Procedia - Social and Behavioral Sciences 156 ( 2014 )

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1 Available online at ScienceDirect Procedia - Social and Behavioral Sciences 156 ( 2014 ) th International Scientific Conference; Economics and Management 2014, ICEM 2014, April 2014, Riga, Latvia Consumer ethnocentrism and behavior in a market of dietary supplements Ingrida Šmaižien a *, Rimgail Vaitkien b a, b Kaunas University of Technology, K. Donelai io g. 73, LT Kaunas, Lithuania Abstract The study discloses the relationship between consumer ethnocentrism (CE) and behavior in the Lithuanian market of dietary supplements. The correlation between the CE level and consumers demographic characteristics, as well as consumers perceptions on quality and safety of local-made and imported dietary supplements are discussed. The relationship between the CE level and factors influencing purchase decisions is presented and discussed 2014 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license ( Keywords: Consumer ethnocentrism; country of origin; consumer behavior; product perception. 1. Introduction Despite the growing consumer cosmopolitism and openness to foreign products, consumer ethnocentrism (CE) remains a significant issue in researching consumer behavior. CE refers to consumer perceptions that buying foreign-made products is inappropriate, immoral and may hurt national businesses and employment (Shimp & Sharma, 1987; Auruskeviciene et al., 2012). Transferred to economic actions, such CE attitudes effect consumers perceptions of national and imported products, as well as purchase decisions (Kaynak & Kara, 2002). Previous studies on CE explore consumers ethnocentric feelings not only as a drive of the moral obligation to buy local-made products, but also as a determinant of product perceptions (Pecotich & Rosenthal, 2001; Smaiziene * Corresponding author. Tel.: address: ingrida.smaiziene@ktu.lt The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license ( doi: /j.sbspro

2 464 Ingrida Šmaižienė and Rimgailė Vaitkienė / Procedia - Social and Behavioral Sciences 156 ( 2014 ) & Vaitkiene, 2013). High level of CE is related to rating the domestic products higher (Acharya & Elliott, 2003; Carpenter et al., 2013) and even paying premium prices for them (Drozdenko & Jensen, 2009). Consumers high in ethnocentrism are tend to treat imported products as the ones with lower quality and decreased equity (Shankarmahesh, 2006; Saffu et al., 2010). In the marketplace, strong ethnocentric attitudes might lead to overestimation of domestic products or underestimation of foreign-made products (Sharma et al., 1995; Cumberland et al., 2010). Furthermore, the findings of Watson and Wright (2000) indicate that ethnocentric consumers are more likely to buy products made in close countries, if locally-made products are not available (Evanschitzky et al., 2008). It is possible to make the premise that ethnocentric consumers have more favorable perceptions of the products produced in geographically and culturally close countries. The previous research suggest that CE might be used for predicting the importance placed on a product s countryof origin in comparison to other intrinsic and extrinsic attributes of a product (Mockaitis et al., 2013). Consumers high in ethnocentrism pay more attention to the country-of-origin cue (Cumberland et al., 2010). Non-ethnocentric consumers are less concerned about the product s country-of-origin and pay more attention to other intrinsic and extrinsic cues (Cumberland et al., 2010); as such consumers do not feel any moral obligation to purchase domestic products (Acharya & Elliott, 2003; Saffu et al., 2010). The level of CE is tightly related to consumers demographic characteristics (Erdogan & Uzkurt, 2010; Siemieniako et al., 2011; Josiassen et al., 2011; Mockaitis et al., 2013). Furthermore, the empirical findings of previous researches suggest CE manifests in a different way in various markets. This calls for a product-specific and regional-specific approach while analyzing the phenomenon of CE. Product-specific approach leads to considering that consumers are more sensitive to country-of-origin of the products that are consumed directly (Drozdenko & Jensen, 2009) food, drinks, toothpaste, etc. In this research, the market of dietary supplements was chosen, as the dietary supplements present a group of products that are consumed directly and are related to more physical risk when compared to other groups of products. Regional-specific approach leads to searching some common tendencies among the countries with similar characteristics. In post-soviet countries, the consumer values and attitudes, including consumer ethnocentrism, were inevitably shaped by such factors as centrally planned economy, limited imports and lack of international competition, high consumption of national products, limited advertising and sales promotion techniques in the past (Reardon et al., 2005; Kreckova et al., 2012), as well as recent liberalization of economies and integration into the European Union. In this research, Lithuanian market was chosen as an example of post-soviet country and transitioning economy in the Central and Eastern Europe. The research problem discussed in the paper: what is the relationship between the consumer ethnocentrism and consumer behavior in a Lithuanian market of dietary supplements. This study aims to disclose the relationship between the consumer ethnocentrism and behavior in a Lithuanian market of dietary supplements. The following research questions are being discussed in the study: what is the relationship between CE and consumer demographic characteristics; what is the relationship between CE and consumer perceptions of domestic and imported products; what is the relationship between the CE and the importance of factors influencing purchase decisions; what is the relationship between the CE and sort of information searched during the purchase process in the market of dietary supplements. The research method applied are consumer survey (N=352) and statistical analysis. 2. Method Data for this study was collected by means of coordinated survey online and survey in written form throughout Lithuania in April The sample consists of 352 consumers. The CE level was measured with the help of consumer ethnocentric tendencies scale (CETSCALE) developed by Shimp and Sharma (1987). The original version of 17-item CETSCALE was modified and shortened to the 12-item scale. On the basis of the data collected by means of this scale, four groups of respondents having different ethnocentric attitudes were distinguished from low CE to high CE. In order to survey consumers perceptions about the quality of dietary supplements manufactured in Lithuania and foreign countries, seven-point scale was used (1-very low quality, 7-very high quality). For surveying consumer s perceptions about the safety of domestic and imported dietary supplements the three-point scale was

