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International Business 150 Term Paper Professor Jieqiong Ma Product: Game of Cones Eyeshadow Palette Country: South Korea

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Part I: Market Analysis Introduction Located on the southern tip of the Korean Peninsula in East Asia is the Republic of Korea. The Republic of Korea is bordered by North Korea in the north, the East Sea to the east, the Korea Strait to the south, and the Yellow Sea to the west. As of July 2011, South Korea has a population of 48.7 million. The capital city, Seoul, has a population of around 9.8 million people (sos-us-en-noncluster). The official language of South Korea is Hangeul, or formerly known as Hunminjeongeum (About South Korea | South Korea). In August 1948, with Syngman Rhee as the first president, the Republic of Korea was established. North Korean troops invaded the south in June 1950, starting the three-year Korean War. In 1953, an armistice was signed to end the war, but a permanent peace treaty has never been signed. Following an uprising in 1960, President Syngman Rhee was forced to resign. Major General Park Chung- Hee’s rule resulted in tremendous economic growth and development but increasingly restricted political freedoms. His reign ended with his assassination in 1979. Following his assassination, Lieutenant General Chun Doo-hwan lead a group of military officers and declared martial law and took power. Throughout the Park and Chun rulings, South Korea developed a very vocal society that led to strong protests against the rulers. Pro-democracy protests forced changes within the government in 1987, including restorating presidential elections. The Presidential Election of 1997 marked another step forward in Korea's move towards democracy; Kim Dae-jung, a democracy and human rights activist, was elected. Though South Korea has been transitioning toward a true democratic system, as of 2015 South Korea has been challenged with corruption in the government (South Korea Country Review, 2018). Cultural and Social Analysis The cultural and social analysis of South Korea is important to look at as it affects the market of the country, and the ways in which American firms such as beauty bakerie can introduce their products in the most effective way possible. In South Korea, many languages are spoken. The primary language spoken is Korean. However, there are several different Korean dialects, which all vary depending on region (“Languages in South Korea”, n.d.). The most popular dialect in South Korea is Hanguk. Another example of a dialect used is the Seoul dialect or Gyeonggi, which is regionally based, and, “spoken in Seoul, Gyeonggi, and Incheon” (“Languages in South Korea”, n.d.). English is widely spoken throughout South Korea, as well, about, “58% of Koreans speak English frequently” (“South Korea’s Languages”, 2018). Additionally, there is a substantial Chinese population in South Korea, so among that community mandarin and cantonese may be used (Owen, 2018). “Some older people in South Korea may speak Japanese. Busan to the south is close to Fukuoka in Japan, and therefore has a large number of Japanese speakers” (Owen, 2018) The location of this region has an impact on the dialect used, and influences it mildly in the Japanese direction. The written alphabet of the Korean language is Hangul. It is made up of 24 letters, arranged in blocks for each syllable. This has a resemblance to the chinese alphabet. Before Hangul was created, Koreans used Chinese lettering, Hanja, to write (“Languages in South Korea”, n.d.). Today, use of hanja to convey Korean words may be seen, but this type of portrayal of Korean words is becoming more rare (Owen, 2018).

