1988, with permission from Copyright Clearance Center; 144 © Marieke
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ACKNOWLEDGEMENTS xv
 for the Asia Pacific Region’, p. 21.,Copyright 1995, with permission from Copyright Clearance
Center; 264 © Reprinted from Long Range Planning 28 (1), P Lasserre, ‘Corporate Strategies for the
Asia Pacific Region’, p. 21, Copyright 1995, with permission from Copyright Clearance Center;
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on Horfstede, ‘Management Scientists are Human’, Management Science 40, no. 1 January 1994:
4–12. Global Marketing Management 3rd Edition, Kotabe and Helsen, © John Wiley & Sons, Inc.
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& Sons Australia: 160 © John Wiley & Sons, Australia. Photo by Renee Bryon • Euromonitor
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• WARC: 229 /F. Zandopour and K. Harish, International Journal of Advertising 15 (1996) p. 341.
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• Palgrave Macmillan Ltd: 306 © Schutte, H. & Ciarlante, D. 1998, Consumer behaviour in Asia,
p. 77, MacMillan Press, London. Reproduced by permission of Palgrave Macmillan; 485 © Journal of
International Business Studies (Second Quarter 1990) p. 245. Reprinted with permission of Palgrave
Macmillan • Patek Philippe S.A.: 365 © Patek Philippe S.A. • Department of Health and Ageing:
370 © Commonwealth of Australia • Simon & Schuster, Inc.: 403, 498, 502 Reprinted with the
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Creating and sustaining superior performance by Michael E. Porter. © 1985, 1998 All rights reserved
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Gomez • Fairfax Syndications (Photos): 609 © Fairfax Photos /Louise Kennerley.

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xvi ACKNOWLEDGEMENTS
Techniques by James E. Austin. © 1990 by James E. Austin. All rights reserved • PRS Group: 97 /
International Country Risk Guide, April 1, 2003, The PRS Group. www.prsgroup.com • Harvard
Bus. School Publishing, 112 /Reprinted by permission of Harvard Business Review. ‘The Disruptive
Playbook’ from ‘Mapping Your Innovation Strategy’ by Scott D. Anthony & Lib Gibson, May 2006.
Copyright © 2006 by the Harvard Business School Publishing Corporation; all rights reserved;
609–10 Reprinted by permission of Harvard Business Review. ‘In India, Distribution is God’ by
Samir Patil, HBR Blog Network, August 17, 2012. http://blogs.hbr.org/cs/2012/08/in_india_­
distribution_is_god.html. Copyright 2012 by the Harvard Business School • Copyright Clearance
Center: 276 Reprinted from Long Range Planning, vol. 28, no. 5, Martinsons, Tsong, ‘Successful
joint ventures in the heart of the dragon’, p. 5, Copyright 1995, with permission from Copyright
Clearance Center; 307–8 R Cooper, Journal of Product Innovation Management 2, no. 1, March 1985,
p. 39. Reprinted with permission of Blackwell Publishers; 427–8 Reprinted from Journal of World
Business, vol. 23, no. 1, Cavusgil & Sikora, ‘How multinationals can counter grey market imports’,
pp. 78–82, Copyright 1988, with permission from Copyright Clearance Center; 470–1 Reprinted
from Business Horizons, vol. 31, no. 1, Cavusgil, ‘Unraveling the mystique of export pricing’, p. 58,
Copyright 1988, with permission from Copyright Clearance Center • Australian Trade Commission:
429 Tim Harcourt/Austrade • Miniwatts Marketing Group: 532 Copyright © 2000–2012, Miniwatts
Marketing Group. All rights reserved.

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such cases, please contact the Permissions Section of John Wiley & Sons Australia, Ltd.

ACKNOWLEDGEMENTS xvii
 PART 1

INTERNATIONAL MARKETING
ENVIRONMENT

CHAPTER 1 Introduction to international

marketing3

CHAPTER 2 Economic and financial

environment37

CHAPTER 3 Political and legal environment 77

CHAPTER 4 Cultural environment 123

CHAPTER 5 Understanding international

consumers155
 CHAPTER 1

Introduction to
international
marketing
Learning objectives
After studying this chapter, you should be able to:

●● describe the growth of Asian markets and the

implications for global trade and international
marketing

●● explain the aspects of the international trade

and business environment that have made
understanding international marketing imperative

●● discuss the evolution of global marketing

●● outline the key processes involved in planning,

implementing and monitoring an international
marketing strategy

●● understand the comparative advantage,

international product cycle and internalisation
theories in relation to international trade and
investment.
 SCENE SETTER

Connecting globally: Online presence

as the strategic necessity for international
marketing
Businesses in today’s globalised marketplace require
the inclusion of online marketing strategies when
connecting with worldwide consumers. Students of
international marketing need to keep up to date with
the major internet players, whose approaches represent
significant divergence from traditional marketing. These
businesses include social media — such as Facebook,
YouTube, LinkedIn, Twitter and Google+ — and online
marketplaces such as eBay, Amazon.com and Apple’s
iTunes store. Also worthy of note is the growth in region-
specific online marketers. In China, companies like
DHgate.com, chinawholesaleonline.org, Chinavasion
and Made-in-China.com have emerged to connect Chinese wholesalers with the rest of the
global marketplace.
The power of social networking as a tool for marketing products and services has been
utilised by forward-thinking companies who understand that 80 per cent of purchase
decisions are based on personal recommendations from people the purchasers know. In the
online environment of social networking, 80 per cent of consumer recommendations made
comprise people who may or may not have met face-to-face with the shopper but who offer
positive or negative referrals on social media sites. One of the challenges for businesses is
that, within the online social networking environment, a single recommendation now has
a far greater potential impact than any engagement achieved through traditional marketing
strategies. So, effective harnessing of the marketing power of social media tools has become
a necessary strategy for international businesses.
As organisations, large or small, engage with the global community, their employees
are expected to virtually cross time zones and demonstrate increased work arrangement
flexibility in order to manage international connections and services. Online businesses have
moved away from the traditional use of door-to-door salespeople and retail department stores
and into the highly competitive global market where the top 20 per cent of products no
longer account for 80 per cent of consumer purchases. In the online environment, a much
wider selection of products and services is available for purchase anywhere across the world
and at any time.
In the Asia–Pacific region, the Chinese online market space offers businesses and
consumers access to products that may have been previously available only through in-country

