Special Session Summary Recent Developments in Country-Of-Origin Research

Citation:

Gerald Haubl (1998) ,"Special Session Summary Recent Developments in Country-Of-Origin Research", in E - European Advances in Consumer Research Volume 3, eds. Basil G. Englis and Anna Olofsson, Provo, UT : Association for Consumer Research, Pages: 147-148.

European Advances in Consumer Research Volume 3, 1998      Pages 147-148

SPECIAL SESSION SUMMARY

RECENT DEVELOPMENTS IN COUNTRY-OF-ORIGIN RESEARCH

Gerald Haubl, University of Alberta, Canada

The special session consisted of four papers that focus on different aspects of country-of-origin research. The paper by Johny Johansson offers an explanation for the apparent paradox that the effects of country-of-origin on purchase decisions may become even stronger as the globalization of markets progresses. Israel Nebenzahl’s paper discusses a method for testing the proposition that both the country consumers associate with a brand and the one where the product is manufactured may affect product evaluations. Initial empirical results are presented. The paper by Gerald HSubl investigates the relationship between brand strength and the country of production’s impact on consumers’ perceptions of product quality. The findings of an experiment indicate that, in the case of a shift of production from a brand’s home country to another country, strong brands may actually be subject to more negative country-of-production effects than weak brands. Finally, Michael Baker’s paper discusses how the image of a nation can be used to promote exports, inward investment, and tourism through the development of an umbrella brand for that nation. A brief summary of each of the four papers follows.

 

RESOLVING A PARADOX: WHY COUNTRY-OF-ORIGIN EFFECTS MAY BE STRONGER THAN EVER

Johny K. Johansson, Georgetown University

This paper starts with a review of some recent research on country-of-origin (COO) effects. The author contrasts the cognitive and the affective effect of the COO on product evaluations, and discusses ways in which COO can help summarize pertinent product and brand information. The strength of COO effects differs across product categories, partly because of variability in a country’s quality for a given product category, and because the global diffusion of manufacturing skills affects product categories differently.

There is consistent evidnce that, as the globalization of markets and industries progresses, COO tends to become even more important as an evaluative criterion used by consumers and industrial buyers. At first sight, this may seem like a puzzling result. The author illustrates how recent findings reported in the COO literature can help explain this apparent paradox. Rather than leading to a world in which national borders no longer matter, globalization has actually enhanced the salience of the COO information. Increasingly, consumers become more attuned to subtle differences between alternatives from different countries, and often can not only distinguish between these products, but also pinpoint the relative advantages of each based on their COO. In industrial markets where the buyers’ demand for world-class technology and quality would seem to rule out any COO effects, the growth of relationship marketing has led to increased emphasis on cultureCand consequently on COO. The paper discusses how these developments can be explained with reference to the mental workings of COO effects.

 

CONSUMERS’ AWARENESS OF A BRAND’S ORIGIN AND MADE-IN COUNTRIES: DEVELOPMENT OF RESEARCH METHODOLOGY AND INITIAL RESULTS

Israel D. Nebenzahl, Bar-Ilan University

Nebenzahl, Jaffe, and Lampert (1997) have recently proposed a theoretical model that describes the dynamic interactions between brand image, country image, product evaluation, and relative experience with products. The model describes how brand and country images impact product evaluation and how experience with products, in turn, affects the corresponding brand and country images. The model recognizes that the image of two countries, the one which consumers associate with the brand ("origin country") and the one where (most of) the manufacturing takes place ("made-in country"), may affect product evaluations.

A key proposition of the theoretical model is that, in evaluating a branded product, consumers associate the brand with a certain origin country and are aware of the brand’s made-in country when the latter differs from the origin country, so that the image of both countries may impact the evaluation process. The author proposes a method for testing this proposition and presents initial empirical results. The approach calls for in-store observation of the communication processes between a salesperson and a customer, followed by personal interviews of the customer. Results of an initial empirical study suggest that, while consumers do associate brands with origin countries, awareness of the made-in countries is limited and varies by product category.

