2.5. Homogenisation of Preferences

The hypothesis that preferences will become ever more similar on a worldwide scale has been around for quite some time (see, e.g., Levitt 1983) and has been highly disputed. It can be decomposed into two seemingly contradictory trends: on the one hand, the trend toward ever more similar preferences, and on the other the trend toward ever more specific preferences. As long as they both occur simultaneously and on a worldwide scale, they might have far-reaching effects on firm behaviour.

There are three arguments in favour of consumer preferences becoming more alike beyond cultural or nation-state borders: Firstly, due to the improvement and the worldwide availability of mass media, information is shared on a worldwide scale. Knowledge concerning the consumer habits of others could, from that point of view, influence one’s own preferences. Secondly, the growth in tourism over the last decades has brought people belonging to diverse cultures into direct contact with each other. And thirdly, higher income levels in many countries have led people to lead more similar lifestyles.

For firm behaviour, the trend towards the homogenisation of preferences can have far-reaching consequences: Certain marketing strategies are not confined to specific countries anymore but can be used in a variety of world regions and economies of scale in promotion and advertising can be realised. This means that international interaction costs have been decreasing. Use of such strategies is not confined to large companies anymore but small and medium-sized companies can also apply them.

On the other hand, trend experts have long reported a tendency towards an individualisation of lifestyles. The number of archetypal consumers, whose preferences and desires market research companies are after, has substantially increased. The individualisation of lifestyles means a trend towards an ever-finer differentiation of products. This means that niches for specialised producers open up and the danger of a strategically induced market foreclosure seems rather negligible.