4 part 1 International marketing environment

visits and trade shows. With this new online offering, access to contract manufacturing and
wholesaling can be conducted through single market portals. This type of business conduit
has the potential to change manufacturing from production line to just-in-time manufacturing,
reduce stockpiling of less popular or season-specific products and increase opportunities
within market segments.
As social media and new marketplaces pervade the global community and influence the
traditional flow of finance from one country to another, both brick-and-mortar and internet
businesses must rethink their marketing strategies and business models to move from
local to global, and stock-on-shelf to just-in-time respectively. Businesses can no longer
be complacent in the face of the online revolution. The impact of social media demands
quality of product and service as well as the need for building and maintaining positive
relationships between businesses and their clients on a global scale. As an example, in
Australia 45.8 per cent of the population is on Facebook.1 As a business you don’t want to
be unfriended on Facebook!

Overview
The scene setter illustrates the growing significance of social media and the online
market space for international marketers amidst a global environment of economic
turmoil. The environment forms the critical background for international marketing
planning and strategy development. Strategic action is based on and tailored to environ-
mental conditions. Corporate success and failure, to a large extent, is determined by
the anticipation of and preparation for the future. This fluid nature of international
markets and the pressure of competition make the study of international marketing
not only interesting, challenging and rewarding, but also of vital relevance for human
welfare. The terms ‘international marketing’ and ‘global marketing’ epitomise both the
competitive pressures and expanding market opportunities all over the world. This
does not mean that all organisations have to operate internationally, as do Qantas and
other organisations such as Sony, Philips and Samsung. It does mean, however, that
whether an organisation operates domestically or across national boundaries, it can
no longer avoid competitive pressure from around the world. Australian food and bev-
erage organisations wishing to market to Muslims in Australia, for example, compete
with imports from other nations and regions selling halal2 food, such as Indonesia,
Malaysia and the Middle East, because these food products must meet the religious
dietary requirements of the customers. In developing the marketing strategy for an
organisation, therefore, any marketing manager needs to understand the nature of, and
the changes within, the international environment in order to devise a strategy that
satisfies consumer needs and achieves corporate success.
This book primarily examines the essential elements of international marketing
from the perspective of an international marketing manager. From a conceptual point
of view, there is little difference between domestic and international marketing in
terms of the general processes of strategy development and implementation. How-
ever, within an international context, the complexity of the problems is much greater;
marketing almost always involves different cultures, languages, laws and resources.
The international marketing manager must, therefore, possess a degree of cross-­
cultural empathy and language skills, as well as knowledge of more specific between-
nation differences.

