3. Research Model
3.1. Research Hypotheses
This section will provide a brief summary of the key conclusions of the literature review that are relevant to this research, and research hypotheses derived from the literature review.
An overwhelming majority of previous studies on COO and product perception place Japanese products, as perceived by consumers across different countries, at or near the top of the ranking. The exceptions, in which Japanese products are ranked poorly, usually come from countries like China and Korea, and they are likely rooted in historic or political animosity, rather than actual, objective product evaluations. As there is no such wide-spread animosity towards Japan in the Czech Republic, I propose that Japan‟s products (both general
Independent
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products as well as laptops) should be evaluated as the best from the three countries under study in this research. China, on the other hand, has been receiving a fair amount of negative press on faulty and often even hazardous products. The Made-in-China product label carries the stereotypical association with poor product quality. For these reasons, I expect Chinese products to receive the lowest rating of the three countries under comparison. As for Taiwan, the prediction is rather unclear. The negative image of the Made-in-Taiwan brand from the past may play a role, even though nowadays the stereotype is not as widespread as it once was.
Czech consumers today are most likely quite unfamiliar with Taiwanese products and do not have a clear positive or negative image of Taiwan in their minds. Therefore, I expect the appraisal of Taiwanese products to be mostly neutral, somewhere between Japan and China.
H1: Japanese products are rated as the best of the country products in this study, while Chinese products receive the worst ranking. Taiwanese products are in between them in terms of product perception.
General images of countries are not scrutinized in research nearly as much as perceptions of country products, and the amount of background research is consequently much smaller. However, I expect a similar trend here as in the case of perception of country products. China receives a fair amount of negative media attention in the Czech Republic not only for its products, but also for other reasons (Tibet annexation, censorship, lack of political and social freedom etc.). Because most Czech people probably do not have much personal experience with China, their view of the country is likely to be shaped by this, generally negative, media image. Japan‟s reputation in the Czech Republic is that of a distant, rather obscure and throughout different country, which is however highly developed, high-tech and with extremely hard-working inhabitants. This stereotypical image is likely to create a generally positive evaluation, especially as there is no large-scale animosity or lingering negative images of Japan in the Czech Republic. Taiwan is largely unknown for most Czech
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people, who have very little information about the realities of the country. News regarding Taiwan is also very sparse in the mainstream Czech media (news appearing in recent 1-2 years focused on the aftermath of typhoon Morakot, Chen Shui-bian‟s arrest, Kaohsiung World games 2009, United States‟ sale of arms to Taiwan). Since most Czech people probably do not have enough knowledge about Taiwan to develop positive or negative opinion of it, I expect the perceived image of Taiwan to be on average neutral.
H2: Japan‟s country image is evaluated as the best, followed by Taiwan, and China with the worst ranked country image.
Previous studies indicate that countries that are relatively unknown to the public tend to receive more neutral and negative attributions than large, internationally visible countries, and it is difficult for them to build a strong, positive country image (Chattalas, 2008; Anholt, 2009). This may present a problem especially in the image-building efforts of Taiwan, which is as a country relatively unknown to people abroad. Paswan & Sharma (2004) suggest that the accuracy of country knowledge is positively related to country image. Inaccurate or missing country knowledge leads to a confusing and somewhat negative image about the country. Theory of mere exposure provides an explanation for this finding, stating that people develop a preference for things they are familiar with (Zajonc, 1968). Therefore, I propose that subjective and objective familiarity with a country is positively related to favorability of country image perception.
H3: Higher familiarity (knowledge) with a country will lead to a better perception of the country image.
Existing literature agrees that in most instances, there is a positive link between the image of a country and perception of country products (Lee & Ganesh, 1999; Gurhan-Canli &
Maheswaran, 2000). Products made in (or strongly associated with) countries with a positive image also tend to receive positive appraisals from consumers. In general, it appears that the
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impact of country image is largest in relation to the perception of product quality (Pappu et al., 2006). While the country regarded by consumers as the pinnacle of product quality varies region by region (Gurhan-Canli & Maheswaran, 2000), it is estimated that the positive link between perception of a country and perception of country products will be valid regardless of the country under research. Therefore, in this study I expect a significant positive association between country image and product perception for Taiwan, Japan and China, for both general country products as well as for a specific product category (laptop computers).
