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1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCeng*, Meng Su, and L. Robin Keller42644♦Corresponding author.Luping Sun is Assistant Professor of Marketing. Central University of Finance and Economics (e-mail: sunluping@cufe.edu.cn). Xiaona Zheng is Associate Professor, Department of Management Science and Information Systems, Peking University ( Kelly-F07-Bankruptcy_Remote_Presentation.DOCe-mail: xzheng@gsm.pku.edu.cn). Meng Su is Research Professor, Marketing Department. Peking University (e-mail: sumeng@gsm.pku.edu.cn). L. Robin KelleKelly-F07-Bankruptcy_Remote_Presentation.DOC
r is Professor. Operations & Decision Technologies. University of California, Irvine (e-mail: LRKeller@uci.edu).Professor Xiaona Zheng serves as the c1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOC thoughtful and constructive comments, which helped improve the paper significantly. The authors also thank Dr. Ying Jin for her contribution during the early stage of this research, and Professor Shaoming Zou from University of Missouri - Columbia for his helpful suggestions. The authors gratefully Kelly-F07-Bankruptcy_Remote_Presentation.DOC acknowledge data and financial support from General Motors Corporation. This research was also supported by the National Natural Science Foundation oKelly-F07-Bankruptcy_Remote_Presentation.DOC
f China (Grant No. 71172032, 71502182, 71332006, and 71272039) and the Fundamental Research Funds for the Central Universities.https://khothuvien.cori1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOC purchase intention. However, consumers intending to buy a product may switch to competing brands, displaying an intention-behavior discrepancy (IBD). Drawing upon literature on country associations and dual process theory, we examine the performance of foreign versus domestic brands on IBD in emerg Kelly-F07-Bankruptcy_Remote_Presentation.DOCing markets and the moderating role of prior knowledge. We conducted an intention survey followed by a post-purchase survey in the Chinese automobileKelly-F07-Bankruptcy_Remote_Presentation.DOC
and smartphone industries. We found that foreign brands have an advantage on IBD relative to domestic brands, indicating that they have the dual advan1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCthey are more likely to systematically reprocess information and discount foreign brands’ favorable country associations. For these consumers, overestimating the product reduces foreign brands’ advantage to a smaller degree than underestimating it due to confirmation bias. These findings provide imp Kelly-F07-Bankruptcy_Remote_Presentation.DOClications for brands in emerging markets.Keywords: foreign brands, domestic brands, intention-behavior discrepancy, prior knowledge,emerging market3ThKelly-F07-Bankruptcy_Remote_Presentation.DOC
e globalization of the marketplace has intensified competition between foreign and domestic brands. Some prior research suggests that consumers prefer1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCOther research, however, finds that consumers show a home country bias that favors domestic brands, due to economic and socio-psychological motives (Feurer, Baumbach, and Woodside 2016; Verlegh 2007; Zeugner-Roth, Zabkar, and Diamantopoulos 2015). Despite the mixed findings, there is a consensus tha Kelly-F07-Bankruptcy_Remote_Presentation.DOCt consumers in emerging markets such as China, India, and Tunisia generally prefer foreign brands (especially those from more developed countries) oveKelly-F07-Bankruptcy_Remote_Presentation.DOC
r domestic brands (Batra et a). 2000; Essoussi and Merunka 2007). In these markets, foreign brands from developed countries are perceived to have high1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCsome Chinese brands use foreign-sounding names to attract local consumers (Melnyk, Klein, and Vởlckner 2012). For example, the leading Chinese appliance brand Galanz uses a Germanic name to be associated with the high durability and quality of German appliances.There is, however, still a research ga Kelly-F07-Bankruptcy_Remote_Presentation.DOCp when it comes to the performance of foreign versus domestic brands in emerging markets. In this body of literature, most research examines product eKelly-F07-Bankruptcy_Remote_Presentation.DOC
