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IMR
21,1 Does country of origin matter
for low-involvement products?
Zafar U. Ahmed
102 College of Business & Technology, Texas A&M University, Commerce,
Texas, USA
Received April 2002
Revised November 2002
James P. Johnson
Accepted December 2002 Crummer Graduate School of Business, Rollins College, Winter Park,
Florida, USA
Xia Yang, Chen Kheng Fatt, Han Sack Teng and
Lim Chee Boon
Nanyang Business School, Nanyang Technological University, Singapore

Keywords Country of origin, Food products, Singapore

Abstract This empirical study focusses on consumers’ attitude to low-involvement products,
bread and coffee, in a newly-industrialized nation. Using data from 236 consumers in Singapore,
the study examines the influence of country of origin (COO) relative to other product attributes in
consumers’ evaluation of domestic and foreign food products. The results indicate that COO does
matter when consumers evaluate low-involvement products but, in the presence of other extrinsic
cues (price and brand), the impact of COO is weak and brand becomes the determinant factor. In
addition, the results suggest that a country’s positive image in some product categories does not
necessarily carry over to other product categories. The implications of these findings for marketing
food products internationally are discussed.

Introduction
Brand name and price are factors that generally influence consumers’
evaluation of and purchase intentions towards a product. However, the
globalization of production and markets has added another factor to the list as
more and more companies shift production to overseas locations where factors
of production are superior or less costly, and then market their products to
consumers around the world. Consequently, for many international consumers
a product’s country of origin (COO) can be an important cue in evaluating both
domestic and foreign products.
Studies have shown that consumers around the world use COO as an
attribute in product evaluation (e.g. Bilkey and Nes, 1982; Hong and Wyer,
1989; Maheswaran, 1994; Okechuku and Onyemah, 1999; Supanvanij and
Amine, 2000). How COO perceptions affect consumers’ evaluation of and
International Marketing Review intention to purchase products, and the relative strength of COO compared
Vol. 21 No. 1, 2004
pp. 102-120
with other informational cues, are of considerable interest to international
q Emerald Group Publishing Limited
0265-1335
marketing practitioners and researchers since this information can help them
DOI 10.1108/02651330410522925 to devise more effective strategies to aid firms in selling their products
internationally. For instance, international marketing managers can employ Does country of
promotional techniques that downplay the COO information if a country’s origin matter?
image is unfavorable, or enhance it if the image is favorable. Moreover,
firms can adjust their branding strategies, such as adopting or acquiring a
brand name that is associated with a country that has a favorable country
image. However, most studies of COO effects have focused on high
involvement products (e.g. automobiles and electronics) for which consumers
103
will usually look beyond cues such as price or design in making their
purchase decision. Yet falling barriers to trade – especially in trade blocks
such as NAFTA, the European Union, and the Association of South East
Asian Nations (ASEAN) – have opened opportunities for firms to
manufacture low-involvement items such as food products in one country
and sell them in another. Similarly, global food corporations have seized the
opportunity to extend their brands overseas, often making use of local
manufacturing facilities in their new markets.
To date, there have been few studies on the impact of consumers’ COO
perceptions on low-involvement products; thus, it is not clear what role COO
plays in shaping consumers’ preferences and intentions to purchase such
goods or whether its effect is the same for low-involvement products as for
high-involvement products. This study aims to contribute to the
international marketing literature by assessing COO effects on the
evaluation of low-involvement staple food products: coffee and bread.
Furthermore, most previous COO studies have concentrated on
post-industrialized and service-oriented economies in North America and
Western Europe. As Hofstede (1980) indicates, theoretical models and
frameworks that are developed by social scientists in one sociocultural
environment might not be applicable elsewhere. Therefore, a secondary goal
of this study is to examine whether the COO construct that has been
developed and widely researched in western developed nations is applicable
in Singapore, a newly industrialized nation in Asia. In this respect, this
study is modeled on and is an extension of earlier work on COO in a
developing country context by Okechuku and Onyemah (1999). In the
following section, we review the literature on COO effects and develop a
research model and hypotheses that are tested with data gathered from 236
consumers in Singapore.

