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Consumer brand classifications: an assessment of culture-oforigin versus country-of-origin Kenny Lim

Project Manager, Aretae Interactive Ltd, Singapore

Aron O'Cass

Bachelor of Business Convenor and Lecturer, School of Marketing and Management, Griffith University± Gold Coast, Australia Keywords Consumer behaviour, Perception, Country-of- origin, Brand awareness, Brand names Abstract Examines consumers' perception of brands as influenced by their origins and the differences in classification ability between consumers' knowledge levels. Specifically, culture-of-brand-origin (COBO) is proposed to have replaced country-oforigin (COO) as the most important origin influence regarded by consumers in their perceptions of brands. Culture-of-brand-origin is used to mean the cultural origin or heritage of a brand. Data were gathered from 459 respondents in the Asian city of Singapore; and used to assess Singaporean consumers' ability to classify the cultural origins of fashion clothing brands. This was compared to their ability to classify the country origins of the same brands. Six brands were used in a between-subjects design, with three brands of western countries and three of eastern countries. Results indicate that consumers can more readily identify the cultural origin of brands over their countryof-origin. Reveals that a consumer's ability to make this distinction is influenced by the consumer's perception of how well he/she knows the brand.

Valuable assets

Introduction Brand names have become increasingly valuable assets for many companies in an age of growing globalised business. In a cluttered marketplace, brand names are very nearly the last source of differentiation for providers of products and services that are readily emulated with easy access to the technology and information available today. It is argued that brands add value to consumer goods by supplying meaning (McCracken, 1993), as well as communicating competence, standard and image to the consumer. The difficulties of global competition have underscored the importance of established brands (Thakor and Kohli, 1996) in consumer markets. Consumers use brands as clues to indicate product performances, rather than engage in a detailed search for information when deciding between competing brands (de Chernatony and McDonald, 1992). To a large extent, the brands also speak of familiarity and credibility (Fatt, 1997) about the product. The number of successful global brands a country possesses has often been utilised as a yardstick by which economic superiority is implied. The 1997 ranking of the top ten global brands by Financial World, for example, includes nine from the only superpower nation of the world ± the USA. In an article widely read in Asia, Chowdhury (1999) pondered the lack of strong Asian brands in the global marketplace, revealing the burning question of why a region making up nearly half of the world's population and caught up The research register for this journal is available at http://www.mcbup.com/research_registers The current issue and full text archive of this journal is available at http://www.emerald-library.com/ft

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in feverish consumerism has so few successful global brands. Indeed, the need for more to be done to understand the nature of brands and brand development in Asia is apparent, and increasingly, the development of strong global brands is becoming an important objective for many of the economies in the region of Asia. With this objective in mind, this paper seeks to further our understanding of the role of origin information on consumer perception of brands. Specifically, we set out to explore the differences in perceptions of brand familiarity held by Singaporean consumers toward fashion apparel brands of western and eastern origins and consumers' ability to identify the country- versus culture-of-origin of brands. Consumer brand knowledge

What we know Research into the implications of consumer brand knowledge for marketing began as early as the 1950s (Gardner and Levy, 1955), even before Levitt's authoritative work Marketing Myopia was published in 1960. There has since been a stream of brand researchers who have contributed to the literature of consumer brand knowledge and how it impacts on consumer behaviour (Laroche and Brisoux, 1989; Dodds et al., 1991; Keller, 1993; Cobb-Walgren et al., 1995). Consumer brand knowledge determines how a consumer thinks about a brand (Keller, 1993), and how the consumer responds to different stimuli regarding a brand. For example, it would be easier for an advertisement to meet its communication objectives if consumers are positively predisposed towards the brand being advertised (Ray, 1982; Rossiter and Percy, 1987). Understanding consumer brand knowledge therefore helps companies be more effective in their marketing activities directed at consumers. Among the many factors believed to influence consumer brand knowledge and therefore brands in an age of international competition, country-of-origin (COO) effects remain the most researched (Al-Sulaiti and Baker, 1998) and is considered by many to make up the largest body of research in international buyer behaviour (Tan and Farley, 1987; Heslop et al., 1998; Martin and Romeo, 1992; Lee and Brinberg, 1995; Verlegh and Steenkamp, 1999). Popularly defined as the country-of-manufacture or assembly (Papadopoulos, 1993; Lee and Schaninger, 1996), the COO of a product has been found to influence consumer evaluations of the product on two dimensions: perceptions of quality (Khachaturian and Morganosky, 1990), and perceptions of purchase value (Ahmed and d'Astou, 1993). More importantly, Papadopoulos et al. (1991) also found COO effects to lead to consumer preferences for products from one country over another.

