The country of origin effect on brand loyalty for Moller's cod liver oil

Country of Origin Effect on the Brand Loyalty of Moller's Cod Liver Oil

An understanding of the contextual elements that impact upon individual purchase decision making and the overall process through which individuals behave and ultimately make decisions is an important first stage in the development of any marketing communications plan (Shirin & Kambiz, 2011). The increasing demand for Italian food has contributed to the growth of restaurant chains such as Olive Garden, owned by General Mills, which has more than 100 units, and Sbarro, which has more than 500 outlets in forty-eight states. The acceptance of Italian food is not a fad. This ethnic food preference has staying power. Italian restaurant distribution is strongest in the mid-Atlantic, Pacific Coast, south Atlantic, and eastern and north central states. The Spaghetti Warehouse, a restaurant chain based in Garland, Texas, is now selling franchises and stepping up expansion. The Italian meals most often served are lasagna, spaghetti with sauce, pasta with red sauce, fettuccine, and pizza. Brands that dominate their market segments for Italian food are Chef Boy-Ar-Dee and Franco- American for canned pasta, Progresso for canned soup, Ragu and Prego for spaghetti sauces, and Stouffer Lean Cuisine and Michelina for frozen Italian entrees.

The popularity of pizza need scarcely be mentioned. Pizza Hut has more than 8,000 units in the United States, and Domino's Pizza has more than 4,000 units. By comparison, Pizza Hut has at least 2,000 more units than Burger King. There has also been an increase in Italian restaurants catering to both casual and fine dining. Obviously, America's enthusiasm for Italian food has transcended ethnic background. The bulk of Italian immigrants migrated to the United States during the period from 1890 to 1910 (Nagashima, 2009). Many of these immigrants settled in New York City, Philadelphia, and Chicago. The older generation tended to preserve the customs and language from Italy.

As generation succeeded generation, fluency in the Italian language diminished. However, food habits were passed from one generation to another. While these food preferences are not as strong in younger generations, to some extent they still exist. The melting-pot phenomenon of non-Italian-Americans with the willingness to try different ethnic foods would seem to be as strong as ever. Italian foods and sauces are clear-cut favorites and continue to dominate the ethnic food market (Ahmed, & Adraoui, 1994).

The Hershey Pasta Group is the number one company in its category and has reported record sales in the 1990s. The branded category composed of San Giorgio, American Beauty, Ronzoni, Skinner, and Light'N Fluffy provided the largest of sales volume growth. The profile of a typical pasta user is a female, married, most likely between the ages of 18 and 44, with an annual household income between $25,000 and $50,000, with at least one child living at home, with three or more packages of pasta and at least three different shapes of pasta in the cupboard but who consumes spaghetti more than any other shape. This consumer eats pasta one-third of the time when dining out and believes that pasta is a good source of complex carbohydrates and is economical, convenient, and filling. Pasta has had positive press. Since 1975, the volume of pasta consumed in pounds has more than doubled. Pasta is a food high in complex carbohydrates, and for those consumers concerned with proper eating habits, this is a factor that constitutes significant patronage motivation (Han, 2009). Moreover, pasta has a long shelf life and is convenient to store and prepare. Another reason pasta is popular is that consumers have grown up using Hershey Pasta products, resulting in a loyalty element. Also, pasta is viewed as relatively inexpensive. As Americans develop into more health conscious people, various research organizations have carried out research studies on food. Italian food has been graded healthy and advantageous. This has been accurate of pasta but not essentially of pizza and a few types of cheeses that are utilized (Balabanis & Diamantopoulos, 2011).

On the other hand, there are other cheese substitutes that are more helpful for good health. Alternatively, consumers have learned that there are an assortment of Chinese food and Mexican food that are extremely high in fat content, sodium, and cholesterol. Italian food, somewhat, has been mainstreamed into restaurants, food stores, and homes. This achievement should serve as an instance for marketers of other ethnic foods, such as Asian and Mexican. Marketers have only apparently been watchful to the prospect of marketing Greek, Polish, Russian, and other types of ethnic food. Even though not important in numbers, there is a new flourish of immigration from Russia, India, and some of the Arab countries that has money-making possibilities for food marketers (Insch, 2003; Tse, et al. 2008).