CHAPTER 1 Introduction to international marketing 5

Another random document with
no related content on Scribd:
Faubourg St. Germain, the aristocracy of the empire, and the
bureaucracy of the present French republic.
The imperial princes of the blood, all nearly related to the Emperor,
rank above the ten created princes, who head the list of the nobility.
Five of these ten princely houses are the old Gosekke, the first five
of the one hundred and fifty-five kugé families comprising the old
Kioto court. With the Gosekke, which includes the Ichijo, Kujo,
Takatsukasa, Nijo, and Konoye families, rank, since 1883, the
houses of Sanjo, Iwakura, Shimadzu, Mori, and Tokugawa, sharing
with them the privilege of offering the bride to the heir-apparent.
The Emperor visits personally at the houses of these ten princes,
and recently the Tokugawas entertained him with a fencing-match
and a No dance in old style, the costumes and masks for which had
been used at Tokugawa fêtes for centuries. In accordance with other
old customs, a sword by a famous maker was presented to the guest
of honor, and a commemorative poem offered in a gold lacquer box.
Yet the head of the Tokugawa house is a grandson of the Shogun
who first refused to treat with Commodore Perry, and son of Keiki,
the arch rebel and last of the Shoguns, who for so long lived
forgotten as a private citizen on a small estate near Shidzuoka,
keeping alive no faction, awaking no interest—attaining, in fact, a
political Nirvana.
Under new titles the old fiefs are lost sight of and old associations
broken up. The marquises, counts, and barons of to-day are slender,
dapper little men, wearing the smartest and most irreproachable
London clothes, able to converse in one or two foreign languages on
the subjects that interest cosmopolitans of their rank in other
empires, and are with difficulty identified with their feudal titles. The
Daimio of Kaga has become the Marquis Maeda, his sister married
the Emperor’s cousin, and the great yashiki of their ancestors has
given way to the buildings of the Imperial University. The Daimio of
Satsuma is now Prince Shimadzu. It is not easy to associate these
modern men-about-town, who dance at state balls, who play billiards
and read the files of foreign newspapers at the Rokumeikwan, who
pay afternoon calls, attend teas, garden-parties, dinners, concerts,
and races; who have taken up poker and tennis with equal ardor,
and are victimized at charity fairs and bazaars, with their pompous,
stately, two-sworded, brocade and buckram bound ancestors.
There are great beauties, favorites, and social leaders among the
ladies of the court circle, and the change in their social position and
personal importance is incredible. Japanese matrons, who, a few
years ago, led the most quiet and secluded existence, now preside
with ease and grace over large establishments, built and maintained
like the official residences of London or Berlin. Their struggles with
the difficulties of a new language, dress, and etiquette were heroic.
Mothers and daughters studied together with the same English
governess, and princesses and diplomats’ wives, returning from
abroad, gave new ideas to their friends at home. Two Japanese
ladies, now foremost at court, are graduates of Vassar College, and
many high officials are happily married to foreign wives; American,
English, and German women having assumed Japanese names with
their wedding vows. The court has its reigning beauty in the wife of
the grand master of ceremonies, the richest peer of his day, and
representative of that family which gave its name to the finest
porcelain known to the ceramic art of the empire.
Tokio society delights in dancing, and every one at court dances
well. Leaders of fashion go through the quadrille d’honneur, with
which state balls open, and follow the changes of the lancers with
the exactness of soldiers on drill, every step and movement as
precise and finished as the bending of the fingers in cha no yu. The
careless foreigner who attempts to dance an unfamiliar figure
repents him of his folly. Japanese politeness is incomparable, but the
sedateness, the precision, and exactness of the other dancers in the
set will reproach the blunderer until he feels himself a criminal. The
ball is the more usual form of state entertainments. The prime-
minister gives a ball on the night of the Emperor’s birthday, and the
governor of Tokio gives a ball each winter. From time to time the
imperial princes and the ministers of state offer similar
entertainments, and every legation has its ball-room. The members
of the diplomatic corps are as much in social unison with the higher
Japanese circles as it is possible to be with such subjects at any
capital, and the round of tiffins, dinners, garden-parties, and small
dances makes Tokio very gay during the greater part of the year.
The first formal visiting of the season begins in October, and by
May social life is at an end until hot weather is over. Lent makes little
break in the social chain. Great seriousness and exactness in social
usage is inherent in this high-bred people. Visits of ceremony are
scrupulously paid within the allotted time, and a newly-arrived official
in Tokio finds no diminution of the card-leaving and visiting which
awaits him in any other capital. At the houses of the imperial princes
cards are not left, the visitor inscribing his name in a book in the hall.
After each state ball, a guest must call at once upon the princess, or
minister’s wife, who presided, and any remissness strikes his name
from her list.
Garden-parties are the favorite expression of Tokio hospitality. All
official residences in the city have fine grounds, and many ministers
of state own suburban villas. A few of the legations are able to
entertain in the same way, and many military officers make the
garden of the old Mito yashiki, now the Arsenal grounds, the scene
of their courtesies.
There is a stately court journal, which is the official bulletin, but
Tokio has not yet set up a paper of society gossip and scandal for
the rigorous censorship of the Japanese press to expunge; nor are
there books of court memoirs. Yet what memoirs could be more
interesting than those that might be written by the men and women
who were born in feudal times, who have lived through the exciting
days of the Restoration, and have watched the birth and growth of
New Japan.
 CHAPTER XIII
THE SUBURBS OF TOKIO

