Chinese Brands: Customer Buying Behavior

Background

Theoretical and practical implications of the effects of Chinese brands on the buyer’s behavior are global issues worth much attention. The aim of the research is to determine the significance of the relationship between customer buying behavior and Chinese brands. Hypothetically, a significant influence exists between the buyer behavior and a product’s country of origin, which in is this case China. The problem is to determine whether brands made in China influence buyer behavior. This will answer the research question; do brands made in China influence buyer behavior? Theoretically, the price and perceived quality of a product have a strong correlation between buyer behavior and the product to being purchased. In addition to that, the motivating drive on an individual to invest money into a product whose perceived value is strongly bound to one’s social status significantly plays a role in influencing the buyer’s behavior. This is based on the learning concept which is basically psychological. The Learning process, a psychological process, falls into two categories. These include classical and instrumental conditioning (Bilkey & Nes 97). Classical conditioning is contiguous. It is based on repetitive application of a specific condition on an individual subject. When customers are continuously subjected to these products, they eventually develop an attitude towards them that influences their purchasing behavior (Dmitrović & Vida, 390). A critical analysis of these attitudes and consumer behavior shows a strong correlation between product pricing, brand name, product quality, and the style of the consumer. On the other hand, perception is the interpretation of information received about a product. If a customer perceives that a certain product meets certain quality standards, the chances of purchasing that product are high. When a product’s perceived value is good, so the cost and esteem associated with purchasing it is high. This analysis could lead the researcher to comparatively study qualitative and quantitative methods and identify a methodology best suited to the study. A quantitative research method, as discussed below could be appropriate (Bilkey & Nes 90). The rational behind using quantitative research methods is hereunder argued. Quantitative research methods focus on the use of mathematical methods and approaches in solving specific problems by seeking to validate an underlying hypothesis. Mathematical instruments used include numerical analysis of data obtained from a given sample. The method seeks to quantify a research and seeks to explain a phenomenon from a numerical analysis. This includes identifying a sample size based on a key population characteristic based on the number of participants in the research or survey. A key advantage is the steadiness of the sample design involved.

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Rationale

Brands made in China have been popularly associated with low quality, fake products, and low standards. The researcher was compelled to conduct a research it into the influence of Chinese brands on consumer buying behavior through a theoretical and practical approach. Consumer behavior is dynamic in nature and persistence of these products in the market may spark losses both to the consumer and the retailer if careful evaluations are not done on product quality, perceived value, actual value, and product pricing (Sharma, Shimp, & Shin 28).

Literature Review

Brands made in china are everywhere spanning cheap to expensive and luxury products. A combination of the right marketing factors such as low cost labor force, economic reforms, and economic growth have contributed to the exponential growth of Chinese products into various markets in the world today. A direct relationship between consumer buying behavior and product quality is evident from the literature review hereunder discussed (Douglas & Craig 40).

China is one of the most important manufacturers of consumer and industrial products that are sold in the world market today. These products range from expensive to cheap products and various perceptions about customer buying behavior has evidently been influenced by the country of origin. Partly because of the prevailing economic conditions in the world today, Chinese products have had an incredible entry and an exponential growth in consumption in various markets around the world has been witnessed. However, the market has had certain perceptions about these products. This has been partly due to pricing, product quality, and continued use of these products compared to similar products in the same market.

