Dissertation on The concept of country of origin effect on the consumer

behavior in the Dubai market

Executive Summary
Dubai residents were surveyed regarding their perception on country of origin
as the determinant of consumer behavior and their purchase and preference for
locally or foreign-made products. This study used the Consumer Ethnocentrism
Scale in assessing the variables.
The findings indicated that the respondents that country of origin affects the
economy of Dubai. Thus, the predominant response indicates that the respondents
prefers to buy Dubai-made products when given a choice between foreign goods.
Moreover, the result showed that despite the influx of international brands in Dubai,
the respondents still prefer to buy locally-made products. However, the study also
indicated that it is not only country of origin factors that affects the progress of
Dubais economy. There are several factors affecting the progress of the economy of
Dubai such as terrorist attacks, globalization, and its business relationships with
other countries.
Using a t-test analysis, the statistics showed that there is a significant
relationship in the perception of the respondents to the concept of country of origin
effect on the consumer behavior in the Dubai market. Consequently, the t-test
analysis reveals that the concept of country of origin has a significant effect on the
consumer behavior in the Dubai market. The statistics shows the t-value to be
-1053.8 which illustrates that there is a relationship between the variables.

Chapter 1
PROBLEM AND ITS BACKGROUND

Introduction
Country of origin (CO) is a potentially powerful image variable that can be
used to gain competitive advantage in international marketing. However,
deficiencies in the definition and measurement of its facets have contributed to
ineffective and infrequent use of CO image as competitive tool. Country-of-origin

(CO) image refers to "buyers' opinions regarding the relative qualities of goods and
services produced in various countries" (Bilkey 1993, p. xix).
Several reasons may account for the relative neglect of CO image as a
competitive tool. First, the CO variable is culture-laden, and most managers are
inadequately trained to address cultural issues despite significant research
indicating that multinational marketing strategy is ill-served if cultural and
perceptual differences among countries are not properly comprehended and heeded
(Harris 1984; Kale 1991). Second, translating CO images into marketing
communication opportunities is difficult because the relationship between the brand
and its country of origin is potentially more distant than the relationship between
the brand and its firm, store, or advertising. Third, Zinkhan and his colleagues'
observations about what constitutes effective measures for image manifestations
and their current state of development are equally applicable to CO image
measures (Dobni and Zinkhan 1990; Johnson and Zinkhan 1990; Villanova, Zinkhan,
and Hyman 1990).
Consumer behavior on the other hand, depends so much on marketing
strategies and advertisements of Multinational Companies in order to penetrate
domestics markets. Once a market is selected, marketing managers must determine
whether a global or local approach should be taken. Most often, MNCs uses the
Country of Origin strategy in order to market their products as more superior than
that of domestic products. Their brand strategies involve inherent choices between
using a global brand across markets or developing brands for specific markets.
Relevant issues to consider in making these decisions include consumer
familiarity with the global brand (and the size of the global consumer segment), the
linguistic implications of the brand name for a new market, consumer culture, the
presence and nature of competing brands within a given category, and the degree
to which the brand is to be positioned on the basis of its country-of-origin (Alden,
Steenkamp and Batra, 1999; Batra, Ramaswamy, Alden, Steenkamp and
Ramachander, 2000; Gupta and Govindarajan, 1999; Shoham, 1999).
In the case of Dubai, it has assimilated American consumerism (Tompaine,
2002) through the years. There is no clash of civilizations: veiled mothers take their
children shopping for Nike sneakers at the city's malls, stopping for lunch at KFC or
McDonald's without giving the matter a second thought (Tompaine, 2002).
Dubai embraces America's consumer culture, but carries it out to its logical
extreme. According to Tompaine Journal (2002) this goes far beyond the presence of
U.S.-based fast-food chains -- Coke, Pepsi, Kodak or any of the other well-known
symbols of American globalism (in the recently opened Dubai Internet City the most
prominent building bears a Microsoft logo). This is evidenced by the perception of
marketers such as: Does store "A" have five brands of VCR to its competitor's three?
This has nothing to do with consumer 'empowerment'. Store "A" just figures that
five choices instead of three may help get you in the door and separate you from

your money. Moreover, every flat surface in Dubai appears to contain advertising.
This consumption behavior of Dubai seemed to have been leaning towards the
internationalization and liberalization not only of goods and products but also on the
choices of the residents themselves.

Background of the Study

Marketers often promote the fact that a product is made in a country with a
reputation for manufacturing high-quality merchandise. Moreover, experimental
studies support the viability of this strategy. Associating a product with a country
that is known for superior workmanship often increases evaluations of this product
(Erickson, Johansson, & Chao, 1984; Hong & Wyer, 1989, 1990; Johansson, 1989;
Tse & Gorn, 1992; Wall, Liefeld, Heslop, 1991). Despite this evidence, however,
country-of-origin effects are not clearly understood under many conditions in which
products are evaluated. A number of factors potentially influence both the
magnitude and the direction of the effect that a product's country of origin can have
on evaluations of its quality. These factors must ultimately be specified. Moreover,
the cognitive processes that underlie their effects must be identified, and the
conditions in which the processes operate must be circumscribed. Until this is done,
the effect of calling consumers' attention to a product's country of origin in any
given instance will be hard to predict.
Hong and Wyer (1990), for example, found that the reputation of a product's
country-of-origin information influenced perceptions of a product's quality well over
the effects of information about its specific attributes. In some conditions, however,
country-of-origin information also had an indirect effect on product evaluations
through its mediating influence on the way the attribute information was processed.
Once formed, this concept influenced subjects' interpretation of the intrinsic
attribute information they received subsequently, and so the latter information had
different effects than it would normally have (Hong & Wyer, 1990). Moreover, when
subjects initially learned about a product without an a priori objective of evaluating
it, their knowledge of the product's country of origin stimulated them to think more
extensively about the specific attribute information that followed it. As a result, the
attribute information had more impact on the judgments they later reported (Hong
& Wyer, 1989).
The quality of products that are typically manufactured in a country can also
potentially serve as a comparative standard relative to which a particular product is
evaluated. Thus, a product of average quality might be viewed as relatively inferior

when compared to products from a country with a reputation for high-quality

merchandise. However, the same product might be viewed as superior in
comparison with products from a country with a poor reputation. To this extent, the
reputation of a product's country of origin could have a negative contrast effect on
evaluations of the product. Although the use of other extrinsic attributes, such as
price, as standards of comparison has in fact been detected (Herr, 1989; Monroe,
Grewal, & Compeau, 1991), the use of country of origin in this capacity has not
been identified in research reported to date (Bilkey & Nes, 1982; Ozsomer &
Cavusgil, 1991).
There is a way in which country of origin might serve as a comparative
standard (Lynch, Chakravarti, & Mitra, 1991). On one hand, it might come into play
after the object's features have already been integrated into a subjective impression
and subjects are asked to report their impression along a response scale. In this
case, it might be used as an end anchor to construe the range of values to which
the response scale pertains (Higgins & Rholes, 1976; Ostrom & Upshaw, 1968;
Wyer, 1974). Thus, if the products made in the country are generally favorable,
subjects might subjectively position the response scale to include a more favorable
set of stimulus values than they otherwise would.
This study seeks to infer these stated aspects of the concept of country of
origin among consumers particularly in an Arab city, particularly the United Arab
Emirates city of Dubai. Dubai, the commercial capital of the UAE, has the largest
tourism market, attracting both business travelers and an increasing number of
leisure tourists. While Dubai enjoys the main focus as one of the two most powerful
Emirates along with Abu Dhabi, the other 5 Emirates, while being completely
different to each other in terms of population and economic resources, still have
something to offer and are keen to develop themselves and build their own modern
business and commercial infrastructures.

Statement of the Problem

One could consider two general ways in which a product's country of origin
can influence judgments. First, it can have an informational influence; that is, it can
be used to infer more specific product attributes or be treated as a desirable or
undesirable feature in its own right. Second, the quality of products that are
typically made in a country might be used as a standard of comparison to which any
particular product from the country is evaluated. Note that the use of country of
origin in this latter capacity would lead it to have a negative contrast effect. That is,

evaluations of the product would be less favorable when it is made in a country with
a good reputation than when it comes from a country with a poor one.
The study intends to investigate the effects of the concept of country of
origin in the buying behaviors of the product consumers in the city of Dubai.
Specifically the study seeks to answer the following questions:
1.

What contributes to the formation of CO images among

the consuming public in Dubai?

2.

What is the level of familiarity does the consuming public

of Dubai have particularly in origin of the products sold in the city?

3.

How salient is CO image in shaping attitudes and behavior

toward specific products and brands and in affecting choice behavior, both in
absolute terms and relative to other marketing stimuli?

4.

How much information is provided by the products in

order for them to weigh heavier on the judgment of the consuming public?

5.

Is there a significant relationship between the quantities

of information provided by the products in the buying behavior of the consuming

public in the city of Dubai?

6.

Is there a significant relationship between a products

country of origin and the buying behavior of the consuming public in Dubai?

Hypothesis
The researcher intends to investigate the implications of country of origin
principles of buying behavior among the consumers in the country of Dubai. This
study intends to prove the following hypothesis:

The concept of country of origin has no significant effect on the consumer

behavior in the Dubai Market.

Significance of the Study

This study will primarily benefit both the youth and the leaders in the
commercial industry of Dubai. The youth, especially those intent on a career in the
commercial industry will find out what is expected of them by the industry, what
future the industry has for them, and what they have to do to be competitive
career-wise, in this type of industry. As for the established businessmen, this study
will show if their expectations and goals can be met by future batches of business
management. Through feedback, they would be able to voice out their concerns
regarding the concept of branding and consumer behaviour, which will consequently
elevate the quality of graduates and help the universities cope with their demands
and the ever-changing needs of the industry.
This study would also be of help to those market scientists who are
interested in finding out the social implications of the boom and the bust phases of
the industry as dictated by consumer behaviour.
Finally, this study would benefit future researchers in the field of the market,
education, human resource management, business and the social sciences
particularly in areas in the Arab region such as Dubai since it depicts the future of
the consumerism and its varying effects to many sectors of society.

Scope and Limitation

The study intends to investigate the effects of country of origin concept in the
city of Dubai particularly in the commercial sector of the said United Arab Emirates
cosmopolitan. For this study, primary research and secondary research will be used.
Primary research will be conducted using anonymous questionnaires that will be
sent to randomly selected product consumers in the city of Dubai. The researcher
will also be conducting focus group interview with market analysts and economists
regarding the possible effects of the concept of country of origin on the consumer
behavior on Dubai. The questionnaires will be used to collect quantitative data and
the interviews will be used to provide qualitative insights into the data collected.

The data will be analyzed and compiled for the correlation of the hypothesis.
An indicator of the control group will be individuals at the city of Dubai. The data will
then be presented by means of graphical representations and illustration and the
difference would be highlighted. A negative correlation between the variables would
suggest that the hypothesis is null, that is, that the concept of Country of Origin has
no impact to the consumer behavior of the product consumers of Dubai.

Review of Related Literature

Country of Origin has been illustrated as a factor in consumer choice and
product evaluation. It has been researched and proven to affect consumer behavior
particularly in Arab countries such as the UAE, where culture has been deemed as
conservative and tends to resist foreign offensive in their consumer market.
However, in Dubai, the establishment of the Duty Free paved the way for the flow of
goods and products thus, allowing foreign companies to introduce their respective
brands. This section shall illustrate the phenomenon of Country of Origin (COO) and
how it affects consumer behavior. It shall also present an examination of UAE and
Dubais political economy and consumer market. Furthermore, an examination of
the methodological issues, internationalism vs. nationalism, and the consumer
perception and evaluation goods based on COO shall be reviewed.