COO effects and economic development

Some of the more interesting findings that have resulted from research of COO effects include first, the tendency for consumers to evaluate their own country's products more favourably than imported products (Kaynak and Cavusgil, 1983), and second. the tendency for products from emerging economies to be evaluated negatively (Bilkey and Nes, 1982; Cordell, 1992). Other studies also suggest a relationship between COO effects and the level of economic development (Wang and Lamb, 1983); products from developed countries are perceived as more superior to products from undeveloped and developing countries. The reasons for these perceptions have been largely attributed to the economic, cultural and political systems of the source countries (Wang and Lamb, 1983). However, the traditional view of COO effects is increasingly becoming misleading or confusing in the modern marketplace as products are typically designed in one country, manufactured in another, and assembled in yet a third

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(Baker and Michie, 1995; Chao, 1993). This has resulted in the proliferation of ``hybrid products'' (Han and Qualls, 1985; Johansson and Nebenzahl, 1986; Han and Terpstra, 1988), where products may involve more than one countryof-origin. As hybrid products become increasingly prevalent in the global marketplace (Chao, 1993), it has become difficult for consumers to extract country-of-origin information for product evaluations. In view of this, the belief that consumers rely heavily on country-of-origin for origin information is seen as troubling in this study. The suitability and meaningfulness of COO as a cue in consumer decision making is questioned. By the same yardstick, it is obvious that there is a growing need for a multidimensional concept on country-of-origin effects on product evaluation (Ahmed and d'Astou, 1994). Convergence in consumer needs

Country-of-origin effects and brands There has been growing awareness (Domzal and Unger, 1987) that considerable similarities exist in the needs of consumers around the world. This convergence in consumer needs is largely attributed to increased crossborder population mobility (Quelch, 1999), and electronic mobility facilitated by telecommunications technology (Domzal and Unger, 1987; Quelch, 1999) such as film, television, and the Internet. Because of these similarities in consumption needs, it is increasingly easy for marketers to target and market to a consumer segment that spans several continents, so as to reap economies of scale in production and promotion. For all the similarities, differences between the markets of different countries still exist because of factors such as culture, history and geography; and there are differences between the many regions of the world in the way consumers perceive products and brands. Among the many factors which are believed to influence consumer perceptions of products in an age of international competition, country-of-origin (COO) effects have attracted growing attention (Al-Sulaiti and Baker, 1998) and have even been considered by many to make up the largest body of research in international buyer behaviour (Tan and Farley, 1987; Heslop et al., 1998; Verlegh and Steenkamp, 1999). There have been many definitions of COO in the literature and its effect on consumer behavior. It has been defined as the country where the corporate headquarters of the company marketing the product or brand is situated (Johansson, 1985; and Ozsomer and Cavusgil, 1991); as the country of manufacture or assembly (Papadopoulos, 1993; Lee and Schaninger, 1996); and as the country of product design.

Perceptions of quality and purchase value

COO effects have been found to influence consumer's evaluations of foreign products on two dimensions: perceptions of quality (Khachaturian and Morganosky, 1990), and perceptions of purchase value (Ahmed and d'Astou, 1993). More importantly, Papadopoulos et al. (1991) also found COO effects to lead to consumer preferences for products from one country over another. As production and consumption of goods become internationally sourced, the influence of COO effects on consumer evaluations of products has gained attention. According to Chao (1993), hybrid products will be increasingly prevalent in the global marketplace because of the changing strategies of global corporations. As a result, there is a growing need for a multidimensional concept on country-of-origin effects on product evaluation (Ahmed and d'Astou, 1994). Therefore the traditional view COO effects is questionned as it is potentially misleading or confusing to consumers in an increasingly

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dynamic marketplace as products are typically designed in one coutnry, manufactured in another, and assembled in yet a third (Baker and Michie, 1995; Chao, 1993). This has resulted in the proliferation of ``hybrid products'' (Han and Qualls, 1985; Johansson and Nebenzahl, 1986; Han and Terpstra, 1988), where products may involve more than one country-of-origin. Culture-of-brand-origin One perspective is that faced with complex country-of-origin information communicated by hybrid products, the COO effects have been shifted from the product level to the brand level in consumers' product evaluations. This perspective has gained considerable interest in recent years (e.g. Lee and Ganesh, 1999; Ammonini et al., 1998; Zhang, 1996; Thakor and Kohli, 1996). In addition to this shift, it is proposed here that specific country-of-origin information is becoming less dominant (relevant) for the fact that it is becoming increasingly difficult for consumers to extract the multiplicity of country information (manufacture, design, assembly and head office). In place of country-of-origin is the culture-of-brand-origin, which is more readily available to the consumer as a result of exposure to the marketing activities of the brand. Effects of foreign branding