The suburbs of Tokio are full of holiday resorts for the people and
the beautiful villas of nobles. To the north-east, in Oji, are the
Government chemical works and paper mills, where rough bits of
mulberry-wood are turned into papers of a dozen kinds, the silkiest
tissue-paper, smooth, creamy writing-paper, thick parchment, bristol-
board, and the thin paper for artists and etchers. On a sheet of the
heaviest parchment paper I once stood and was lifted from the floor,
the fabric showing no mark of rent or strain, and it is wellnigh
impossible to tear even a transparent Oji letter sheet. The Oji tea-
house has a famous garden, and in autumn Oji’s hill-sides blaze with
colored maples, and then the holiday makers mark the place for their
own.
Waseda, the northern suburb, contains an old temple, a vast,
gloomy bamboo-grove, and the villa of Countess Okuma, to whose
genius for landscape-gardening is also due the French Legation’s
paradise of a garden, in the heart of the city, that place having been
Count Okuma’s town residence before he sold it to the French
Government. From Waseda’s rice fields a greater marvel grew.
Meguro, south of Tokio, is a place of sentimental pilgrimage to the
lovers of Gompachi and Komurasaki, the Abelard and Heloise of the
East, around whose tomb the trees flutter with paper poems, and
prayers. In the temple grounds are falling streams of water, beneath
which, summer and winter, praying pilgrims stand, to be thus
pumped on for their sins. Similar penitents may be seen at a little
temple niched in the bluff of Mississippi Bay. Meguro has an annual
azalea fête and a celebration of the maple-leaf, and its resident
nobles, among whom is General Saigo, give feasts in honor of the
season’s blooms.
 The Sengakuji temple, near Shinagawa, is a sacred spot and
shrine of chivalry, the burial-place of the Forty-seven Ronins; and
here come pious pilgrims to say a prayer and leave a stick of burning
incense, and view the images and relics in the little temple.
Near Omori, half-way between Yokohama and Tokio, Professor
Morse discovered the shell-heaps of prehistoric man. The
neighborhood is made beautiful by old groves, old temples and
shrines, tiny villages, picturesque farm-houses, and hedge-lined
roads, while Ikegami’s temples shine upon the hill that stands an
evergreen island in the lake of greener rice fields or golden stubble.
Here died Nichiren, founder of the Buddhist sect bearing his name.
For six centuries these splendid temples have resounded with the
chantings of his priesthood, who still expound his teachings to the
letter. The Nichiren sect is the largest, richest, most influential, and
aggressive in Japan. They are the Protestants and Presbyterians of
the Buddhist religion; firm, hard, and unrelenting in their faith,
rejecting all other creeds as false, and zealously proselyting.
Nichiren was a great scholar, who, poring over Chinese and Sanscrit
sutras, believed himself to have discovered the true and hidden
meaning of the sacred books. His labors were colossal, and though
exiled, imprisoned, tortured, and condemned to death, he lived to
see his followers increasing to a great body of true believers, and
himself established as high-priest over the temples of Ikegami. In the
popular play “Nichiren,” one has thrilling evidence of what the pious
founder and his disciples endured.
On the twelfth and thirteenth of each October special services are
held in memory of Nichiren, which thousands of people attend. On
the first day of this matsuri the railway is crowded with passengers.
Bonfires and strings of lanterns mark the Omori station by night, and
by day the neighboring matsuri is announced by tall bamboo poles,
from which spring whorls of reeds covered with huge paper flowers.
These giant flower-stalks are the conventional sign for festivities, and
when a row of them is planted by the road-side, or paraded up and
down with an accompaniment of gongs, the holiday spirit responds
at once. The quiet country road is blockaded with hundreds of
jinrikishas going to and returning from Ikegami’s terraced gate-ways.
Men, women, and children, priests, beggars, and peddlers pack the
highway. The crowd is amazing—as though these thousands of
people had been suddenly conjured from the ground, or grown from
some magician’s powder—for nothing could be quieter than Omori
lanes on all the other days of the year.
Along the foot-paths of the fields women in tightly-wrapped
kimonos with big umbrellas over their beautifully-dressed heads;
young girls with the scarlet petticoats and gay hair-pins indicative of
maidenhood; little girls and boys with smaller brothers and sisters
strapped on their backs, trudge along in single files, high above the
stubble patches, to the great matsuri. In farm-house yards
persimmon-trees hang full of mellow, golden fruit, and the road is
literally lined with these apples of the Hesperides. Peddlers sit on
their heels behind their heaped persimmons and busily tie straw to
the short stems of the fruit, that the buyer may carry his purchase
like a bunch of giant golden grapes. Fries, stews, bakes, and grills
scent the air with savors, and all sorts of little balls and cubes, pats
and cakes, lumps and rolls of eatables are set out along the country
road. A queer sort of sea-weed scales, stained bright red, is the
chewing-gum of the East, and finds a ready market.
On the days of the matsuri the village street is impassable, and the
whole broad walk of the temple grounds leading from the pagoda is
lined with booths, jugglers, acrobats, side-shows, and catch-penny