Country of Origin
Systematic research on the country-of-origin (COO) effect began with the
publication of Schooler's (1965) seminal article in the Journal of Marketing Research
("Product Bias in the Central American Common Market"). Early research on COO
can be described as demonstrational in nature; most research was only concerned
with documenting the existence of the COO effect under a variety of circumstances
(Jolibert and Peterson, 1995). Statistically significant COO effects have been
documented across countries, for a variety of product categories, and for both
industrial buyers and consumers.

After concluding that "all of the studies reviewed indicate that country of
origin does indeed influence buyers' perceptions" (p. 94), Bilkey and Nes set forth
several issues that they believed needed to be addressed to advance the state of

COO knowledge. These issues stimulated a plethora of wide-ranging research that

sought to establish theoretical explanations for the COO effect as well as determine
its antecedents and relative influence in the presence of other cues. Several studies
attempted to clarify and understand how individuals used country of origin in the
context of information processing and knowledge activation (Hong and Wyer, 1989;
Johansson, 1989). For instance, Han (1989) posited that the country of origin of a
product could serve as a stereotype measure or surrogate for other product
attributes for individuals unfamiliar with it or the product category. For individuals
familiar with the product or product category (e.g., experts), Han posited that
country of origin could serve as a summary index or heuristic that reduces the
amount of information processing required in making a decision. Recent research
has focused on the antecedents of the COO effect (Hong and Wyer, 1990; Roth and
Romeo, 1992) and assessing the relative importance of country of origin as one of
many possible cues (Thorelli, Lim and Ye, 1989; Tse and Gorn, 1993).
Internationalism vs. Nationalism in Consumer Behavior
When a firm decides to export products to new markets it faces two
fundamental decisions: which markets to enter, and whether to use a global or a
localized strategy (Klein, 2002; Jain, 1989). Regarding the first issue, managers
must identify the intrinsic factors of each potential new market that might predict
future success or failure. These factors are extremely varied and range from matters
concerning infrastructure and political stability, market size and consumer income
levels, to issues related to the presence of local or previously established multinational competitors (Czinkota and Ronkainen, 1996; Gupta and Govindarajan,
1999).

Two constructs emerging from the marketing literature suggest important

additional factors that the international manager should consider when making
branding decisions: consumer animosity toward a producing nation, and consumer
ethnocentrism. Consumer animosity--defined as anger related to previous or
ongoing political, military, economic, or diplomatic events--has been found to affect
consumers' purchase behavior (Klein, Ettenson and Morris, 1998). Consumer
ethnocentrism is defined as the belief that it is inappropriate, or even immoral, to
purchase foreign products because to do so is damaging to the domestic economy,
costs domestic jobs, and is unpatriotic. This construct has also been found to affect
purchase behavior (e.g., Shimp and Sharma, 1987).
Research on country-of-origin effects has generally examined how a country's
image (concerning, for example, workmanship, innovation, and technological
advancement) is projected on to the features of products produced by that country
(Bilkey and Nes, 1982; Johansson, 1989; Johansson, Douglas and Nonaka, 1985;
Papadopoulos and Heslop, 1993).
Among the image variables in the international advertiser's toolkit, the CO
variable is conceivably the most potent if skillfully applied. Papadopoulos (1993, p.
xxi) asks rhetorically, "It is often said that brand names like 'McDonald's' are worth
millions. If so, how many billions is Germany's image worth?" A few authors have
questioned the magnitude of importance of CO image in affecting choice behavior
(Ettenson, Wagner, and Gaeth 1988; Johansson 1989; Johansson, Douglas, and
Nonaka 1985), but most acknowledge its salience in overall product evaluation and
as a proxy for other, more intrinsic, qualities (Han and Terpstra 1988; Yoo 1992).
Internationally, CO serves as a useful extrinsic cue and as a surrogate for
difficult-to-evaluate intrinsic characteristics such as quality and performance
because consumers tend to be less familiar with foreign than with domestic
products (Huber and McCann 1982; Olson 1977). Han and Terpstra (1988, p. 236)
claim, "It has been found that all products originating in foreign countries are
subject to country-of-origin [image] effects." Han (1990, p. 24) further states that
CO-image studies in general show that consumers have significantly different
general perceptions about products made in different countries. Hooley, Shipley,
and Krieger (1988, p. 67) asserted that international marketers need to understand
these country of origin images as they relate both to their own, and to their
competitors' products. Specifically, they will need to determine whether such

images are positive or negative, whether and how they affect behavior, and how
they can be catered to in the marketing strategy. Yet, few multinational marketers
and advertisers make full use of their products' favorable CO image or successfully
overcome the liability associated with an unfavorable one.

Consumer Ethnocentrism and Product Choice

Animosity and consumer ethnocentrism can have very different implications
for international marketers, depending on the origin of products available in a given
category. If the choice is between a domestic and a foreign good, then highly
ethnocentric consumers will be likely to chose the domestic product. If the choice is
between two foreign goods, one of which comes from a country that is the target of
hostility, then animosity will predict the choice. Consumers can hold nonprotectionist views about foreign products and feel that their purchase is perfectly
appropriate in general, but still refuse to buy the products of a specific country.
Overall, studies of international consumer animosity point to the need for firms to
develop a richer understanding of how current and prospective consumers in
international markets react to goods imported from a particular producer nation.
Country-of-origin has been found to act as an information cue that affects
judgments of product quality, particularly when consumers are less familiar with a
product category (Han, 1989; Maheswaran, 1994), or less motivated to process
product information (Hong and Wyer, 1989). In general, the country-of-origin is used
by consumers to assess a product's quality, and to choose the best option available.
The animosity model of foreign product purchase suggests a very different
process by which a product's origin can have an impact on purchase decisions.
Consumer animosity has been found to have a direct, negative effect on consumers'
purchase behavior, but unlike previously studied country-of-origin effects, consumer
animosity does not drive product attribute judgments or quality perceptions.
Consumers separate their anger towards a country from their assessment of that
country's products. In other words, angry consumers do not distort or denigrate
images of a target country's products, they simply refuse to buy them (Klein et al.,
1998).

This fundamental premise of the animosity model--that animosity's effects on

buying are direct and independent of product quality judgments--not only diverges
from traditional country-of-origin research, but also from most behavioral
frameworks in marketing which assume a primary relationship between consumers'
product judgments and their purchase behavior (e.g., Green and Srinivason, 1990;
Wilkie and Pessemier, 1973). In the case of consumer animosity, anger can lead
consumers to eschew a country's goods in spite of positive product perceptions.
The animosity model also includes the construct of consumer ethnocentrism.
Previous studies have found an inverse relationship between scores on the
CETSCALE, which measures consumer ethnocentrism, and consumers' willingness to
purchase imports. Further, consumer ethnocentrism has been found to predict
judgments of the quality of imported goods (Netemeyer et al. 1991; Shimp and
Sharma, 1987; Sharma, Shimp, and Shin, 1995). Those who believe that it is wrong
to buy foreign and that only domestic products should be purchased also tend to
denigrate the quality of foreign goods.
Thus, while consumer ethnocentrism is related to both product judgments
and purchase intentions, animosity affects consumers' purchase decisions
independently of product judgments. A further distinction between the constructs is
that animosity is comprised of consumer feelings toward a specific country, whereas
consumer ethnocentrism concerns attitudes toward buying goods from all foreign
countries. While some consumers may find it perfectly acceptable to buy foreign
products from a variety of countries, they may refuse to buy a product from a
specific nation toward which they feel enmity. Thus, it is not enough for
international managers to understand the degree of consumer ethnocentrism within
a potential market. Favorable opinions toward buying foreign goods in general could
mask potent attitudes against buying from a specific foreign country.
It is essential, therefore, to understand the decision contexts under which
each construct is likely to play a dominant role. Klein et al. (1998) measured the
effects of both constructs on general buying measures (e.g., "Whenever possible, I
avoid buying products from Japan"). Yet, it would be more diagnostic to predict
purchase decisions based on consumers' choice sets. Consumer ethnocentrism
should be particularly relevant when a consumer chooses between a foreign and a
domestic product; it should, however, be irrelevant for choices between two foreign
products, because both products are bad options for the ethnocentric consumer.

Animosity, however, should be relevant when choosing between goods from foreign
countries, provided that the consumer holds animosity towards one of these
countries. Further, one might expect that both animosity and consumer
ethnocentrism will play a role when the consumer chooses between a domestic
product and a foreign product from a disliked country. The relative importance of t
he two constructs in this situation is likely to depend upon the predominance of
ethnocentric beliefs and levels of animosity within a given society.

The Political Economy of UAE and Dubai

The partnership between the United Arab Emirates and the United States of
America, upon recognition of UAE's independence in 1971, developed ties and have
grown progressively stronger ever since. (Al-Alkim, H., et al., 1999). This partnership
has been the gateway of UAE, particularly Dubai in allowing for the free-flowing of
goods and businesses (Al-Alkim, H., et al., 1999). In fact, the establishment of
Dubais Duty Free allowed UAE citizens to be exposed to goods from other countries
and in a variety of brands. It has been stipulated by Al-Alkim, H., et al. (1999) that it
also shaped the consumption behavior of Dubai residents.
The UAE is what many economic writers call a competition state, a state that
provides a lot of space for entrepreneurial activity and one that pursues supply-side
policies (Tetreault, 1999). A competition state is one that supplies resources: capital,
infrastructure, social services for the domestic population and for the economy. A
competition state also supplies extranational partnerships or the opportunities to
make such partnerships. The state works to attract foreign states and firms to
engage in long-term, mutually beneficial relations with domestic

counterparts (Tetreault, 1999). Finally, a competition state provides effective

regimes: legal regimes, regulatory regimes and allocative systems, so that the
system works for the domestic population and for outsiders coming in to
invest (Tetreault, 1999).
The United Arab Emirates (UAE) boasts a prudently managed and
successfully diversified economy and the country continues to consolidate and build
on its achievements of the past two decades (Siddiqi, 2001). For instance, the test,
carried out by Madar Research Group (2003), showed that Dubai was on par with
top European Union states in the online availability of the basic services offered to
businesses and individuals.
Dubai is the world's third largest re-export centre after Hong Kong and
Singapore, accounting for 70 per cent of the UAE's non-oil trade (Siddiqi, 2001).
During 1998-99, its re-export business exceeded the value of its oil exports. Dubai
Duty Free has seldom been out of the headlines since its launch in 1983 (The Middle
East, 1994). Not only did it lead a revolution in the Middle East by being the first to
develop a modern, Western style duty free shopping, but it is a key part participant
in the promotion of Dubai as a business and tourist destination.
In spite of world recessions, the UAE, Dubai in particular, continues to be
growth markets and there are good opportunities in Dubai for foreign companies
(The Middle East, 1993). The Gulf Emirate of Dubai, armed with what is probably the
most attractive foreign investment incentive packages in the region, is aggressively
promoting itself as a regional manufacturing and re-export, banking, aviation and
even tourism hub (The Middle East, 1993). This follows similar foreign investment
and export drives over the last few months by Bahrain, Saudi Arabia, Oman, Qatar
and Abu Dhabi - all experiencing the continuing post Gulf war boom.
In spite of recession in other parts of the world, the Gulf Cooperation Council
(GCC) states, including the UAE, continue to be growth markets and in Dubai, in
particular, there are good opportunities for foreign companies as the emirate
continues to invest in infrastructure and to diversity its economy (The Middle East,
1993).
Dubais Consumer Culture
Walking into a Dubai department store, one is presented with a wide
array of products and brands from different countries popular among which is the
United States, the European Community and China. These countries provides

different products at differing prices. In Dubai, a consumer is presented with the

dilemma of choosing products and goods based on price, quality and out of habit.