One illustrative study into this possibility was conducted by Leclerc et al. (1994), who examined the effects of foreign branding on product perceptions and attitudes, and found that spelling or pronouncing a brand name in a foreign language ± thereby implying the cultural origins of a brand ± was a more differentiated cue for brand perceptions than country-of-origin information. While not using the same terminology, Thakor and Kohli (1996, p.27) addressed the same concern by proposing a similar concept; that of brand origin, defined as ``the place, region or country to which a brand is perceived to belong by its target consumers''. They suggested that the origin of manufacture ± the traditional description of country-of-origin ± is no longer significant to buying behaviour in the age of corporate globalisation, and that the perceived origin of the brand is more suggestive as a demographic variable.

Consumer bias

The view that consumer perceptions of brand names are influenced by culture effects may also be supported by Samiee (1994), who regarded origin effects as an influence or bias held by consumers, resulting from the country-of-origin of the associated product or service. It is reasonable to infer that the influence or bias resulting from a country may be attached to a brand name over time, even though its products are no longer designed, manufactured or assembled in its country-of-origin. The fact that the effect results from a country lends support to the proposal that it is a generic cognition ± as is culture ± and the fallacy of using country as a reference for that effect. Consequently, cultureof-brand-origin may be the reason why consumers still attach certain cultural characteristics to a brand when specific information about the foreign country is not available. For example, consumers evaluated Volkswagon Fox favourably in a study because of its image as a brand of exceptional engineering based on its German origins; only 8 percent of the respondents knew it was manufactured in Brazil (Ratliff, 1989). Research propositions To examine the issue of COO and COBO and knowledge effects, three research propositions (RPs) are developed to explore a new theoretical development related to the cultural origin of brands, and its role in explaining consumer evaluations of brands. These propositions provide the direction that this study takes in attempting to contribute to the existing literature on the topic of branding.


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RP1. Culture-of-brand-origin (COBO) will be more easily identifiable (correctly identified) than country-of-origin (COO). This proposition is based on the view that consumers will more readily identify culture-of-brand-origin than country-of-brand-origin. RP2. Perceived consumer knowledge (brand and country) levels differ between those who classify culture-of-brand-origin successfully and those who classify it incorrectly. RP3. Consumer knowledge (brand and country) will be a strong predictor for classification of culture-of-brand-origin and country-of-origin. The issue of consumer brand knowledge is important to our understanding of how consumers perceive information about the origins of a brand and ultimately perceive and evaluate brands. It is believed that knowledge will have a significant impact on consumers' ability to correctly identify the origins of a brand. However, even accounting for knowledge levels, consumers are believed to be able to classify culture-of-brand-origin better than country-of-brand-origin. Interviewer administered survey

Three-phase process

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Research methods The research design for the study was based on the development and administration of a survey questionnaire to gather the data to address the propositions. An interviewer-administered survey was constructed containing items tapping respondents' subjective brand knowledge of fashion clothing brands, subjective country knowledge and familiarity, age, gender and classification of the culture-of-brand-origin and country-of-origin of the brands. In ensuring the validity of the findings from this study to the research proposition being presented, the design of the questionnaire followed principles of instrument design accepted within the academic community. This included a rigorous process of generating appropriate items and assessing their representativeness to the objectives of the study. The survey instrument was developed though an iterative process of item generation from the current branding and consumer behaviour literature. On the basis of items used in the literature and the definitions established in this study a pool of items was generated in a similar manner to that of Yoo et al. (2000). Following the item generation phase content validation and refinement was undertaken via a panel of academic judges with expertise in consumer behaviour and a series of focus groups (Converse and Presser, 1986; Deng and Dart, 1994). Item generation followed a three-phase process. In the initial phase items were generated from the literature, from consultation with consumer behaviour experts, and from the researchers' own knowledge of branding. Phase Two began with the submission of the first draft of the survey to three expert judges for feedback on content validity and other issues of concern, such as, question phrasing, question sequence, and layout (Tull and Hawkins, 1990; O'Cass, in-press). Evaluation by this panel resulted in some minor refinement of item wording. The final phase involved submitting the second draft of the survey to focus groups (four groups in total), at which time the survey was screened for content validity, understanding, and ease of use and completion. Such qualitative procedures for survey development are in-line with the arguments raised by Converse and Presser (1986). The decision to conduct focus groups is also consistent with the view of Malhotra et al. (1996), in that a qualitative approach is increasingly taken in pilot testing an instrument when conducting cross-cultural marketing research, and focus groups are commonly used to provide such qualitative information (Long, 1991; Bassili and Fletcher, 1991). JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 10 NO. 2 2001