Literature review
Country of origin
The COO of a product has been defined as “the country of manufacture or
assembly” (Bilkey and Nes, 1982; Han and Terpstra, 1988), identified by “made
in” or “manufactured in” labels (Bannister and Saunders, 1978; Chasin and
Jaffe, 1979; Nagashima, 1970, 1977). However, the growth of multinational
companies and the emergence of hybrid products with components sourced
IMR from many countries have blurred the accuracy or validity of “made in” or
21,1 “manufactured in” labels (Baker and Michie, 1995; Baughn and Yaprak, 1993),
making the identification of COO sometimes very difficult. For example,
consumers identify many well-known brands with particular countries, even if
the product being evaluated was not manufactured in the firm’s country of
domicile. Thus, Toyota, Sony, and Honda products are considered to be
104 Japanese; Marks & Spencer and Body Shop items are British; McDonald’s and
KFC are US.

COO effects
According to Hong and Wyer (1989), when consumers are presented with the
COO cue together with other cues, such as price and brand, the effects of COO
in their cognitive process can be observed in two ways:
(1) the halo effect; and
(2) the summary construct.
When consumers are not familiar with the products of a country, the country
image acts as a “halo” that directly affects consumers’ beliefs about these
products and indirectly affects the overall evaluation of them through these
beliefs (Erickson et al., 1984; Johansson et al., 1985). That is, the mention of a
particular country triggers feelings, positive or negative, in the consumer’s
mind. These latent feelings are thought to endure since they are conditioned by
country-specific feelings. In contrast, when consumers are familiar with a
country’s products, a summary construct model operates in which consumers
infer a country’s image from its product information, which then indirectly
influences brand attitudes (Han, 1989). Country image then serves as an
indirect channel in affecting product attributes and brand attitudes.

COO and product evaluation

Consumers make decisions about the quality of products based on a systematic
process of acquisition, evaluation and integration of product information or
cues. A cue is defined as all informational stimuli available to the consumer
before consumption (Monroe and Krishnan, 1985), and can be intrinsic or
extrinsic. Examples of intrinsic cues are taste and design, while extrinsic cues
include COO, brand, and price (Rao and Monroe, 1989). When intrinsic cues are
missing or cannot easily be assessed, consumers tend to rely more on extrinsic
cues (Jacoby et al., 1977); this is often the case for low-involvement products,
since the cost of searching for intrinsic cues to aid consumers in product
evaluation far exceeds the benefits (Zeithaml, 1988).
Maheswaran (1994) suggests that COO is used in product evaluation as a
stereotyping process that allows consumers to predict the likelihood of a
product manufactured in a certain country having certain features; generally,
consumers will evaluate a product more favorably if it has a favorable COO.
This stereotyping process affects product evaluation in three ways. First, COO
acts as a signal; consumers have prior perceptions of the general quality of Does country of
products from a particular country, and they use these perceptions to infer the origin matter?
ratings of other product cues (e.g. quality, reliability) and thus the overall
product evaluation (Hong and Wyer, 1989). Second, COO can be an independent
cue, used along with other cues for product evaluation. (Hong and Wyer, 1989;
Li and Monroe, 1992). Third, COO can be used as a heuristic to simplify the
product evaluation process, even though other available product cues may be 105
more useful (Hong and Wyer, 1989; Li and Wyer, 1994). This often occurs when
there is too much product information, or when consumers are unfamiliar with
the product. Interestingly, there is no evidence from studies in western societies
that males and females differ systematically in their use of COO for product
evaluation (Hung, 1989).

Consumer ethnocentrism
COO is typically used to infer the quality of products. However, in some cases,
consumers are concerned about the COO because they express a preference for
domestically produced products. Consumer ethnocentrism is the belief held by
consumers about the appropriateness and morality of purchasing foreign-made
products (Shimp and Sharma, 1987). Purchasing foreign-made products may be
seen as immoral and unpatriotic because it has an adverse impact on the
domestic economy; hence, consumers tend to purchase local products even if
the quality is lower than that of imports (Wall and Heslop, 1986). In line with
this, Okechuku (1994) and Wang and Lamb (1980) demonstrated that
consumers in developed countries tend to prefer their own locally-produced
goods first, followed by products from other developed countries, and then
products from less developed countries. Thus, where consumer ethnocentrism
is strong, consumers take COO into consideration when evaluating products.