As a resident of Dubai, I often do my shopping on big department

stores since it saves me time instead of having to go through several stores to find
what I need. As one enters the supermarket division, one can see tens of different
brands. Out of habit though, the first thing that I pick up is the product that I have
been used to- products made in Dubai. This is no longer out of conscious decision
but rather out of habit. Sometimes though when I have time, I try to look at the
brands and compare it with the one Im using. More often, at this times, I try the
product but since I have been used to my old brands, I still prefer to use my tried
and tested products.
This feelings however is not often shared by some people preferably the
younger populace. This is evident in their choices of clothing, rubber shoes and
other paraphernalia. According to a young professional, his choice of clothes leans
more on the trendy look derived from countries such as the United States and
Europe. This difference is a characterization of the evolving consumer culture in
Dubai as a result of the free-flowing information between countries.
Dubai's emergence as a major commercial and industrial location occurred
quietly (Weiss, 1995). Considering the overregulated, import barrier--laden
conditions prevalent across the Middle East and neighboring South Asia, it's easy to
understand why people from both regions flock to Dubai on purchasing expeditions.
Its location and free-trade, low-tax environment have forged a cosmopolitan
shopping mecca (Weiss, 1995). Even for Asians and Europeans, prices on many
consumer items--ranging from jewelry to electronics--are far cheaper than at home.
Dubai's modern shopping malls--along Al Rigga Road or in the Al Dhiyafa section-rival Western counterparts.
While a number of studies have found that consumers, in general, are
favorably biased towards domestic versus imported foreign products (Baughn and
Yaprak, 1993; Peterson and Jolibert, 1995), none has examined the impact of
nationalistic, patriotic and internationalistic tendencies on such a bias. The origins
of the consumer ethnocentrism construct (Shimp and Sharma, 1987) come from the
general construct of ethnocentrism introduced as a psychosociological concept by

Sumner (1906). Ethnocentrism focuses on a "we group" feeling where the ingroup is
the center and all outgroups are judged in relation to it. The ingroup that nurtures
attachment and loyalty is, in this case, one's country. Nations "... achieve personal
relevance for individuals when they become sentimentally attached to the
homeland (affectively involved), motivated to help their country (goal-oriented) and
gain a sense of identity and self-esteem through their national identification (ego
involved)" (Druckman, 1994, p. 63). The strength of these needs varies from
country to country and from individual to individual (Terhune, 1964).

The construct of consumer ethnocentrism was developed as an economic

form of ethnocentrism and encompasses issues such as one's fear of economically
harming his/her beloved country by buying foreign products, the morality of buying
imported products, and a personal prejudice against imports (Sharma et al., 1995).
Shimp and Sharma (1987) developed a multi-item scale to capture consumer
ethnocentric tendencies (the CETSCALE) and showed that consumer ethnocentrism
explains why consumers prefer domestic over imported products (even when the
latter are cheaper and their quality is evidently better). Herche (1992) showed that
consumer ethnocentrism can predict (with varying precision across productcategories) consumers' preferences to buy or own domestic as opposed to foreign
products. Importantly, he demonstrated that ethnocentric tendencies are better
predictors of import purchase behavior than demographic and marketing mix
variables (Herche, 1994). However, consumer ethnocentrism's predictive ability of
buying intentions varies from country to country; for example, Good and Huddleston
(1995) found it to be important for Poles' but not for Russians' intentions to buy
foreign products.

Regarding the antecedents of consumer ethnocentrism, several studies have

found that males, better-educated consumers and those with higher incomes tend
to be less ethnocentric (Sharma et al., 1995). The rationale provided for the
observed relationships is that females, older, and less educated people are more
conservative and more patriotic; moreover, as one's income increases, the more
likely one is to travel and try more products, and thus, be more open to imported
products (Sharma et al., 1995).

COO and Consumer Evaluation

There are at least four different ways in which the country of origin of a
product could affect its evaluations (Li and Wyer, 1994): (a) as a product attribute
whose implications combine with other attributes to influence evaluations, (b) as a
signal to infer more specific product characteristics, (c) as a heuristic (to simplify
the evaluation task), and (d) as a standard relative to which the product is
compared.
Marketers often promote the fact that a product is made in a country with a
reputation for manufacturing high-quality merchandise. Moreover, experimental
studies support the viability of this strategy. Associating a product with a country
that is known for superior workmanship often increases evaluations of this product
(Hong & Wyer, 1990; Johansson, 1989; Tse & Gorn, 1993). Despite this evidence,
however, country-of-origin effects are not clearly understood under many conditions
in which products are evaluated. A number of factors potentially influence both the
magnitude and the direction of the effect that a product's country of origin can have
on evaluations of its quality. These factors must ultimately be specified.

The cognitive processes that underlie their effects must be identified, and the
conditions in which the processes operate must be circumscribed. Until this is done,
the effect of calling consumers' attention to a product's country of origin in any
given instance will be hard to predict. Hong and Wyer (1990), for example, found
that the reputation of a product's country-of-origin information influenced
perceptions of a product's quality well over the effects of information about its
specific attributes. In some conditions, however, country-of-origin information also
had an indirect effect on product evaluations through its mediating influence on the
way the attribute information was processed.
To the extent that a product's country of origin is used as information about
its quality, product evaluations should increase in favorableness as the country's
reputation for manufacturing high-quality merchandise increases (Li and Wyer,
1994). However, this general informational effect could occur for at least three
reasons. First, the country of origin could itself be viewed as a favorable or

unfavorable attribute of the product, which is independent of other attributes (Hong

& Wyer, 1990; Li & Monroe, 1992). Second, it might be used as a signal to infer
more specific product attributes about which information is unavailable ( Li, Leung,
& Wyer, 1993; Li & Monroe, 1992; Li, Monroe, & Chan, 1994). Third, it could be used
as a heuristic basis for judgment that is substituted for other available judgmentrelevant information.
COO as a Comparative Tool in Consumer Evaluation
There are two ways in which country of origin might serve as a comparative
standard (Lynch, Chakravarti, & Mitra, 1991). On one hand, it might come into play
after the object's features have already been integrated into a subjective impression
and subjects are asked to report their impression along a response scale. Thus, if
the products made in the country are generally favorable, subjects might
subjectively position the response scale to include a more favorable set of stimulus
values than they otherwise would (Li and Wyer, 1994). Consequently, any given
stimulus would be evaluated less favorably along the scale than it would if the scale
had been positioned to include a more unfavorable set of values.
Consumer behavior has been defined as the "acquisition, consumption and
disposition of products, services, time and ideas by decision making units" (Jacoby
1975, 1976).
Much consumer research relies on surveys, and a considerable amount of
work has been devoted to questionnaire and survey design. Bickart (1993) and
Simmons et al (1993) examined question order effects in surveys, while Menon, et.
al. (1995) examined the memory processes underlying consumers' responses to
behavioral frequency questions. Rose et al (1993) suggest that comparative
measures (e.g. "Is Brand A superior to Brand B?") are more sensitive in detecting
persuasion than noncomparative measures. Webster (1996) found that response
quality for surveys is highest when interviewer and interviewee are of the same
gender or ethnicity.

Country of Origin Effects and Consumer Behavior

For the past three decades, the effect of a product's country of origin on
buyer perceptions and evaluations has been one of the most widely studied
phenomena in the international business, marketing, and consumer behavior

literatures (Jolibert and Peterson, 1995). Indeed, Tan and Farley [1987] concluded
that the potential impact of the country of origin of a product is the "most
researched international aspect of consumer behavior" (p. 540). Recently an entire
book (Papadopoulos and Heslop, 1993) was dedicated to the country-of-origin
phenomenon. According to Papadopoulos and Heslop (1993), the country of origin of
a product, which is typically operationalized or communicated through the phrase
"made in _____," is an extrinsic product cue - an intangible product attribute - that is
distinct from a physical product characteristic or intrinsic attribute. As such, a
country-of-origin cue is similar to price, brand name, or warranty in that none of
these directly bear on product performance.
As a result of such rapid changes and development in the global business
strategic environment, product country association is no longer just a single-country
phenomenon. Increasingly more products are emerging as a result of multifirm and
multicountry efforts (Chao, 1993). Contrary to the traditional country-of-origin
research paradigm which typically assumes that a product can be specifically tied to
a country in which it is made, it is no longer as easy to do so in today's complex
global reality.
There is a long stream of research on COO effects. A large number of studies
have reported a consistent pattern of bias toward showing COO effects on consumer
attitudes and/or product evaluations (Bilkey and Nes, 1982). Many have, however,
questioned the validity of these research findings derived from mostly single-cue
models. In fact, some multiple-cue studies have reported either no significant or
only minor country-of-origin effect (Johansson, Douglas and Nonaka 1985; Ettenson,
Gaeth and Wagner 1988) rendering conclusions regarding COO effects somewhat
equivocal. Thus, the questions of whether country is an important variable
impacting consumer product evaluations and whether the effect, if any, may only
be transitory continue to linger (Schellinck 1986; Johansson 1989).
The impact of price information on consumer perception of quality has been
studied rather extensively (Monroe, 1973; Monroe and Dodds, 1988). Similar to
country-of-origin studies, no clear picture has emerged to indicate unequivocally
whether a positive price and quality relationship exists, particularly in cases where
other information cues were also provided to the consumer.
Given that consumers do not possess perfect information, they are likely to
rely on prior experience as well as a variety of information cues, other than price
provided, to judge product quality. In such a context, for consumers who are more
experienced with the product, the price-quality association is likely to weaken
(Wheatley, Walton and Chiu 1977; Rao and Monroe 1988). It would seem logically

consistent that as the consumer confidence in judging product quality based on

other information cues such as product attributes increases, his/her inclination to
rely on price as an indicator of quality naturally should tend to decrease.

Methodological Issues in Measuring COO

Although numerous dependent variables have been investigated in COO
studies, investigations were limited to two broad categories quality/reliability
perceptions of consumers and purchase intentions. These two categories capture
the majority of response or dependent variables investigated in COO studies and
were deemed representative of dependent variables commonly investigated in COO
studies. While perceptions and intentions are intuitively related, they are
conceptually distinct (Fishbein and Ajzen,1975) and hence merit separate analysis.
Perceptions are more "primitive" than intentions. As such, perceptions are
antecedent to, and determinants of, intentions (e.g., Belk (1985), although the
relationship is mediated by constructs such as satisfaction (e.g., Cronin and Taylor,
1992). The choice of these particular categories of variables in the context of COO
studies has been previously justified by Johansson (1989), and the present
investigation's separate analyses of them is analogous to the approach followed by
Roth and Romeo (1992).
Consider the findings of single- versus multiple-cue studies. Single-cue
studies of the influence of country of origin on product perceptions and purchase
intentions have been criticized on the basis that the significant results that have
been obtained likely reflect methodological artifacts rather than substantive
differences (Bilkey and Nes, 1982; Johansson, Douglas and Nonaka, 1985; Ozsomer
and Cavusgil, 1991). Specifically, it has been argued that the effect of a COO cue
should be greater in a single-cue study than in a multiple-cue study, in part because
demand artifacts are potentially greater in the former and in part because the
presence of other cues could influence study participants' reactions in the latter.
Despite the logical appeal of this argument, empirical results produced to date with
multiple-cue studies are conflicting and inconclusive (Han and Terpstra, 1988; Tse
and Gorn, 1993). Even so, while there is no consensus, on balance the evidence
suggests that larger effect sizes should occur for single-cue studies than for
multiple-cue studies in COO research. One objective of the present investigation
was to resolve such conflicting findings.