The items developed for the examination of the research propositions measured the subjects' perceived knowledge of the brand such as `Ì know a lot about this brand'' and perceived familiarity of the brand such as ``How familiar are you with this brand?'' An unstructured question recorded the subjects' perception of the brand's country-of-origin, while culture-of-brand-origin was measured using a dichotomous scale: ``What country do you think this brand originated from?'' ``What do you think is the culture of origin of this brand?'' Western Eastern The survey also included items to measure the respondents' familiarity with the perceived country-of-origin of the brand. Data collection

Data collection was conducted at a major university in Singapore over a period of five days, during which a total of 498 completed questionnaires were collated. The responses of 459 (see Table I) respondents were used for the subsequent analyses after 39 were deleted due to missing responses. The use of the student sample is determined to be appropriate for the study as they represent a segment of the population that will, over the next number of years, acquire the financial means to be the consumers of many consumer and durable products in the Singapore market. Also, Verlegh and Steenkamp (1999) in a meta analysis concluded no differences exist between studies using students to those using non-students in COO studies. The sample consisted of a convenience sample of undergraduate and postgraduate students studying both full-time and part-time and across the entire university faculties of Business, Arts, Engineering and Science. They were each given stimuli (a print advertisement) for a brand of fashion apparel that they referred to in responding to the items in the questionnaire. Six brands were used in the study, three of which were brands of eastern origin, while another three were of western origin. The brands were picked from an extensive list of Asian Regional and Western Regional and Global brands by three focus groups conducted prior to the execution of the survey. The six permutations of the survey were randomly assigned to respondents within the sample.

Representative sample

The student sample represents a segment of the population that will, over the next number of years, acquire the financial means to be the consumers of many consumer and durable products in the Singapore market, and is thus an appropriate sample for the study to be of interest to the economy. Fashion clothing has also been identified as a significant product in the lives of young (university student) consumers, as well as a product with wide appeal to younger consumers (Flynn and Goldsmith, 1999; O'Cass, 2000). Age

Male Frequency

Female Frequency

Total

18 19 20 21 22 23 24 25 Total

± ± 12 46 111 79 12 4 264 (57.5%)

7 29 72 71 6 4 4 2 195 (42.5%)

7 29 84 117 117 83 16 6 459 (100%)

Cumulative % 1.7 7.9 26.1 51.6 77.1 95.2 98.7 100.0

Table I. Distribution of the sample by gender and age JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 10 NO. 2 2001

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The data were appropriately analysed via independent sample t-tests, pairedsamples t-test for significance of difference between two means, crosstabulations and discriminant analysis to address the research propositions. Given the nature of the sample and the research objective the analytical procedures were considered appropriate and also other studies similar to the present study had also adopted comparable analytical approaches (O'Cass, 2000; Haubl, 1996; Hong and Wyer, 1990). Respondents

The respondents ranged in age from 18 to 27 years (mean = 21.42, standard deviation = 1.41). Close to 52 percent of the respondents were under the age of 22, and 57.5 per cent of the respondents were male students. There were no male students in the sample under the age of 20 as male Singaporeans have to serve a compulsory two-and-a-half-years National Service in the military at the age of 18. About 78 percent of the respondents spent less than S$500 (about A$450 at the average rate of exchange at the time of data collection) every month, and close to 62 percent of the respondents saw more than seven hours of television every week. Though this demographic profile differs from what one might consider to be a representative cross-section of consumers in Singapore, the age range and exposure to commercial marketing activities (through television) associated with young Singaporean consumers suggests that the demographic profile of the sample is representative of the population of interest. The six permutations of the questionnaire (see Table II), three with brands of an eastern origin and three with brands of a western origin, were shuffled and randomly given to the respondents to complete.

Distribution of brands

The distribution of the individual brands (see Table II) to the respondents appear to be reasonable; for example, 51.2 percent of the respondents completed questionnaires that evaluated brands of an eastern origin, compared to 48.8 percent for brands of a western origin. The distribution of the brands between the gender appear to be reasonable as well; with evaluation of brands evenly split between men and women. Results RP1 The research proposition that COBO is more salient (more easily identifiable) than COO was examined by comparing the data on the respondents' perceived COO with the respondents' perceived COBO. Based on the perception of the brand evoked by the brand name and an image of the brand, respondents indicated their knowledge of COBO by responding to a Frequency

Brand

Male

Female

Western orgin Guess? Calvin Klein Benetton Total for western origin (% within gender)

49 42 35 126 (47.7)

33 36 29 98 (50.3)

Eastern origin G2000 Giordano U2 Total for eastern origin (% within gender)