tricksters. The “sand-man,” with bags of different colored sands,
makes beautiful pictures on a cleared space of ground, rattling and
gabbling without cessation while he works. First he dredges the
surface with a sieve full of clean white sand, and then sifts a little thin
stream of black or red sand through his closed hand, painting
warriors, maidens, dragons, flowers, and landscapes in the swiftest,
easiest way. It is a fine example of the trained hand and eye, and of
excellent free-hand drawing. A juggler tosses rings, balls, and knives
in the air, and spins plates on top of a twenty-foot pole. His colleague
balances a big bamboo on one shoulder, and a small boy climbs it
and goes through wonderful feats on the cross-piece at the top. A
ring of gaping admirers surrounds a master of the black art, who
swallows a lighted pipe, drinks, whistles, produces the pipe for a puff
or two, swallows it again, and complacently emits fanciful rings and
wreaths of smoke. Hair-pins, rosaries, toys, and sweets are
everywhere for sale.
A huge, towering, heavy-roofed red gate-way admits streams of
people to the great court-yard, surrounded on three sides by temples
large and small, where the priests chant and pound and the faithful
pray, rubbing their rosaries and tossing in their coins. At one shrine
greasy locks of hair tied to the lattices are votive offerings from those
who have appealed to the deity within. There is a little temple to the
North Star, where seamen and fisher-folk pray, and one to Daikoku,
the god of riches and abundance, the latter a fat little man sitting on
bags of rice, and always beset by applicants.
In the great temple pyramids of candles burn, incense rises, bells
sound, and money rains into the big cash-box at the head of the
steps. The splendid interior is a mass of lacquer, gilding, and color,
the panelled ceiling has an immense filigree brass baldaquin
hanging like a frosted canopy over the heads of the priests, and a
superb altar, all images, lotus-leaves, lights, and gilded doors,
dazzles the eye. Under the baldaquin sits the high-priest of the
temple, who is a bishop of the largest diocese in Japan, while at
either side of him more than two hundred celebrants face each other
in rows. The priestly heads are shaven, the smooth faces wear the
ecstatic, exalted expression of devotees purified by vigil and fasting,
and over their white or yellow gauze kimonos are tied kesas, or
cloaks of rich brocade. The lesser hierarchy appear in subdued
colors—gray, purple, russet—but the head priest is arrayed in
gorgeous scarlet and gold, and sits before a reading-desk, whose
books are covered with squares of similar brocade. He leads the
chanted service from a parchment roll spread before him, at certain
places touching a silver-toned gong, when all the priests bow low
and chant a response, sitting for hours immovable upon the mats,
intoning and reading from the sacred books in concert. At intervals
each raps the low lacquer table before him and bends low, while the
big temple drum sounds, the high-priest touches his gong, and
slowly, behind the lights and incense clouds of the altar, the gilded
doors of the shrine swing open to disclose the precious image of
sainted Nichiren. On all sides stand the faithful, extending their
rosary-wrapped hands and muttering the Nichirene’s special form of
prayer: “Namu mio ho ren ge kio” (Glory to the salvation-bringing
book, the blossom of doctrine).
After seven hours of worship a last litany is uttered, and the
procession of priests files through the grounds to the monastery,
stopping to select from the two hundred and odd pairs of wooden
clogs, waiting at the edge of the temple mats, each his proper pair.
The high-priest walks near the middle of the line underneath an
immense red umbrella. He carries an elaborate red lacquer staff, not
unlike a crozier, and even his clogs are of red lacquered wood. The
service in the temple suggests the forms of the Roman Church, and
this Buddhist cardinal, in his red robes and umbrella, is much like his
fellow-dignitary of the West.
To citizens of the United States Ikegami has a peculiar interest.
When the American man-of-war Oneida was run down and sunk with
her officers and crew by the P. and O. steamer Bombay, near the
mouth of Yeddo Bay, January 23, 1870, our Government made no
effort to raise the wreck or search it, and finally sold it to a Japanese
wrecking company for fifteen hundred dollars. The wreckers found
many bones of the lost men among the ship’s timbers, and when the
work was entirely completed, with their voluntary contributions they
erected a tablet in the Ikegami grounds to the memory of the dead,
and celebrated there the impressive Buddhist segaki (feast of hungry
souls), in May, 1889. The great temple was in ceremonial array;
seventy-five priests in their richest robes assisted at the mass, and
among the congregation were the American admiral and his officers,
one hundred men from the fleet, and one survivor of the solitary
boat’s crew that escaped from the Oneida.
The Scriptures were read, a service was chanted, the Sutra
repeated, incense burned, the symbolic lotus-leaves cast before the
altar, and after an address in English by Mr. Amenomori explaining
the segaki, the procession of priests walked to the tablet in the
grounds to chant prayers and burn incense again.
 No other country, no other religion, offers a parallel to this
experience; and Americans may well take to heart the example of
piety, charity, magnanimity, and liberality that this company of hard-
working Japanese fishermen and wreckers have set them.
 CHAPTER XIV
A TRIP TO NIKKO

