Face vs a good deal; Chinese and American Perspectives

Another good article at Knowledge@Wharton.Very simply, American’s don’t care about face as long as the price is “fair.”  Americans also tend to think that preferential treatment is almost always unfair (unless they’re the one getting the deal).  Chinese consumers, on the other hand, expect to get better deals if they have a personal connection with the seller and they must have face with friends (i.e. a relatively lower price than other people they know) regardless of the actual price paid.From the article:

“According to Bolton, these findings suggest that Americans may be less accepting of dynamic pricing at this point because "fair is fair" as they see it. "In China, there may be more room to maneuver" in setting different pricing levels, she said, because consumers tend to view pricing fairness in terms of how they fared in comparison to "in-group members," or friends versus strangers.”

The article focuses on retail sales, but the implications for other levels of business are clear. If you’re an American buyer in China—you have to know you’re not going to be getting the “best” price and you need to be OK with that.  A price that works for you is going to have to be good enough.  Also know that you can bargain and haggle over everything.  And I really do mean everything.  It also means that your Chinese supplier will perceive value in your repeat buying.It sounds a bit stereotypical to say that American’s value “fairness” almost as much as a good bargain and the Chinese don’t care as much about the price as long as they have good relationship behind the purchase, but that seems to be the findings here.