3 Ingrida Šmaižienė and Rimgailė Vaitkienė / Procedia - Social and Behavioral Sciences 156 ( 2014 ) used (1-not safe to use a product, 2-doubt about a product safety, 3-confident about a product safety). The ten-point scale was used to determine the importance of country-of-origin in comparison with other factors influencing purchase decisions (1-absolutely unimportant, 10-very important). Five-point scale was used for identifying the type of information that is being searched most often on the packages while choosing dietary supplements for purchasing (1-never read, 5-always read). The correlation between the CE level and consumers demographic characteristics, product perceptions and factors influencing purchase decisions was analyzed. 3. Results When analyzing the research data, the statistically significant negative correlation between the CE level and household income has been identified (r=-0.191). Referring to this data, in a Lithuanian market of dietary supplements, consumers with low income have stronger ethnocentric attitudes. No statistically reliable correlations between CE level and consumers age, as well as CE level and consumers education, have been identified. Table 1. Correlation between CE and perceptions on the quality and safety of dietary supplements Correlation between CE and product quality Correlation between CE and product safety perceptions perceptions Dietary supplements Correlation Coefficient Sig. (2-tailed) Correlation Coefficient Sig. (2-tailed) manufactured in. USA -,266 **,001 -,053,483 Great Britain -,247 **,005 -,179 *,044 Germany -,203 **,006 -,054,483 Switzerland -,181 *,039 -,095,252 Japan -,153,173 -,255 **,006 Netherlands -,148,245 -,255 **,009 Scandinavian countries -,120,148 -,194 *,017 Belgium -,037,755 -,212 *,026 Slovenia -,020,854 -,004,965 France,009,932 -,179 *,044 Poland,059,540 -,004,965 Russia,074,350 -,024,744 China,076,489 -,118,179 Lithuania,178 **,008,109,113 Ukraine,183,094,086,344 India,233 *,040 -,008,934 The performed correlation analysis (Table 1) shows statistically significant negative correlation between CE level and consumers perceptions on the quality of dietary supplements produced in developed economies (Germany, Switzerland, USA, Great Britain) (respectively r=-0.203; ; ; ). The statistically reliable positive correlation between consumer ethnocentrism and perceptions of dietary supplements manufactured in Lithuania, as well as India, have been identified (r=0.178 and 0.233). Statistically significant correlation have been found between the CE level and perceptions on safety of dietary supplements manufactured in Scandinavian countries, France, Japan, Belgium and Netherlands (respectively r= ; ; ; ; ). On the basis of performed analysis of correlation between CE level and the importance of the factors influencing decisions of purchasing dietary supplements (Table 2), statistically reliable positive correlation have been identified between CE and importance of price (r=0.142), offered discount (r=0.218), doctor s recommendations (r=0.189), recommendations of a pharmacist (r=0.206), large amount for reasonable price (r=0.166), Lithuanian brand name (r=0.401), advertising (r=0.247), attractive packaging (0,212) and comprehensive presentation on TV, radio or in press (r=0.185). There have been identified no statistically significant correlation between the level of consumer ethnocentrism and the importance of product s country of origin when choosing dietary supplements.