Cultivating Hispanic Food Market Preferences

The job for food marketers is not merely to recognize food preferences of the Hispanic market but to gain knowledge of whether a broad spectrum of Americans would also take pleasure in consuming the same kinds of food. Hispanics have been a fine market for food, beverage, and household-care items. Hispanic customers have a tendency to be brand conscious and believe in the price-quality relationship. common products have not sold well to this market segment (Martenson, 1987; Rau & Preble, 2007).

This market section displays a high degree of brand loyalty, and as a result it is important for firms to cultivate this market before competitors do. Marketers use diverse approaches to segment the Hispanic market. One conclusion is to propose one product or operation as if it were a homogeneous marketplace. Another approach is to subdivision according to country or region of origin. Other firms use lifestyle and psychographic variables. A fourth approach is to use Hispanic music and celebrities in advertisements. even though language may be a general base, this subcultural group is not a single market, but instead a number of subcultural markets native to their countries of origin. Consequently, marketers should be aware that what might work in New York might not succeed in either Miami or California. According to the existing studies, Hispanics and European-American customers vary in terms of a mixture of important buyer behavior variables (Han, 2009).

Hispanic customers usually show high brand loyalty and have a penchant for well-known or familiar brands. Brands that are perceived to have an image of status are viewed favorably. There is a high propensity to shop at smaller stores and to purchase brands that are promoted by the stores catering to their particular ethnic group. Innovative product adoption may be inhibited by language difficulties. Hispanics are less confident shoppers than Anglo consumers and tend not to be impulse buyers. Furthermore, Hispanic consumers tend to be more careful shoppers and more price oriented. There would appear to be considerable differences in brand preferences, as reflected in brand share, between Hispanic and non-Hispanic consumers for some types of food products (Insch, 2003; Wall & Heslop, 1986). For example, Hispanics have a higher preference for Libby's canned fruit, fruit-flavored Hawaiian Punch, Breyers ice cream, Oscar Mayer hot dogs, and Parkay margarine. Moreover, multiculturalism is creating new tastes. The boost in Mexican food in restaurants may just be the tip of the iceberg. To illustrate, from 1993 to 1994 the sales of shelf-stable Mexican food have increased more than 6%. The sales of frozen Mexican food increased by more than 5% (Ahmed, & Adraoui, 1994).

Uniformity or not: the standardization / I adaptation debate

A brand can be defined as "a name, term, sign, symbol, or design, or combination of them which is intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors (Keller, 1993). The theme of standardization/adaptation runs across the subject of international business, marketing and communications. It is associated with economies of scale generally but more specifically here with creative production and number of personnel involved. At the level of the organization there are three 'models' available to the international marketer. The first is central control where marketing and communication effort is directed from the centre (for example, Unilever Europe). Second, the head office acts as a resource centre where the locals are free to develop within central directives on agencies and media buying (for example, Nestle) (Michell & Joel, 1995).

Third, there is complete autonomy where minimal justification of actions is required (for example, Heinz). Generally speaking the notion of products being culture-bound is well used in the literature. Alternative strategy in terms of just what can be kept the same and just what might have to be adjusted, even if only slightly, in different part of the world has to be a consideration. This applies in the communications arena probably more so than in any other type of parameter (Nagashima, 2009).

Standardized brand/product and standardized communication are possible but there are other choices, such as:

standardized brand/product and locally adapted communications locally adapted product/brand and standardized communications locally adapted brand/product and locally adapted communications.

The organization may or may not have to adapt or customize or modify pro- motional strategy because of local differences brought about socioculturally, economically, legally or by the availability - or not - of particular media and media vehicles. With this in mind communications strategy has to be developed and implemented. The central debate remains that of degree of uniformity. The pros and cons are obvious, i.e. economies of scale, consistent message across markets, centralized control, different market characteristics, media availability and costs and government regulations (Balabanis & Diamantopoulos, 2011). The stronger argument appears to be that different strategy appears to work in different situations, rather than a totally standardized campaign. Once these geographical issues are decided upon then the scope of the campaign, objectives and elements of strategy can be worked on. If the organization develops a message for one market and then transposes this intact into others or if it develops a message with a number of markets in mind from the start, it may be centrally conceived in both cases (Han, 2009; Wills & Ryans, 1977).