50 43 45 138 (52.3)

30 33 34 97 (49.7)

Table II. Distribution of the sample by brand evaluated 126


dichotomous scale of ``western'' and `èastern'', and their knowledge of COO by writing down the country they thought the brand originated from or is embedded in. Responses towards COO and COBO were visually inspected and coded as ``correct'' (=1) and `ìncorrect'' (=2) in two new variables. Descriptive information of the two variables is presented in Table III. The results indicated that the proportion of respondents who correctly indicated culture-of-brand-origin (84.3 percent) was larger than the proportion of respondents who correctly indicated the country-of-origin (65.1 percent). A paired samples t-test conducted on the means of the two variables confirmed that (classification of COO mean = 1.35 and COBO mean = 1.16, df = 458 ) the t-value was ±8.919 with significant p < 0.001. Also it was noted that no gender differences existed in classification correctness. The likelihood for respondents to indicate COBO correctly was hence significantly higher than the likelihood for them to indicate country-of-origin correctly. Cross-tabs procedure

A cross-tabs procedure was also computed for correct-incorrect classification of western versus eastern brands. The results indicated that the proportion of respondents who indicated COBO correctly when evaluating brands of a western origin (93.75 percent) was higher than the proportion of respondents who did the same when evaluating brands of an eastern origin (75.32 percent). On the other hand, the proportion of respondents who indicated the COO correctly when evaluating brands of a western origin (57.6 percent) was lower than the proportion of respondents who did the same when evaluating brands of an eastern origin as indicated in Table IV. The chi-square test was highly significant (chi-square 83.37, p 0.001, df 1) indicating significant differences in classification of COBO and COO. Thus, Frequency

%

When evaluating brands of a western origin: Perceived culture-of-brand-origin

Correctly Incorrectly Total

210 14 224

93.75 6.25 100.0

When evaluating brands of an eastern origin: Perceived culture-of-brand-origin


177 58 235

75.32 24.68 100.0

When evaluating brands of a western origin: Perceived country-of-origin


129 95 224

57.6 42.4 100.0

When evaluating brands of a western origin: Perceived country-of-origin


171 64 235

72.8 27.2 100.0

Table IV. Comparison of respondents who indicate culture-of-brand-origin correctly

Perceive culture-of-brand-origin correctly? Correctly Incorrectly Total Perceive country-of-origin correctly? Correctly Incorrectly Total

Frequency

%

387 72 459 299 160 459

84.3 15.7 100.0 65.1 34.9 100.0

Table III. Comparison of respondents who indicated country-of-origin and culture-of-brand correctly JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 10 NO. 2 2001

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the two proportions of classification significantly differ between COBO and COO. When examining the specific countries indicated by the respondents as COO for the brands, the results indicated a total of 22 different countries-oforigin for the six brands that they evaluated, revealing a lack of, or confused knowledge, about COO for the brands. There is thus strong support for the research proposition that COBO is more salient (more easily identifiable) than COO information on consumer brand knowledge.

T-tests

Moderate to significant differences

RP2 T-tests were computed to explore the knowledge difference between successful classification and unsuccessful. The independent samples t-test was used to test for significant differences in the subjective knowledge levels of those who classified COO and COBO correctly versus those who classified incorrectly. Table V indicates that moderate to significant difference exists between correct and incorrect classification across both familiarity with the brand and familiarity with the perceived country-of-origin of the brand and culture-of-origin. For example, differences in brand familiarity for COBO were mean score 3.12 for those who correctly identified origin and 2.86 for those who incorrectly classified origin (t-value 1.853, p 0.065). Country familiarity also differed with mean score of 2.79 for those who correctly classified and 2.50 for those who incorrectly classified origin (t-value 2.184, p 0.029). Significant differences were also found for mean scores of familiarity across country-of-origin. For example, brand familiarity mean score for correct country identification was 3.25 and incorrect classification was 2.76 (tvalue 4.843, p 0.001). Also, country familiarity scores differed, with those who correctly identified country-of-origin mean score of country familiarity 2.92 and incorrectly identifying COO mean score of 2.43 (t-value 4.793, p 0.001). The results indicate moderate to significant differences for brand familiarity and country familiarity between those who classify culture-of-brand-origin correctly and those who classify incorrectly. The results indicate significant differences (larger t-values and significance levels) for brand familiarity and country familiarity for correct versus incorrect classified respondents. The differences are much stronger for COO than COBO, indicating that knowledge impacts more on COO classification than COBO. Research proposition 2 is supported in that differences were found in familiarity for classification of COO and COBO with more significant differences at the COO level. t-test for equality of means Sig. Mean t (2-tailed) Culture-of-origin Brand familiarity Country familiarity Country-of-origin Brand familiarity Country familiarity

