The effects of brand origin and country-of-manufacture on consumers' institutional perceptions and purchase decision-making

Shijiao Chen, Malcolm Wright, Hongzhi Gao, Huan Liu, Damien Mather

Research output: Contribution to journalArticlepeer-review

2 Citations (Scopus)

Abstract

Purpose: Industry-wide crises involving consumer products place consumers at risk. Consumers rely on institutions that constrain corporate practice and control product quality to reduce risk. As institutions vary by country, country-of-origin (COO) acts as a salient cue for consumers to identify institutional quality and thus evaluate risk when making purchase decisions. However, in the era of globalisation, identification of institutional quality becomes complex as global value chains involve different countries such as brand origin (BO) and country-of-manufacture (COM). Therefore, this research investigates how BO and COM individually and jointly affect consumers' institutional perceptions and subsequent purchase decision-making in the presence of systemic risk.

Design/methodology/approach: This research includes three studies (n = 764) employing surveys and choice modelling experiments with samples from China and the USA.

Findings: The results show that BO and COM relate to different institutional perceptions. BO evokes perceptions of legitimacy and the regulatory environment, while COM evokes perceptions of the normative and the regulatory environment. The combination of BO and COM determines how institutional quality is communicated and further affects consumers' legitimacy perceptions, preferences and willingness to pay a price premium.

Originality/value: This research contributes to understanding the effect of BO and COM in the context of complex value chains from an institutional perspective. It also provides implications for leveraging complex COO cues with BO and COM information to improve consumers' institutional perceptions.
Original languageEnglish
Pages (from-to)343-366
Number of pages24
JournalInternational Marketing Review
Volume38
Issue number2
Early online date28 Aug 2020
DOIs
Publication statusPublished - 6 Apr 2021

Keywords

  • Brand origin
  • Consumer behaviour
  • Country-of-manufacture
  • Institutions
  • Legitimacy

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