Various factors determine customer buyer behavior based on customer perceptions. Among them is the country of origin. Bamber and Khan argue that the country of origin determines to a large extent how products in the market are evaluated and the perceived value of these products by customers (82). In particular, continued use of Chinese products has sparked a feeling of inferior quality about a number of them that are perceived to be fake (Balabanis & Diamantopoulos 85). A critical analysis of these attitudes and consumer behavior show a strong correlation between product characteristics, price, brand name, quality, and consumer lifestyle. Analytically, the tendency to purchase these products is diminishing. When a product is produced in a less developed country such as China and sold in a developed country, consumers tend to evaluate these products negatively (Jo, Nakamoto & Nelson 640). Such evaluations significantly impacts on buyer behavior in terms of preferences to buy a specific product from a specific destination, China. The brand name and the country of origin evoke a strong feeling and urge to buy or not to buy a product. Consider a brand name like Philips, the country of origin may be the Netherlands (Josassen & Flertcher 1).Philips evokes a feeling of confidence in terms of product quality. Product quality has a strong correlation with product price due to the perceived value likely to be gained from its consumption. In addition to that, this perception has a strong positive effect on consumer behavior (Insch & McBride 260). Despite these perceptions, it’s worth noting that a country’s image is dynamic, changing over time. Changes can be on international and national levels. Changes may span labor laws, relationship with other countries, imposition of export and import tariffs, manipulation of a country’s currency for individual gains as happened at the eve of the Second World War and currently with China, income levels of people of a country such as the index of the gross domestic product (GDP) of a country and the size of the market. These macro-economic factors significantly influence a customers buying behavior besides the effects of micro economic factors (Granzin & Painter 80).

These being some of the salient factors that specifically influence customer buying behavior, others are personal and bear a strong correlation to a product’s features. Theoretically, consumer behavior is influenced by a myriad of factors. Among them is the learning concept. Balabanis and Diamantopoulos, argues that many of these factors are psychological in nature (86). Among the psychological factors is learning. Learning falls into two categories. These include classical and instrumental conditioning (Balabanis, & Diamantopoulos 90). Classical conditioning is contiguous. It is based on applying and reapplying a certain condition on a specific subject. The subject becomes accustomed to specific stimuli and responds accordingly to the application of the applied stimuli. Critically, over time, Chinese products are evidently inferior in quality. When people are continuously subjected to the use of these products, they gradually develop a negative attitude towards them and that adversely affects their buying behavior. On the other hand, instrumental conditioning is based on rewards. When need invokes the recurrence of a certain behavior, rewards play a major role in stimulating such a recurrence. Rewards can be in the form of price discounts, a good quality product, among other incentives (Balabanis & Diamantopoulos 86). A critical evaluation of Chinese products reveals that a segment of this approach critically lacks in their marketing programs and product creation. The Chinese undervalue their products and produce low quality products that have such transient life making customers to hesitate going back to purchase more. That is specifically untrue of the developed world. However, the argument that Chinese products still dominate the global market is somewhat true. China evaluated its market very well and with well calculated marketing strategies enters and curves a reasonable pie of the world market, specifically the developing world. Though this has not sparked competition from traditional share holders of these markets, it has become increasingly true that many of these traditional shares have gone to Chinese firms. Other theoretical arguments on a customer’s buying behavior include stimulus discrimination (Saffu & Scott 190). In relation to influencing the buying behavior of expensive brands from China, once the customers have been made to believe that products made in China are either of an inferior quality or fake, whether they are genuine and of high quality but bear the stamp of the country of origin as china, the probability of purchasing such a product is low.

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Another theoretical argument fronted about customer buying behavior is perception. Perception is the interpretation of information received about a product. If a customer perceives that a certain product meets certain quality standards, the chances of purchasing that product are high. Balabanis and Diamantopoulos, argues that when a product’s perceived value is good, so the cost associated with purchasing it is high (87). However, when comparing the perceived value of Chinese products that are expensive and those manufactured in other countries, it becomes clear that buyers tend to perceive these products as being inferior to the highly priced ones that are manufactured in other countries. This is in addition to the concept of selective perception. The underlying criterion for this concept is that a lot of information about a product is filtered and does not reach the target destination. That is the case with Chinese products. They are created with such sophistry that one cannot easily differentiate them from those of higher quality (Cutura 61). These products are tailored to create the perception that they are of high quality and can compete with well known brands.