Right Wrong Right Wrong

3.12 2.86 2.79 2.50

Right Wrong Right Wrong

3.25 2.76 2.92 2.43

Mean difference

1.853

0.065

0.2534

2.184

0.029

0.29

4.843

0.001

0.4948

4.793

0.001

0.49

Table V. Paired samples t-test of culture-of-origin and country-of-origin classification and brand familiarity and country familiarity 128


Two-group discriminant analysis

RP3 To explore the ability of knowledge (brand and country) to predict successful classification of origin of brands a two-group discriminant analysis was undertaken. Understanding of whether subjective country knowledge and subjective brand knowledge contribute to ability to classify the origin of the brand is an important factor that impacts on the viability of COO and COBO utility. Although the basic assumption of discriminant analysis is that the discriminators follow multivariate normal distributions in each group with equal covariance matrixes, the discriminant analysis model is quite robust in reality, and has been known to retain its integrity even when assumptions of multivariate normality are not met. In such cases, discriminant analysis is found to give useful results (Jackson, 1983) and is an acceptable analytical procedure. Both variables were entered simultaneously in the discriminant analysis so as to determine which were the best discriminators, after controlling for the other variable (Jackson, 1983). This simultaneous test was the most rigorous approach to discriminant analysis and allowed the determination of the most significant contributor among the types of subjective knowledge, while controlling for the other. Country- of-origin and culture-of-brand-origin groups were obtained by grouping the responses according to correctness of classification; 1 for right classification and 2 for wrong classification and the independent variables (interval scaled) of subjective brand knowledge and subjective country knowledge were used as predictors of classification correctness. Culture-of-brand-origin was computed first, followed by country-of-origin. In both analyses, the discriminant functions were significant (chi square [cultureof-brand-origin] = 5.414, df = 2; p = 0.067, wilks' lambda 0.988; chi square [country-of-origin] = 28.57; df = 2; p = 0.001, wilks' lambda 0.939 ). Table VI gives the correlations between each discriminating variable and its respective discriminant function (culture-of-brand-origin and country-of-brand-origin) and equality of group means, F values and significance levels. There is support for Research proposition 3 with brand knowledge and country knowledge being strong predictors of COO and COBO. Interestingly, the results indicate that knowledge (brand and country) are stronger predictors of COO than COBO, in that knowledge has a stronger effect on COO classification than on COBO.

Confusion matrix

To assess how effectively the derived discriminant functions were able to classify cases, a confusion matrix was generated applying the jackknife (leave-one-out) method for classification (Crask and Perreault, 1977). For culture-of-brand-origin and subjective knowledge (country knowledge and brand knowledge), 84.2 percent of the grouped cases were correctly classified. For country-of-origin and subjective knowledge, 67.6 percent of the grouped cases were correctly classified. The results indicate strong predictive power for classification based on knowledge levels as expected. Discussion Central to the value of this study was the research proposition that COBO is just as relevant as COO as an extrinsic brand cue in international brand consumption decisions by consumers. This proposition suggested changes on two dimensions in origin effects as a source of information in brand consumption decisions. Familiarity Country familiarity Brand familiarity

Culture-of-brand-origin Correlations F P< 0.935 0.812

4.77 3.60

0.029 0.059

Country-of-brand-origin Correlations F P< 0.882 0.869

22.97 22.34

0.001 0.001

Table VI. Discriminant analysis familiarity effects on brand classification JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 10 NO. 2 2001

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First, it is argued that the proliferation of hybrid products has prompted a shift of origin effects from the product to the brand. This dimension of the proposition has lately gained researchers' attention (e.g. Lee and Ganesh, 1999; Nebanzahl and Jaffe, 1997; Thakor and Kohli, 1996; Chao, 1993), and has most recently been empirically examined by Lee and Bae (1999) in a study of SouthKorean consumers. Second, it is believed that the confusing effect of attaining information on specific COO for hybrid products has prompted consumers to assimilate origin information into a cultural dimension. Multidimensional concept of COO effects

