Melissa Lubi1, Jati Kasuma1, Mohd Azizee Jemari1 and Bibi Sarpinah Sheikh Naimullah2
1
Faculty of Business Management, 2Faculty of Electrical Engineering, Universiti Teknologi Mara Sarawak
Abstract The emergence of globalization continuously to dominance the market, it has become
increasingly essential for marketers to study the consumer behavior towards foreign product as well as how this will influence product evaluation among consumer especially consumer in Miri. In general, consumer tends to have contradiction behavior towards foreign product and they commonly have different product appraisal among one and another. However, it is common for those products made in developing country are perceived to be of lower quality then product from an industrialized nation. Thus, this would lik e to investigate the relationship between consumer attitude and country of origin foreign product evaluation. Using self-administered questionnaires, there are 384 residents were selected in order to obtain data regarding with the purpose of this study. The results reveal that there is a significant relationship between country of origin and as well as consumer attitude towards foreign product evaluation among consumer in Miri.
Keywords: Attitude, Country of Origin, Foreign Product Evaluation, Consumer
Introduction
Country o f Origin effect has been widely discussed topic in the mark eting literature for many years (Papadopoulos & Heslop, 2002). Seemingly, country of origin effect also influences consumer evaluation towards product. As being points out b y Keller (1993), one of the effects of country of origin is that consumers with favorable attitude towards prod ucts originating fro m a certain country are willing to pa y premium p rices, which comes across as notable profit to the company. In addition, consumers use count ry o f origin as a signal of product quality (Han, 1989) and authenticity (Holt et al., 2004). The result of consumer evaluation towards foreign product from different country of origin thereb y depend on the consumer‟s values and perception as the product can be accepted or rejected b y the consumer. O verall, the natures of consumer behavior are continuously changing and will eventually impact the evaluation process among consumer in their buying process. In addition, to understand the effects of brand image and country of origin, researchers and marketers should be familiar with the buying behavior of consumers (Gera, 2014). Thus, this stud y was conducted to identify the wa y in which attitude and country of origin pla y their roles as the antecedents of consumer behavior and it impacts towards foreign product evaluation.
75 Research Proble m and Research
Objectives
Consumer‟s values and perceptions, the product-country image can either increase or decrease perceived value. Still, the country image is not static (Jarvelainen, 2012) but can change over time as consumers beco me more familiar with the products and the quality of them actually improves (Kerbouche, Adouka, Belmimoun and Guenoouni, 2012). In general, consumer tends to have contradiction b ehavior towards fo reign product and the y commonly have diffe rent product appraisal among one and another. However, it is common for those products made in developing country are perceived to be of lower quality then product from an industrialized nation (Hulland, Todino, & Lecraw, 1996). S upposedly, fair evaluation that is purely based on the product capabilities itself should be more favorable b y consumers as it will produce equal opportunities for every product to win over custo mer choice regardless it country of origin or level of d evelopment of the country.
In fact, over the years electronic industry has developed significant capabilities and skills for the manufacture of a wide range o f semiconductor devices, high-end co nsumer electronic and information and communication technolo gy (ICT) product (Malaysia Exter nal Trade Development Corporation (MATRADE), Electrical and Electronic Directory 2011 -2013). However, multinational companies such as Apple computer s ystems Mala ysia, Samsung Mala ysia electronics and Canon Marketing still have a very stronghold on consumer electronics in Mala ysia (MIDA), 2011). In addition, the emergence of other low cost produces such as China and ASEAN Free Trade Area (AF TA) would intensify the co mpetitiveness of the Mala ysia electrical and electronic market (Maheran and Haslina, 2008). T hus, it will become more difficult for local electrical and electronic product to compete with other well-known foreign brands as consumer not only obviously feels more secure to purchase those popular brands but also good value for their mone y. Besides, t he strong brand eq uity that those fo reign product hold for such a long period managed to gain trust and favorable evaluation from consumer worldwide. Therefore, the massive impact of country of origin towards consumer behavior and product evaluation among local consumer cannot be d enied.
Hence, it is essential to carry out this stud y in o rder to identify the relationship attitude and country of origin had with foreign product evaluation. F urthermore, the stud y is crucial so that the factor that will impact foreign product evaluation the most can be identified. The objective of the stud y is to investigate the relationship between ps ychological factor (attitude) and country of origin towards foreign product evaluation. Beside, through this stud y, hopefully it can produce a comprehensive understanding related to the relationship between consumer behavior on country o f o rigin and foreign product evaluation.