A survey conducted by Balabanis and Diamantopoulos on customer perceptions about Chinese products revealed that 66% of the participants agreed that “made in China brands” directly hurt the image of products whose country of origin was China while 30% of the participants agreed that the label, brands made in China accelerated the feeling that these brands are of inferior quality (90). The feeling translated to customer perceptions about Chinese brands and their buying behavior. In addition to that, other information revealed that only 4% took a neutral stand (Durvasula, Andrews & Netemeyer 80). Theoretically, a brand image is a very important component that optimizes on buyer buying behavior. Images can be self image, store image, among other types of images. Balabanis and Diamantopoulos’s thoughts about brand image are that a product’s image can be influenced by pricing mechanisms, product quality among a host of others (87). When buyers are made to perceive quality in a product, based on a concept known as subliminal-perception, there is an improved tendency for customers to buy that product. In addition to that, self-image is a strong determinant factor on the attitude and behavior in buying expensive products. People have a tendency of wanting to be associated with expensive gadgets that have a tendency of propelling self-image to better heights. However, the question about the country of origin of a product affords discussion.

While much value is attached to products whose country of origin is developed, China is still racing behind these developed nations. To sell a product whose perceived value is high, but whose country of origin is China in a developed country’s market stirs mixed feelings. A survey conducted by Kim and Thorndike Pysarchik reveals that many people’s perceptions about expensive Chinese brands is that they are of inferior quality and the price tags associated with them are not justified (291). On the same argument, they assert that while Chinese brands may cause a social identity of a specific individual to appreciate with respect to the prestige associated with these brands, little do these brands influence a positive buyer behavior. That is notwithstanding various contracts that have been won by various Chinese markets in the western and developed nations to provide services and products at various levels. Examples include companies like Gree, Midea, Bai, and Brilliance Auto among many others. Brands manufactured by these companies are expensive. Therefore brand identity and country of origin plays a minor role in influencing customer buyer behavior for certain products. Many of the above mentioned companies are technological firms that have won lucrative contracts in western countries.

Despite that, other expensive brands continue to enjoy mixed customer ratings. The writing by Josassen and Flertcher provides a detailed account of the purchasing behavior of Chinese luxury and expensive products (2). It asserts that buyer behavior is a difficulty element to evaluate in terms of product success in the market.

Gradually, consumer behavior has been identified to be critically influenced by perceived risks. Theoretically, perceived risk include physical risks, monetary risks, performance associated risks, and societal risks. Physical risks include the texture, construction and material quality of a product. Quality may be perceived by the customer and as the length of time the product remains functional and the ability of the product to fulfill its purpose (Piron, 308). In addition to that, monetary risks span the loss that can be incurred in the event the product fails to perform as expected. On the other hand, societal risks are descriptive of the image and status one acquires from buying a particular product. This is a vitally important component in determining the buyer behavior of products made in China. A focus on expensive products describes the attitude of the customer, brand loyalty to a particular product, and cognitive dissonance that describes the relationship between pre-buying and post buying and behavior (Quellet 120).

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Having reviewed the relevant literature on theoretical aspects of buyer behavior and their implications on a customer’s buyer behavior, a theoretical perspective of the buyer’s decision making process in the buying process for these brands is vital. The first step that results from the influence on the buyers to purchase a product is the perceived need or problem recognition (Dow 214). Dow asserts that a person may perceive or recognize a need to purchase out of self drive, pride, and out of necessity (213). Prestige and product quality may be among the underlying reasons in motivating an individual to buy a product. However, due consideration may also be emphasized on the performance of the product and its inherent quality. If a customer perceives that the product quality meets specific performance requirements, the possibility to move on to the next step, which is information search, is highly likely. Dow asserts that at this point, the customer seeks information about the product and its perceived quality (212). Issues like the country of origin, product quality and perceived value are thoroughly searched both internally and externally. The most popular areas to search for information are product catalogues, stores, magazines and the electronic media such as the internet.