Chapter 3
METHODS AND PROCEDURES
This part of the proposal shall discuss the research methods available for the
study and what is applicable for it to use. Likewise, the chapter shall present how
the research will be implemented and how to come up with pertinent findings.
Method of Research to be Used
Research requires an organized data gathering in order to pinpoint the
research philosophies and theories that will be included in the research, the
methodology of the research and the instruments of data interpretation. In this
study, the Research Process Onion will be utilized so that the findings of the study
can be thoroughly established. The inner part of the onion describes the
methodology portion whereas the outer part discusses the strategies that can be
utilized in interpreting the results of the findings.
This study shall utilize the descriptive research method which uses
observation and surveys. In this method, it is possible that the study would be
cheap and quick. It could also suggest unanticipated hypotheses. Nonetheless, it
would be very hard to rule out alternative explanations and especially infer
causations. This descriptive type of research will utilize observations in the study.
To illustrate the descriptive type of research, Creswell (1994) will guide the
researcher when he stated: Descriptive method of research is to gather information
about the present existing condition. The purpose of employing this method is to
describe the nature of a situation, as it exists at the time of the study and to explore
the cause/s of particular phenomena. The researcher opted to use this kind of
research considering the desire of the researcher to obtain first hand data from the
respondents so as to formulate rational and sound conclusions and
recommendations for the study.
The research described in this document is partly based
on quantitative research methods. This permits a flexible and iterative approach.
During data gathering the choice and design of methods are constantly modified,
based on ongoing analysis. This allows investigation of important new issues and
questions as they arise, and allows the investigators to drop unproductive areas of
research from the original research plan.
This study also employs qualitative research method, since this research
intends to find and build theories that would explain the relationship of one variable
with another variable through qualitative elements in research. These qualitative

elements does not have standard measures, rather they are behavior, attitudes,
opinions, and beliefs.
Furthermore, as we define the qualitative research it is multimethod in focus,
involving an interpretative, naturalistic approach to its subject matter. This means
that qualitative researchers study things in their natural settings, attempting to
make sense of, or interpret phenomena in terms of the meanings people bring to
them. Accordingly, qualitative researchers deploy a wide range of interconnected
methods, hoping always to get a better fix on the subject matter at hand.

Evaluation of Research Objectives

This study shall use the CETSCALE in accomplishing the following objectives:
1. To determine the factors that contributes to the formation of country of
origin images among the consuming public in Dubai
2. To determine the level of familiarity of Dubai residents in the origin of
products sold in the city
3. To analyze the significance of country of origin image in shaping
attitudes and behavior toward specific products and brands and in affecting choice
behavior, both in absolute terms and relative to other marketing stimuli
4.
behavior

To evaluate the relationship of product information and consumer

5. to evaluate the relationship between the quantities of information

provided by the products in the buying behavior of the consuming public in the city
of Dubai
6. to evaluate the relationship between a products country of origin and
the buying behavior of the consuming public in Dubai?

Research Design and Instrument

An underlying theme of this study is that Dubai consumers preferences are
simple expressions of a more pervasive and generalized concept of consumer
ethnocentrism. Shimp and Sharma (1987) coined the term consumer ethnocentrism
to represent the belief held by American consumers (for
example) about the appropriateness, indeed morality, of purchasing foreign
products (1987: 280).

Thus, the construct of ethnocentrism relies on the presumption that the

consumers patriotic emotions have significant effects on attitudes and purchase
intentions and ultimate behavior. To operationalise the concept of consumer
ethnocentrism, Shimp and Sharma (1987) developed a 17-item scale to
measure the construct and named this the Consumer Ethnocentric Tendency
Scale (CETSCALE).
Against this background, the objectives of the current study are, broadly to
examine the relationships between consumer behavior as measured by the
Consumer Ethnocentrism Scale by Shimp and Sharma (1987) and the home country
bias, perceptions of quality and expressed choice for products assembled and
designed domestically or in foreign countries. The scale used for
measuring consumer ethnocentrism is the original CETSCALE as developed
by Shimp and Sharma (1987). The CETSCALE uses 17 items to measure the
ethnocentric tendencies of the Dubai residents using a 7-point bi-polar scale.
The degree of consumer ethnocentrism among Dubai consumers can be
easily interpreted from the total CETSCALE score. Total score on the 17 point
CETSCALE might vary due to the use of a 7-point Likert scale. The mean scale value
is the predictor of the intensity of ethnocentrism (Shimp and Sharma 1987). A
higher mean scale value indicates higher consumer ethnocentrism.
The Data Gathering Method
The study shall use questionnaires and interviews to gather pertinent data.
Moreover, the researcher shall also use previous studies and compare it to its
existing data in order to provide conclusions and competent recommendations.
Database of the study
The primary source of data will come from a questionnaire and interviews
conducted by the researcher. The primary data frequently gives the detailed
definitions of terms and statistical units used in the survey. These are usually broken
down into finer classifications.
The secondary sources of data will come from published articles from social
science journals, theses and related studies on market behavior and economics.
Acquiring secondary data are more convenient to use because they are already
condensed and organized. Moreover, analysis and interpretation are done more
easily.
For this research design, the researcher will gather data, collate published
studies from different local and foreign universities and articles from social science

journals; and make a content analysis of the collected documentary and verbal
material. Afterwards, the researcher will summarize all the information, make a
conclusion based on the null hypotheses posited and provide insightful
recommendations on the dealing with the buying behavior of the consumers in
relation to the influence of the concept of country of origin.
The general population for this study will be composed of randomly selected
product consumers in Dubai, numbering ninety (90).

Sampling Technique
First, a self-administered questionnaire containing 18 to 20 questions and
shall be filled out by the respondents. Another set of questionnaires will be prepared
for the interview of experts in consumer behavior and economics. Ideally, the
respondents will grade each statement in the survey-questionnaire using a Likert
scale, with a five-response scale wherein respondents will be given five response
choices.
The equivalent weights for the answers will be:
Range
4.50 5.00

Interpretation
Strongly Agree

3.50 4.00

Agree

2.50 3.49

Uncertain

1.50 2.49

Disagree

0.00 1.49

Strongly Disagree

The researcher opted to use the questionnaire as a tool since it is easy to

construct having the rules and principles of construction are easy to follow.
Moreover, copies of the questionnaire could reach a considerable number of
respondents either by mail or by personal distribution. Generally, responses to a
questionnaire are objectified and standardized and these make tabulation easy. But
more importantly, the respondents replies are of their own free will because there
is no interviewer to influence them. This is one way to avoid biases, particularly the
interviewers bias.
Validity of the Data
For validation purposes, the researcher will initially submit a sample of the
set of survey questionnaires and after approval; the survey will be conducted to five

respondents. After the questions were answered, the researcher will ask the
respondents for any suggestions or any necessary corrections to ensure further
improvement and validity of the instrument. The researcher will again examine the
content of the interview questions to find out the reliability of the instrument. The
researchers will exclude irrelevant questions and will change words that would be
deemed difficult by the respondents, to much simpler terms.

Administration of the Instrument

The researcher will exclude the five respondents who will be initially used for
the validation of the instrument. The researcher will also tally, score and tabulate
all the responses in the provided interview questions. Moreover, the interview shall
be using a structured interview. It shall consist of a list of specific questions and the
interviewer does not deviate from the list or inject any extra remarks into the
interview process. The interviewer may encourage the interviewee to clarify vague
statements or to further elaborate on brief comments. Otherwise, the interviewer
attempts to be objective and tries not to influence the interviewer's statements. The
interviewer does not share his/her own beliefs and opinions. The structured
interview is mostly a "question and answer" session.

Statistical Treatment of the Data

When all the survey questionnaire will have been collected, the researcher
will use statistics to analyse all the data.
The statistical formulae to be used in the survey questionnaire will be the
following:
1.
Percentage to determine the magnitude of the responses to the
questionnaire.
n
% = -------- x 100
N
2.

n number of responses
N total number of respondents

4Weighted Mean

f1x1 + f2x2 + f3x3 + f4x4 + f5x5

x = --------------------------------------------- ;

xt
where:

f weight given to each response

x number of responses
xt total number of responses

The researcher was be assisted by the SPSS in coming up with the statistical
analysis for this study.

CHAPTER IV
A. PRESENTATION, INTERPRETATION AND ANALYSIS OF DATA
Country of origin provides an impetus for consumer behavior particularly in
Dubai where consumers are classified as nationalistic in relation to their
consumption of products made domestically. Moreover, country image plays a
significant role in consumers' perceptions of products. Thus, understanding the
dimensions of country image and how it can be operationalized is important for
managers whose products and those of their competitors are manufactured around
the world.
Dubai, being one of cities flocked by international goods, increasingly finds
itself with a variety of products with several brands. This exposure led to the
openness of information regarding the quality and price of foreign products. For
some, it has recurring effects on the domestic market.
This study sought to investigate the effect of the concept of country of
origin (COO) in the market of Dubai. This is the manner unto which the study
accounts the factors and the perception on the criteria themselves. This chapter
discussed the findings based on the collated information on the survey conducted
by the researcher. The general population for this study was composed of randomly
selected product consumers in Dubai, numbering to ninety (90). This chapter
was divided into several parts; the first part provided the general description of the
respondents. Particularly, it discussed the respondents age, gender, marital status,
educational attainment and monthly income. Next, the second part illustrated the
perception of the respondents pertaining to the Consumer Ethnocentrism Scale
(CET). The third part was a description on the perception of the respondents about
the problems and solutions encountered in consuming foreign products. Finally, the
final part of the study presented the guide questions discussing the insight of

the respondents regarding to the effects of country of origin on the consumer

preferences and behavior of Dubai residents.
A demographic profile of the respondents was detailed with the presumption
that the attributes of the respondents influence their behavior and answers on the
survey questions. Specifically the study sought to answer the following questions:
7.

What contributed to the formation of CO images among

the consuming public in Dubai?

8.

What was the level of familiarity does the consuming

public of Dubai have particularly in origin of the products sold in the city?

9.

How salient was CO image in shaping attitudes and

behavior toward specific products and brands and in affecting choice behavior, both
in absolute terms and relative to other marketing stimuli?
10.

How much information was provided by the products in

order for them to weigh heavier on the judgment of the consuming public?

11.

Was there a significant relationship between the quantities

of information provided by the products in the buying behavior of the consuming

public in the city of Dubai?

12.

Was there a significant relationship between a products

country of origin and the buying behavior of the consuming public in Dubai?

Apparently, the researcher evaluated the implications of country of origin

principles of buying behavior among the consumers in the country of Dubai. This
study sought to prove the following null hypothesis:
The concept of country of origin has no significant effect on the consumer
behavior in the Dubai Market.

Part I. Profile of Respondents

This section presents the general profile of the respondents in terms of age,
gender, educational attainment, civil status and monthly income. The first to be
taken into consideration was the age of the respondents followed by gender, marital
status, educational attainment and income. The responses are summarized in the
figures below.
Exhibit 1. Age of the Respondents

Exhibit 1 shows the age range of the respondents. The result shows
that fifty eight percent (58%) of the respondents were 26-30 years old, showing that
most of them can be considered as young adult, sixteen percent (16%) of the
respondents were between 31-35 years old while fourteen percent (14%) of the
respondents were between 36-40 years old. Consequently, very few can be
considered old, this shown by the figure that only 6% of the respondents are in the
40 and above status. Subsequently, there was no respondent on the ages between
15-20 years old. The apparent diversity of the maturity of the respondents reflects
several implications in the studys findings. In relation of the age bracket of the
respondents, the researcher could presume that in the said percentage, a
considerable number could be among the young adult members of the population.

Exhibit 2. Gender of the Respondents

Exhibit 2. The number of the male respondents (51%) is almost equal to the
female (49%). Based on the collated questionnaires, over a half of the population
was composed of male respondents while 49% were females. This shows a virtually
equal footing in terms of representation of gender regarding the perception of the
respondents to the effect of country of origin in product consumption. The male
respondents outnumber the female respondents by approximately 2%; this data
provides a glimpse of the aggregate size of women as a consumer.

Exhibit 3. Civil Status

Exhibit 3. The above illustration shows the civil status of the respondents.
47% of the total respondents, the findings implies that majority of the respondents
are single. Moreover, a significant number, 42% comprise those who are already
married. Furthermore, there is a little percentage of respondents who are separated
or widow. Most of the surveyed individuals are either married or single. This is due
to the large number of young adult in the sample as compared to those who are
older.

