For a long time, all CEE countries were considered as one entity, labeled as the 'Soviet Bloc'. All were inaccessible for Western marketing, and their politics was defined by Moscow. Rare visitors from the US or Western Europe were startled to see a grey world without advertising, poorly paved roads, and crumbling infrastructure. Economies were relying, or at least tried to, on heavy industry and inefficient state-run agriculture.
This perception, as most stereotypes is a very long-lived one. It is all too easy to see the CEE region as a whole and staying behind the developed world, now maybe without Russia. It is easy to overlook that most markets started to develop in their own way, reflecting specific mentality, traditions and aspirations of individual societies. New countries were formed in place of former Soviet Union, Yugoslavia, and Czechoslovakia; several countries joined the European Union and others are still waiting. Some, like Ukraine, may never become members. There are only two things that all these markets really share: strong economic growth (albeit interrupted here and there by a financial crisis) and a good share of communist-time nostalgia. You may know that France is different from Germany and both are different form Italy; but who can tell what makes Romania different from Hungary and from Poland?
Now, consider this:
We speak different languages. Some are Slavic, some are not (like Hungarian or Romanian)
We have different traditions
We have different religion
The countries were shaped by different historical events
Our cultural heritage is different
We eat different foods
We have different aspirations
We even don't all drink Coke!
One of the most comprehensive and consistent approaches to differences between markets has been developed by Geert Hofstede, now Professor Emeritus at the Maastricht University. The value of the Hofstede model is that it relates directly to marketing issues. The model is based on five dimensions which were found to best represent differences between countries. It is best supplemented by looking at strong local brands and their icons, as well as compare best advertising campaigns to see differences in style and consumer values.
The Hofstede dimensions are:
Power Distance Index (PDI- it reflects the extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally.
Individualism (IDV) and its opposite, collectivism, that is the degree to which individuals are integrated into groups.
Masculinity (MAS and its opposite, femininity, refers to the distribution of roles between the genders which is another fundamental issue for any society.
Uncertainty Avoidance Index (UAI) describes a society's acceptance of uncertain situations. High UAI indicates that people o feel rather uncomfortable situations that are novel, unknown, surprising, different from usual and perceive them as threatening.
The last dimension is Long-Term Orientation (LTO) versus short-term orientation: this fifth dimension was found in a study developed by Chinese scholars and has been measured for just 23 countries. But even if we take the first four, we can see that scores for the CEE countries vary as much as for any other markets. These differences help to understand why CEE markets are different in responses to Western brands and communication concepts
Among te CEE markets, Slovakia and Romania score very high on power distance. Therefore, power and social status are important values that are frequently represented in advertising. Wealthy people like to show their social position and the less successful ones accept this.
Slovakia I also high on masculinity but Romania is not – in the latter country, values like caring for other people and emotional relationship are highly appreciated. Romania is also very low on IDV (the same refers to Bulgaria) – it is really a 'collective' society, where people define themselves in relation to others. This strongly influences behaviour such as clothing and attitudes towards cosmetics.
Among the six countries shown, Poland has the highest UAI score. This makes Polish consumers likely to respond to specific kinds of communication (problem -> solution). As consumers, they are more conservative than others.
Hungary is a society that values homogeneity – the PDI score is very low there. In Hungary, all people are made equal.
Czech Republic does not stand out on any of these dimensions but the striking observation is that it is so much different than Slovakia. This helps to understand why the two countries decided to divorce! Today, the Czech society is more similar to Germany than to its neighbors.
Last not least, each CEE country has its own brand heritage. Some brands are so strong and beloved that not Western corporation can beat them, like Kofola in Czech Republic. Others have found new creative ways to win local consumers after being taken over (like Dacia in Romania, which was acquired bye Renault).
So what a marketer can do if she or he wants to win CEE consumers? Most of these markets are too small to create separate brands, products and different communication. One solution is to give your brand local 'touch' so that the brand is recognized by every society by their own. You definitely have to run taste tests in every country separately if your product is edible. In some categories, however, a uniform approach works well (e.g., painkillers). Therefore the advice is same as ever: study your consumers' behavior and attitudes, try to understand their needs – do serious market research!
Agnieszka Gornicka
President, Inquiry
Inquiry is the Region Leader for One Planet One Call for Central and Eastern Europe providing market research in Poland, Russia, Czech Republis, Hungary and other countries in CEE.
Inquiry is a Polish-based market research agency with strong presence in the CEE markets. We do qualitative and quantitative research for FMCG manufacturers, telecoms, IT, finance, pharmaceuticals, advertising agencies and publishers.