These steps are followed by alternative evaluations. The evaluation criteria include product price, product quality, and associated style and prestige. These attributes may be subjective or objective. An individual who buys an expensive product will search for alternatives before settling on a specific product (Samiee, Shimp & Sharma 380). These steps are preceded by the purchase decision. Once a customer is satisfied about the value of a product, an individual purchases the product, before the post purchase behavior. After purchasing a product, and particularly an expensive one, the customer evaluates the product performance in terms of actual performance and expected performance.

Methodology

A theoretical analysis and practical implications into the effects of Chinese brands into customer buying behavior of expensive brands will be conducted based on a quantitative research method. Different research methods provide different results. The research will based on an in-depth knowledge on the buyer buying behavior, the factors that influence a buyer into purchasing a specific product and focused on the results of a survey on the perceived value of Chinese products. In addition to that, the reach will look at the buyer’s purchasing process in view of the fact that the product to be bought is expensive and has various implications on the customer. The discussion below sets to provide a detailed analysis of both quantitative and qualitative research methods and the rationale of selecting the quantitative method in the research process (Carvalho 3).

Emphasis was laid on the research methodology and the rationale to a specific research method. Different research methods optimize different research techniques geared towards accumulating specific data that influences the kind of research outcome. Therefore, it is vitally important to evacuate both qualitative and quantitative research methods against the specific research conducted about an issue or product (Lindqvist & Nordänger 365).

Designing a scale for evaluating human feelings is not possible as they are subjective. Therefore to determine one’s feelings about a product or service may be difficult. However, to a desirable extent, it is possible. That is the case with the methodologies incorporated in the research (Vida & Damjan 120). A qualitative research design is evidence based and seeks in earnest to answer questions about cause and effect. The method critically evaluates findings and brings to the surface issues not known therebefore and these findings are applicable beyond the scope of the field where the research was conducted. In addition to that, the method focuses on techniques and procedures that are well tested and determined. The method sets to understand and solve the problem from the perspective of the buyer of expansive products that are made in china. It is a complex method that undertakes to provide textual analysis of the situation, focuses on the human side of the issue in terms of opinions, behavior and attitudes and beliefs about the issue. That done, a qualitative research could in essence provide detailed information about customer buying behavior of Chinese made products in the context of personal attitude and perceived value and the motivating element of self-esteem (Uddin, Parvin & Lutfur 1).

On the other hand, quantitative research methods focus on the use of mathematical methods and approaches in solving specific problems by seeking to validate underlying hypotheses. Such mathematical instruments include mathematical analysis of data collected from a given sample. The method seeks to quantify a research and seeks to explain a phenomenon from a numerical analysis. This includes identifying a sample size based on key population characteristic parameters such as the number of participants in the survey. Another key characteristic which the researcher identified to be a key advantage was the steadiness of the sample design involved in the research. It was observed that the sample design based on this method consisted of participants who could not influence the outcome with biasness. On the other hand, some aspects of a qualitative research are flexible and open to influence by confounding variables. This influences the outcome of the research negatively. In addition to that, qualitative research methods influence the kind of questions posed to participants. In comparison, a quantitative research does not influence the nature of questions posed to participants, implying that these participants have minimal influence on the outcome of the research and cannot introduce noise variables into the final outcome. Besides the advantages associated with quantitative research, qualitative research seeks to modify study and research questions with changing outcomes while the research is being conducted. This has the disadvantage and the potential to lead the researcher from the original objectives and aims of the research (Cicic, Brkic & Praso-Krupalija 65).

Other issues that were considered when choosing a research method included the kind of questions and the accuracy associated with those questions. Quantitative research is characterized by questions that are close ended and no modification is possible with them. On the other hand, qualitative questions are open ended and subject to modifying questions posed to participants.

