Consumer Perception of Product Quality and the Country-of-Origin Effect 1

Abstract

Consumer attitudes to local and foreign products and the likely “country-of-origin” effect in “Buy Local” and “Made In …” campaigns are surveyed. First, the importance of country of origin in relation to other product attributes is considered. Second, country of origin is assessed as a surrogate indicator of product quality. Third, the likely effect of country of origin on consumer choice across a range of product categories is studied with brand name and price held constant. Across the product categories studied, respondents rated country of origin as significantly less important as a choice determinant than product quality and price. In addition, clear country-of-origin effects are identified. Consumers rate products as being of significantly different quality when the only variation between products is stated country of origin. Further, consumers express a marked preference for locally made products when price, technical features, and brand name are invariant, and where the locally made product is perceived to be superior or, at least, not significantly inferior to an overseas-made product. Where the locally made product is perceived to be of inferior quality to the imported product, consumers generally prefer an imported product. Thus, while consumers rate country of origin after product quality and price, when these other factors are equivalent, the fact that the product is promoted as locally made is a positive influence on product choice.