GEORGIAN CONSUMERS’ PERCEPTION OF DOMESTIC AND FOREIGN PRODUCTS
Nugzar Todua, Ivane Cevahishvili Tbilisi State University, Tbilisi, Georgia Ali Riza Apil, Ali Riza Apil is an Assistants Professor of Marketing, Department of Business Administration, International Black Sea University, Tbilisi, Georgia
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EVALUATIONS AND FINDINGS
Country of origin analysis focuses on buyer’s opinions regarding the relative qualities of goods and services produced in various countries (Papadopoulos and Heslop, 1993). In this study, we research how consumers perceive products sourced from different countries. Ten product categories from nine different countries studied.
Table 3 shows the mean scores of the respondents’ perception of quality for each of the products from the eight countries of supply as well as the home country of Georgia. The rating scale used was from 1 = “low quality” to 5 = “high quality”. First, a mean rating for Georgian consumers’ perception and evaluation for each country on each product class, as well as products in general was calculated for each country on each product class. Respondents were asked to vote for the indicated products of the countries which they know about. So each respondent did not give rating for all product classes of the indicated countries (See Table 1).
In the overall ranking, based on the calculated average of the perception scores by country, Germany was perceived as the country that produces high quality products. While the USA was placed second, closely followed by Japan and Italy(See Table 1). Georgian consumers view home appliances, electronic products, automobiles and medical products from Japan, Germany and the USA most favorably. Clothing, fashion products and shoes from Italy, USA, and Germany are perceived to be higher quality. Georgians are proud of their alcoholic drinks and cheese, as a reflection of this attribute, they rated local alcoholic drinks and cheese with a distant higher rating over the other alternatives. This reflects the preference for the taste of culturally bound products.
Georgian consumers, in every product class as well as for products in general, view products from China least favorably. Although, Georgian consumers perceived home country alcoholic drinks and cheese the highest, in other product categories they perceived domestic products lower in quality. We can conclude that Georgian consumer preferences for products vary according to product class.
In Chart 1 perceptions of Georgian products are depicted on a graph. Among Georgian products cheese and alcoholic beverages received relatively higher ratings and home appliances got lowest ratings. Shoes and medical products are relatively in a better position among Georgian domestic products.
Further, post hoc comparisons using the Duncan test showed that, Georgian cheese and alcoholic beverages maintain a higher image than their counterparts produced in the developed countries like Germany, Italy and Russia (See Table 2). Georgian shoes were regarded as having a lower image than the developed countries’, Polish and Russian ones, equal to Turkish ones but having a better image than the Chinese ones. Georgian home appliances were ranked as the lowest of the surveyed countries. Georgian medical products were ranked lower than Chinese and Polish, but higher than Turkish ones. Georgian clothing, fashion products and home maintenance products were ranked lower than Russian, Turkish and Polish but equal to Chinese ones.
Reliability Analysis
Cronbach’s coefficient alpha was used in this study to assess the reliability of the measures. Nunnally (1976) suggests a reliability coefficient of 0.60 or larger as a basis for acceptance of the measure. A Cronbach alpha coefficient of 1 would indicate perfect uni-dimensionality within a scale. When Cronbach alpha was computed for all the ten items of the scale for nine countries this was found to be 0.926. This indicated the possibility that the entire scale was uni-dimensional. Cronbach alpha coefficient of 0.926 can be considered a reasonably high reliability coefficient. Based on this, it can be concluded that all 10 product classes of selected countries used are measuring the attitudes of Georgian consumers toward products of these countries (See Table 3).
Consumers quality ratings of products sourced from Poland exhibited the highest reliability (0.906). Even though consumers quality ratings for products sourced from Japan exhibited the lowest reliability (0.639), it is over the limit suggested by Nunnally (1976) for the acceptance of measure.