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South Korea has a wide range of belief systems, as they have the right to practice religion freely. Shamanism is a prominent aspect of South Korean culture. Shamanism does not have a designated structure, but exists as influence of the people through, “folklore and customs” (“Historical and Modern Religions of Korea”, 2018). It’s highly spiritualistic, and emphasizes the existence of spiritual entities in objects, and those who have died. People who believe in shamanism may use it to connect and receive advice from spirits, which they are able to contact, to an extent through a musok-in, which is considered as someone who is, “a go-between, mediating between ordinary Koreans and this other world,” of spirits (Tudor, 2017). Early Korea viewed Shamanism as a negative force, because it was built on, “fear and superstition,” however, it has been revitalized in time as a positive and fun characteristic of Korean culture, through appreciation of its colorful rituals and aspects (“Historical and Modern Religions of Korea”, 2018). Confucianism also has a large following in South Korea. Confucianism is an ideology that emphasizes the, “importance of loyalty, filial piety, and ancestor worship” (“Religion: Korea.net”, n.d.). This stresses the significance of respect for elders in Korean culture, and portrays the values of which Korean’s with this faith prioritize in the decision making of their daily life, and those business related. With a strong ethics code, confucianist South Koreans adhere to a great respect for others, and act accordingly. Also, the emphasis on loyalty, establishes a strong business relationship, as employees are expected to regard their employers in a loyal manner, in the way of long term employment and in the way they conduct business. While employers are expected to provide job security (Weaver, 2014). Catholicism is established in South Korea, as well. Its significant impact on South Korean culture, was its association, in the 1960s, “with the ideas of progressive change and the introduction of modern political ideologies,”(Lankov, 2014). This influenced a support in democracy, when South Korea was ruled by a military dictatorship. . Cheondogyo is another South Korea religion. It was, “formed on the basis of the Eastern Learning (Donghak) of the 19th century, maintains the doctrine that “Man is Heaven,” which exerted a strong influence upon the process of modernization in Korea” (“Historical and Modern Religions of Korea”, 2018). This emphasizes the importance of modernizing technology and culture throughout South Korea, which may indirectly lead to the support of foreign investments, and other global business initiatives that would improve and innovate South Korean life. There is also a prominent Protestant following in South Korea. The protestant ethics placed a strong emphasis on education and hard work in South Korean culture and approach to business. As this religion spread in South Korea, it advocated for equality of genders, and promoted awareness of negative superstitious tendencies in the culture overall (“Historical and Modern Religions of Korea”, 2018). This influenced equality not only in everyday life, but in the workplace, and created a greater stress on education. Buddhism is very present in South Korean culture. Its emphasis on individual salvation through reincarnation, implies a strong moral code and sense of self (“Historical and Modern Religions of Korea”, 2018). Many practice Buddhism through meditation in monasteries, and so Buddhism promotes a lifestyle of reflection, and emphasizes the importance of the individual. South Korea has a modernized culture that is able to maintain tradition while embracing innovation. A very popular food eaten in South Korea is kimchi. This dish is made of a variety of vegetables (“South Korea Guide”, 2017). South Korean food is focused on meat, rice, and vegetables. According to Chung, in the article, “Aesthetics of Korean foods: The symbol of Korean culture,” food culture in South Korea is very traditional. Also, “ancient Koreans carefully

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considered both the taste and visual appeal when preparing food,” and such aesthetic significance in food presentation has continued today (Chung, 2016). A belief developed in ancient Korea that food and medicine go hand in hand, and has influenced the belief today that the food consumed by an individual can determine health (“Food: Korea.net”, 2018). Also, a large portion of Korean foods are made through the fermentation process, which provides an essential component to the taste and nutrition behind Korean food. Traditional drinks in South Korea include soju, Korean rice wine, and ginseng wine. The beer drank there is similar to that of western styles, and on the lighter side. Green tea is also a popular drink choice (Owen, 2018). There are specific customs affiliated with dining in South Korea. Food and dining, for example, are used as a means to create and establish relationships (“South Korea Guide”, 2017). Associated with a higher degree of respect for their elders, in South Korea elders are the initiators of a meal, as they are the first served. Also, in terms of dinner etiquette, South Koreans are very mindful of chopsticks and do not point them at others, or leave them sticking out of a dish (“South Korea Guide”, 2017). South Korean fashion is modeled after pop culture figures. This style refers to, “Idol Fashion,” which is based on South Korean idols (Marasigan, 2018). This look includes mismatched outfits and bright