Literature Review Product Evaluation
Product evaluation based on judging the country of origin is called ―country o f o rigin affect‖. Roth and Romeo (1992) assert that country o f origin effect means custo mers‟
76 stereotypes o f one specific country. Country„s stereotype means people in a country or specific people have stereotype or preferences for products of another country (Thorelli, 1985). This affect commonly o ccurs when consumers evaluate prod uct alternatives from different countries before the y make their final decision. In addition, Co untry o f origin ma y create a ―halo effect‖ whereb y consumers‟ attention and evaluation of other product dimension are affected (Ghazali, Othman, Yahya and Ibrahim, 2008). Realizing the importance of country of origin effect in their businesses, many countries concentrate in creating and polishing their image in the e yes of the world in order to attain an image that are linked to high quality, low risk involved b y the consumer and in the long run goal, able to gain market leader position. This is vital to any country in term of substantial economy growth as the image of product‟s country of origin is an extrinsic factor which majorly influences consumer‟s evaluation o f the product. F urthermore, consumers evaluate products on their attributes and infer product quality from a variety of informal cues or stimuli, including intrinsic cue (e. g., product performance) and extrinsic cues (e.g., brand name, prod uct origin) (Han and Terpstra, 1988; Peter and O lson, 2008). Even though it is now reco gnized through various studies that country of origin doesn‟t act as a single product evaluatio n cue for consumers but that consumers use it in combination with other product attributes, country of origin continues to have an important effect on product accessing (Usunier, 2002 ).
The stud y conducted b y Jap (2013) aims mainly to identify C hinese consumers‟ consumption value and evaluation towards global brands luxury goods as Wang and Chen (2004) commented that many C hinese consumers purchase imported products to enhance and symbolize their higher social status, prestige, fashion and product reliab ility compared to the local brand product counterparts. The result of the stud y has proved that C hinese consumers prefer foreign luxury product over local brands as the y evaluate both foreign and local luxury products based on the p roduct construct in term o f quality, trustworthiness, prestige, design and brands. This result has a positive correlation with the research completed b y Keegan and Green (2013) in which C hinese consumers have very different consumption values compared to their western counterparts. Xiao (2005) supported b y commented that due to rapid economic growth in the country over the past 25 years, Chinese co nsumer consumption values and b ehavior tends to vary significantly based on regions, cohorts and social class. Thus, the ownership of foreign luxury product does boost C hinese consumer pride as it reflect the higher level o f social rank as people evaluate the product as expensive and exhibit higher quality to compare with local brands of same product category. Besides, Jap (2013) stated that C hinese consumers preferred foreign over local brands for luxury products because by doing so, those Chinese consumers will receive immediate social acceptance and face (or mianzi) up to the level of the socia l status the y wish to achieve (Jap, 2010). This mean that the wa y in which C hinese consumers behave and their eagerness to own foreign luxury product not only drive b y their want to satisfy their basic need but also because it will able to show their dist inctive value to compare with other ordinary consumers.
Attitude Factor
In toda y‟s turbulent market, the attitude o f consumers is a subject matter of great concern for marketers tod a y because an order from this base can be crucial with
77 regards to choosing the right marketing strategy and also making business activities success ful (Solomon, Marshal and Stuart, 2008). Peter and O lson (1994) stated that attitude is general measurement toward individual concepts, which mostly are object and behavior. Attitude structure the wa y consumer think, believe, feel and respond to the internal and external environment. Attitude is shaped selectively to compromise consumers‟ needs and could be changed b y external effects like; joining a new community, gaining more knowledge and environment of a person (C hisnall, 1995). This mean attitude is no t enduring and can be created for some purposes.
