Initial Results By R. Mohan Pisharodi And Ravi Parameswaran

The globalization of markets since the 80's has enhanced the urgency of research on the impact of country-of-origin image (CO) in cross-national consumer behavior. A rich harvest of such studies has consequently been generated. Prior weaknesses in such studies, such as poor handling of a complex construct, single cue studies and lack of methodological rigor, are being addressed. This study is in the genre of such research where the nature and dimensionality of the CO construct is examined using confirmatory factor analysis. Findings suggest that the theorized structure needs modification. Critical reviews on country-of-origin (CO) studies have identified several major inadequacies which have thus far prevented a definitive identification of the precise nature of the impact of CO in influencing purchase behavior. How complex is the construct? In other words, what is its dimensionality? The focus of this study is a rigorous examination of the nature of the country-of-origin construct and a confirmation of the scales that have been developed to measure it. The relative importance of country and general product image (GCA, GPA) cues in shaping purchase behavior is not entirely clear based on past research.

Johansson, Douglas, and Nonaka (1985) claimed that the CO effect, as a result of single cue studies, may be overstated and that its effects may be contaminated by the effect of other cues. Heslop, Liefeld and Wall (1987) stated that the CO effect gained in strength with product complexity, increased risk, and decreased purchase frequency. Bilkey and Nes (1982) reported that a negative CO image was not overcome by a well known brand name. An extensive literature search was conducted in the design of the questionnaire that was used in this study. Data were gathered from the adult population of a large midwestern metropolitan area which is highly heterogenous in terms of ethnic composition. These people represented the then current and potential users of automobiles -- both domestic and foreign. In order to adequately capture the ethnic flavor of the metropolitan area, relevant ethnic associations were contacted, membership lists acquired and representative samples selected therefrom.

Blank questionnaires were hand delivered to the selected respondents and completed questionnaires were collected within the next two weeks. In order to achieve a high response rate, the president/committee members of these associations were approached and requested to encourage their members to participate. A total of 678 completed and useable questionnaires were returned from the 1025 that were originally placed, a 66% response rate. A second objective of the statistical analysis presented in this paper was to respecify the measurement model (if necessary) through an understanding of the dimensionality of the three concepts of interest. Maximum likelihood estimation procedures available in the statistical package LISREL 7 (Joreskog and Sorbom 1989) were used for the application of the full information method. The covariances in the input data set were tested against the covariances expected as the result of the a priori specified model. When the parameters of the model are estimated through the method of maximum likelihood (an option in LISREL), the differences between the relationships reflected in the data and those specified by theory are tested using a chi-square statistic.

The chi-square statistic tests the overall fit of the model to data, smaller values of the statistic typically representing better fit. Oblique centroid multiple groups factor analysis (MGRP) available in the statistical package ITAN (Gerbing and Hunter 1988) was used for the application of the limited information method. The process of model respecification described in this paper was strongly driven by theory. In other words, model respecification based purely on data (and possessing no theoretical rationale) was avoided. The initial model (Figure 1) consisted of three constructs (unobservable variables): GCA, GPA, and SPA, and 40 indicators (observable variables). GCA was measured using 12 indicators, GPA by 18 indicators, and SPA through 10 indicators. The indicators of goodness-of-fit obtained through the analysis of the model using LISREL 7 indicated a very poor fit (Table 2). The poor fit was also reflected in large standardized residuals and modification indices. Similarly, the inter-item correlations generated by ITAN indicated the three constructs were being measured using indicators which lacked internal consistency.