The Nikko mountains, one hundred miles north of Tokio, are the
favorite summer resort of foreign residents and Tokio officials. The
railway now reaches Nikko, and one no longer travels for the last
twenty-five miles in jinrikisha over the most beautiful highway,
leading through an unbroken avenue of over-arching trees to the
village of Hachi-ishi, or Nikko.
On the very hottest day of the hottest week of August we packed
our koris, the telescope baskets which constitute the Japanese trunk,
and fled to the hills. Smoke and dust poured in at the car windows,
the roof crackled in the sun, the green groves and luxuriant fields
that we whirled through quivered with heat, and a chorus of
grasshoppers and scissors-grinders deafened us at every halt. At
Utsonomiya it was a felicity to sit in the upper room of a tea-house
and dip our faces and hold our hands in basins of cool spring-water,
held for us by the sympathetic nesans. They looked perfectly cool,
fresh, and unruffled in their clean blue-and-white cotton kimonos, for
the Japanese, like the creoles, appear never to feel the heat of
summer, and, indeed, to be wholly indifferent to any weather. The
same placid Utsonomiya babies, whose little shaved heads bobbed
around helplessly in the blaze of that midsummer sun, I have seen
equally serene with their bare skulls reddening, uncovered, on the
frostiest winter mornings.
Once out of the streets of this little provincial capital, the way to
Nikko leads up a straight broad avenue, lined on both sides for
twenty-seven miles with tall and ancient cryptomerias, whose
branches meet in a Gothic arch overhead. The blue outlines of the
Nikko mountains showed in the distance as we entered the grand
avenue. The road is a fine piece of engineering, with its ascent so
slow and even as to seem level; but at times the highway, with its
superb walls of cryptomeria, is above the level of the fields, then
even with them, and then below them, as it follows its appointed
lines. Before the railway reached Utsonomiya, travellers from Tokio
had a boat journey, and then a jinrikisha ride of seventy miles
through the shaded avenue. This road was made two centuries ago,
when the Shoguns chose Nikko as their burial place, and these
venerable trees have shaded the magnificent funeral trains of the old
warriors, and the splendid processions of their successors, who
made pilgrimages to the tombs of Iyeyasu and Iyemitsu. In our day,
alas, instead of mighty daimios and men-at-arms in coats of mail, or
brocaded grandees in gilded palanquins, telegraph-poles, slim, ugly,
and utilitarian, impertinently thrust themselves forward before the
grand old tree-trunks, and the jinrikisha and the rattle-trap basha
take their plebeian way.
The cryptomeria has the reddish bark and long, smooth bole of the
California sequoia, and through the mat of leaves and branches,
high overhead, the light filters down in a soft twilight that casts a
spell over the place. After sunset the silence and stillness of the
shaded avenue were solemn, and its coolness and the fragrance of
moist earth most grateful. Two men ran tandem with each jinrikisha,
and they went racing up the avenue for ten miles, halting only once
for a sip of cold water before they stopped at the hamlet of Osawa.
The villages, a row of low houses on either side of the way, make the
only break in the long avenue. With its dividing screens drawn back,
the Osawa tea-house was one long room, with only side walls and a
roof, the front open to the street, and the back facing a garden where
a stream dashed through a liliputian landscape, fell in a liliputian fall,
and ran under liliputian bridges. At the street end was a square
fireplace, sunk in the floor, with a big teakettle swinging by an iron
chain from a beam of the roof, teapots sitting in the warm ashes, and
bits of fowl and fish skewered on chopsticks and set up in the ashes
to broil before the coals. The coolies, sitting around this kitchen,
fortified their muscle and brawn with thimble cups of green tea,
bowls of rice, and a few shreds of pickled fish. We, as their masters
and superiors, were placed as far as possible from them, and
picnicked at a table in the pretty garden. After the severe exertion of
sitting still and letting the coolies draw us, we restored our wasting
tissues by rich soup, meats, and all the stimulating food that might
be thought more necessary to the laboring jinrikisha men.
When we started again, with all the tea-house staff singing sweet
sayonaras, a glow in the east foretold the rising moon, and a huge
stone torii at the end of the village loomed ghostly against the
blackness of the forest. The glancing moonlight shot strange
shadows across the path, and we went whirling through this lattice of
light and darkness in stillness and solitude. The moon rose higher
and was hidden in the leafy arch overhead, and before we realized
that its faint light was fading, came flashes of lightning, the rumble of
approaching thunder, and a sudden crash, as the flood of rain struck
the tree-tops and poured through. The hoods of the jinrikishas were
drawn up, the oil-papers fastened across us, and through pitch
darkness the coolies raced along. Vivid flashes of lightning showed
the thick, white sheet of rain, which gusts of wind blew into our faces,
while insidious streams slipped down our shoulders and glided into
our laps. Putting their heads down, the coolies beat their way against
the rain for two more soaking miles to Imaichi, the last village on the
road, only five miles from Nikko. The tea-house into which we turned
for shelter was crowded with belated and storm-bound pilgrims
coming down from the sacred places of Nikko and Chiuzenji. All
Japanese are talkative, the lower in station the more loquacious, and
the whole coolie company was chattering at once. As the place was
too comfortless to stay in, we turned out again in the rain, and the
coolies splashed away at a walk, through a darkness so dense as to
be felt. At midnight our seven jinrikishas rattling into the hotel court,
and fourteen coolies shouting to one another as they unharnessed
and unpacked, roused the house and the whole neighborhood of
Nikko. Awakened sleepers up-stairs looked out at us and banged the
screens angrily, but no sounds can be deadened in a tea-house.
To the traveller the tea-house presents many phases of comfort,
interest, and amusement altogether wanting in the conventional
hotel, which is, unfortunately, becoming common on the great routes
of travel. The dimensions of every house in the empire conform to
certain unvarying rules. The verandas, or outer galleries of the