Even though attitude cannot be noticed obvio usly yet it can be noticed from consumer behavior. There have been examples in the past about how the big co mpanies end up with failure due to their lack of interest in society‟s attitude changes towards their product or service while the new brands tract their consumers after handling sophisticated attitude researches (Peter and O lson, 2008). This proves that attitude is important determinant in establishing consumer behavior towards product. The extent to which consumer‟s attitude respond favorably towards imports depend highly to whether the consumer lo yal or not to the local product. Consumers who are sensitive about product‟s country o f origin ma y or may not be ethnocentric. It depends on how lo yal consumers to their countries (Guneren and O zturen, 2008). Consumer ethnocentrism is usually a determinant of consumers‟ attitudes toward imports (S himp et al., 1994). Country of origin can have greater effect on consumer attitude than brand name since even a well-known brand it cannot change negative attitude of consumer on the product which made in a d eveloping co untry. In addition, the image o f the country also p lays an important role in creating positive attitude among consumers toward imports. Hence, the better Country of origin image, the more trust consumers will have in the products.
Country o f Origin
The Country o f Origin effects has received considerable attention in internal marketing research (Gera, 2014). Country o f origin can be defined as a potentially powerful image variable that ma y be used to gain competitive advantage in international mark eting (Parameswaran and Pisharodi, 1994). In addition, country o f origin is one of the non-physical i.e intangible characteristics of a product which influences consumers‟ perceptions regarding product‟s attributes and quality (Balabanis and Diamantopoulos, 2004). Gera (2014), also stated Country of Origin is an important factor that affects consumers‟ opinion towards product quality. Besides, the location of production (country of origin), as an information cue, activates various ethnocentric and/or non-ethnocentric beliefs and the antecedent knowled ge of consumers, which subsequently affect the interpretatio n and eva luation of product attributes (Chryssochoidis et al., 2006). Consumers evaluate product on the basis o f information cues that are divided into intrinsic and extrinsic. However, consumers often use extrinsic cues (e. g, product nationality) as an indicator o f quality (Ahmed et al., 2004). Samli (1995) added Country of o rigin as a concept that is a critical information cue, which p lays a major role in having the product accepted in a different world market. Consumers use Country o f origin information as a signal of product quality (Han, 1989) and authenticity (Holt et al., 2004). Whereas intrinsic cues are often preferred, consumers do face difficulties gaining access to them, which means that consumers frequently rely on extrinsic cues for product jud gment (Bred ahl, 2004). Hence, it is undeniable that country of origin has an impact towards product evaluation among consumers. In addition, consumers often refer to the country of origin
78 as an indicator whenever making decision on new buying situation or lack of info rmation. As describe b y Veale and Quester (2009), low familiarity with the product has been related with greater use of extrinsic cues (COO) to evaluate product.
Parameswaran and P isharodi (1994), define country of origin as a potentially powerful image variable that ma y be used to gain competitive ad vantage in international marketing. The more the country portra ys a favorable image, the more likely the country‟s prod uct to be embraced b y consumer. Besides, Laroche et al., (2005), added that country image has an influence on product evaluations both directly and indirectly through p roduct beliefs. If the country o f origin stereotype is negative, it can pose formidable barriers for marketers attempting to position their goods within a foreign market (Johansson et al., 1994 in K inra, 2006). F urthermore, Laroche et al., (2005) defines that country image is a three dimensional concept co mprising of co gnitive, affective and conative components. This image is created b y such variables as representative products, national characteristics, economic and political back ground, history and traditions (Nagashima, 1970). Whereas studies on product nationality as a quality cue have generally focused on the image of the country (where the product was made) in the consume r evaluation process, the emphasis of consumer ideolo gies has been on the mindset and value system of the consumer, their geo grap hical location, their cultural and ethnic environment and the impact on the decision making process and outcomes (Vida, 1996). Numerous firms have used positive associations with the country of o rigin to good advantage in the marketing of goods (Papadoupoulos et al., 1993 in K inra; 2006). Consumer often make jud gments about product quality and purchase value on the basis of extrinsic cues, this is why country of origin, an extrinsic cue, is often used b y buyers to jud ge foreign products (Insch et al., 2002; Ahmed et al., 1995).
Methodology
As being defined b y Ho and Lee (2012 ), population is the entire group of people, objects, events, or things of interest that researcher would like to investigate. For this stud y, the population was the residents of Miri C ity is 300, 543. The sample that used in this stud y was yo ung adult and adult from various areas comprise urban, sub urban and also rural. A young adult according to Rob erts and Blanton (2001) is who ranges between the ages o f 20 and 29 years o f age. The stud y of the behavior of this segme nt is interesting as the y are eager to learning and developing knowledge about life including as a consumer in our society. Thus, this sample was investigated through this stud y in order to identify the relationship of consumer behavior antecedents and foreign product evaluation. A number of 384 residents were selected in order to obtain data regarding with the purpose of this stud y. The sample size of 384 respondents was abstract from population and sample size table construct by Krejie and Morgan (1970).