This is popular because of co-ordination and control providing the benefit of speed of roll out. With easier production and fewer staff involved the cost benefits are easy to see. The danger is that voiceovers/dubbing and so on may not be adequate or may even be disastrous. However, the search for universal symbols and meaning transference in many markets with the same message is an attractive proposition. There are three ways to choose - adoption (the whole thing is exported, language and all, and can work for, say, French perfume), prototype (where concepts and central ideas remain intact but where local input is made use of and the control of this remains in the hands of the company but depends on the quality of the local input), and concept co-operation or guideline (that keeps a certain amount of the brand and company facets intact, for example company colours, strap lines, and raises the dangers of lack of control but also imposition of facets that are wrong for particular markets) (Michell & Joel, 1995; Sandler & David, 2003).

Four creative impediments to centralization might exist: locals wishing to take control and prove themselves; cost reduction through adapting campaigns that pays less to the agencies than creating a new campaign; local managers who do not wish to see their authority decline; and the 'not invented here' syndrome (Bailey & Gutierrez, 2007). Standardization is possible where audiences are similar (for example, lifestyles), where image can be used, where the target has similar characteristics (for example, social status), where the product is high tech (for example, involving innovation/innovators and a common technical language) and where products have a nationalistic flavor (for example, country of origin can be important) (Foss & Eriksen, 1995).

Adaptation is necessary where concentration on the differences is seen as important / necessary to tackle problems encountered by a standardized approach across the marketing environment (from political to social/cultural to media infrastructure) and where internal differences such as stage in the product/brand life cycle can be catered for (Mueller, 1996). Examples of companies such as Parker (pens) and Colgate who have realized to their cost what it can mean to fail with a standardized approach are common in the literature.

There is also recognition that the adaptation approach does not necessarily mean changing fundamentals such as core values of the brand. In communication terms the actors in a commercial may be changed (as with Coca-Cola using different national sports and therefore players) at a surface level. An illustration of the possibilities for marketers to acquire and develop strong signifiers that can have worldwide meaning is provided in the case study (Maheswaran, 2004).

Going international with a brand of whisky raises many issues. Perhaps the case study beginning of the relationship between the spirit and 'Scottishness' was Compton Mackenzie's Whisky Galore in which the Hebrideans conspired to 'Scottishness' and defeat the excise man. Recent Hollywood interpretations of Scottishness single malt whisky: the through the likes of movies such as Highlander, Braveheart and Rob Roy may Bunnahabhain and have done no harm to the Scottish (or Scotch) whisky campaign. In recent other single malts years a number of acquisitions by the big international players in the spirits market have taken place. The rationale for this is that global distribution over the past couple of decades has been achieved. What is missing is a full range of good to premium brand offerings - hence the acquisitions (Insch, 2003).

Seagram were central to this and have a history now of global distribution of many things including Chivas Regal. This brand is now in the Pernod Ricard stable having been part of the aforementioned Diageo/Pernod Ricard deal. The Bunnahabhain Distillery was founded in 1827 on the Isle of Islay, north- west Scotland. The distillery produces a single malt whisky, marketed under the Bunnahabhain brand name. Single malt whiskies are produced by over 100 distilleries in Scotland, and the Bunnahabhain is a medium, smooth, soft, mellow, light, gold-colored drink with a hint of peat. Traditionally, malt whiskies are classified according to how old they are - generally the older, the better and more expensive. Price plays an important part in brand choice, but this does depend on the product and the occasion. Generally, blended whiskies are cheaper, for example a bottle of Bells would cost around £12; a supermarket branded single malt will retail at around £14.99; an established brand could retail at anything from £16 but most are around £25 unless on special promotion as, for example, around Christmas and New Year. If the product is to be 'mixed', for example with ginger or Coca-Cola, a cheaper brand may be adequate, but consumers are willing to pay a lot for a quality malt, especially when it is bought as a present or for a special occasion. In the whisky market, packaging is at least as important as advertising - some would say is as important as the product itself! Image is a highly relevant factor in customers' decision-making (Bailey & Gutierrez, 2007). The Scottishness of the product is crucial. Traditionally, Scotland and good whisky go hand in hand; consumers see the origin of a whisky as a quality indicator when making a purchase decision.