Other extrinsic cues

According to Bilkey and Nes (1982), when COO is the only informational cue
provided, the results might be positively biased towards detecting COO effects.
Later studies found that when additional cues are present, the relative
importance of COO on product evaluation diminishes (Hastak and Hong, 1991;
Johansson et al., 1985; Johansson and Nebenzhal, 1986). For example,
consumers who lack information about the product may rely on the brand
name to infer its quality (Szybillo and Jacoby, 1974); thus, brand loyalty is
evidence of the importance of a trusted brand name in consumers’ evaluation of
products (Ettenson and Gaeth, 1991). Research has found that a highly
regarded brand name can help alleviate the negative effect of a poor COO
image in product evaluation (Cordell, 1993; Erickson et al., 1984; Eroglu and
Machleit, 1988). Similarly, where value for money matters more than image and
quality, price is more influential than COO in consumers’ purchase decisions of
low-involvement products (Wall et al., 1991).
IMR In sum, consumers use COO as an extrinsic cue to evaluate the quality of the
21,1 product. In some cases, it indirectly affects the interpretation of other available
product cues and thus the overall product evaluation; in other cases, it is the
only cue used to evaluate the product, even when other product cues are
available. When consumers are not familiar with the product, the halo effect
operates in their product evaluation process; however, when consumers are
106 familiar with the product, the summary construct sets in. The difference
between the halo effect and the summary construct lies in the sequence of
consumers’ cognitive process. In addition, when there is insufficient product
knowledge or limited time, consumers will resort to stereotypical beliefs such
as country image in their evaluation of products. For high-involvement goods,
the influence of COO is less pronounced in the presence of other extrinsic cues
such as brand and price.

Research model and hypotheses

Our research model (Figure 1) and hypotheses are derived from the above
literature review and reflect a western, developed nation perspective of product
evaluation. According to this model, consumers use the same extrinsic cues –
brand, price, COO – when evaluating low-involvement products (Zeithaml,
1988): in this case, staple food items. Following Roth and Romeo (1992), COO is
conceptualized as a multidimensional construct whose dimensions include the
taste/aroma, prestige, and quality associated with the food item. Thus, we
investigate:
.
the importance of COO relative to price and brand in the evaluation of
basic food products by Singaporean consumers;

Figure 1.
Research model
 .
Singaporean consumers’ preference for the domestic “Made in Singapore” Does country of
label for basic food products. origin matter?

The effects of COO, brand and price on evaluation of low-involvement products

Li and Wyer (1994) suggest that the use of COO for product evaluation is more
pronounced in the purchase decision for high involvement products, such as 107
automobiles, electronics and white goods. Conversely, for low-involvement
products such as food staples, where the purchase decision is less significant,
the influence of COO in product evaluation is expected to be weak, due partly to
the product’s low monetary risk and low hedonistic value. Furthermore, in the
presence of other extrinsic product cues, the influence of COO is expected to be
less pronounced than that of brand and price (Ettenson et al., 1988). Since brand
has been found to have a greater influence than COO on high involvement
consumer products, we hypothesize that this also applies to the evaluation of
low-involvement products. Thus:
H1a. Brand is of greater importance than COO in evaluating
low-involvement products.
Following a similar argument and based on the finding by Wall et al. (1991)
that price is more important than COO in the purchase decision of basic
commodities such as food:
H1b. Price is of greater importance than COO in the evaluation of
low-involvement products.
Studies have found that when products from less developed countries are
associated with a reputable brand name, the brand effect often outweighs a
negative COO image (e.g. Cordell, 1992; Eroglu and Machleit, 1988). We would
expect to find the same for low-involvement products: a potentially negative
COO effect should be reduced or negated by the popularity of a brand, so that a
reputable brand will overcome a potentially negative COO associated with the
basic food item:
H2. A renowned brand name for a low-involvement product will dilute the
impact of a negative COO.

COO and level of economic development

Consumers in developed countries tend to prefer products from their own
country first, followed by products from other developed countries, and then
products from less developed countries (Jaffe and Martinez, 1995; Okechuku,
1994; Wang and Lamb, 1980). Since Singapore is deemed a newly industrialized
country, we sought to investigate whether Singaporean consumers’ buying
behavior supports previous findings in the developed world:
IMR H3. Singaporean consumers prefer low-involvement products with the
21,1 “Made in Singapore” label to low-involvement products made
elsewhere.

Research methodology
108 The products selected for the study were bread and coffee, a typical breakfast
combination for Singaporeans. Since these are staple food items, all consumers
were expected to be familiar with these products and to have specific
expectations, tastes and preferences for them. The countries of origin chosen
for the bread profile were France, Singapore, Indonesia, and Malaysia.
Imported French bread is a specialty item in Singapore, and Singapore also
boasts excellent local bakeries; thus, these two countries were expected to
induce positive COO images for bread. In contrast, Indonesia and Malaysia are
developing countries that supply much of Singapore’s fresh food and produce
but do not convey a strong positive country image to Singaporeans. The
countries of origin for the coffee profile were Singapore, Switzerland, Colombia,
and Indonesia. They were chosen based on their COO impact; as economically
more advanced nations, Singapore and Switzerland were expected to have a
positive COO image, while Colombia and Indonesia, both developing countries,
were expected to have a negative COO image.