H4a: Better image of a country in the eyes of Czech consumers will lead to a better perception of country products in general.
H4b: Better image of a country in the eyes of Czech consumers will lead to a better perception of country products in a specific product category (laptop computers).
Existing research suggests that the relationship between country image and perception of products made in the country can be further influenced by a number of other variables.
Consumers‟ experience with using products made in the country is one such variable. The study of Ahmed & d‟Astous (2008), which assessed the perception of a number of countries as a country of origin by Canadian and Moroccan consumers pointed out that Chinese products were rated much more favorably than products originating from Singapore, in spite of the fact that Singapore is an industrialized country at a much higher level of economic development than China. This finding, which stands in a contrast with many of the theoretical assumptions of the COO research, may perhaps be explained by the fact that consumers are not very familiar with Singaporean products, whereas they do come across Chinese products very frequently. Past experience with country products appears to be an important predictor of consumer behavior, as consumers show preference for products they are familiar with, and reluctance to consider unknown products, including products originating from relatively unknown countries (Johansson et al., 1994). According to some studies, consumers also only
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pay attention to the COO information if they are already familiar with products from the same country (Josiassen et al., 2008). To sum up, consumers‟ usage experience of country products can be expected to play a substantial role in the country image – country product evaluation relationship.
H5: After controlling the other variables in the model, Czech consumers‟ user experience of products from Taiwan, China and Japan is a significant predictor in the relationship between the country image and the consumers‟ evaluation of products made in the country.
It is widely established in COO literature that the influence of COO image information on product evaluation varies depending on the product category. In other words, the perception of country-products in a specific product category can differ from general product perception, and it may also be influenced by other relevant variables. One product-related variable that is consistently raised in relation to a product category is the consumers‟ expertise and knowledge of the product category (Lee & Lee, 2009). The rationale behind this attention is that consumers who know more about a product category are able to make more accurate product evaluations as well as more informed purchase decisions. Therefore, highly knowledgeable consumers treat the COO information differently than consumers with less product category knowledge. Despite this long-running interest of the research community in product category knowledge, its role in relation to COO remains unresolved (Josiassen &
Harzing, 2008). On the one hand, some studies claim that the influence of the COO cue on product evaluation is stronger when consumers are unfamiliar with the product category (Han, 1989; Usunier, 2006; Josiassen et al., 2008). The reasoning behind this approach is that with unfamiliar products, consumers may rely more strongly on extrinsic cues (such as COO) for product evaluation, due to their inability to infer product characteristics (quality) from intrinsic cues (Maheswaran, 1994; Phau & Suntornnond, 2006). On the other hand, other studies propose that higher product familiarity in fact leads to a higher use of the COO cue for
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product evaluation (Johansson, 1989). Because the literature provides such ambiguous and inconclusive information, I deem it appropriate to establish in this study whether the product category knowledge is a significant predictor in the country image – country-product perception relationship.
H6: After controlling the other variables in the model, the consumer‟s product category expertise is a significant predictor in the relationship between the COO image and the consumers‟ evaluation of laptop computers produced in corresponding countries.
Another product category-related variable that has been of high interest to COO researchers is product involvement, which refers to “the general level of interest in the object or the centrality of the object to the person‟s ego structure” (Day, 1970, p. 10). High-involvement products are thus ones where the buyer is prepared to spend considerable time and effort on product research and information seeking prior to selection and purchase of the product. Literature suggests that for high-involvement products and product categories, consumers will not only use cues such as price and design when evaluating a given product, but will draw on additional information including COO image (Ahmed & d‟Astous, 2004;
Josiassen et al., 2008). On the other hand, consumers tend to pay little attention to COO and other cues with low-involvement products, where the purchase decision is of small importance and small financial risk (Ahmed et al., 2004). Ahmed et al. (2002) also suggest that for technologically complex products, higher level of consumer involvement leads to more favorable evaluation of country products. Therefore, for product category „Laptop computers‟ included in this study, consumer involvement should serve as a significant predictor in the product evaluation.