This multidimensional concept of COO effects on goods and services was proposed and in examining the research proposition, the brands used for evaluation in this study were communicated to the respondents in their generic form; in that no other information ± extrinsic or intrinsic ± about the brands' products, country-of-origin, or quality was conveyed. An image used by each brand and its brand name were the only information provided in the questionnaires. In undergoing a rigorous selection process for the brands that involved three focus groups and a list of criteria, the study ensured that the brands chosen, as well as an image used as stimuli, were representative of their brand images. This was conceptually similar in manner to a study done by Dodds et al. (1991), who suggested that to give specific information about the brand ``may direct the study to be more of a test of familiarity than of the quality information inherent in the brand perceptions''. Without information about the products, country-of-origin, or quality of the brand, the respondents' prior perception of the brand was the only cue available in responding to the questionnaire. Nevertheless, it was found in this study that young consumers in Singapore perceived COBO significantly more accurately than COO for the brands. The discussion of the possibility that COO information is increasingly difficult to extract was also illustrated by the Singaporean respondents' inability to indicate the specific country they perceive the brands to be made in. On this, a spread of 22 different countries was indicated as the origin that the brands were made in, indicating a high level of confusion in using COO as a source of information. The findings provide support to the proposition that the culture rather than the country, of the brand rather than the product, is used by consumers to extract extrinsic cues about the products they encounter in the marketplace.

Cognitive assessment

Taken together, the two dimensions inherent in the propositions suggest an important change in the cognitive manner with which consumers assess a product. This finding is significant for its implications on the marketing activities undertaken by global corporations for their brands. If internationalisation of company operations and the proliferation of hybrid products are the obvious reasons for this development, it is apparent that consumers will increasingly draw information about a brand's origin on a cultural dimension, as the global marketplace becomes more intertwined by technology and legislature. If the value of a brand name lies in its acceptance by consumers as a simple manner to infer product quality (Olsen and Jacoby, 1972), then the informational cues communicated by the brand name must naturally be clear and simple for its consumers. Amidst growing concern (Al-Sulaiti and Baker, 1998, p. 150) that ``the growth of multinational companies and the evaluation of hybrid products have in many cases blurred the accuracy, or validity'' of COO information (Baker and Michie, 1995; Braughn and Yaprak, 1993; Chao, 1993; Yaprak and Braughn, 1991), the concept of COBO is argued here to provide the next wave of understanding in how consumers perceive and evaluate brands.

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Limitations The use of the student sample in this study was primarily driven by the focus on examining young consumers and convenience of accessibility for data collection. While it has been strongly argued that student samples are appropriate for the testing of theories (Calder et al., 1981), they are also known to be more susceptible to the views, ideas and products of other cultures than older segments of society (Netemeyer et al., 1991), possibly resulting in ethnocentric tendencies that are different to that reflected in the population. Caution

For the same reason that the sample represents only consumers sharing similar characteristics, the generalising of findings in this study to other countries within the region of Southeast Asia should be undertaken with some caution. There are also limitations from the use of a single product class (although six brands were used). However, many other studies have used single products and particularly fashion clothing (Browne and Kaldenberg, 1997; Auty and Elliott, 1998; O'Cass, 2000). Future research Future research into brand associations and brand origins should focus on different products within Asian countries and use non-student samples. It should also look to examining some of the measures that are used here, particularly brand familiarity and country familiarity for measurement development and differences across cultures and origin perceptions. With the current body of research on country-of-origin and various brand associations influenced by it, the finding of this study also suggests a need to revisit some of these associations. For example, would the perception that a brand originated from a western origin influence the associations attached to the brand? Would consumer preference be influenced by culture-of-brand-origin? Finally, the implications of a higher degree of correctness in classification of COBO, as well as a higher level of familiarity for western brands as opposed to eastern brands, warrant further study if only for its commercial value to western corporations attempting to succeed in Asia.

Perceived culture

Conclusion This study has contributed in two ways to current understanding in the discipline of branding. It has explored the possibility of a change in the way consumers extract origin information from brands and the salience of origin to consumers; and it has examined the influence of knowledge levels on this process. The findings revealed that there has indeed been an assimilation of origin information from individual countries into a cultural dimension. For the simple fact that origin information has become confusing in an age of globalisation, consumers no longer use country-of-origin as a source of information about a product's quality. Instead, it is highly likely that consumers now use the perceived culture of a brand's origin to provide the information they traditionally extracted from country-of-origin. This theory has been supported by the findings of this study on young Singaporean consumers. This study also revealed that consumer knowledge levels toward a brand influence how accurately a consumer extracts information about the brand's origin. Generally, a higher level of knowledge towards a brand is possessed by a consumer who correctly extracts country-of-origin information, when compared to the knowledge level possessed by a consumer who correctly extracts culture-ofbrand-origin information about a brand. It is reasonable to infer that the cultural origin of a brand is indeed easier to extract than the country-of-origin, and is thus a more effective form of marketing in the current era of hybrid products.