Extrinsic cues
The three attributes chosen for both products were all extrinsic cues: brand,
price and COO. This is because consumers rely more on extrinsic cues in
evaluating low-involvement products, since the cost of searching for intrinsic
cues often exceeds the relative benefits (Zeithaml, 1988). The brands chosen
were the most representative in terms of availability and popularity in
Singapore with respect to each of the four countries for each food profile. For
the bread profile, the brands were Délifrance (France), Gardenia (Singapore),
and Top One (Malaysia); a fourth, hypothetical brand “Indobread” represented
the several generic brands that were supplied from Indonesia. For the coffee
profile, Nescafé (Switzerland), Super (Singapore), Boncafé (Colombia), and
Indocafé (Indonesia) were selected. The prices used in each food profile were
the prevailing product price levels in Singapore at the time of data collection in
2001. We adopted a multidimensional measure of COO as recommended by
Roth and Romeo (1992), adapting some of their suggested dimensions in order
to accommodate the specific products used. The dimensions selected were
taste, prestige, and quality of the ingredients for the bread profile, and aroma,
prestige, and quality of the coffee beans for the coffee profile.

Survey instrument
Data were gathered via a questionnaire. Initial questions screened out
respondents who either did not use or did not purchase bread and coffee. Two
questions then asked respondents to rate on nine-point Likert scales their Does country of
familiarity with the brand names of bread (or coffee) made in each country. The origin matter?
aim was to control for any relationship between familiarity and the respondents’
choices. Next, respondents were asked to rate for each country on a nine-point
Likert scale the taste (aroma), prestige, and quality of its bread (coffee). This was
followed by a question about the respondents’ likelihood of purchasing the
bread and coffee made in each country, which sought to determine the extent of 109
the influence of COO on consumers’ purchase intentions. Finally, for each
product category, we used a table generated by permutating the three extrinsic
attributes (Brand (four levels), COO (four levels) and Price (three levels)).
Combining all attribute levels results in 36 permutations for each food category
but, to make the evaluation task more feasible, a fractional factorial plan was
used (Cochran and Cox, 1957). Consequently, respondents evaluated only 16
permutations for each product category. A pilot test was conducted on a sample
of 15 respondents to identify any problems associated with the questionnaire
design and any ambiguities with the phrasing of the questions. Based on the
feedback, some questions were modified.

Data collection
To ensure representativeness of the general population, the sources of our
sample were students of higher education institutions, and café and
supermarket customers from all walks of life across Singapore.
Questionnaires were distributed to students in six local colleges; some
students completed and returned the questionnaire on the spot, others mailed in
their response, and some chose to complete an online version identical to the
printed one. The café and supermarket patrons were approached at random by
the researchers and completed the questionnaire on the spot. A total of 280
questionnaires were returned; 236 usable questionnaires were included in the
data analysis.

Analysis and results

The sample consisted of 53 per cent male respondents and 47 per cent female,
which approximated the gender profile of the Singapore population (see
Table I). The age distribution of the sample was heavily biased towards the
younger generation, especially those below 35 years of age (95 per cent versus
the national statistic of 53 per cent). This can be attributed to the fact that most
of our respondents were students or café patrons, who predominantly fall into
the younger age groups. About 93 per cent of the respondents had received
some college level education, making the sample as a whole more highly
educated than average. However, this was more likely to produce credible
results since educated respondents were able to understand the questionnaire
better than less well-educated respondents, and so could respond to it more
effectively. About 75 per cent of the sample had an income of $50,000 or less.
IMR
National Statisticsa
21,1 Variable Frequency Percentage (%)