house, are always exactly three feet wide. A foreigner, who insisted
on a nine-feet-wide veranda, entailed upon his Nikko carpenter many
days of painful thought, pipe-smoking, and conference with his
fellows. These mechanics were utterly upset in their calculations.
They sawed the boards and beams too long or too short, and finally
produced a very bad, un-Japanese piece of work. The floors of these
galleries are polished to a wonderful smoothness and surface. They
are not varnished, nor oiled, nor waxed, but every morning rubbed
with a cloth wrung out of hot bath-water which contains oily matter
enough to give, in time, this peculiar lustre. Three years of daily
rubbing with a hot cloth are required to give a satisfactory result, and
every subsequent year adds to the richness of tone and polish, until
old tea-houses and temples disclose floors of common pine looking
like rosewood, or six-century-old oak.
The area of every room is some multiple of three feet, because the
soft tatami, or floor-mats, measure six feet in length by three in
width. These are woven of common straw and rushes, faced with a
closely-wrought mat of rice-straw. It is to save these tatami and the
polished floors that shoes are left outside the house.
The thick screens, ornamented with sketches or poems, that
separate one room from another, are the fusuma; the screens
shutting off the veranda, pretty lattice frames covered with rice-paper
that admit a peculiarly soft light to the rooms, are the shoji, and in
their management is involved an elaborate etiquette. In opening or
closing them, well-bred persons and trained servants kneel and use
each thumb and finger with ordered precision, while it is possible to
convey slight, contempt, and mortal insult in the manner of handling
these sliding doors. The outer veranda is closed at night and in bad
weather by amados, solid wooden screens or shutters, that rumble
and bang their way back and forth in their grooves. These amados
are without windows or air-holes, and the servants will not willingly
leave a gap for ventilation. “But thieves may get in, or the kappa!”
they cry, the kappa being a mythical animal always ready to fly away
with them. In every room is placed an andon, or night-lamp. If one
clap his hands at any hour of the twenty-four, he hears a chorus of
answering Hei! hei! hei’s! and the thump of the nesans’ bare feet, as
they run to attend him. While he talks to them, they keep ducking
and saying Heh! heh! which politely signifies that they are giving their
whole attention.
The Japanese bed is the floor, with a wooden box under the neck
for a pillow and a futon for a covering. To the foreigner the Japanese
landlord allows five or six futons, or cotton-wadded comforters, and
they make a tolerable mattress, although not springy, and rather apt
to be damp and musty. The traveller carries his own sheets, woolen
blankets, feather or air pillows, and flea-powder, the latter the most
necessary provision of all. The straw mats and the futons swarm with
fleas, and without a liberal powdering, or, better, an anointing with oil
of pennyroyal, it is impossible to sleep. These sleeping
arrangements are not really comfortable, and, after the fatigue of
walking and mountain-climbing, stiffen the joints. By day the futons
are placed in closets out of sight, or hung over the balconies to air,
coming back damper than ever, if the servants forget to bring them in
before sunset. The bedroom walls are the sliding paper screens; and
if one’s next neighbor be curious, he may slip the screen a little or
poke a hole through the paper. A whisper or a pin-drop travels from
room to room, and an Anglo-Saxon snorer would rock the whole
structure.
At ordinary Japanese inns the charge for a day’s accommodation
ranges from a half-yen upward. A Japanese can get his lodgings and
all his meals for about thirty cents, but foreigners are so clumsy,
untidy, and destructive, and they demand so many unusual things,
that they are charged the highest price, which includes lodging,
bedding, and all the tea, rice, and hot water they may wish. All other
things are extra. In the beaten tracks bread and fresh beef may
always be found, and each year there is less need of carrying the
supplies formerly so essential. Chairs and tables, cots, knives and
forks, and corkscrews have gradually penetrated to the remotest
mountain hamlets. At the so-called foreign hotels at Nikko and other
resorts, charges are usually made at a fixed price for each day, with
everything included, as at an American hotel.
Foreigners travelling away from the ports take with them a guide,
who acts as courier, cooks and serves the meals, and asks two and
a half yens a day with expenses. Thus accompanied, everything
goes smoothly and easily; rooms are found ready, meals are served
promptly, show-places open their doors, the best conveyances await
the traveller’s wish, and an encyclopædic interpreter is always at his
elbow. Without a guide or an experienced servant, even a resident
who speaks the language fares hardly. Like all Orientals, the
Japanese are impressed by a retinue and the appearances of
wealth. They wear their best clothes when travelling, make a great
show, and give liberal tips. The foreigner who goes to the
Nakasendo or to remote provinces alone, trusting to the phrase-
book, finds but little consideration or comfort. He ranks with the class
of pilgrims, and the guest-room and the choicest dishes are not for
him. The guide may swindle his master a little, but the comforts and
advantages he secures are well worth the cost. All the guides are
well-to-do men with tidy fortunes. They exact commissions wherever
they bring custom, and can make or break landlords or merchants if
they choose to combine. Some travellers, who, thinking it sharp to
deprive the guides of these percentages, have been left by them in
distant provinces and forced to make their way alone, have found the
rest of the journey a succession of impositions, difficulties, and even
of real hardships. After engaging a guide and handing him the
passport, the traveller has only to enjoy Japan and pay his bill at the
end of the journey. The guides know more than the guide-book; and
with Ito, made famous by Miss Bird, Nikko and Kioto yielded to us
many pleasures which we should otherwise have missed. An
acquaintance with Miyashta and his sweet-potato hash made the
Tokaido a straight and pleasant way; and Moto’s judicial
countenance caused Nikko, Chiuzenji, and Yumoto to disclose
unimagined beauties and luxuries; and Utaki always marshalled the
impossible and the unexpected.
 CHAPTER XV
NIKKO