4 466 Ingrida Šmaižienė and Rimgailė Vaitkienė / Procedia - Social and Behavioral Sciences 156 ( 2014 ) Table 2. Correlation between CE and the importance of the factors influencing decisions of purchasing dietary supplements Factors influencing purchase decisions Correlation Coefficient Sig. (2-tailed) Factors influencing purchase decisions Correlation Coefficient Sig. (2-tailed) Lithuanian brand name,401 **,000 Recommendations of friends and,102,070 acquaintances Advertising,247 **,000 Number and variety of supplements,098,081 in a product Offered discount,218 **,000 How many capsules per day it is,086,130 necessary to apply Attractive packaging,212 **,000 How many times per day it is,080,155 necessary to apply Recommendations of a pharmacist,206 **,000 Large amount of the active,082,145 substance of interest Doctor s recommendations,189 **,001 Expiry date,059,294 Comprehensive presentation on TV,,185 **,001 Product ecology,023,677 radio or in press Large amount for reasonable price,166 **,003 Naturalness -,001,981 Price,142 *,010 Well-known brand -,022,689 Consumers comments in the,106,060 Product s country of origin -,034,544 Internet When analyzing correlation between the level of consumer ethnocentrism and search for the particular information on the package while purchasing dietary supplements, there have not been identified any statistically significant correlation between CE and consumers search for the information about the product s country-of-origin. Statistically significant positive relations have been identified between the level of consumer ethnocentrism and search for a brand name, information about ingredients, producer and indications (correlation coefficients are 1.55; 0.248; 0.133; respectively). 4. Conclusions The results of the research in the market of dietary supplement verify the theoretical approach that consumers with low income have stronger ethnocentric attitudes. The empirical findings indicate that consumers with low level of ethnocentrism have more favorable perceptions about the quality of dietary supplements manufactured in developed economies. Yet, the research data suggest that consumers with low level of ethnocentrism are keener to doubt about the safety of dietary supplements regardless their country of production. The research results indicate that consumers with high level of consumer ethnocentrism have more favorable perceptions on the quality of dietary supplements produced in Lithuania. Consumers high in ethnocentrism do not have more favorable perceptions of dietary supplements manufactured in geographically and culturally close countries, in comparison with the perceptions of consumers with lower level of consumer ethnocentrism. The positive correlation between consumer ethnocentrism and perceptions of dietary supplements produced in India might be explained by the relatively low prices of Indian dietary supplements and low income of consumers high in ethnocentrism. While making purchase decisions in the market of dietary supplements, for consumers high in ethnocentrism the most important factors are the ones related to prices and such external cues as recommendations of a doctor or pharmacist, presentation in media and advertising. In the process of purchasing, consumers with high level of ethnocentrism more often search for a brand and producer s name than for a country-of-origin cue. References Acharya, Ch. & Elliott, G. (2003) Consumer Ethnocentrism, Perceived Product Quality and Choice-An Empirical Investigation. Journal of International Consumer Marketing, 15, Auruskeviciene, V., Vianelli, D. & Reardon, J. (2012). Comparison of consumer ethnocentrism. Transformations in Business & Economics, 11, Carpenter, J. M., Moore, M., Alexander, N. & Doherty, A. M. (2013). Consumer demographics, ethnocentrism, cultural values, and acculturation to the global consumer culture: A retail perspective. Journal of Marketing Management, 29,

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