The PD scale: a measure of psychic distance and its impact on international marketing strategy

Abstract

Purpose Despite considerable research on psychic distance (PD), research into the topic is confounded by a general failure to precisely define and fully operationalize the construct. The purpose of this paper is to develop a new measurement scale to assess psychic distance (the PD scale), and also to investigate the impact of the PD scale on the adaptation of international marketing strategies. Design/methodology/approach The paper uses data collected by mail questionnaire in a sample survey of 301 export firms. The results were analyzed using structural equation modeling. Various statistical tests show that the results are reliable and valid. Findings Findings reveal that psychic distance is a higher‐order construct composed of two dimensions: country distance and people distance. The results also indicate that both dimensions of the PD scale are positively and significantly associated with cultural distance and the adaptation of product, promotion, pricing and distribution strategies to the foreign market. Originality/value The paper develops a new scale, the PD scale, which is a measure of psychic distance and addresses a gap in the literature by testing its impact on the adaptation of the international marketing strategy.