Gender
Male 125 53.0 50.2
Female 111 47.0 49.8
110
Age
24 and below 181 76.7 35.5
25-34 43 18.2 17.5
35 and above 12 5.1 47.0
Highest education level
Primary 2 0.8
Secondary 10 4.2
Junior College/Polytechnic 89 37.7 N.A.
University 132 56.0
Post Graduate 3 1.3
Annual household income
, $25,000 98 41.5
$25,001-$50,000 77 32.6
$50,001-$75,000 30 12.7 N.A.
$75,001-$100,000 28 11.9
. $100,001 3 1.3
Race
Chinese 230 97.5 76.9
Indian 2 0.8 7.7
Malay 3 1.3 14.0
Table I.
Others 1 0.4 1.4
Demographic profile of
respondents Note: aThe national statistics are obtained from the Department of Statistics, Singapore

This is representative of Singapore population, which comprises mainly

middle-class consumers. The respondents were predominantly ethnic Chinese
(97.5 per cent).
The data were analyzed first by one-way ANOVA, comparing the mean
likelihood of purchasing bread (coffee) made (manufactured) in each of the four
countries (Table II). The results were significant ( p , 0.001), indicating that

Product Sum of squares DF Mean square F

Bread Between countries 1686.588 3 562.196 194.814*

Within countries 2712.657 940 2.886
Total 4399.245 943
Table II. Coffee Between countries 464.665 3 154.888 52.348*
COO effect on Within countries 2781.297 940 2.959
consumers’ purchase Total 3245.962 943
intentions Note: * p , 0.001
the likelihood of purchasing differs across countries for both product groups; Does country of
therefore, there appeared to be a significant COO effect in consumers’ purchase origin matter?
intentions. H1a and H1b predicted that both brand and price would be more
important than COO in evaluating low-involvement products, so we used
conjoint analysis to assess the relative importance of the three extrinsic cues
(see Appendix for a detailed explanation of this technique). The results
111
(Table III) show that brand is the most important cue for bread, followed by
COO and price. For coffee, brand again is the most important cue, followed by
price and COO. Therefore, for both products COO is not the most important
cue, but for bread it was more important than price; thus, H1a was supported,
while H1b was supported for coffee, but not for bread.
H2 predicted that the negative impact of a poor COO image would be
mitigated by a renowned brand name. Table IV shows the respondents’ COO
and brand preferences obtained from conjoint analysis. For bread, the brand
preference order was: Délifrance; Gardenia; IndoBread; and Top One, which
were similar rankings to the COO images (France; Singapore; Malaysia;
Indonesia). In this case, brand appeared to have no effect on the poor COO
image of Malaysia and Indonesia. For coffee, however, the most preferred
brands were Boncafé (Colombia) and Nescafé (Switzerland). Thus, for coffee, an
appealing brand name, possibly evoking associations with France, was able to
overcome the poor country image of Colombia, but there was not a similar
effect for bread. Therefore, H2 was supported for coffee, but not for bread.

Product Extrinsic cues Relative importance Rank

Bread Brand name 0.454 1

Country of manufacture 0.298 2
Price 0.248 3
Coffee Brand name 0.424 1 Table III.
Country of manufacture 0.233 3 Relative importance of
Price 0.343 2 extrinsic cues

Product Made in Utility Rank Brand Utility Rank

Bread France 9.71 2 Délifrance 11.72 1

Indonesia 6.48 4 IndoBread 5.95 3
Malaysia 7.48 3 Top One 5.78 4
Singapore 10.38 1 Gardenia 10.59 2
Coffee Colombia 9.19 1 Boncafé 9.58 2
Indonesia 6.84 4 Indocafé 7.11 3 Table IV.
Singapore 9.16 2 Super 6.56 4 Consumers’ COO and
Switzerland 8.88 3 Nescafé 10.84 1 brand preferences
IMR H3 predicted that Singaporean consumers would prefer products with the
21,1 “Made in Singapore” label. Tables IV and V provide the relevant data. In
Table IV, the “Utility” column for bread indicates that Singaporean
respondents preferred “Made in Singapore” label the most, with “Made in
France” coming second, followed by “Made in Malaysia” and, lastly, “Made in
Indonesia”. For coffee, the most preferred COO label was “Manufactured in
112 Colombia”, followed by “Manufactured in Singapore”, then “Manufactured in
Switzerland”, and lastly “Manufactured in Indonesia”. To check for gender
bias, paired samples t-tests found no significant differences between males and
females in their mean likelihood of purchasing each product from each country
( p , 0.05). Thus, based on the results in Table IV, we may conclude that
Singaporean consumers favor the “Made in Singapore” labels for
low-involvement products. This affirms the claim by Kaynak and Cavusgil
(1983) that consumers tend to perceive their home country products more
favorably. Therefore, H3 was supported.

