Cultural Convergence in Emerging Markets: The Case of McDonald's in China and India

Abstract

It is a truism that successful organizations of any type adapt and conform to the idiosyncracies of their target consumer groups as it is their customers that embody their raison d'etre. This is especially important for small businesses and entrepreneurial enterprises because they lack the requisite experiential treasure trove or elaborate corporate bureaucracies to accomplish this task typically available to established large firms. In fact, textbooks on international business are full of examples of business failures when consumer proclivities have been ignored by businesses. Informed by this admonition, this manuscript seeks to investigate the psyche of Chinese and Indian consumers of a global franchise system, McDonald's. It advances the premise of cultural convergence of Chinese and Indian consumers through the lenses of organizational socialization theory. We examine whether the franchise system's universal culture and the social values of egalitarianism and democratization enshrined in the system are linked to consumers' patronage of McDonald's in the world's two largest emerging markets. Using multivariate analysis of variance, we evaluate cross‐country differences in perceptions of egalitarianism and democratization as well as patronage frequency. Both country‐specific effects and cross‐cultural effects are discussed, and managerial implications for franchisee‐entrepreneurs in each country are outlined.