colors. Another popular trend is, “Ulzzang Fashion,” which includes a combined outfit of loose and tight clothing, and statement prints (Marasigan, 2018). Clothing from Korean tradition is the hanbok, which is, “is traditional Korean attire typically worn in marriage ceremonies, family celebrations, and traditional festivals” (D’Angelo, 2018). In terms of personal hygiene, South Koreans take their appearance into great consideration. Since, dental work is highly expensive in South Korea, great lengths are taken to preserve good dental hygiene (“17 Facts Proving That South Korea Is Beyond Our Understanding”, n.d.). This includes brushing teeth after every meal. Also, Korean women have high standards of skin and hair care, and use a multitude of products to maintain their desired look (“17 Facts Proving That South Korea Is Beyond Our Understanding”, n.d.). Makeup trends in South Korea currently are fresh and dewy skin, rosy cheeks, and feathery eyebrows (Soh, 2017). These looks are more natural, expressing a pink and healthy glow. South Korea is rich in culture made up of myths and superstitions. Many traditional rituals pertain to family life and ancestors. In Korean cultural, “the spirits of the departed do not leave the earth for several generations; thus, deceased parents and grandparents are still considered part of the family. Ancestral rites (cherye) are performed to honour them on death anniversaries and on major holidays” (“South Korea: Daily Life and Social Customs”, 2018). On these holidays, Koreans dress in traditional clothing, hanbok, and eat traditional foods. Another Korean ritual involves predicting the future of a child, where when a child turns one year old, they are supposed to choose an object off a table, symbolizing the profession they will one day go into (D’Angelo, 2018). There are many superstitions in South Korean culture. Writing in red is looked down upon, because, “red is the color used to write the names of the dead in Korea,” and so writing the names of the living in red is a bad luck (“South Korea: Everything about south korea from culture, food, traditions to kpop & Kdramas”, 2013). Whistling at night is also avoided, for it is seen as a way to invite ghosts and snakes. The number four is seen as an unlucky number, as it it sounds like the Korean word for, “death.” Koreans avoid the number four, similar to the way Americans avoid the number 13, an example of this is that some building will have no fourth floor. Also, Koreans have superstitions of electric fans, and if one sleeps in a closed room with a

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fan, they will die (“South Korea: Everything about south korea from culture, food, traditions to kpop & Kdramas”, 2013). Korean mythology is based on a combination of Korean faiths and traditional tales. Korean mythology consists of many gods and goddesses, all of which symbolize a natural entity, such as the moon or sun, or symbolize things such as luck or fate (“Korean Mythology”, n.d.). The founding tale of Gojoseon, relays of a goldy entity, Hwanung, descending from heaven to take care of humans. Later Hwanung gifts a bear with the human form of a woman, Ungnyeo, after the bear proves its desire to become human by following the demands of Hwanung. Together, they have a child, Dangun, who becomes the founder of the Korean people. He later takes on the name Joseon, now changed to Gojoseon (“Korean Mythology”, n.d.). Most Korean myths are passed down orally, and not traditionally written down. Although South Koreans value their traditional culture, they are open to foreign products. South Korean consumers range from preference between domestic and foreign product depending on what said product is, and the age of the consumer (BXP, 2009). Older Korean consumers, for example, have a greater desire to purchase domestic products, as it is viewed to them as more patriotic. Younger Korean consumers are more subjected and influenced by Western products, and are therefore less wary of Western products (BXP, 2009). When purchasing foreign product, South Koreans value the brand of a product, hold a high standard to the qualities in which it benefits their health, and are considerate of the cost of the product, especially leaning to those that are more inexpensive (“South Korea: Reaching the Consumer”, 2018). Trust is earned from the Korean consumer through trustful and meaningful relationships, through honest and accurately portrayed quality product (BXP, 2009). Marketing is an important factor to the Korean consumer, and certain colors and packaging are more satisfactory than others. Excessive packaging, for example, is not appreciated by Koreans. Korean consumers, “take pride in great attention to detail, where small accents can have a big significance,” and so the packaging of a product should be a good portrayal of the product itself, and compliment the product in an aesthetically pleasing way (BXP, 2009). Things such as the context of a culture heavily influences the market as it gauges the way people in a given culture communicate and portray messages. In South Korea, there is a highcontext culture, which means that it is typical in South Korean interactions to heavily rely on gestures, body language, and unspoken messages in order to effectively communicate and come to an understanding of one another (Merkin 2009). It is also important for South Koreans and other low-context cultures alike to form close knit relationships and a deeper understanding of individuals on a personal level as well as in the complex social relationships formed in a business. This