 

THE ROLE OF BRAND STRENGTH AS A MODERATOR OF COUNTRY-OF-PRODUCTION EFFECTS ON CONSUMERS’ PERCEPTIONS OF PRODUCT QUALITY

Gerald HSubl, University of Alberta

While the main effects of both country of production and brand name on consumers’ judgments about product quality are well-supported in the literature (see, e.g., HSubl 1996; Hong and Wyer 1989), the issue of potential interaction effects between these two pieces of product information has only recently attracted some attention (HSubl and Elrod 1997). A question of central importance in this context is whether the evaluation of products associated with a strong brand name will be affected by the country of production to the same extent as that of weak or less-known brands. It has been hypothesized that a strong brand name may increase consumers’ ability to infer product quality, thus rendering the product’s country of production less influential relative to the case of a weak brand (see Ulgado and Lee 1993).

The author discusses the findings of an experiment designed to test the hypothesis that brand strength moderates country-of-production effects in the sense that the "made in" information affects the evaluation of strong brands less than that of weak brands. Subjects were exposed to music from 12 CD playersCbased n a 6 (brands) x 2 (countries of production) within-subjects designCand asked to rate the quality of each. Six Japanese brands that are spread over the continuum of brand strength were used. For each brand, two identical CD players were included in the experiment, one of which carried the label "Made in Japan" while the other was labeled "Made in Singapore." The results indicate that, counter to the hypothesis, brand strength and the magnitude of the country-of-production effect are positively related. This suggests that production outside a brand’s country of origin may affect strong brands more negatively than weak brands. The author discusses possible explanations for this finding.

 

SCOTLAND THE BRAND

Michael Baker, University of Strathclyde

While some proponents of globalization (e.g., Levitt 1983) have argued that converging consumer tastes will result in a decline in the importance of country-of-origin (COO) cues, the balance of evidence points to a contrary conclusion (e.g., Tse and Gorn 1993; Johansson 1993). The author discusses three possible explanations for this. First, the complexity of modern markets leads consumers to try to simplify information processing through "chunking," using COO as a surrogate indicator of product quality (Jacoby, Szybillo, and Busato-Schach 1977). Second, exposure to information about foreign countries and products heightens consumer awareness of, and familiarity with them, as well as of the differences among them. Lastly, as a result of the growing standardization of intrinsic product characteristics, marketers increasingly rely on such extrinsic identifiers as origin and brand to define unique market positions.

The second part of the paper discusses ways in which the image of a nation can be used to promote exports, inward investment, and tourism. The case of Scotland is used to illustrate the strategy of developing an umbrella brand for a country. The author summarizes the key findings of a research project entitled "Scotland the Brand."

REFERENCES

HSubl, Gerald (1996), "A Cross-national Investigation of the Effects of Country of Origin and Brand Name on the Evaluation of a New Car," International Marketing Review, 13, 5, 76-97.

HSubl, Gerald and Terry Elrod (1997), "The Impact of Congruity Between Brand Name and Country of Production on Consumers’ Product Quality Judgments," working paper, Faculty of Business, University of Alberta.

Hong, Sung-Tai and Robert S. Wyer, Jr. (1989), "Effects of Country-of-Origin and Product-Attribute Information on Product Evaluation: An Information Processing Perspective," Journal of Consumer Research, 16, 175-187.

Jacoby, Jacob, George J. Szybillo, and Jacqueline Busato-Schach (1977), "Information Acquisition Behavior in Brand Choice Situations," Journal of Consumer Research, 3, 209-216.

Johansson, Johny K. (1993), "Missing a Strategic Opportunity: Managers’ Denial of Country-of-Origin Effects," in Product-Country Images: Impact and Role in International Marketing, Nicolas Papadopoulos and Louise A. Heslop (eds.), Binghamton, NY: International Business Press, 77-86.

Levitt, Theodore (1983), "The Globalization of Markets," Harvard Business Review, 61, May/June 1983, 92-102.

Nebenzahl, Israel D., Eugene D. Jaffe, and Shlomo I. Lampert (1997), "Towards a Theory of Country Image Effect on Product Evaluation," Management International Review, 37, 1, 27-49.

Tse, David K. and Gerald J. Gorn (193), "An Experiment on the Salience of Country-of-Origin in the Era of Global Brands," Journal of International Marketing, 1, 1, 57-76.

Ulgado, Francis M. and Moonkyu Lee (1993), "Consumer Evaluations of Bi-National Products in the Global Market," Journal of International Marketing, 1, 3, 5-22.

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