Academic journal article Management & Marketing

The Analysis of Conceptual Tools for the Study of Country of Origin Effect for Hybrid Offerings

Academic journal article Management & Marketing

The Analysis of Conceptual Tools for the Study of Country of Origin Effect for Hybrid Offerings

Article excerpt

Abstract. This paper envisages to analyze theories related to the study of the Country of Origin Effect (COE), specifically in relationship with two types of products: tangible goods and services. It starts from the growing international character of different types of products and from the necessity that companies with international activity to consider the COE concepts when deciding on their competitive advantages. The paper looks at theories on COE for the so-called hybrid products, both for tangible goods and intangible services. Further, it illustrates the existing similarities and differences between the concepts, emphasizing on corresponding consequences for international marketing decisions.

Keywords: country of origin effect, hybrid products, international hybrid services, international marketing.

1. Introduction

The large increase in international trade and in the internationalization of companies, that took place in the last years resulted in a wider presence of products with different national origins in many markets of the world. It is also largely acknowledged in the literature that the country of origin serves as a cue from which the consumer appreciates the products' attributes. The country of origin is used by consumers to evaluate the product's quality and performance (Khan and Bamber, 2008). In recent times, products do not belong anymore to just one country. The fact that companies decide to manufacture products in other countries for cost reasons determined the existence of products that have more origins than just one country. In this context it is useful to study how the use of COE as a criterion in the product's evaluation relates to the multiple origins of different products, and how companies can use it at their advantage, as it is considered that the country of origin image has become one of the key factors in creating and maintaining competitive advantage (Vrontis and Thrassou, 2007).

2. Defining country of origin effect

The importance that the origin of a product has, when the product is sold internationally, in terms of both possible positive or negative effects, suggests that the aspect has to be carefully monitored by companies. But first what is the country of origin effect (COE)?

The country of origin effect on consumer perception and buying decisions has been of interest for a long time to marketing researchers. The topic has drawn attention in the literature since the 1960s. Among the first authors who studied the subject were Schooler (1965) and Reierson (1966). Schooler (1965) was the first to initiate the country of origin effect research, focusing on determining whether the construct of the country of origin effect actually existed or not. He found that there is a COE and he defined it, as referring to when consumer rely on country of origin information as a basis to judge the quality of a product. Reierson (1966) indicated the need for the country of origin research to take into consideration the nature of national stereotypes. He found that the country of origin effect was present for general products, classes of products and specific products. A few years later, Nagashima (1970, 1977) focused on the dynamic rather than static country image, by conducting longitudinal studies. In the meantime, numerous studies have been conducted about the country of origin effect focusing on different aspects of the COE, different types of products and different countries and regions of the world (Heslop and Papadopoulos, 1993; Laroche, Papadopoulos, Heslop and Bergeron, 2003; Poon, Evangelistica and Albaum, 2010). These studies also tried to define and re-define the COE. More recently Johansson (2000), defined the COE as being "the picture, the reputation, the stereotype that businessmen and consumers attach to products from a certain country" and Verlegh and Steenkamp (1999) emphasize the affective character of the process by defining the country of origin as a stereotype-driven attribute that links the product to positive and/or negative emotional associations with particular nations. …

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