Exhibit 4. Educational Attainment of Respondents

Exhibit 4. Likewise, the respondents were asked for their educational

attainment; the report shows that 53% of them are college graduates. The survey
indicates that most of the respondents are college graduates. The diversity of the
population is further asserted when the respondents were asked regarding their
professional history. This data illustrates that the respondents are mature
particularly in terms of experience. Moreover, due to the higher educational
attainment of the respondents. the quality of response also signify that the subjects
of the study are. On the other hand, the apparent youthfulness of the respondents,
provided by their age could not be considered as a deterrence to their responses
considering that the researcher has made sure that the respondents have been
consuming branded products from foreign countries aside from their local
consumption.

Exhibit 5. Monthly Income

Exhibit 5. The above figure illustrated the monthly income of the surveyed
individuals. The illustration shows the minimal gap between the ranges of their
income. From the collated data, there were 22.22% of the respondents whose
monthly income was 10,001 and above dirham. Majority these respondents were
composed of managers, businessmen, young professionals and administrators.
Followed by 27.78% whose ranges of income were in between 2,1001 to 5,000
dirham. Then, 28.89% of the total respondents have an income between 5,000 to
10,000 dirham. And lastly, there were only 21.1% of the respondents with income
of 2,000 or below.

Part 2. Perception of the Respondents - Consumer Ethnocentrism

Scale (CET)
W
eighted
mean
1. People in Dubai should always
5

2. Only those products that are

unavailable in Dubai should be
imported.

4.1
5

3. Buy Dubai made products.

Keep Dubai working

4.2
6

4. Dubai products first, last, and

3.2

foremost

5. Purchasing foreign-made
products is un-Dubai

3.3
5

6. It is not right to purchase

foreign products

4.1
0

7. A real Dubai citizen should

always buy Dubai made products

3.3
5

8. We should purchase products

made in Dubai instead of letting other
countries get rich off us.

3.9
4

9. It is always best to purchase

Dubai products.

retation
2.9

buy Dubai products instead of imports 1

4.0
9

Interp

Neutral

Agree

Agree

Neutral

Neutral

Agree

Neutral

Agree

Agree

10. There should be very little

trading or purchasing of goods from
other countries unless out of

3.9
2

Agree

necessity.
11. Dubai should not buy
foreign products because this hurts
Dubai businesses and causes

3.3
5

Neutral

unemployment.
12. Curbs should be put on all
imports

4.0
6

13. It may cost me in the long

run, but I prefer to support Dubai
products.

4.1
9

14. Foreigners should not be

allowed to put their products in
markets.

3.8
8

15. Foreign products should be

taxed heavily to reduce their entry
into Dubai

3.9
3

16. We should buy from foreign

countries only those products that we
cannot obtain in our own country.

3.6
3

Agree

Agree

Agree

Agree

Agree

17. Dubai consumers who

purchase products made in other
countries put their fellow Dubai's out 5

3.6
2

Agree

of work
The above table presented the perceptions of the respondents pertaining
to the impact of country of origin in consuming different products. The table

above shows that the dominant response was Agree, weighted average in every
statement. According to some respondents, the people of Dubai should buy and
consider their own products in order to contribute to the progress of their
country. The surveyed individuals also agreed that only those products that are
unavailable in Dubai should be imported which was illustrated by weighted
mean of 4.14. Majority of the respondents agreed on the statements and
signifies the high impact of ethnocentrism.
Ethnocentrism, coined by William Graham Sumner, is the viewpoint that
one's ethnic group is the center of everything, against which all other groups
are judged. Within culture, language, behavior, customs, and religion can be a
basis for ethnic distinctions, and sub-divisions. Meaning to say, majority of the
respondents believe that Dubai product were better compared to other foreign
products. However the surveyed individuals with 3.64 weighted mean also
accepted the fact that their country cannot stand alone without the help of
other foreign products since they need to buy from foreign countries only those
products that they cannot obtain in their own country .
The government of Dubai according to the most of the respondents
should employ heavy taxes to other foreign products that will reduce the entry
into Dubai. Moreover, the degree of ethnocentrism for most respondents was
high since they are looking for great improvement and progress of Dubai. The
respondents agreed that Dubai products first, last, and foremost. For them
purchasing foreign-made products is un-Dubai. The weighted mean concerning
to a real Dubai citizen who bought Dubai made products was interpreted as
neutral.
Furthermore, this report shows that Dubai citizens are really concern to
the development of their country but the impact of nature with full of foreign
products was definitely a great factor to consider because even though they
dont want to buy this product they are forced to purchase it since they need it
and it is only very limited. They should purchase products made in Dubai
instead of letting other countries get rich off Dubai. There should be very little
trading or purchasing of goods from other countries unless out of necessity.
Dubai should not buy foreign products because this hurts Dubai businesses and
causes unemployment Curbs should be put on all imports. Foreigners should not
be allowed to put their products in markets. And lastly, according to them Dubai

consumers who purchase products made in other countries put their fellow
Dubai's out of work.
In the modern world, however, the crossing of the lines between cultures,
that at one time happened only occasionally, has become an everyday
occurrence. Technological advances in communication have progressively
overcome previous obstacles to communication - physical obstacles that once
helped to keep ethnic distinctions distinct. Ethnic lines still exist, and co-exist,
and cultures of the world often find that their central concern, that of
maintaining an identity despite rapid transculturation, was still possible.

The reasons for maintaining an ethnicity are often personal, and relate to the
cohesion of familiar personal and social elements - in other words, attachment or
accustoment. We all are born into a human culture, and it is the culture that shapes
our self-awareness and understanding of other individuals. It also reflects,
depending on the cultural teaching, customs or patterns of behavior in relating to
other cultures. This behavior can range from universal acceptance or feelings of
inferiority compared with other cultures, to racism, which many consider an aspect
of xenophobia. Marketers often promote the fact that a product is made in a country
with a reputation for manufacturing high-quality merchandise. Moreover,
experimental studies support the viability of this strategy. Associating a product
with a country that is known for superior workmanship often increases evaluations
of this product. Despite this evidence, however, country-of-origin effects are not
clearly understood under many conditions in which products are evaluated. A
number of factors potentially influence both the magnitude and the direction of the
effect that a product's country of origin can have on evaluations of its quality. These
factors must ultimately be specified.

The cognitive processes that underlie their effects must be identified, and the
conditions in which the processes operate must be circumscribed. Until this is done,
the effect of calling consumers' attention to a product's country of origin in any
given instance will be hard to predict. For example, found that the reputation of a
product's country-of-origin information influenced perceptions of a product's quality
well over the effects of information about its specific attributes. In some conditions,
however, country-of-origin information also had an indirect effect on product

evaluations through its mediating influence on the way the attribute information
was processed.
To the extent that a product's country of origin is used as information
about its quality, product evaluations should increase in favorableness as the
country's reputation for manufacturing high-quality merchandise increases.
However, this general informational effect could occur for at least three
reasons. First, the country of origin could itself be viewed as a favorable or
unfavorable attribute of the product, which is independent of other attributes.
Second, it might be used as a signal to infer more specific product attributes
about which information is unavailable. Third, it could be used as a heuristic
basis for judgment that is substituted for other available judgment-relevant
information.
Although numerous dependent variables have been investigated in
Country of Origin Studies, investigations were limited to two broad categories
quality/reliability perceptions of consumers and purchase intentions. These two
categories capture the majority of response or dependent variables investigated
in COO studies and were deemed representative of dependent variables
commonly investigated in COO studies. While perceptions and intentions are
intuitively related, they are conceptually distinct and hence merit separate
analysis. Perceptions are more "primitive" than intentions. As such, perceptions
are antecedent to, and determinants of, intentions although the relationship is
mediated by constructs such as satisfaction. The choice of these particular
categories of variables in the context of COO studies has been previously
justified by Johansson (1989), and the present investigation's separate analyses
of them is analogous to the approach followed by Roth and Romeo (1992).
Cross Tabulation Results
Researchers have previously examined the effect of demographic variables
such as age, gender, education, and income level on consumer ethnocentrism
(Sharma, Shimp, and Shin 1995; Wall, Liefield, and Heslop 1989). Older people are
more likely to exhibit higher levels of ethnocentrism, as they tend to be more
conservative (Bannister and Saunders 1978; Han 1988). Studies in the United States
(Howard 1989) and Canada (Wall and Heslop 1986) have shown that women rate
domestic products more favorably than men. More educated people are less likely
to have ethnic prejudices (Watson and Johnson 1972), tend to be less conservative

(Ray 1983), and are more likely to have positive attitudes toward imported products
(Wall and Heslop 1986; Wang 1978). People who travel abroad tend to exhibit lower
levels of ethnocentrism (Wall, Liefield, and Heslop 1989) as foreign travel is likely to
result in more cultural exchanges and broadening of minds. Also, high-income
consumers are generally found to react more favorably toward foreign products
(Wall and Heslop 1986; Wang 1978).
Consumer Ethnocentrism According to Age
The extent of ethnocentrism among Dubai residents was tested according to
their age group. For the six age groups, the absolute value of ethnocentrism was
quite high, meaning that Dubai people tended to be particularly ethnocentric. The
difference between the six sample groups, however, was statistically significant.
Ethnocentrism was greatest on the age group 30 years old and above, indicating
the positive attitudes toward Dubai and Dubai-made products. For those aged 30
years old and below, the findings indicated that their level of ethnocentrism was not
as high.
This finding differed from that found in the previous study, where no
difference was observed (Yu and Albaum, 1997). One possible explanation was
that the people of Dubai were becoming more local, and this was one way to
express themselves as being natives of Dubai. Another possibility is that the
Asian economic crisis has made people from Dubai more aware of what they
have to offer both to themselves and to others.
There was a significant correlation between ethnocentrism and age. A
possible reason may be the fact that the ranges of respondents' ages determined
their openness on international goods.
Consumer Ethnocentrism According to Gender and Educational
Attainment
For the most part, the objectives underlying the sampling plan were
achieved. All the people surveyed met the qualifying age criteria, and the number
interviewed at each of the data collection points was approximately equal. It is not
always possible to obtain a quota sample that matches exactly the predetermined
quotas; this study is no exception. The design called for equal proportions of male
and female respondents. However, there were slightly more females, but gender
differences were not statistically significant.
Ethnocentrism was found to vary with gender and educational level in Dubai.
Perhaps the relatively high degree of ethnocentrism found in Dubai was a popular,
contemporary feeling among consumers there that eclipsed the effect of
demographic differences. Dubai youths who had traveled abroad (and therefore,

were expected to have a greater exposure to and appreciation for foreign countries
and cultures) seemed to rise above the popular feelings somewhat, and exhibited a
significantly lower level of ethnocentrism that people who had not.
Consumer Ethnocentrism According to Civil Status and Monthly
Income
Four categories constituted civil status: Single, Married, Separated
and Widow. When grouped according to civil status, the findings showed no
significant correlation between the four categories. This shows that ethnocentrism
and civil status does not affect each other.
On the contrary, the findings showed that there was a significant difference in
ethnocentrism and monthly income. The result showed that the higher the income
of the respondents, the lower their ethnocentrism. Conversely, those who have a
lower income tends to be more ethnocentric.
Statistical Analysis
For greater clarity the researcher also employed guide questions.
These guide questions reveals the quality of economy of Dubai. Apparently, the
impact of country of origin of products in Dubai was also discussed.
According to most respondents, the economic situation in Dubai right
now in terms of goods, products and services coming from other countries is in good
condition. However there was still a great dominance of foreign products that was a
great competitor of local products. They agreed that local products in Dubai are in
high standards but the only problem was the competition and volume of foreign
products in the market of Dubai.
According to them several countries dominates when it comes to terms of
volume and in terms of sales. For example: Russia, Argentina, USA, Japan, China and
Hong Kong. There are some instances that regions in UAE contribute as foreign
products. The surveyed individuals believed that compared to foreign goods, Dubaimade products doing well. They also alleged that degradation and total face-out
were the possible implications of Dubai consumers buying more foreign goods than
locally-made products. For some cases there are some observed changes in the
consumption pattern of Dubai residents like the practicality of the consumer and
effect of it to their health and economy because the degree of purchasing of these
products becomes minimal. The respondents also accepted that country of origin
affects the consumption behavior of Dubai residents. The implication of Dubai

residents consumption behavior to Dubais economy will might be a result to rise

and fall of the country in global market.
T-test Statistics
The t distribution is used instead of the normal distribution whenever the
standard deviation is estimated. The t distribution has relatively more scores in its
tails than does the normal distribution. It is therefore leptokurtic. The shape of the t
distribution depends on the degrees of freedom (df) that went into the estimate of
the standard deviation. With very few degrees of freedom, the t distribution is very
leptokurtic. With 100 or more degrees of freedom, the t distribution is almost
indistinguishable from the normal distribution. As the degrees of freedom increases,
the t distribution approaches the normal distribution. The larger the kurtosis (the
larger the tails), the farther out you have to go from the mean in order to contain a
given percentage of the scores. For example, to contain 95% of the t distribution
with 4 df, the interval must extend 2.78 estimated standard deviations from the
mean in both directions. Compare this to the normal distribution for which the
interval need only extend 1.96 standard deviations
in
both directions.