Findings and Discussions
Respondents for this stud y were 384 consumers in Miri that comprised three different areas which were rural, sub-urban and urban. The age ranges of the respondents were from 20 until40 and above years old. Table 1 below shows the respondents‟ Demographic Back ground in detail.
79 Table 1 Demographic Background (n=384)
ITEMS FREQUENCY PERCENTAGE (%)
Gender Male 193 50.3 Female 191 49.7 Age 20-25 years old 116 30.2 26-30 years old 118 30.7 31-35 years old 36-40 years old 41 years old and above
42 31 77 10.9 8.1 20.1 Religion Muslim 109 28.4 Christian 261 68.0 Buddha 2 0.5 Others 12 3.1 Race Malay 94 24.5 Iban 102 26.6 Chinese 21 5.5 Orang Ulu 145 37.8 Others 22 5.7 Educational
Secondary School and Equivalent 282 73.4
Bachelor‘s Degree 94 24.5 Master Degree 7 1.8 Doctoral Degree 1 0.3 Occupational Student 29 7.6 Employed 266 69.3 Unemployed 83 21.6 Self Employed 6 1.6 Marital Status Single 191 49.7 Married 182 47.4 Divorced 7 1.8 Widow 4 1.0 Income Level Below RM1000 137 35.7 RM1000-RM2999 132 34.4 RM3000-RM4999 80 20.8 RM5000 and Above 35 9.1 Residential Area Urban 99 25.8 Sub-Urban 212 55.2 Rural 73 19.0
Note: Frequency and percentage total for each item is 384 and 100% respectively. Based on the Table 1 above, the ratio of gender was quite balance with 193 of the respondent were male (50.3%) and 191 of the respondents were female (49.7%). In terms of age, the finding indicated that highest ratio of the respondents was 26 to 30 years old
80 were between the range of yo ung adult with 118 o f respondents (30.7%) and followed b y 20 to 25 years old with 116 o f respondents (30.2%). There were 77 of the respo ndents (20.1%) in the range of age between 41 years old and above while 42 o f the respondents (10.9%) were 31 to 35 years old. The lowest was respondents in the age of 36 to 40 years old with 31 respondents (8.1%). This shows that yo ung adult are actively part o f the research. As above, in terms of religion C hristian were the highest with 261 of the respondents (68.0%), followed b y Muslim with 109 of the respondents (28.4%) and others religion with 12 of the respo ndents (3.1%). The lowest in term of religion distribution was Buddha with only 2 o f the respondents (0.5%) correspondingly. In terms of race, the highest were Orang Ulu with 145 of the respondents (37.8%), fo llowed b y Ibans with
102 respondents (26.6%), 94 of the respond ents (24.5%) were Mala y and other races were 22 of the respondents (5.7%). The lowest was C hinese with only 21 of the respondents (5.5%). Orang Ulu was the highest as it consists of Kayan, Kenyah, Kelabit, Penan, S hebob and Lun Bawang (Sarawak S tatistical and Fact, 2011 ).
From the research, in term of education, majority of the respondents were secondary school and equivalent with 282 of the respondents (73.4%), followed b y Bachelor‟s Degree holder with 9 4 of the respondents (24.5 %), Master Degree with 7 respondents (1.8%) and the lowest was only 1 respondent (0.3 %) has Doctoral Degree for this stud y. Besides that, finding shows that majority of the respondents were emplo yed with 266 respondents (69.3%), followed b y 83 respondents (21.6%) were unemplo yed, student with 29 respondents (7.6%) and the lowest were self- emplo yed with 6 respondents only (1.6%).
As mentioned in the Table 1, the highest ratio for marital status was single with 191 of the respondents (49.7%) and closely followed b y married respondents with 182 of the respondents (47.4%). Others, with 7 of the respondents (1.8%) were divorced while widow status indicated the lowest with 4 respondents (1.0%). In terms o f income level, respond ents with income level below RM 1000 were the highest with 137 respo