Analytically, the researcher found it tenable to evaluate data that was collected during the research based on quantitative measures and values. Each variation in the research process could be quantified and uses highly structured methods. These methods included conducting a survey on a specific population with specific characteristics (Cicic, Brkic & Praso-Krupalija 67).

Quantitative research methods are inflexible and provide participants with a uniform ground upon which they are evaluated. Questions asked in the process are close-ended and the possibility of introducing confounding variables is limited. In addition to that, quantitative research methods require that the researcher is well conversant and thoroughly understands the questions posed to participants. The research was hypothesized as follows based on a normal distribution.

Null hypothesis (Ĥ): Brands China influence buyer behavior

Alternative hypothesis (Η): Buyer behavior is an independent variable

Let us test the hypotheses. Suppose 20 participants are surveyed in the process and the probability that their buying behavior is influenced by brands made in China is 0.25. The outcome can be modeled on a binomial distribution where n takes the value of 20; p takes the value of 0.25. Therefore, this can mathematically be expressed as XB (20, 0.25).

Expressions for this analysis:

Ĥ: p=0.25

Η: p>0.25

If Ĥ is correct, then XB (20, 0.25), using a one tailed test at the 5% level.

Rejection criteria: The test value is found within the critical region if p(X>x) <5% Suppose 7 participants agree that they are influenced by these brands, then x=7 and p (>7). From the binomial tables, P ((>7) = 1-P (≤6). That is the same as 1-0.7858=0.2141 approximately 21 percent. Given that 7 is not in the critical region and that p (>7)>5%, there is no evidence to deny the fact and reject the null hypothesis. Therefore we could conclude that brands made in china influence buyer behavior.

Ethics Form

The research process should be largely characterized fundamental Principles based on the tenets of universally accepted research ethics. The research will be characterized by respect for persons where the autonomy and dignity of every participant in the research process is well protected. In addition to that, the researcher will endeavored to optimize the principle of beneficence by incorporating measures in the research process to minimize risks that may be related to the research while ensuring the best out of the research is for the participant or customer. Each step of the research process will characterized the researcher’s commitment to the cause of justice that calls upon the researcher to ensure fair distribution of the benefits accruing out of the research.

This form is essential and should at all times be dully filled and submitted for this project. It is purposely designed to point out areas demanding due attention due to ethical issues that may be involved in the research process. Thus an approval by the relevant authorities will see the project proceed as desired.

Answer all questions presented below YES NO N/A
  1. Will the participants involved in the research come from your college of study?
No
  1. Does the study identify participants who are vulnerable? Vulnerable participants may include disabled people and children.
Yes
  1. Will participants’ images appear in electronic forms such as the internet, and other media, etc?
No
  1. Will private data be made public in any way?
No
  1. Will participants in the research participate through informed consent?
Yes
  1. Will the research span sensitive and private data?
Yes
  1. Will customer’s previous experience with Chinese products be presented as a sample in the study?
Yes
  1. Will Chinese product be presented as samples during the study?
No
  1. Will products by other manufacturers from other countries be presented in the research for the purpose of comparison? When such products are presented in a research environment for the purpose of comparing them with those manufactured in china, serious implications are bound to arise. This may affect across section of companies and people involved in the research process.
No
  1. Will the study be iterative in nature?
No
  1. Will there be adequate compensation for participants?
Yes
  1. Have the risks associated with research been carful evaluated?
Yes
  1. Is there a relationship of any kind between the researcher and the participants?
No
  1. Is the researcher exposed to any particular risk?
No

Ethical issues

Ethical issues cover ethical relativism in which a researcher is required to observe values and norms that are perceived to be universal and that cover every individual despite the fact that no universal standards can be applied to every individual. Participants will be required to tell the truth by communicating honestly about their feelings and perceptions. Lying may thwart the actual meaning of an issue and adversely affect the outcome of the research. False statements that may be used to justify a position should be avoided at all times of researching.