is because these deeply developed relationships help individuals within a company thoroughly understand the desires and messages that their coworkers or employers are communicating in a much less explicit manner than that of a high-context culture. When explicit language or behavior is either frowned upon or perceived as rude in a culture such as South Korea, a culture such as America must learn how to adapt their communication patterns and business practices in order to successfully introduce a product to their desired market. Now, South Korea’s culture will be analyzed based on Hofstede's dimensions, which are as follows: power distance, individualism, masculinity, uncertainty avoidance, long term orientation, and indulgence. South Korea scores a sixty on its power distance scale (Hofstede Insights, 2018), which is fairly intermediate, but it suggests a sense of respect for the power dynamics and hierarchy of its society. This insinuates that South Koreans tend to be culturally

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inclined to respect their bosses and elders at a higher level than those who have a lower level of power in society. Next, South Korea scores an 18 on the individualism scale (Hofstede Insights, 2018), which is very low. This implies that the culture in South Korea is much more collectivist, which is highly influenced by their cultural tendency to be family oriented and make decisions about their lives based on the collective desires of their family unit, rather than their own individual desires. They possess a sense of a moral duty towards loyalty and the betterment of society, which often means sacrificing personal needs in turn for respect or even promotion in the workforce. Additionally, they score a 39 on the masculinity scale (Hofstede Insights, 2018), which means that they are a much more feminine society. This tells us that South Koreans take a more nurturing and egalitarian approach to society and business alike, rather than trying to stand out and compete to be the best. On uncertainty avoidance, they score an 85 (Hofstede Insights, 2018), telling us that they avoid uncertainty at an alarmingly high rate in their culture. People in South Korea are extremely hard working, punctual, and precise, as they have a high level of structure which eliminates the likeliness of uncertainty. This also means they are not accepting of unorthodox ideas or unusual practices in the workplace as they possess such a rigid code of conduct that leaves little to no room for outliers. On the long term orientation scale, they score a 100 (Hofstede Insights, 2018), implying that they are one of the most pragmatic societies of all time, as they value long-term growth in an economic standing, rather than short-term profit growth. On the last dimension, indulgence, they scored a 29, insinuating their tendency to suppress personal indulgences and value restraint. This explains that South Koreans are more likely to give up free time in which they engage in personal causes, and instead contribute large portions of their time to work and causes that benefit society. Aesthetics, otherwise known as a set of principles concerned with the nature and appreciation of beauty, can be an important cultural factor that affects the nature of business in a society. One of these aesthetic factors that influence society and art are is colors and what they symbolize. For example, the color yellow in South Korea is associated with earthliness, and a sense of peace (Japan Visitor, 2018). Black is associated with water, and white is associated with metal (Japan Visitor, 2018). Green and blue imagery represent wood, and red represents fire (Japan Visitor, 2018). Certain color patterns are associated with seasons, and even specific times of the day (Japan Visitor, 2018). Art and paintings are a big part of Korean culture, and this explains the deep rooted symbolic meaning placed on colors. There are many important symbols in South Korean culture, but one very important one is the flag of South Korea, called Taegukgi. The white background of the flag represents purity, which explains the prominence of the color white in traditional Korean attire. The flag also symbolizes balance, as the red and blue taegeuk in the center is modeled after a yin yang. Balance and peace are important cultural practices in South Korea, thus the flag represents such values. The music of South Korea ranges vastly, and includes both traditional and modern aspects. Traditional Korean music can be divided into four different subcategories, Korean folk music, aristocratic chamber music, Korean court music and religious music (seoulkoreaasia, 2017). All of these categories have a strong religious or ritualistic basis. For example, sinawi or shinawi music is embraced during shamanistic rituals in Korea, and Dongbu folk songs are bright, simple melodies that vary based on their religious origins (seoulkoreaasia, 2017). More

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modernly, K-pop is embraced in Korea. As well as other Eastern Asian countries, and is heavily based off of R&B and hip hop. A very well known modern Korean Pop band is BTS. The aesthetics of beauty in South Korea are a hugely important aspect to examine. Beauty standards are much stricter in Korea than in America. It it much more common for Korean women to struggle with body image issues, as thinness and facial beauty are considered important factors highly linked with success both socially and economically in Korea (Kwon & Lee, 2015). Being beautiful is often associated with socioeconomic status and p...