The figure on the right shows t distributions with 1, 4, and 15 degrees of

freedom. Areas greater than +2 and less than -2 are shaded. This figure shows that
the t distribution with 1 df has the least area in the middle of the distribution and
the greatest area in the tails. Thus, it is the most leptokurtic.
The t-test is a test of the same null hypothesis as above. However, this time
we have a new index of departure and, hence, a new formula to learn. In small
samples (N < 30), sample standard deviations are biased estimates of their
corresponding population standard deviations. In other words, s does not estimate s

perfectly -- it is usually to small. Thus, we simply adjust the standard error using
something called degrees of freedom (in this case, df = N - 1). Substituting these
variations into the traditional z formula, we obtain the t test formula:

Using the data presented in part 2, the researcher tried to determine if the
concept of country of origin has no significant effect on the consumer behavior in
the Dubai Market with t-test statistic.
T-test analysis

Sample Data
Sample Size

17

Hypothesis
Tests

Me
an

3.763
10

H0:

Sta

ndard
Deviatio
n

0.377
SE

Mean

0.091

10
H1:

The above

tables show the

1053.8

complete
analysis of the
data presented

in part 2. In t-test analysis, the

illustrations of
F

tables are presented into

16

sections. As the analysis is

concern, we can
1.8 This shows that

see the hypothesis test of data.

the researcher assumed that the

different

p-value

E-40

responses of the

respondents have a sample mean score of 100 since it is his null hypothesis. Then,
the researcher will reject the null hypothesis if the computed t-value is less than
100.

Based on the computation and by using the formula presented above, the
calculated t-value is 1053.8 i.e. less than 100. Therefore, there is a reason to
accept the alternative hypothesis and reject the null hypothesis. Meaning to say,
the concept of country of origin has a significant effect on the consumer behavior in
the Dubai Market. It is also safer to state that country of origin has an effect to the
respondents.
Analysis of Findings
In a global marketplace, the competitive position of firms is determined by
many factors. One critical consideration that influences this position is country of
origin and its effects on consumer behavior. In addition, there has been a
proliferation of foreign brands that are manufactured or assembled and marketed in
Dubai by local and foreign-based firms. Customers in Dubai can choose from a set
of brands that includes foreign-manufactured or licensed products covering every
conceivable product category.
After reviewing a large number of studies that have investigated the countryof-origin effect in various different settings, this study highlighted several gaps
within our knowledge of this issue. The role of national identification in home
country bias in Dubai has not yet been examined in the marketing literature.
Although there is a positive relationship between national identification and
consumer ethnocentrism, the study shows that these constructs have independent
positive effects on consumers willingness to buy domestic products in different
product categories. The study offers limited support for negative effects of national
identification and consumer ethnocentrism on willingness to buy foreign products.
What aspect of a country of origin makes the country an important influence
on consumer behavior? One suggestion is that country of origin represents one of
many so-called image variables. Image variables are variables that are distinct from
the actual product itself, but they are strongly associated with or identified with the
product and, as a consequence, may be relied on when evaluating various aspects
of the product. Often, these variables convey some information about the image
one can project or attain by using or associating with a particular product. In
addition to country of origin, other image variables include brand name, product
price, and endorsements by well-known celebrities.

To the extent that country of origin conveys something about the image of a
product and/or the image one can convey by associating with or using a particular
product, there is reason to suspect that some individuals' perceptions of product
quality may be particularly likely to be influenced by a product's country of origin.
Research on various aspects of consumer behavior suggested that the individual
difference variable of self-monitoring may aid in differentiating those individuals
who may be especially likely to be influenced by the image aspects of products from
those who may be less likely to be influenced by such variables.

For instance, demographic shifts may act as a catalyst for social and cultural
changes in both the private and commercial spheres. Also, product knowledge has
been recognized as an important factor in the research on consumer decision
making. It has also been acknowledged that there are different types of knowledge.
Brands originating from a particular country seem to create intangible assets
or liabilities that are shared by those brands originating from the same country. The
similar image of brands from the same country has been noted to be particularly
important when products cannot be easily evaluated by consumers, as in the case
of automobiles and consumer electronics, where consumers seek external cues for
drawing inferences. Differences in terms of country image can be attributed to the
unique characteristics of their home countries in terms of demand conditions, factor
conditions, rivalry, and related and supporting industries. Country-specific
endowments create the environment in which companies are born and learn to
compete effectively in certain areas and, as such, affect essential ingredients for
achieving competitive success (Porter 1990).
The reason why country of origin influences product judgments can vary
substantially over situations and depend on subjects' processing objectives at the
time they receive information, the time between receipt of information about
country of origin and other product information, the amount and order in which this
information is presented, product familiarity, and decision importance. It is only
after identifying the processes that underlie country-of-origin effects and
circumscribing empirically the conditions in which they operate that one can begin
to understand how country of origin, and perhaps other extrinsic product attributes,
affect product evaluations and purchasing decisions.
These results add to a growing body of empirical knowledge concerning the
cognitive processes that underlie the effects of country of origin on product
evaluations. In particular, this study provide evidence of the use of country of origin

as a standard of comparison in addition to country of origin's informational influence

on judgments among Dubai residents.

Chapter IV
B. Problems and Solutions

Q1. What are the problems and issues challenging the choices for products
for consumption in Dubai?
According to the respondents, despite a relatively small population in the
world (but has become the most populous city in the UAE, accounting for more than
a third of the urban population at the end of 2001, according to official figures. An
estimated one million people live in this city, almost double the population of Abu
Dhabi which has just above 500,000 residents, the Ministry of Planning said.),
Dubai's total imports exceed $14 billion. The reason is that Dubai is the major reexport centre for the region. Meaning to say, the labor force needed by the people
of Dubai was limited, therefore instead of producing basic products needed by the
people, they prefer to buy foreign products since it was more practical and
convenient. The surveyed individuals believed that the government was also
focused to trading and business dealing to other foreign countries. Another problem
encountered was the emirate's non-oil imports have expanded sharply in the recent
past. Many of the economies of the region served by Dubai are still at a relatively
early stage of development, so there is plenty of long term scope for diversification
and expansion in the future. Another important consideration is Dubai's rapidly
developing role as a supplier to such emerging markets as India, the CIS, Central
Asia and South Africa.

Most of the respondents agreed that the easy access of foreign products to
get in to the country was definitely a great factor to consider why the people of
Dubai prefer to buy these products. Some surveyed individuals also agreed that the
quality of product made in Dubai were not that good compared to other countries.
For some cases, the consumers did not consider the products made in Dubai since
the competition between foreign products and Dubai product was high. The
dominance of quantity of foreign products in the country degraded the quality of
Dubai products. Another problem mentioned by some respondents was the impact
of globalization with respect to the trading and business relationship of different
countries.

The restructuring of firms and industries on an increasingly global basis

during the 1990s was driven by a combination of economic and technological
factors. Changes in government policies in key areas facilitated the restructuring,
while providing additional incentives for the development of global strategies.

Traditionally, corporations have pursued foreign activities principally with a

view towards lowering production costs and/or gaining access to protected markets.
Firms engaged in labor-intensive manufacturing, for example, sought to decrease
costs by locating labor-intensive operations in countries where wages were
substantially lower. In addition, formal and informal barriers to trade often provided
further incentives to develop offshore operations, as did advantageous investment
climates that might include tax incentives and other forms of support to promote
local economic growth. While these factors continue to play an important role,
others are also influencing strategies.

Growing global competition, for example, is requiring companies to seek

efficiencies that may require increasing their scale of operations. Often this can be
achieved best not by investing in greenfield plants, but by acquiring existing
facilities, wherever they may be located. In a related area, excess capacity in some
sectors has tended to intensify pressures to restructure on a global basis. The auto,
petroleum and chemicals/pharmaceuticals sectors are examples where megamergers have been pursued to achieve larger economies of scale, while providing

opportunities for firms to phase out non-competitive facilities and rationalize key
functions such as research and development, marketing, and distribution
networks. Combining and/or accessing strategic intangible assets such as
management skills, technical know-how and related assets is also playing an
important role. These arrangements typically serve to enhance the value of a firm's
assets and to optimize returns over the long term, with lesser attention to costs as
such. In this context, corporations are now defining their value in terms which
include their intangibles. Increased attention is being paid, for example, to the
importance of the capabilities of human resources to firm performance which
would include the knowledge, skills and abilities of systems engineers,
programmers and researchers.
Development and design of automobiles, for example, requires high levels of
expertise in ICT, materials science, electronics, etc., which might be best exploited
through strategic alliances. Pharmaceutical companies are also active in this area,
outsourcing a major share of R&D in order to accelerate development of new
products. In this context, firms can use M&As to acquire key technologies, thereby
avoiding potentially costly research and development.
This is also relevant for ICT firms, where leading firms such as Fujitsu have
become more aggressive in exploring and exploiting R&D developed outside the
firm (Nezu, 2002).
In addition to the factors discussed above, the speed and scope of global
industry restructuring have been greatly influenced by changes in framework
conditions. These changes have tended to facilitate, if not promote, such
restructuring largely through market liberalization and deregulation.
Integration of regional markets in Europe and North America, for example,
has encouraged firms to expand their operations geographically, leading to more
M&As and marketing alliances.
In product markets, the ongoing lowering of tariff and the strengthening of
the multilateral rules governing trade are promoting a freer exchange of goods. This
is providing new opportunities for companies to expand markets, while subjecting
them to more intense global competition. Surviving and thriving are thus requiring
companies to think increasingly in global terms. This is serving to reinforce the
economic pressures mentioned earlier.

Moreover, the development of complementary rules governing trade in

services has provided a framework for promoting the liberalization and expansion of
cross-border transactions, which should similarly provide incentives for increased
global co-operation. Regulatory reform in many sectors is playing an important role
in the dramatic increases in strategic alliances by opening up new opportunities.
This has been particularly noticeable in telecommunications, where cross-border
alliances have become common. Vodafone Group Plc, a UK-based firm, is a case in
point. Through acquisitions and alliances, the company has grown from a small,
local mobile phone operator, to a GBP 21.4 billion firm with interests in mobile
networks in 28 countries across five continents (Lloyd, 2002 and Vodafone Group
Plc, 2001).

