Findings of the conducted survey to the German population

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Effects of COO on consumers

The COO effect as an extrinsic cue has been studied over five decades by several scholars who have been trying to understand its effects on consumer behaviour (Pharr, 2005). It has been established that COO does have a significant effect on consumer evaluations on products when consumers lack other information cues (Bilkey & Nes, 1982 cited in Kaynak & Kara, 2000). The scope of COO influence whereby the effects are more or less dominant on their influence on consumers’ evaluations as well as which other factors play a significant part in lessening the effects have been researched and published for several years (Leifeld, 1993; Peterson & Jolibert, 1995; Samiee, 1994; Verlegh & Steenkamp, 1999). These researchers understood that COO is used as an extrinsic cue by consumers to make evaluations about the product which is also associated with the quality of the product. According to Keller (1993) and Shocker et al. (1994), the brand equity of a country image can be improved by the consumers’ beliefs of the COO.

Other research perspectives on COO

Several research studies done in the past have looked at the concept of COO from different perspectives. Agrawal and Kamakura (1999); Roth and Diamantopoulos (2009); Roth and Romeo (1992); Usunier and Cestre (2007) studied COO from the product country image perspective, while other researchers such as Bloemer et al. (2009); Veale and Quester (2009); Verlegh et al. (2005); Oberecker et al. (2011) and Nes et al. (2014) have focused on the consumer product evaluation and consumers’ product preference from a COO perspective. In this thesis, the authors approach the study from both point of view. This thesis will look at the effects of COO from the frame of reference single/multiple cue theories, country image theory, affinity theory and product-country match theory. Single/multiple cue effect theories are used as this study investigates effects of COO on prefabricated wooden houses from Sweden in absence of other cues, followed by a proposed model composed of country image theory, country of affinity theory and product-country match theory as a mediator.

Single cue

Early research by Nagashima (1970) and Schooler (1965) focused on the COO effect as the single information cue hence were limited in the consideration of other cues. Nagashima (1970) and Schooler (1965) focused on empirical studies by investigating the effect(s) of the COO information on the consumer’s evaluation of certain products as a 14 single cue (Chattalas, Kramer & Takada, 2008). According to Elliot and Cameron (1994), the COO information is used by consumers as a substituting indicator of the quality of a certain product. Referring to the product classes that have been considered in the study, the COO information got evaluated less relevant than the cues price and product quality as indicators for product choice (Elliot & Cameron, 1994).

Multiple cues

This section will focus on studies done on multiple cues on the area related to COO. According to multiple cue studies containing the COO cue and the (global) brand name as a cue, researches by Jacoby, Olson and Haddock (1971), Monroe (1976), Jacoby, Szybillo and Busato-Schach (1977), Johansson, Douglas and Nonaka (1985), Hui and Zhou (2003) and Srinivasan, Jain and Sikand (2004) attribute the brand name cue a relatively higher effect on the consumer product evaluation than the COO cue (Terpstra, 1983) in literature. The study results by Tse and Gorn (1993), however, support conclusions of previous research that showed a significant effect of the COO cue on consumers’ product evaluation (Nagashima, 1970; Cattin, Jolibert & Lohnes, 1982; Lillis & Narayana, 1974; Gaedeke, 1973). The findings state that even in the presence of a (global) brand name, the COO cue can still have a significant effect on the product evaluation and remains as a salient indicator.

Sources of Consumer Country Affinity

Earlier findings by Martin and Eroglu (1993) showed consumer affinity effectively distinguishes from cognitively created country images formed by informational beliefs by a consumer about a specific country. Other researchers such as Verlegh (2007) found that consumers might like a specific country, thus making them want to form associations with it which leads them to purchase products from that country. The various studies conducted in this area support that consumer affinity has a significant impact on purchase decisions, Jaffe and Nebenzahl (2006) support this theory by stating that consumers who show positive feelings and preferences towards a specific foreign country tend to make purchases as a direct outcome of their feelings. Furthermore Wongtada et al., (2012) underpin the concept of country affinity by stating that an individual’s prior experiences linking them to a preferred holiday destination leads them to have positive affection for the country while on macro level the information gained on social media platforms from others and other forms of media also contribute to the formation of such feelings towards country affinity.

Table of Contents :

• 1 Introduction
  • 1.1 Background
  • 1.2 The research problem
  • 1.3 The purpose of the research
  • 1.4 Research questions
  • 1.5 Delimitations of the study
  • 1.6 Contribution
  • 1.7 Key terms
• 2 Literature Review
  • 2.1 Introduction
    • 2.1.1 Defining Country of Origin
    • 2.1.2 Effects of COO on the Country
    • 2.1.3 Effects of COO on consumers
    • 2.1.4 Other research perspectives on COO
  • 2.2 Single & multiple cue theory
    • 2.2.1 Single cue
    • 2.2.2 Multiple cues
  • 2.3 Country image (CI) effects
  • 2.4 Consumer Country Affinity
    • 2.4.1. Sources of Consumer Country Affinity
    • 2.4.2. Classifications of Consumer Country Affinity
  • 2.5 Product-country match
    • 2.5.1 Product-country match framework
    • 2.5.2 Relevant country strengths and product dimensions
  • 2.6 Proposed model used in the study
• 3 Methodology
  • 3.1 Research Philosophy
  • 3.2 Research Design
  • 3.3 Research Approach
  • 3.3.1 Qualitative and Quantitative research
  • 3.4 Sampling Selection
  • 3.5 Data Collection Method
    • 3.5.1 Secondary data collection
    • 3.5.2 Primary data collection (first step): Semi-structured interviews
    • 3.5.3 Primary data collection (second step): Internet survey
    • 3.5.3.1 Questionnaire development
    • 3.5.4 Pilot test survey
  • 3.6 Data Analysis
    • 3.6.1 Qualitative data analysis
    • 3.6.2 Quantitative data analysis
  • 3.7 Trustworthiness
  • 3.8 Reliability and Validity
  • 3.8.1 Reliability
  • 3.8.2 Validity
• 4 Empirical Findings
  • 4.1 Findings of the interviews in Germany
  • 4.2 Findings of the conducted survey to the German population
    • 4.2.1 Sampling and response rate
    • 4.2.2 Descriptive findings
    • 4.2.3 Reliability of Measurements
    • 4.2.4 Country image (CI) findings
    • 4.2.5 Country Affinity (CA) findings
    • 4.2.6 Comparison of COOs and Design styles
    • 4.2.7 Bullerbü Syndrome (BS) findings
    • 4.2.8 T-test on gender for CI, CA and BS
    • 4.2.9 ANOVA test on age for CI, CA and BS
  • 4.3 Multiple regression analysis findings
    • 4.3.1 Product category dimensions
• 5 Analysis
• 6 Conclusion
• 7 Reference list

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Country of Origin Effect MASTER THESIS WITHIN: Business Administration NUMBER OF CREDITS: 15 ECTS PROGRAMME OF STUDY: International Marketing AUTHOR: Xhulio Bejkollari and Henry Ngilorit