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This summary has been provided to allow managers and executives a rapid appreciation of the content of this article. Those with a particular interest in the topic covered may then read the article in toto to take advantage of the more comprehensive description of the research undertaken and its results to get the full benefit of the material present

Executive summary and implications for managers and executives Asian brands - can they become international brands? Traditional preconceptions and prejudices about the places where products originate (and hence those products) are, as Lim and O'Cass describe, confused in the modern marketplace since ``. . .products are typically designed in one country, manufactured in another and assembled in yet a third''. We simply don't know (or at least find it difficult to know) just where a particular product is made. As a result of this development ± and such ``hybrid'' products will become more and more dominant ± we fall back on short cuts for our prejudices. The result is that ``. . .the culture rather than the country of the brand rather than the product is used by consumers to extract extrinsic cues about the products they encounter in the marketplace''. And, such cultural prejudices are as significant as national prejudices. Why no big Asian brands? Lim and O'Cass ask why it is that `à region making up nearly half of the world's population and caught by a feverish consumerism has so few successful global brands''? Part of the reason lies, no doubt, in the recent nature of East Asia's consumer boom but much can be made of a preference for brands from the sophisticated West. Country-of-origin research, we read, has revealed two crucial facts about how the origin of a product influences consumer behaviour ± people tend to prefer products from their home country and have a more negative perception of brands from `èmerging economies''. Thus while Singaporean consumers have a sneaking preference for local products, they will prefer US or European brands rather than those from other Asian economies. The challenge for Asian brand owners becomes bigger when the strength of consumer prejudice in Western economies is considered. The country-oforigin effect's two main effects must be reinforced ± home preference coupled with a preference for brands from developed economies. However, the experience of Japanese brands over the past 30 years or so, does give Asian manufacturers some comfort. Japanese brands have shifted from the ``cheap and cheerful'' end of the market to a much stronger position especially in the manufacture of consumer electronics and motor vehicles. Underdevelopment or cultural prejudice? For Asian brand owners to progress, however, they need to understand whether the barrier is due mainly to perceptions associated with underdevelopment or to perceptions associated with Asian cultures. Lim and O'Cass reveal that culture is a better cue than country-of-origin ± but this is perceived culture rather than actual culture-of-origin. Moreover, the country-of-origin question is now so blurred that marketers will get a better picture from the use of culture ± even the simple WesternEastern distinction used by Lim and O'Cass ± than they will from asking about country-of-origin. Lim and O'Cass underline this view by revealing the range of countries that Singaporean consumers attributed certain brands to. Put simply, we make judgments about products by reference to the brand and it is the national or cultural associations of that brand that matter rather


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than the precise details of product manufacture. No-one doubts that CocaCola is an American brand but the bottling of Coca-Cola takes place locally. It is the cultural associations of the brand that matter. It would not seem unreasonable to suggest that the degree of technical sophistication of a given product will militate against brands from an emerging economy. It would not be too much of a leap to suggest that the Brazilian-assembled VW Fox would have different associations if the same vehicle carried a Brazilian brand instead. Brand imperialism and developing economies When the Western brand owner shifts production to lower cost locations in developing countries, the brand identity is retained. Most of these developing countries (the sensible ones at least) welcome this investment since it brings jobs, skills and money into the local economy. But, at the brand level what we have might be described as `ìmperialism''. Emerging local brands are squeezed out by the powerful Western brand. The developing country is caught in a dilemma. On the one hand the industrial development helps to drive economic development, reduces the need to increase debt and proves popular with local people. But, at the same time, the development of independent indigenous brands atrophies. Industrial development might be the right choice for the economy in the short-term but it raises the prospect of creating a developed economy (as Singapore has done) with a paucity of strong local brands. Since, brands are the lifeblood of the developed economy, providing the crucial cues for consumers, the transformation to a successful economy requires strong brands. Focusing on cultural homogeneity If we accept that national brands are preferred, then we should find a similar prejudice towards brands from an associated culture. Chinese brands should not prove a problem for Singaporean consumers and vice versa. On the other hand cultural differences may present problems. We cannot make the assumption that a supposedly `Àsian'' culture presupposes consumer attraction to ``Chinese'' brands. There are cultural similarities between Singapore and Malaysia but there are also massive differences not least from the influence of Islam in Malaysia (and for that matter Indonesia). Nevertheless, successful domestic brands can spread more easily to places where the local culture has similarities to the culture of the brand-owners society. The leap to a Western society with very difference mores reduces the opportunity for brand success. In time, international brands will develop in countries such as Singapore but there is no simple means of driving success. And, in the meantime, the dominant US and European brands will be extremely difficult to displace from their place at the top of the international brand ``league''. (A preÂcis of the article ``Consumer brand classifications: an assessment of culture-of-origin versus country-of-origin''. Supplied by Marketing Consultants for MCB University Press.)

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