Of all Japan’s sacred places, Nikko, or Sun’s Brightness, is

dearest to the Japanese heart. Art, architecture, and landscape-
gardening add to Nature’s opulence, history and legend people it
with ancient splendors, and all the land is full of memories. “He who
has not seen Nikko cannot say Kekko!” (beautiful, splendid, superb),
runs the Japanese saying.
With its forest shades, its vast groves, and lofty avenues, its hush,
its calm religious air, Nikko is an ideal and dream-like place, where
rulers and prelates may well long to be buried, and where priests,
poets, scholars, artists, and pilgrims love to abide. Each day of a
whole summer has new charms, and Nikko’s strange fascination but
deepens with acquaintance.
The one long street of Hachi-ishi, or lower Nikko village, ends at
the banks of the Dayagawa, a roaring stream that courses down a
narrow valley, walled at its upper end by the bold, blue bar of
Nantaisan, the sacred mountain. Legend has peopled this valley of
the Dayagawa with impossible beings—giants, fairies, demons, and
monsters. Most of the national fairy stories begin with, “Once upon a
time in the Nikko mountains,” and one half expects to meet imp or
fay in the green shadows. Mound builder and prehistoric man had
lived their squalid lives here; the crudest and earliest forms of
religion had been observed in these forest sanctuaries long before
Kobo Daishi induced the Shinto priests to believe that their god of
the mountain was but a manifestation of Buddha. Everything
proclaims a hoary past—trees, moss-grown stones, battered images,
crumbling tombs, overgrown and forgotten graveyards.
Each summer half the Tokio legations move bodily to Nikko, and
temples, monastery wings, priests’ houses, and the homes of the
dwellers in the upper village are rented to foreigners in ever-
increasing numbers. Nikko habitations do not yet bring the prices of
Newport cottages, but the extravagant rate of three and even five
hundred yens for a season of three months is a Japanese
equivalent. Besides the foreigners, there are many Japanese
residents; and, while the Crown-Prince occupies his summer palace,
he is daily to be met in the streets, the forest paths, or temple
grounds. The white-clad pilgrims throng hither by thousands during
July and early August, march picturesquely to the jingle of their staffs
and bells round the great temples, and trudge on to the sanctuary on
Chiuzenji’s shores within the shadow of holy Nantaisan.
Two bridges cross the Daiyagawa, and lead to the groves and
temples that make Nikko’s fame. One bridge is an every-day affair of
plain, unpainted timbers, across which jinrikishas rumble noisily, and
figures pass and repass. The other is the sacred bridge, over which
only the Emperor may pass, in lieu of the Shoguns of old, for whom it
was reserved. It is built of wood, covered with red lacquer, with many
brass plates and tips, and rests on foundation piles of Titanic stone
columns, joined by cross-pieces of stone, carefully fitted and
mortised in. Tradition maintains that the gods sent down this rainbow
bridge from the clouds in answer to saintly prayer. Its sanctity is so
carefully preserved, that when the Emperor wished to pay the
highest conceivable honor to General Grant, he ordered the barrier
to the bridge to be opened that his guest might walk across. Greatly
to his credit, that modest soldier refused to accept this honor, lest it
should seem a desecration to the humble believers in the sanctity of
the red bridge.
Shaded avenues, broad staircases, and climbing slopes lead to
the gate-ways of the two great sanctuaries—the mortuary temples
and tombs of the Shogun Iyeyasu and his worthy grandson, the
Shogun Iyemitsu. The hill-side is shaded by magnificent old
cryptomerias; and these sacred groves, with the soft cathedral light
under the high canopy of leaves, are as wonderful as the sacred
buildings. Each splendid gate-way, as well as the soaring pagoda,
can be seen in fine perspective at the end of long avenues of trees,
and bronze or stone torii form lofty portals to the holy places. The
torii is a distinctively national structure, and these grand skeleton
gates of two columns and an upward curving cross-piece are
impressive and characteristic features of every Japanese landscape,
standing before even the tiniest shrines in the Liliputian gardens of
Japanese homes, as well as forming the approach to every temple.
The stone torii and the rows of stone lanterns are mossy and lichen-
covered, and every foot of terrace or embankment is spread with fine
velvety moss of the freshest green. Although two hundred years old,
the temples themselves are in as perfect condition and color as
when built; and nothing is finer, perhaps, than the five-storied
pagoda with its red lacquered walls, the brass trimmings of roofs and
rails, the discolored bells pendent from every angle, and a queer,
corkscrew spiral atop, the whole showing like a great piece of
jeweller’s work in a deep, green grove.
Iyeyasu, founder of Yeddo, successor of the Taiko, and military
ruler in the golden age of the arts in Japan, was the first Shogun
buried on Nikko’s sacred hill-side, and it was intended to make the
mortuary temple before his tomb as splendid as the crafts of the day
permitted. His grandson, Iyemitsu, was the next and only other
Shogun interred at Nikko, and his temple fairly rivals that of his
ancestor.
At each shrine rise broad stone steps leading to the first and outer
court-yards, where stand the magnificent gates, exquisitely carved,
set with superb metal plates, and all ablaze with color and gilding.
The eye is confused in the infinite detail of structure and ornament,
and the intricacy of beams and brackets upholding the heavy roofs of
these gate-ways. Walls of red lacquer and gold, with carved and
colored panels topped with black tiles, surround each enclosure, and
through inner and outer courts and gate-ways, growing ever more
and more splendid, the visitor approaches the temples proper, their
soaring roofs, curved gables, and ridge-poles set with the Tokugawa
crest in gold, sharp cut against the forest background. At the lowest
step his shoes are taken off, and he is permitted to wander slowly
through the magnificent buildings on the soft, silk-bordered mats.
Richly panelled ceilings, lacquered pillars, carved walls, and curtains
of the finest split bamboo belong to both alike, and in the gloom of
inner rooms are marvels of carving and decoration, only half visible.
Both temples were once splendid with all the emblems and
trappings of Buddhism, redolent with incense, musical with bells and
gongs, and resounding all day with chanted services. But after the
Restoration, when the Shinto became the state religion and the
Emperor made a pilgrimage to Nikko, Iyeyasu’s temple was stripped
of its splendid altar ornaments, banners, and symbols, and the
simple mirror and bits of paper of the empty Shinto creed were
substituted. In the dark chapel behind the first room there remains a
large gong, whose dark bowl rests on a silken pad, and when softly
struck fills the place with rising and falling, recurring and wavering,
tones of sweetness for five whole minutes, while Ito stands with open
watch and warning finger, and the priest bends low and drinks in the
music with ecstatic countenance. Iyemitsu’s temple was spared, and
there stand the rows of superb lacquered boxes containing the
sacred writings. There, too, are the gilded images, golden lotus-
leaves, massive candlesticks, drums, gongs, banners and pendent
ornaments, besides the giant koros, breathing forth pale clouds of
incense, that accompanied the rites of the grand old Buddhist faith.
 INTERIOR OF THE IYEMITSU TEMPLE

Each temple has a fine water-tank in its outer court; an open

pavilion, with solid corner posts supporting the heavy and ornate roof
above the granite trough. Each basin is a single, huge block of
stone, hollowed out and cut with such exactness that the water,
welling up from the bottom, pours over the smooth edges so evenly
as to give it the look of a cube of polished glass. The fountain at the
Iyemitsu temple was the gift of the princes of Nabeshima, and its
eaves flutter with the myriad flags left there by pilgrims who come to
pray at the great shrine. All about the temple grounds is heard the
noise of rushing water, and the music and gurgle of these tiny
streams, the rustle of the high branches, and the cawing of huge
solitary rooks are the only sounds that break the stillness of the
enchanted groves between the soft boomings of the morning and
evening bells. The noise of voices is lost in the great leafy spaces,
and the sacredness of the place subdues even the unbelieving
foreigner, while native tourists and pilgrims move silently, or speak