Discussion
Of the four hypotheses tested in this study, H1a and H3 were supported and H1b
and H2 were partially supported. COO does play a role in consumers’ evaluation
of low-involvement products but its effect is weak, which can be attributed to the
characteristics of the products. For this product category, the purchase decision
is of minor importance, so consumers tend to pay less attention to cues such as
COO. Instead, they tend to buy out of habit; that is, they will choose the particular
brand that they are most familiar with, either conditioned by frequent purchase
or due to its popularity. The data supported H1a, which predicted that brand
was more important than COO in the evaluation of low-involvement products.
However, the same was true for price in evaluating coffee, but not in evaluating
bread (H1b). Comparing the relative price of bread and coffee, it was evident that
coffee is a more expensive item. As Wall et al. (1991) suggest, when the price of
low-involvement products increases, the price cue eclipses the importance of
COO in product evaluation and purchase intention.
The second hypothesis was only partially supported; the relative influence
of a strong brand name was more pronounced for coffee than for bread. The
“Boncafé” brand from Colombia was the most preferred brand, overcoming the
negative country image associated with a developing country. Although

Quality of Overall Purchase

Product Made in Taste Prestige ingredients quality likelihood Familiarity

Table V. Bread France 6.25 7.14 6.84 7.00 6.61 3.78

Ratings of COO Indonesia 4.23 3.82 4.20 4.25 3.87 2.44
dimensions and Malaysia 4.72 4.27 4.59 4.70 4.64 3.56
likelihood of purchase Singapore 6.13 6.29 6.21 6.39 7.09 5.61
(bread) Note: Ratings based on a scale from 1 (very low) to 9 (very high)
Singapore was the second most preferred country for coffee, its very own Does country of
product, Super, was the least preferred brand. The nature of the product and origin matter?
the brand names might provide an explanation here. The data in Tables V and
VI (“Purchase likelihood” column) indicate that, despite its generally poor
country image, Colombia was the country that respondents were most likely to
buy coffee from. This could be attributed to South America’s reputation as a
source for coffee. The evidence is in the “Aroma”, “Quality of coffee beans” and
113
“Overall quality” columns for coffee in Table VI, in which Colombia is rated the
highest. We can thus infer that country quality perception varies across
product categories, so that Colombia might rank very high on coffee but very
low on other products, such as electronics. According to Roth and Romeo
(1992), if a country is perceived to have a positive country image and this image
is important to a product category, consumers will be more willing to buy the
product from that particular country. Simply, there must be a fit between the
product category and the country image.
Second, a generic brand name, “Super”, for Singaporean coffee may lack the
prestige of a hedonistic brand name such as “Boncafé”, which evokes images of
France, a country renowned for its epicurean lifestyle. Consequently, Boncafé
appeals more to respondents than Super, even though respondents might be
more familiar with the local brand. This reasoning is again supported by the
results from the bread category in which Top One, a functional brand name, is
ranked the least preferred brand.
The data support H3, which predicted a preference by Singaporean
consumers for “Made in Singapore” products, based on a similar preference for
domestic products in developed nations. In this case, the respondents’ preference
for local food products could be due partly to their familiarity with bread and
coffee made and manufactured locally, as reflected in the mean familiarity
ratings (Tables V and VI) where Singapore is rated the highest in both product
categories. Familiarity results both from the availability of local products that
are widely carried in retail stores and from the presence of local advertisements
that promote domestic products. Price might also play a role: the proximity of
local manufacturers to consumers leads to lower prices due to the absence of
freight charges, tariffs or exchange rate fluctuations that might otherwise inflate
the prices. Since Singapore’s government encourages free trade, Singaporean

Quality of Overall Purchase

Product Manufactured in Aroma Prestige coffee beans quality likelihood Familiarity

Coffee Colombia 5.91 6.19 6.45 6.42 6.37 3.54 Table VI.
Indonesia 4.64 4.53 4.73 4.75 4.59 3.06 Ratings of COO
Singapore 5.29 5.58 5.56 5.68 5.84 3.97 dimensions and
Switzerland 5.72 6.37 6.10 6.25 6.22 3.30 likelihood of purchase
Note: Ratings based on a scale from 1 (very low) to 9 (very high) (coffee)
IMR consumers are constantly exposed to foreign products. Therefore, Singaporean
21,1 consumers’ preference for “Made in Singapore” products seems to based more on
practical motivations rather than the strong patriotism, national pride, or
consumer ethnocentrism asserted by Heslop and Papadopoulos (1993).