Privatization is contributing to cross-border merger activity by increasing M&A

opportunities and exposing firms to heightened competition. Significant increases in
inward M&As in Latin America and in Central and Eastern Europe, for example, are
linked to privatization of state enterprises in telecommunications, energy and other
sectors. In the case of Brazil, partly owing to the privatization of public enterprises,
inward M&As increased rapidly in recent years from USD 4.7 billion in 1996 to USD
24.8 billion in 1998.

Moreover, acquisition of privatized mills has been the principal vehicle

through which the steel maker Ispat has expanded to become one of the worlds
largest steel producers (Picard, 2002). Greater institutional ownership of equity and
reforms in corporate governance structures are pressuring firms to explore ways to
enhance shareholder value, while the dismantling of anti-takeover defenses has
made corporate management more responsive to shareholder concerns. This is
resulting in more open consideration of cross-border M&As and alliances.

In Japan, for example, the evolving nature of corporate relationships with

shareholders, stakeholders and banks has led to record numbers of alliances and
M&As, both domestic and international. Similar pressures are occurring in countries
where tightly-knit cross-shareholding relationships among companies (as has been

the case in France, Germany and Japan) are giving way to more widely dispersed
ownership and greater transparency. The increased openness that this has
prompted has resulted in more active consideration of ways to improve
performance through corporate restructuring. A study of M&As involving French
firms between 1997 and 1999, for example, shows that the emerging influence and
role of institutional investors has been a principal factor underlying the recent wave
of M&A activity (OECD, 2001b).

Finally, access to international financial markets and risk diversification has

been mentioned as factors influencing global expansion. In the case of Lafarge,
being a sizeable industry leader has enabled the company to generate interest from
those institutional investors, who have an interest in managing a diversified
portfolio that may only contain a single cement producer (Sarrazin, 2002).
Moreover, foreign holdings have helped the company to moderate swings in
business activity, which, in the case of cement, tends to be highly cyclical on a
country-by-country basis.
Outlook
As indicated above, the growth in globalization has been supported by
governmental policies that, in recent years, have focused on liberalizing markets
and promoting economic efficiency. Characterized as a "business class" model, the
policies have aimed at the opening of economies to foreign investment,
deregulation, fiscal discipline, privatization, and trade liberalization.

Key global institutions such as the World Bank, the International Monetary
Fund and the World Trade Organisation have supported the widespread acceptance
of the model. Should it continue, one could expect tendencies towards integration
to be strong, with weaker and less adaptable countries finding themselves at a
disadvantage in an increasingly global and highly competitive environment. For the
business community, the implications could be that competitive pressures would
continue to drive firms to focus even more on core operations, outsourcing other
activities to the extent possible.

On the other hand, it has been argued that the widespread support that the
business class model attracted may have peaked, and that a shift could be
occurring towards a world that is shaped more on economic and culture diversity
rather than shared values. In such a scenario, countries are seen as taking a more
interventionist role in their economies, basing their policies and actions more on
cultural values and practices than on economic principles and objectives.
Characterized as a "prism" model, markets would continue to matter, but their
importance would be balanced by a recognition that governments may need to
intervene to assure that social needs are addressed. In this context, fiscal,
investment and related policies would be managed more actively to assure they
were consistent with and contributed to a countrys vision of society. For business,
the diversity in framework conditions among countries would require tailoring
initiatives to local conditions, while recruiting and developing competent local staffs
to implement strategies. Globalization would therefore continue, but would be
subject to greater scrutiny.
Internationally, CO serves as a useful extrinsic cue and as a surrogate for
difficult-to-evaluate intrinsic characteristics such as quality and performance
because consumers tend to be less familiar with foreign than with domestic
products (Huber and McCann 1982; Olson 1977). Han and Terpstra (1988, p. 236)
claim, "It has been found that all products originating in foreign countries are
subject to country-of-origin [image] effects." Han (1990, p. 24) further states that
CO-image studies in general show that consumers have significantly different
general perceptions about products made in different countries. Hooley, Shipley,
and Krieger (1988, p. 67) asserted that international marketers need to understand
these [CO] images as they relate both to their own, and to their competitors'
products. Specifically, they will need to determine whether such images are positive
or negative, whether and how they affect behavior, and how they can be catered to
in the marketing strategy. Yet, few multinational marketers and advertisers make
full use of their products' favorable CO image or successfully overcome the liability
associated with an unfavorable one.

Several reasons may account for the relative neglect of CO image as a

competitive tool. First, the CO variable is culture-laden, and most managers are
inadequately trained to address cultural issues despite significant research

indicating that multinational marketing strategy is ill-served if cultural and

perceptual differences among countries are not properly comprehended and heeded
(Harris 1984; Kale 1991). Second, translating CO images into marketing
communication opportunities is difficult because the relationship between the brand
and its country of origin is potentially more distant than the relationship between
the brand and its firm, store, or advertising. Third, Zinkhan and his colleagues'
observations about what constitutes effective measures for image manifestations
and their current state of development are equally applicable to CO image
measures (Dobni and Zinkhan 1990; Johnson and Zinkhan 1990; Villanova, Zinkhan,
and Hyman 1990).

Q2. What are the implications of these issues to Dubais economic health?
According the respondents, the dominance of foreign products creates
several implications not only to Dubais economic health but literally also to the
health of people of Dubai. The country of origin of products plays a great impact to
the economy of Dubai. However, the country needs to employ heavy taxes to the
foreign product so that the collected taxes will become part of contribution to the
progress of the country. Most of the surveyed individuals agreed that importation
and exportation of products increases the quality of living of Dubai. On the other
hand, people of Dubai should be more aware to the products that they buy since it
was a possible threat of foreign diseases that are easily transferred by these
products.

The respondents believed that despite of dominance of foreign products, the

quality of living in Dubai increases. Moreover, Dubai has been part or one of the
progressive business countries in the world since the good quality of trading and
business communication to other country was their focus.

Q3. What are your proposed solutions to the issues and problems youve
mentioned?
According to the respondents, the government should give focus to
the business owners in Dubai especially to those who are selling and manufacturing

products and goods for citizens of Dubai. The government needs to employ
reasonable taxes for foreign products so that the importation of these products
becomes minimal. The respondents agreed that they have to choose their own
made quality products rather than other foreign products. The surveyed individuals
believed that the government of Dubai should give importance to the citizens of
Dubai, especially to their employment and health assistance. Another thing that the
government of Dubai should employ their attention is the easy access of terrorist.
The respondents agreed that one of the biggest factors that the government
needs to consider was not only the impact of country of origin of products but also
the biggest impact of terrorists attack to the economy of Dubai. They believed that
the increase of security to the country would result to quality economy. However,
the country of origin factor of product was definitely a factor to be considered.
According the number of respondents, they will try to buy quality products of
Dubais citizens but this marketers should give their full effort to produce quality
products that will might attract consumers to turn on to it resulting to rejection of
foreign products. Rejections of foreign products will also a possible factor that will
lessen the entry to the country.

CHAPTER 5
SUMMARY, CONCLUSION AND RECOMMENDATIONS

Country of origin (CO) is a potentially powerful image variable that can be

used to gain competitive advantage in international marketing. However,
deficiencies in the definition and measurement of its facets have contributed to

ineffective and infrequent use of CO image as competitive tool. Country-of-origin

(CO) image refers to "buyers' opinions regarding the relative qualities of goods and
services produced in various countries" (Bilkey 1993, p. xix). Among the image
variables in the international advertiser's toolkit, the CO variable is conceivably the
most potent if skillfully applied. Papadopoulos (1993, p. xxi) asks rhetorically, "It is
often said that brand names like 'McDonald's' are worth millions. If so, how many
billions is Germany's image worth?" A few authors have questioned the magnitude
of importance of CO image in affecting choice behavior (Ettenson, Wagner, and
Gaeth 1988; Johansson 1989; Johansson, Douglas, and Nonaka 1985), but most
acknowledge its salience in overall product evaluation and as a proxy for other,
more intrinsic, qualities (Han and Terpstra 1988; Yoo 1992).
The focus of this study to was to examine the impact country of origin of
products to the consumer behavior in the Dubai Market and the effects foreign
products to the market of Dubai. Data collected from the different sets of
respondents provided answers to the queries of the researcher. The primary source
of data came from a questionnaire distributed to the consumers, investors and
business owners in Dubai. The secondary of data came from an extensive review of
the literature on articles, journal articles, books, and magazines relating
marketing. The study used purposive sampling as a method of choosing its
population. The general population for this study was composed of randomly
selected product consumers in Dubai, numbering ninety (90).
The researcher also provided interviews for respondents whose function is
directly related to the organisation and implementation of the marketing strategy.
The researcher provided the questionnaires for the former and conduct interviews
for the latter. Concurrently, the study employed both qualitative and quantitative
research methods to ensure a flexible and iterative approach. The researcher also
uses percentage analysis, the mean and median analysis, analysis of variance and
correlation statistics to evaluate the collated data.

SUMMARY

1.

PROFILE OF RESPONDENTS

The respondents were composed of the consumer and business owners

respondents in Dubai. Fifty eight percent (58%) of the respondents were 26-30
years old, showing that most of them were already considered as young adult.

Sixteen percent (16%) of the respondents were between 31-35 years old. Fourteen
percent (14%) of the respondents were between 36-40 years old. Respondents
aged 21-25 is 16% of the total respondents. On the other hand, 6% of the
respondents are in the 40 and above status. Lastly, there is zero percent of
respondents who are in the ages between 15-20 years old. The number of the male
respondents (51%) is closed to the female (49%) with the total of 46 for male and
44 for female.
There is only 42% who are married from the ninety respondents. As the figure
was interpreted, there is a little percentage of respondents who are separated or
widow. Most of the surveyed individuals are either married or single. Likewise, the
respondents were asked for their educational attainment and the report shows 53 %
of them are college. From the collated data, there were 22.22% of the respondents
whose monthly income was 10,001 and above dirham. Majority these respondents
were composed of managers, businessmen, young professionals and administrators.
Followed by 27.78% whose ranges of income were in between 2,1001 to 5,000
dirham. Then, 28.89% of the total respondents have an income between 5,000 to
10,000 dirham. And lastly, there were only 21.1% of the respondents with income
of 2,000 or below.

2.

PERCEPTION OF THE RESPONDENTS PERTAINING TO THE

IMPACT OF COUNTRY OF ORIGIN IN CONSUMING DIFFERENT PRODUCTS

Based on the collated information from the surveyed individuals, there is
a great influence of country of origin in consuming different products. shows the
dominant agree response as weighted average in every statement. According to
some respondents, the people of Dubai should buy and consider their own
products in order to contribute to the progress of their country. The surveyed
individuals also agreed that only those products that are unavailable in Dubai
should be imported which was illustrated by weighted mean of 4.14. Majority of
the respondents agreed on the statements and signifies the high impact of
ethnocentrism.
Within culture, language, behavior, customs, and religion can be a basis
for ethnic distinctions, and sub-divisions. Meaning to say, majority of the
respondents believe that Dubai product were better compared to other foreign
products. However the surveyed individuals with 3.64 weighted mean also

accepted the fact that their country cannot stand alone without the help of
other foreign products since they need tobuy from foreign countries only those
products that they cannot obtain in their own country .
The government of Dubai according to the most of the respondents
should employ heavy taxes to other foreign products that will reduce the entry
into Dubai. Moreover, the degree of ethnocentrism for most respondents was
high since they are looking for great improvement and progress of Dubai. The
respondents agreed that Dubai products first, last, and foremost.
The weighted mean concerning to a real Dubai citizen who bought Dubai
made products was interpreted as neutral. This report shows that Dubai citizens
are really concern to the development of their country but the impact of nature
with full of foreign products was definitely a great factor to consider because
even though they dont want to buy this product they are forced to purchase it
since they need it and it is only very limited.

3.

