A Cross-National and Cross-Cultural Approach to Global Market Segmentation: An Application Using Consumers’ Perceived Service Quality

James Agarwal
Ruth Bolton
Naresh K. Malhotra

International service is the fastest growing sector of the world economy, but few studies have examined global market segmentation strategies for services. This study shows that consumer perceived service quality (PSQ) differs across cultures and countries and these differences yield meaningful market segments. It focuses on culture-based differences in PSQ that arise from people’s life experiences, based on prior conceptual work that links individualism-collectivism at the level of the individual consumer (rather than based on nationality) to independent versus interdependent self-construal. It analyzes survey data describing banking services in India and the USA. Thus, the paper provides a theory-based, empirically supported tool for the measurement, management and customization of PSQ in global settings. This tool can be used to derive managerial insights into vertical and horizontal market segments for global services, guiding the development of global marketing strategies for services and improving business performance. We illustrate its use for banking services.

 

This paper is published in Journal of International Marketing, 18(3), 2010, 18-40.