114 Conclusions and international marketing implications

COO does appear to affect Singaporean consumers’ evaluations of
low-involvement products in much the same way that it affects
high-involvement product categories in developed nations. First of all, when
a foreign country’s favorable image is skillfully projected onto a food product,
it can boost the chance of successful market entry and increase the product’s
market share in Singapore. In this case, producers from foreign countries with a
favorable image should accentuate their COO information. For example,
producers of Colombian coffee could emphasize the reputation and prestige of
their product. In contrast, Singaporean consumers are likely to reject food
products from foreign countries with an unfavorable image, so marketers of
such products should devise strategies to downplay COO information, such as
displaying it discreetly on the label.
The results suggest that in the presence of other extrinsic cues, Singaporean
consumers’ purchase decisions are influenced more by the brand than by the
COO of a food product. Thus, the fundamental approach for international
marketers is to establish a strong brand image for their food products.
According to Chung and Jay (1997), a successful brand image can come from
brand popularity and country image. In order to enhance brand popularity,
international marketers should engage in aggressive advertising and adopt a
hedonistic brand name (e.g. Boncafé) that is more acceptable to Singaporean
consumers than a functional name, (e.g. Super). Enhancing an unfavorable
country image, though, is a tougher, longer-term proposition. However, by
forming a strategic alliance with a partner from a country with a more
favorable image and, by adopting the partner’s technology and replicating its
superior operations and production processes, a company should be able to
improve the quality of its products. At the same time, the company should
promote its alliance to assure potential customers of the quality of its products.
For example, “French bread: made in Indonesia under license from Boulangerie
Moulin Rouge, Paris, France.” As a result, the unfavorable country image may
be improved, leading to a positive brand image.
The findings indicate that for basic food products Singaporean consumers
prefer the “Made in Singapore” label over products made elsewhere. This is
probably due more to their familiarity with Singaporean products than to
consumer ethnocentrism. Hence, all is not lost for foreign companies, which
could establish their production or operations in Singapore to create a local
presence in the country. In this way, Singaporean consumers would become
more aware of their products. This finding carries even more weight for
perishables such as bread, since two of the alternative locations for bread Does country of
production – Malaysia and Indonesia – are just minutes from Singapore, so origin matter?
food producers in these locations are able to compete with Singaporean
manufacturers with regard to product freshness.
Finally, a significant finding was that country quality perception varies across
product categories. In other words, there must be a fit between the product
category and the country image (Roth and Romeo, 1992). The negative country
115
image of a developing country may not necessarily penalize all of its products, as
was the case with Colombian coffee. This is because certain developing
countries, despite having an overall unfavorable image, are well known for
producing a particular food product. For example, Brazil is renowned for its
coffee, and India for its tea. By associating food products with these developing
countries, which may seem to contradict the common presumption that a
negative country image adversely influences product evaluation internationally,
international marketers can improve the desirability of their food product(s).
Therefore, international marketers equipped with this knowledge should
consider the match between their particular food product and the country image
instead of hastily associating it with countries that have positive image. In some
cases, the positive country image of a developed country (e.g. Canada for coffee
or tea) may not bolster the international marketing of their products.

Limitations
Several limitations should be kept in mind when interpreting the results of this
study. First, the respondents were biased towards a younger age group,
between 15 and 24, and so may not represent the buying behavior of the
Singaporean population at large. Moreover, only two product categories, bread
and coffee, were used to represent the food industry, limiting the
generalizability of the findings of this study to other basic food products.
Future research that makes use of other food categories and draws on samples
from other age groups would strengthen the external validity of the results.
Second, one hypothetical brand, Indobread, was used to represent bread made
in Indonesia. Since familiarity with a product may influence consumers’
purchase decisions, the unfamiliarity with Indobread might have resulted in
consumers’ dismissal of this brand. However, given that the Délifrance (France)
brand also received a relatively low product familiarity rating (3.78 on a
nine-point scale, versus 2.44 for Indobread), unfamiliarity with the product is
not likely to have affected the respondents’ purchase intentions in this case.
Similarly, the use of a well-known brand name such as Nescafé in consumer
product evaluation may be viewed as a limitation, since respondents are
expected to be more familiar with well-known brand names; this may have
weakened their preferences for other less familiar or hypothetical brands.
However, it can be contended that the use of renowned brand names reflects the
choices consumers have in the market and so enhances the external validity of
IMR the research. Finally, the findings suggest that the use of Colombia as a COO
21,1 for coffee may have confounded the results. Although the study’s pretest
indicated that Singaporean consumers regard Colombia as a developing
country and generally associate Colombia with a poor COO image, the conjoint
analysis shows that when it comes to coffee, Colombia is perceived positively
by Singaporean consumers. Colombia received the highest utility ratings for
116 taste, quality of ingredients, overall quality, and purchase likelihood. This
underscores the point that COO is a dynamic concept, and that a country may
have a positive COO perception for some product categories but a negative one
for others. Future research in this area should carefully screen countries to
ensure that there is no ambiguity about consumers’ COO perceptions of them.