H7: After controlling the other variables in the model, the consumer‟s product involvement is a significant predictor in the relationship between the COO image and the consumers‟
evaluation of laptop computers produced in corresponding countries.
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As outlined in the literature review section, some of the variables which have been recognized to play a role in consumers‟ product and country evaluations are not included in this research, as they are outside of the scope of this study. While the country and product perceptions are affected by the country where the study is conducted, due to different cultural dimensions and attitudes of the evaluating respondents (Ahmed & d'Astous, 2008; Fong &
Burton, 2008), this fact does not play a role in this study, which will be conducted among Czech respondents only. Similarly, the effects of geographical and cultural proximity between the evaluating and evaluated countries, and the fact that the evaluation of a country image can be influenced by direct contact between the two countries by creating more objective evaluations of the country (Balabanis et al., 2002) are most likely irrelevant. All countries under evaluation (China, Japan, Taiwan) are very distant from the Czech Republic geographically, and share no strong historical or cultural links with it. Therefore, none of the countries under study is expected to have an advantage or disadvantage based on geographical or cultural links with the Czech Republic.
Virtually any study of a country image in relation to product perceptions must recognize the importance of the product‟s brand. Like country of origin, product brand is an extrinsic variable which consumers use to assess the product features (Pappu, 2007). Situations where both brand equity and country equity are present create a challenge for researchers, who need to account for both variables in the assessment of consumer product evaluation (Thakor &
Lavack, 2003). Studies which intend to examine solely the effect of country image (isolated from the effect of a recognized brand name) have to opt for some degree of abstraction. The method to do so is either to create a false brand name for the evaluated product, which should then be neutral in the evaluation as the consumer has no positive or negative experience of the brand (often used in experimental research), or to leave out the product brand altogether. In
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the case of this research, respondents are asked to evaluate products based solely on the country of origin and product category cues. Other product cues and features, which are likely to influence product evaluation and purchase intention in a real-life situation (price, design, attributes, warranty and brand) are left out. This issue is further discussed in the debate of single-cue and multi-cue studies.
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4. Research Design
4.1. Measurement of Research Variables
The main objective of this study is to elucidate the effect of country image and familiarity with a country (Taiwan, Japan, China) on perception of products originating from the countries of study. Other predictor variables, such as consumer‟s involvement with the product category, consumer‟s expertise in product category, consumer‟s experience with country products, as well as the demographic variables, are also included in the multiple regression analysis as covariates. Products are evaluated on the general level, as well as on product category specific level (laptop computers).
A structured, self-administered questionnaire is used for data collection. Virtually all of the questionnaire items are validated measures that have been adapted from previous research. The country / people image and product (general and specific) perception measures were first developed by Parameswaran and Yaprak (1987), and further modified and validated by the original authors (Parameswaran and Pisharodi, 1994) as well as other authors (Lee &
Ganesh, 1999; Knight et al., 2003; Pereira et al., 2005). The external consistency of the test (applicability of the test across countries) has been confirmed by the multiple studies and settings where it was employed. Subjective familiarity with a country is based on an approach used by several past studies (Ahmed & d‟Astous, 2008; Josiassen, 2007; Paswan & Sharma, 2004). The subjective familiarity with a product measure originates in a study by Flynn &
Goldsmith (1999). The objective test of consumer experience with country products is taken from Heslop and Papadopoulos (1993). For the test of objective familiarity with a country, the approach of Hayo (1999) and Paswan & Sharma (2004) was modified to match the needs of the present study. The product category-specific involvement was adopted from a study by Ahmed & d‟Astous (2008).