Initial Results By R. Mohan Pisharodi And Ravi Parameswaran

Country-of-Origin (CO) is a potentially powerful image variable which may be used to influence competitive positioning and success in the global market-place. A weakness in CO research and implementation is to treat a country's consumers as homogenous. Dividing the country market into its natural segments before studying CO perceptions would be an added advantage. The current study segments the market by immigrant status (foreign born, first generation, and local ancestry) to study the impact of acculturation and socialization on perception of foreign products. Findings reveal subtle differences in how these groups perceive foreign products. Country-of-Origin (CO) image refers to "buyers' opinions regarding the relative qualities of goods and services produced in various countries" (Bilkey 1993, p. An indication of the importance of country-of-origin images in international marketing strategy can be gauged by the sheer volume of research on the topic. Consumer perceptions of foreign products have been examined from a wide variety of perspectives.

A significant segmenting variable in the study of country-of-origin images is ethnicity, ancestry or national origin. An interesting question relating to country-of-origin images in a country like the U.S. If it does, what is the impact of the length of domicile (in a country) on the person's perceptions about foreign products? In other words, what are the impacts of consumer socialization and acculturation on the perception of foreign products? Consumer socialization and acculturation refer to "the acquisition of consumption related cognitions, attitudes and behavior" (Engel, Blackwell and Miniard, 1993, p. The current study attempts to answer some of these questions. The purpose of this study is to address some of the issues raised in the above discussion. SPA). This three-factor conceptualization of the CO construct forms the basis of our current investigation. Data were gathered from the adult population of a large midwestern metropolitan area which is highly heterogenous in terms of ethnic (national origin) composition.

Blank questionnaires were hand delivered to the selected (systematic sampling procedure) respondents comprising the relevant sampling population (namely immigrant, first generation and US consumers) and completed questionnaires were collected within the next two weeks. A total of 678 completed and useable questionnaires were returned from the 1025 that were originally placed, a 66% response rate. The statistical analysis of data consisted of three steps: the purification of the measurement model, the analysis of CO effects within the proposed model, and the assessment of the impact of socialization and acculturation on CO effects. The indicators used to measure the underlying theoretical structure of the CO construct were analyzed for unidimensionality and reliability using ITAN (Gerbing and Hunter 1988), a statistical package for item analysis with correlational data. ITAN has the capability of using multiple groups confirmatory factor analysis (MGRP) and generates inter-item correlations, item-factor loadings, factor-factor loadings, and standardized coefficient alpha.

The output generated by ITAN can be used to evaluate internal and external consistencyCtwo statistical criteria for establishing the unidimensionality of the indicators of a construct. The measures were partitioned a priori into three different sets measuring GCA, GPA, SPA, and one indicator measuring IP (Intention to Purchase). 678), indicators were dropped and reclustered progressively until smaller sets of measures reflecting fairly high degrees of unidimensionality and reliability were identified. Two dimensions underlying GCA perceptions were identified. Volkswagen Jetta (Germany). The same procedure resulted in the selection of sets of indicators representing the dimensions underlying GPA perceptions of all the respondents for both makes of car. The first dimension (labeled GPA1) consisted of a set of indicators measuring negatively oriented product attributes which Hong and Wyer (1989) term undesirable attributes. This occurred although the directions of these indicators had been reversed earlier through appropriate data transformation. The second and third consisted of indicators measuring positively oriented product attributes. The results of ITAN analysis of the indicators of SPA did not yield multiple dimensions in any of the data sets studied.

LISREL analysis was employed as a complementary technique to ITAN in the process of respecification. In M1, IP is the dependent variable and the other six variables are independent. In M2, SPA is an intervening variable with IP as the dependent variable and the rest as independent variables. The final model (M3) is presented in Figure 1a with selected structural notations and estimates. The chi-square statistic generated by the models do not indicate a good fit of any of the final models to their respective data. 0.05) indicating that relaxing the structural links significantly improves the fit between the specified models and their respective data. In order to assess the impact of socialization and acculturation, as previously mentioned, the data set was subdivided into three categories: immigrants, first generation, and US consumers. The differences between the first two categories would highlight the acculturation effect and the differences between the last two categories would highlight the socialization effect. The measurement model and the structural equation model used for analyzing CO effects (M3: the final model) were applied to the three subsamples with no alteration.