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Appendix. Conjoint analysis

In a real purchase situation, international consumers do not make choices based on a single
attribute such as COO. Instead, they examine a range of features or attributes and then make
judgments or trade-offs to determine their final purchase choice. Conjoint analysis examines these
trade-offs to determine the combination of attributes that will be most satisfying to the consumer.
The value of conjoint analysis is that it predicts what products or services people will choose and
assesses the weight people give to various factors that underlie their decisions (Dolan, 1990).
From each respondent’s rankings, utility points (where higher is better) are assigned to the
options to capture the expressed preferences. In this case, we assigned the highest ranked option
8 points and the lowest ranked option 1 point. This would yield the results indicated in the
“Utility” column shown in Table AI. From these results, the utility levels pertaining to each
extrinsic cue was derived as follows:
 Does country of
Option Brand name Made in Retail price (S$) Rank Utility
origin matter?
1 DÉLIFRANCE France 1.00 1 8
2 DÉLIFRANCE Indonesia 1.00 2 7
3 DÉLIFRANCE Singapore 1.50 3 6
4 DÉLIFRANCE Malaysia 1.70 4 5
5 GARDENIA Malaysia 1.00 5 4 119
6 GARDENIA Singapore 1.00 6 3
7 GARDENIA France 1.50 7 2 Table AI.
8 GARDENIA Indonesia 1.70 8 1 Example of conjoint
Note: This Table is an abridged version of the one used in the questionnaire analysis

Brand
Délifrance ¼ ð8 þ 7 þ 6 þ 5Þ=4 ¼ 6:5

Gardenia ¼ ð4 þ 3 þ 2 þ 1Þ=4 ¼ 2:5

COO

France ¼ ð8 þ 2Þ=2 ¼ 5

Indonesia ¼ ð7 þ 1Þ=2 ¼ 4

Malaysia ¼ ð5 þ 4Þ=2 ¼ 4:5

Singapore ¼ ð6 þ 3Þ=2 ¼ 4:5

Price

$1.00 ¼ ð8 þ 7 þ 4 þ 3Þ=4 ¼ 5:5

$1.50 ¼ ð6 þ 2Þ=2 ¼ 4

$1.70 ¼ ð5 þ 1Þ=2 ¼3

Based on these utilities, we made the following conclusions:

.
This respondent placed greater value on Délifrance bread (utility ¼ 6:5) than a Gardenia
bread (utility ¼ 2:5).
.
This respondent did not differ much in the value that he/she placed on COO. That is, the
utilities were quite close (4 vs 4.5 vs 5).
.
This respondent placed much higher value on a price of $1 than a price of $1.50 or $1.70.
These utilities also tell us the extent to which each of these attributes drives the decision to
choose a particular bread. The importance of an attribute can be calculated by examining the
range of utilities (that is, the difference between the lowest and highest utilities) across all levels
of the attribute. That range represents the maximum impact that the attribute can contribute to a
product.
IMR Using the utilities derived above, we can calculate the relative importance of each of the three
attributes. The range for each attribute is given below:
21,1
Brand: Range ¼ 4 (6.5-2.5) or 53.33 per cent (4/(4+1+2.5)*100 per cent)
COO: Range ¼ 1 (5-4) or 13.33 per cent (1/(4+1+2.5)*100 per cent)

120 Price: Range ¼ 2:5 (5.5-3) or 33.33 per cent (2.5/(4+1+2.5)*100 per cent)
These ranges tell us the relative importance of each attribute. Brand is the most important factor
in product purchase as it has the highest range of utility values. Brand is followed in importance
by the price of the bread. Based on the range and value of the utilities, COO appears to be
relatively unimportant to this respondent.
The preceding example depicts an individual’s utilities. Average utilities were calculated for
all respondents and reported in Table IV.