Human Resorces

Globalization, changes in technology, changing customer needs and preferences and increased competition have forced businesses to change how they did business previously and adopt new strategies and practises to remain relevant and competitive (Hollensen, 2015). While global business was a preserve of a few company in the early to mid-20th Century, such as Unilever, The Coca-Cola Company, Pepsi and a few other companies, now the majority of businesses have been forced to enter into the global market to remain competitive (Menipaz, & Menipaz, 2011). Also, as a result of globalization and the other aforementioned changes, the mobility of people has become very possible and international borders as we knew them are now only demarcations on a map. As a result, in the global and home markets, business organizations are faced with customers from diverse backgrounds in terms of ethnic background, religion, race, education and other factors (Gesteland, 2012).

Cross-Cultural Business Customers in Saudi Arabia

Saudi Arabia is a country located in the Middle East with an estimated population of the country as at 2014 was 30.9 Million Saudi Arabians and approximately 17 million non-nationals according to a World Bank report. The country has approximately 20 cities with populations of over 500,000 thousand inhabitants as at 2014. The largest city and the capital of Saudi Arabia is Riyadh with a population of approximately 6.8 million residents. With an economy that is largely dependent on oil production and exportation, the country has recorded exponential growth since the turn of the century presenting immense opportunities for businesses. With more than 35 percent of the inhabitants of the country made up of non-nationals, the country gives a very good example of cross-cultural customers at the local and global level (Eid, 2011).

Cross-cultural customers are characterized by highly dynamic tastes and preferences dictated by their background and the changing environment in which live in. Also, these customers are less loyal and will not hesitate to stop buying a brand they have been using if they have a single bad experience with a brand (De Mooij, & Hofstede, 2011). In the global context, cross-cultural customers have different and heterogeneous needs and preferences (Cavusgil, Knight, Riesenberger, Rammal, & Rose, 2014). Customers in this setting speak different languages, have different religious beliefs, and subscribe to different political ideologies among other differentiating tenets (Hollensen, 2015). As a result, there is increased diversity in the customers that companies are serving in the both the home and global operating landscape (Menipaz, & Menipaz, 2011; see also Cavusgil et al., 2014).

For businesses, this presents a challenge as well as an opportunity. Business entities that put in place appropriate strategies to take advantage of this growing diversity resulting in changes in needs and preferences meaning companies can now have more products in their portfolio (Hollensen, 2015; see also Gesteland, 2012). For example, in a country that has predominantly Islamic Citizens like Saudi Arabia, there has been an influx of individuals from other parts of the World. In light of this, businesses in Saudi Arabia now have to stock items that would have been unacceptable such as pork products, alcoholic beverages and others that contravene Islamic religious beliefs and practises (Eid, 2011; see also Malshe, Al-Khatib, Al-Habib, & Ezzi, 2012, Gesteland, 2012).

As a result businesses in the country now have an opportunity to make more revenues from sales of these products that were previously among their products portfolio prior to the changes brought about by globalization (Malshe et al., 2012). This is an opportunity to create an additional revenue stream for the business and at the same time reduce the cost of doing business due to the increased options for distributing and availing their products such as through the use of the World Wide Web, the internet, social media, websites and other non-conventional distribution channels (Cavusgil et al, 2014).

Cross-cultural business customers are more demanding and present a challenge for businesses in a bid to secure and sustain a competitive edge in an increasingly dynamic and volatile operating environment. From the foregoing, it is clear that businesses operating global enterprises need to adapt their offering and to meet the needs of an increasingly divergent and difficult customer (Malshe et al., 2012). By their nature, these cross-cultural customers demand that businesses be more responsive and customer oriented necessitating the need to have a different set of skills and behaviours in order to satisfy them and reduce churn, which guarantees the long-term survival of the business (Hollensen, 2015; see also De Mooij, & Hofstede, 2011).

Conclusion

As a result of growing globalization, business enterprises across the globe are faced with a more diverse customer both locally in their home countries and other global markets in which they have operations in. This is more so the case for Saudi Arabia, which is experiencing rapid economic growth resulting in growth of local and foreign business enterprises in the country. In addition, the economic growth has seen the convergence of individuals from across the world coming into Saudi Arabia to pursue economic prosperity. In turn, this has resulted in a more diversified customer base for organization presenting both challenge and opportunity at the same time. Companies that adapt and adjust accordingly come up with strategies that enable them to take advantage of the opportunities that come with a diversified customer base and realize a lot of growth through seizing such opportunities.

References

Cavusgil, S. T., Knight, G., Riesenberger, J. R., Rammal, H. G., & Rose, E. L. (2014). International business. Pearson Australia.

De Mooij, M., & Hofstede, G. (2011). Cross-cultural consumer behavior: A review of research findings. Journal of International Consumer Marketing, 23(3-4), 181-192.

Eid, M. I. (2011). Determinants of e-commerce customer satisfaction, trust, and loyalty in Saudi Arabia. Journal of Electronic Commerce Research, 12(1), 78-93.

Gesteland, R. R. (2012). Cross-Cultural Business Behavior: A guide for global management. Copenhagen Business School Press DK.

Hollensen, S. (2015). Marketing management: A relationship approach. Pearson Education.

Lasserre, P. (2012). Global strategic management. Palgrave Macmillan.

Malshe, A., Al-Khatib, J., Al-Habib, M., & Ezzi, S. (2012). Exploration of sales-marketing interface nuances in Saudi Arabia. Journal of Business Research,65(8), 1119-1125.

Menipaz, E., & Menipaz, A. (2011). International business: theory and practice. Sage.

The World Bank. (2015). Saudi Arabia | Data. Retrieved November 9, 2015, from http://data.worldbank.org/country/saudi-arabia