PROBLEMS AND SOLUTIONS IN DUBAI'S MARKET

According to the respondents, despite a relatively small population in

the world (but has become the most populous city in the UAE, accounting for more
than a third of the urban population at the end of 2001, according to official figures.
An estimated one million people live in this city, almost double the population of
Abu Dhabi which has just above 500,000 residents, the Ministry of Planning said.),
Dubai's total imports exceed $14 billion. The reason is that Dubai is the major reexport centre for the region. Meaning to say, the labor force needed by the people
of Dubai was limited, therefore instead of producing basic products needed by the
people, they prefer to buy foreign products since it was more practical and
convenient. The surveyed individuals believed that the government was also
focused to trading and business dealing to other foreign countries.
For the respondents, the dominance of foreign products creates several
implications not only to Dubais economic health but literally also to the health of
people of Dubai. The country of origin of products plays a great impact to the
economy of Dubai. However, the country needs to employ heavy taxes to the
foreign product so that the collected taxes will become part of contribution to the
progress of the country.

They said that the government should give focus to the business owners in
Dubai especially to those who are selling and manufacturing products and goods for
citizens of Dubai. The government needs to employ reasonable taxes for foreign
products so that the importation of these products becomes minimal. The
respondents agreed that they have to choose their own made quality products
rather than other foreign products. The surveyed individuals believed that the
government of Dubai should give importance to the citizens of Dubai, especially to
their employment and health assistance. Another thing that the government of
Dubai should employ their attention is the easy access of terrorist. The respondents
agreed that one of the biggest factors that the government needs to consider was
not only the impact of country of origin of products but also the biggest impact of
terrorists attack to the economy of Dubai.

4.

Perception of the Respondents (Guide Questions)

The economic situation in Dubai right now in terms of goods, products and
services coming from other countries was in good condition. However there is still a
great dominance of foreign products that has proven to be competition with local
products. They agreed that local products in Dubai are in high standards but the
only problem was the competition and volume of foreign products in the market of
Dubai.
CONCLUSION
Based on the findings of this study, the researcher concludes the following:

1.

The respondents who took part in this study are already mature in

age, responsible and reliable. They are also aware of whats happening in the hotel
industry and are deeply concerned about the improvement economic market in
Dubai specifically to the impact of country of origin of products.
2.

The respondents have given an overall rating of Agree to each of

the criteria. Most of the respondents believe that the country of origin of products
has a great relationship in economy of Dubai. This shows that respondents knew the
importance ethnocentrism to the progress of their economy. For them locally-made
products should be the first thing to consider instead of other foreign products.

3.

The statistics show that there is no significant difference or there is

a significant relationship in the perception of the respondents to the concept

of country of origin effect on the consumer behavior in the Dubai Market.
4.

There are several factors affecting the progress of the economy of

Dubai. The factors to be considered in Dubais market include terrorist attacks,

globalization, and its business relationships with other countries.
5.

The t-test analysis reveals that the concept of country of origin has

a significant effect on the consumer behavior in the Dubai market. The statistics
shows the t-value to be -1053.8 which illustrates that there is a relationship
between the variables.

RECOMMENDATIONS

Country images, built over long periods, are intangible assets that make a
positive contribution to market sales or share by influencing the effectiveness of
marketing variables on sales. Given a country-specific brand image, some strategic
choices will prove more effective than others.
This empirical study generally suggests the following for those brands or
firms in Dubai that wish to be strong contenders in a global market in the twentyfirst century:

Dubai should recognize and monitor over time country, image, which is

unique, and differentiate themselves from those of other countries-of-origin.

Country image tends to arise initially from certain unique resource endowments in
the home country of a foreign firm or brand. The image is strengthened or improved
by the performance over time of the brands from the same country

Dubai companies should examine the pattern of interaction between

image and marketing variables.

Dubai brands should start by building market share, and find out key

factors that positively affect market share for brands from different countries;
advertising popularity were the examples in our case. Do not neglect the universal

factors, but focus more on the key factors that differentiate and uniquely position
the brand by creating intangible assets.

Dubai companies should fine-tune marketing strategy, according to the

mechanism by which intangible assets are created and influence marketing efforts.
In short, understanding the dynamics of intangible assets is critical in
marketing strategy development for long-term success in a global market, where
brands originate from various different countries that have different "home bases"
or different invisible resource endowments.
Although this study did not use cross-national samples, several important
strategic implications were proposed for Dubai companies to successfully compete
in the long run. Future research including cross-national samples is likely to
generate some additional interesting results.
Since this study looked the Dubai market, the findings may not be
generalized to other markets. Future research should provide some important, more
generalizable strategic guidelines on how to compete effectively for long-term
success in a global market, in the presence of country-related intangible assets.
Many businesses have achieved large market shares in the global market
place of the imported product categories such as automobiles, consumer
electronics, and apparel. As manufacturing and marketing become increasingly
global, the understanding of consumer behavior with respect to purchase of foreign
products takes on greater importance. Thus, understanding of consumer product
evaluations in relation to products' country of origin and other information cues has
pragmatic implications.
Marketers can use country of origin in the positioning of their products, for
example by linking a product to relevant characteristics of the origin country. It
should be noted that consumers use country of origin not only as a piece of
information in itself, but also as a source of other product information. In
advertising, the source credibility of country of origin moderates the influence of
advertising claims on product evaluations. Marketers choosing to emphasize
country of origin should acknowledge the existence of home country bias. In
domestic markets, this bias would of course be beneficial, but in foreign markets
care should be taken to minimize psychological resistance to foreign products. It
might be beneficial to develop different positioning strategies for segments that
differ in the strength of consumer ethnocentrism and national identification, as
these variables determine the strength of home country bias.
The results reported in this paper can have important decision making
implications for Dubai domestic firms that are trying to maintain their competitive
position in relation to international competition posed by developed countries.
Moreover, the findings suggest that Dubai firms should strive to gain an equivalence
with brands from Japan, United States and the European Community on perception

of quality, technology sophistication, brand recognition, and advertising

image. Country-of-origin perception still remains an important consideration. Given
the halo effect reported in the literature, the country-of-origin perception can be
strengthened by improving the perception of the other marketing variables.
In addition to expanding the knowledge of the relations between selfmonitoring and product perception, the results may also shed some light on the
understanding of the role of country of origin on product perception. Country of
origin, as well as other image variables, may influence product perception because
it is, in part, appealing to those consumers who chronically strive to present the
most appropriate image in each social situation in which they find themselves.
Thus, one of the reasons that country of origin affects product perception may be
that the country of origin of a product does indeed convey information about the
image one can project and attain by using any given product.
The studys results also highlight the potential utility of addressing an issue
such as the impact of country of origin from an individual difference perspective.
Not only can we learn more about the particular individual difference variable under
consideration, but, as our findings suggest, we can also gain additional insight into
the phenomenon itself by understanding more specifically the characteristics of
those individuals who are differentially likely to demonstrate the phenomenon.
However, I do not claim that the study is a bullet-proof characterization of
country of origin effects and consumer behavior since the data provided by the
respondents may not always be accurate and truthful. Thus, future researches can
verify the changes in these attitudes.

References

Al-Alkim, H., Al-Sayegh, F., Al-Shamsi, F., Gause, G., Jahshan, K., Kechichian, J.,
Mallet, R., Qasimi, F., Richards, A. and Tetreault, M. (1999) A Century in Thirty Years:
Sheikh Zayed and the United Arab Emirates. Middle East Policy, Vol. VI.

Alden, D.L., Steenkamp, J. & Batra, R. (1999). Brand Positioning Through

Advertising in Asia, North America, and Europe: The Role of Global Consumer
Culture. Journal of Marketing, 63 (January): 75-87.

Appendix 1. Timetable
Month

TASK
1
st

Select topic
Undertake preliminary
literature search
Define research
questions
Write-up aims and
objectives

2
nd

3
rd

4
th

5
th

6
th

7
th

8
th

9
th

Select appropriate
methodology and locate
sources of information.
Confirm access.
Write-up Dissertation
Plan
Undertake and write-up
draft critical literature review.
Secondary and
Primary Data Detailed
Sources
Consulted
Research Findings:
Analyzed
Evaluated
Written-up
Discussion:
Research findings
evaluated and discussed in
relation to the literature
review
Methodology writtenup
(including limitations
and constraints)
Main body of the

report written-up and

checked for logical structure
Conclusions drawn
Recommendations
made
Introduction and
Executive Summary writtenup
Final format and
indexing
Print

Appendix 2. Questionnaire
COOUNTRY OF ORIGIN AND CONSUMER BEHAVIOR
You were chosen as a respondent to answer this survey
questionnaire on the effects of country of origin on the consumer preferences and
behavior of Dubai residents. Your answers will provide the data needed in this study.
Rest assured that your answers would be treated with utmost confidentiality. Thank
you very much.
Thank You.

Part 1. Profile of Respondent

Direction: Please fill up in all the necessary information about yourself. Dont
leave any item unanswered.

a.

Age _______

b.

Gender

Male ( )
c.

Female ( )
Marital Status

Single ( )
d.

Married ( )

Widow/Widower ( )

Educational Attainment

Elementary ( )
e.

Separated ( )

High School ( )

College ( )

Graduate Studies ( )

Monthly Income

( ) 2,000 and below dirham

( ) 2,001-5,000 dirham

( ) 5,001- 10,000 dirham

( ) 10,001 and above dirham

Part II. Consumer Ethnocentrism Scale (CET)

Direction:

Encircle the number corresponding to your answer

Strongly Agree

Agree

Uncertain

Disagree

Strongly Disagree

1.

People in Dubai should always buy

Dubai made products instead of imports

2.

Only those products that are unavailable in Dubai should be imported.

3.

Buy Dubai made products. Keep Dubai working

4.

Dubai products first, last, and foremost

5.

Purchasing foreign-made products is un-Dubai

6.

It is not right to purchase foreign products

7.

A real Dubai citizen should always buy Dubai made products

8.

We should purchase products made in Dubai instead of letting other

countries get rich off us.

9.

10.

It is always best to purchase Dubai products.

There should be very little trading or purchasing of goods from other

countries unless out of necessity.

11.

Dubai should not buy foreign products because this hurts Dubai
businesses and causes unemployment.

12.

Curbs should be put on all imports

13.

It may cost me in the long run, but I prefer to support Dubai products.

14.

Foreigners should not be allowed to put their products in markets.

15.

Foreign products should be taxed heavily to reduce their entry into

Dubai

16.

We should buy from foreign countries only those products that we

cannot obtain in our own country.

17.

Dubai consumers who purchase products made in other countries put

their fellow Dubai's out of work

PART III. Problems and Solutions

1.

What are the problems and issues challenging the choices for products
for consumption in Dubai?

______________________________________________________________________________
_____________________________________________________________________________________
_____

2.

What are the implications of this issues to Dubais economic health?

______________________________________________________________________________
_____________________________________________________________________________________
_____

3. What are your proposed solutions to the issues and problems

youve

mentioned?

_____________________________________________________________________________________
_____________________________________________________________________________________
_______

Appendix 3. Guide Questionnaire

Guide Questionnaire
(For economics and marketing experts to be interviewed)

1. Can you briefly explain the economic situation in Dubai right now in
terms of goods, products and services coming from other countries?

2.

What country or countries usually dominates Dubai in terms of volume

and in terms of sales?

3.

What about Dubais local products? What is the development in relation

to the past years?

4.

Compared to foreign goods, are Dubai-made products doing well?

5.

What are the possible implications of Dubai consumers buying more

foreign goods than locally-made products?

6.

At this point, can you observe changes in the consumption pattern of

Dubai residents? What are these?

7.

To what reasons are these attributed to?

8.

In terms of country of origin preferences, to what country does Dubai

consumers usually defer to?

9.

Does country of origin affects the consumption behavior of Dubai

residents?

10.

What do you think is the implication of Dubai residents consumption

behavior to Dubais economy?