References

Balabanis, G. and Diamantopoulos, A. Domestic country bias, country-of-origin effects, and consumer ethnocentrism: a multidimensional unfolding approach, Journal of the Academy of Marketing Science, 32.1(2004): 80-95.

Bilkey, W. J. and Nes, E. Country-of-origin effects on consumer evaluations,Journal of International Business Studies, 8.1(1982): 89-99.

Cicic, M., Brkic N. and Praso-Krupalija, M.Consumer animosity and ethnocentrism in Bosnia and Herzegovina: The Case of a developing country in a post-war time, Akademija MM – Slovenian Marketing Research Journal, 6.10 (2003): 59-73.

Cutura, M. The impacts of ethnocentrism on consumer evaluation processes and willingness to buy domestic vs. imported good in the case of Bosnia and Herzegovina. South East European Journal of Economics and Business, 1.2 (2006): 54-63.

Douglas, S. P. and Craig, S. C. Collaborative and iterative translation: An alternative to back translation. International Journal of International Marketing, 15.1(2007): 20-43.

Dow, D. Adaptation and performance in foreign markets: evidence of systematic under-adaptation, Journal of International Business Studies, 37.2 (2006): 212-226.

Dmitrović, T. and Vida, I. An examination of cross-border shopping behaviour in South-East Europe, European Journal of Marketing, 41.3/4(2007): 382 – 395.

Durvasula, S., Andrews, C. J. and Netemeyer, R.G. A cross-cultural comparison of consumer ethnocentrism in the United States and Russia. Journal of International Consumer Marketing, 9.4 (1997): 73-84.

Granzin, K. L. and Painter, J. J. Motivational influences on “Buy Domestic” purchasing: Marketing management implications from a study of two nations, Journal of International Marketing, 9.2 (2001): 73-96.

Insch, G.S. and McBride, J.B.The impact of country-of-origin cues on consumer perceptions of product quality: A binational test of the decomposed country-of-origin construct, Journal of Business Research, 57(2004): 256-265

Josassen, Alexander & Flertcher, Richard. Looking at Bothe sides of the coin. Revisiting the role of a country of origin in International Business. Journal of Business systems, Governance and Ethics. 2010. Web.

Jo, M. S., Nakamoto and Nelson, E. J. The shielding effects of brand image against lower quality countries-of-origin in global manufacturing, Journal of Business Research, 56 (2003): 637 – 646.

Kim, S. and Thorndike, Pysarchik, D. Predicting purchase intentions for uni-national and bi-national products, International Journal of Retail & Distribution Management, 28.6 (2000):, 280-291.

Piron, F. Consumers’ perceptions of the country-of-origin effect on purchasing intentions of (in)conspicuous products, Journal of Consumer Marketing, 17.4 (2000): 308-328.

Quellet, J.-F.Consumer racism and its effects on domestic cross-ethnic product purchase: An empirical test in the United States, Canada and France, Journal of Marketing, 71.1(2007): 113-128.

Samiee, S., Shimp, T. and Sharma, S. Brand origin recognition accuracy: Its antecedents and consumers’ cognitive limitations, Journal of International Business Studies, 36.4 (2005): 379-398.

Sharma, S., Shimp, T. A. and Shin, J. Consumer ethnocentrism: A test of antecedents and moderators, Journal of the Academy of Marketing Science, 23.1(1995): 26-37.

Saffu,Kojo, Scott, Don. “Developing country perceptions of high- and low-involvement products manufactured in other countries”, International Journal of Emerging Markets, 4. 2 (2009): 185 – 199

Uddin, Jashim, Parvin, Shehely & Rahman, Lutfur. Determinants of Purchasing Imported Products in a Regular Basis: Development of a Regression Model. International Journal of Management. 3.10 (2008).

Vida, I. and Damjan J. The role of consumer characteristics and attitudes in purchase behavior of domestic vs. foreign made products: The case of Slovenia, Journal of East-West Business, 6.3 (2000):, 111-131.

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