The Impact of Demographics on Domestic Product Perceptions
Consumer demographics may influence the nature of COO effects. In different consumer demographic segments; different variations of COO effects may be observed. To test if gender, marital status, age, education and income level play a discriminating role on the evaluations of the country of origin of products, Wilcoxon – Mann Whitney-tests was performed. Respondents were separated according to their age groups. First classification of two age groups; younger than 35 and older than 35. Another interesting issue is whether there is a difference between more educated consumers and those with less education as regards the country-of-origin effect. To test this, the education category was recorded into two separate categories – the first category includes those respondents with high school education, while the second category includes those with higher education, i.e. university and above. Shimp and Sharma’s (1987) CETSCALE was used to determine the ethnocentrism level of consumers. First, respondents were split into two halves according to their ethnocentrism level in the bases of mean scores. Table 4 summarizes the results regarding the impact of gender, income, education, marital status and consumer ethnocentrism.
Respondents were split into four groups based on their self-reported annual personal income level. Higher income respondents rated significantly higher Georgian fashion products. While unmarried respondents rated significantly higher Georgian medical products, married respondents rated significantly higher Georgian home appliances. Younger respondents rated significantly higher Georgian cheese, home maintenance products, and medical products. Older respondents rated significantly higher home appliances of Georgia. Ethnocentric respondents rated significantly higher Georgian, clothing, fashion products, and alcoholic drinks.
DISCUSSION AND CONCLUSIONS
The present study contributes to consumer research by providing information about consumer preferences in a less researched geography. Findings support the previous research indicating that there is a positive relationship between product evaluation and degree of economic development of the sourcing country and COO effect varied according to product class.
During the last four decades, accumulated research on COO effects has found that consumers display a preference for products made in some countries more than others. Georgian consumers perceive the quality of products to be significantly different based on the product’s country of origin. In the conducted research, total evaluation of German products was evaluated to be superior compared to those of other major advanced countries. The present research shows that COO effects exist and influence the product preferences of consumers. Georgian consumers perceive products from developed countries as higher quality than products from developing countries. Products from developed countries like Germany and Italy are perceived to be of high quality. On the other hand, products from developing countries like Poland and China were perceived to be of low quality. This underscores the findings from past research (Bilkey and Nes, 1982; Ettenson, 1993; Zain and Yasin, 1997) that there is a positive relationship between product evaluation and degree of economic development of the sourcing country.
Although general country perception of specific country products is an important determinant in decision making, product class perceptions are main determinant of shopping decisions. Bilkey and Nes (1982) found that attitudes toward products from a particular country vary by product.. In the present research, it was discovered that country ratings varied according to product class. For example, while Italy was ranked third for home appliances and automobiles, it was rated first for clothing and fashion products. Although, Georgian consumers perceived home country alcoholic drinks and cheese the highest, in other product categories they perceived domestic products lower in quality. This present research produced results consistent with the research findings of Bilkey and Nes (1982) and Kaynak and Cavusgil (1983).
Georgian consumers perceive the quality of products to be significantly different based on country of origin. In our research, total evaluation of German products was appreciated to be superior to those of other major advanced countries. Chinese products were the least appreciated ones. The present research proves that COO effect exist and influence the product preferences of consumers especially for products which lacks brand positioning in the market.
Georgians are proud of their alcoholic drinks and cheese, as a reflection of this attribute, they rated local alcoholic drinks and cheese with a distant higher rating over the other alternatives. This reflects the preference for the taste of culturally bound products.
The results confirm the past research indicating the differentiating effect of demographic variables on COO perceptions (Johansson et al., 1985; Schaefer, 1997; Leonidou et al, 1999). Nonetheless, as Heslop and Papadopoulos (1993) point out, there is still a lack of consistent findings regarding consumer demographic variables. Each demographic variable produced a differentiation effect on at least one product category. It seems partial demographic differences exist, but to make generalizations significant differences are not enough. Nonetheless, as Heslop and Papadopoulos (1993) point out, there is still a lack of consistent findings regarding consumer demographic variables.
Future studies on country of origin should extend to other products from major trade partners of Georgia. A research for more products from fewer countries will produce more insight to understand Georgian consumers’ foreign product preferences.
This was a static study and looked at the COO phenomenon during one period of time (static approach). Further studies are needed to determine the COO effect over a longer period of time (longitudinal studies). In addition to the study of urban Georgian consumers, investigation of rural consumer perceptions will shed more light into the study of COO effects.