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For the purposes of this study, country of product origin is operationalized through the
„Made in‟ or „Manufactured in‟ label, in other words as the final points of manufacture of the product, which remains the most common conceptualization of the concept in COO literature (Al-Sulaiti & Baker, 1998). Country image uses the definition of Verlegh & Steenkamp (1999), as “mental representations of a country's people, products, culture and national symbols”, assessing respondents‟ perception of the country and its people. Country familiarity refers to how familiar a consumer is with a particular country. It is measured both as self-reported subjective familiarity, as well as objective knowledge of the country. Experience with country products is measured by consumer behavioral considerations, assessed by product purchases and usage experience. Expertise in a product category is operationalized as a subjective variable, self-evaluated by the respondents. Product involvement is measured by consumer attitudes to a purchase of the product, such as difficulty of purchase, importance of purchase and product information search. Product evaluation includes measurement of general attitudes towards products made in a country, as well as a measurement of attitudes towards a specific product category made in the country.
The questionnaire was assembled in consultation with related literature on questionnaire design (Hague, 1993; Bailey, 1994; Alreck and Settle, 1995). The majority of the survey measures employ a standard Likert scale with 5, 7 and 9 points scales present in the original studies. In order to make the questionnaire user-friendly and easy to follow, all measures using a Likert scale were transformed into 5-point scale answers. A 5-point ordinal scale was used for questions eliciting frequency (1 = never, 5 = very often) and amount (1 = none, 5 = very much).
The first version of the questionnaire was created in English, as all the measures used for its construction come from literature written in the English language. The questionnaire was then submitted for peer review and modified accordingly. It was then translated into Czech
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language, as the research is conducted exclusively among Czech respondents. A pilot study was then conducted with the Czech version of the questionnaire for length, clarity, logical order of questions etc., followed by a final modification, which produced the finalized version of the survey questionnaire. See appendix I and II for the survey questionnaire (in English and in Czech).
4.2. Data Collection
The data was collected from Czech respondents through a web-based survey platform http://www.vyplnto.cz/ between May 12th and May 31st, 2010. The study employed a convenience (non-probability) sample, as obtaining a probability sample was beyond the resources available to this study. The use of convenience sample in this case appears to be acceptable, as “when the country-of-origin effect is inferred from estimated relationships between variables, the use of convenience samples is not a very serious drawback”
(Johansson, 1993, p.79). Most respondents were unsolicited visitors to the survey platform, as well as respondents recruited from internet message boards, discussion forums and social networking sites (Facebook). Precautions were taken to exclude people with unusually high knowledge of Taiwan in my environment (e.g. other Czech students in Taiwan) from the sample. All responses were voluntary and no incentive for filling out the questionnaire was offered. The uniqueness of respondents was ensured by only permitting one questionnaire submission per one IP address. Responses were measured using mostly a five-point Likert scale ranging from 1 - strongly disagree to 5 – strongly agree and 5 points ordinal scale questions for measuring frequency (e.g. frequency of product use) and amount (e.g. amount of information received from a particular source).
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55 4.3. Measurement Reliability Test
As was pointed out previously, virtually all measurement items in this study are validated items adapted from previous research, and show internal consistency reliability (Cronbach‟s α) as well as internal and external validity. Nevertheless, following the collection of all data, a measurement reliability test was executed to ensure the reliability of multiple-item scales.
Table 4.1 lists the items which were combined into the finalized multi-item scales as well as their factor loadings and Cronbach‟s α values. Cronbach‟s α of the majority of measurement scales are above 0.7, showing acceptable to good reliability (Leech, Barrett, Morgan; 2005).
Alpha values between 0.6 and 0.7 are still considered acceptable, but the α value for Japan‟s specific product perception (0.485) is already quite low. Based on the reliability test, the
Alpha values between 0.6 and 0.7 are still considered acceptable, but the α value for Japan‟s specific product perception (0.485) is already quite low. Based on the reliability test, the