valuation or purchase intention (i.e.. what consumers say) and ignores the subsequent purchase behavior (i.e., what consumers do) and the possible dis1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCmost research uses brand evaluation andpurchase intention as dependent variables. Recent literature on international marketing calls4for research to examine performance measures (hat capture consumer purchase behavior (Bartsch. Riefler, and Diamantopoulos 2016; Sharma 2011). A few exceptions that us Kelly-F07-Bankruptcy_Remote_Presentation.DOCe market share or brand ownership as dependent outcomes focus on firm-level performance or consumer animosity toward a specific foreign country (e.g.,Kelly-F07-Bankruptcy_Remote_Presentation.DOC
Gao et al. 2006), which cannot help academics and practitioners fully understand consumer purchase decisions of foreign versus domestic brands.This r1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCrchase behaviors in emerging markets. Consumers intending (0 buy a brand may end up purchasing a competing alternative, leading to an intention-behavior discrepancy (IBD). The concept of IBD captures a brand's competitiveness, and helps researchers and practitioners understand consumers' purchase be Kelly-F07-Bankruptcy_Remote_Presentation.DOChaviors in (heir final decision stage. For a brand, a low 1BD rate indicates consumers’ stickiness to the brand and its competitive advantage. When coKelly-F07-Bankruptcy_Remote_Presentation.DOC
nsumers say they would purchase the brand but instead buy a competing one, finn profits suffer (Billington 1998). Hence, IBD is highly relevant for br1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOC Moreover, in international marketing, “ignoring the discrepancies between intentions and purchase behavior can cause biased results, and thus the use of intention ratings alone could be misleading” (Koschate-Fischer, Diamantopoulos, and Oldenkotte 2012, p. 22). Thus, IBD is also worthy of investiga Kelly-F07-Bankruptcy_Remote_Presentation.DOCtion from a theoretical perspective.Drawing upon the literature on country associations and dual process theory, thisresearch examines the performanceKelly-F07-Bankruptcy_Remote_Presentation.DOC
of foreign versus domestic brands on 1BD in emerginghttps://khothuvien.cori!5markets and the moderating role of inaccurate prior knowledge. We propos1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCive to their domestic competitors. However, this advantage may be smaller for consumers with inaccurate prior knowledge because they tend to encounter incongruent information, and thus may systematically reprocess product information and devalue the favorable country associations. The empirical test Kelly-F07-Bankruptcy_Remote_Presentation.DOCing is based on two-round surveys of purchase intention and purchase behavior for automobiles and smartphones in a large emerging market. With the infKelly-F07-Bankruptcy_Remote_Presentation.DOC
lux of foreign brands, emerging markets offer a great context to examine the performance of foreign versus domestic brands. The large market potential1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCecause of the market environment and institutional factors (Bahadir, Bharadwaj, and Srivastava 2015; Gao et al. 2006). Understanding the foreign brands’ IBD relative to their domestic competitors could assist foreign brands in developing effective marketing strategies in these markets.We chose one o Kelly-F07-Bankruptcy_Remote_Presentation.DOCf the largest emerging markets, China, as our research context. The rapid development and transition to a market-based economy have boosted the ChinesKelly-F07-Bankruptcy_Remote_Presentation.DOC
e market’s attractiveness to foreign brands (Johnson and Tellis 2008; Walters and Samiee 2003). Its economic resurgence has also attracted extensive i1Intention-Behavior Discrepancy of Foreign versus Domestic Brands in Emerging Markets: The Relevance of Consumer Prior KnowledgeLuping Sun. Xiaona Zhe Kelly-F07-Bankruptcy_Remote_Presentation.DOCse of their favorable country associations (Batra et al. 2000). In these markets, one expects to observe a similar phenomenon that foreign brands have anadvantage on IBD. However, compared to other emerging markets, Chinese consumers aremore likely to display conspicuous consumption and associate fo Kelly-F07-Bankruptcy_Remote_Presentation.DOCreign brands with higher symbolic value, even for products with lower social signaling value (Zhou and Hui 2003). Thus, it is expected that foreign brKelly-F07-Bankruptcy_Remote_Presentation.DOC
ands’ advantage on IBD is more pronounced in China.This research contributes to the empirical work that examines the performance of foreign versus domGọi ngay
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