Jack Daniel's has very successfully exploited their 'Southern' U.S. roots when marketing their product to the UK. Similarly, the story of the Stone of Scone, is part of Scottish folklore. For many years whisky has had an old image to go with its ageing customers. In recent years whisky marketers have woken up to the fact that if they do not introduce their products to younger drinkers then they are facing a declining market (Michell & Joel, 1995). Whisky, particularly when mixed, has more appeal to younger drinkers, and many of the younger age groups have been targeted recently, for example, Bell's with their 'good crack' campaign and Teachers with pub-based promotional campaigns. However, all the distillers have a common marketing problem - how to make their product appealing to the new younger markets without alienating the current older customer. Before the aforementioned sale, earlier in 2000, Seagram had attempted to target younger drinkers with a 'trendy makeover'. With both Chivas Regal 18 and its sister brand, Chivas Regal 12, revamped, an attempt was made to attract the younger drinker without alienating the traditional drinker - the age-old problem, especially in alcoholic drinks product categories. This involved adding to the brand's aura of quality and heritage (Maheswaran, 2004).

The objective was to reinforce Chivas Regal as the perfect gift for the sophisticated whisky drinker. It is argued that the single malt can survive drowning in cola but it is the pipe and slippers image that is damaging a key industry (billions of pounds in export earnings, tens of thousands of jobs, communities' survival in danger and so on). It was probably by accident rather than design that a positive association between television's Inspector MorselThe Sweeney/John Thaw and whisky evolved. Burns may have known that 'freedom and whisky gang the gather but today's twentysomethings are more likely to associate whisky with middle age. However, all is apparently not lost. In Spain Scotch is seen as part of the inspirational nightlife culture but to be taken long with cola rather than sipped and savoured. In Greece whisky has overtaken ouzo as the favoured drink with 'disco machismo' favouring the Dimple blend (suggestive shape of the bottle and the name) and France is now the biggest market for Scotch. The finest whiskies have always had snob appeal but Scotch is seen as one of the most highly prized products in the spirits industry and one of the few bright spots of the alcoholic drinks business (Foss & Eriksen, 1995; Sandler & David, 2003).

Brands such as Laphroaig are said to have literary appeal in a sort of 'Islay chic' kind of way (as used by, for example, Dick Francis, Will Self and Edwin Black). Visitor centres, brand ambassadors and bartender evangelists are some of the ways to get the 'Scotch is the new fine wine' message across, creating Scotch buffs along the way - or at least this is the hope of Jack Keenan, boss of United Distillers and Vintners, Diageo's spirits subsidiary. Apparently Mr. Keenan's dream is to have dinner party guests chat about the qualities of one malt against another in the same way as they might with fine wines - in terms of taste and discernment. Brian Ivory of Highland Distillers points out that the strong tastes of single malts can find favour with drinkers in their late teens/early twenties and uses the example of the distinctive Islay malt that is 'strong enough to assert itself even through a half-pint of cola'. Alistair Robertson, manager of the Glenkinchie distillery, admits to wanting to pre- serve the mystique of (malt) whisky - a miraculous product of Highland air and water, and a unique part of Scottish heritage that can never be completely understood, where the taste is only part of the appeal. This is reflected in advertising for Glenmorangie - 'come to the glen (morangie) of tranquillity' (Bilkey & Nes, 2002; Sandler & David, 2003).

Culture, consumer behavior and creative strategy

Things such as visual imagery are important but clearly in the international setting there are certain additional constraints on the creation and execution of communication. Hofstede's (1989; 1990; 1991) five dimensions of culture, i.e. power distance, individual vs. collective, masculine vs. feminine, uncertainty avoidance and Confucian dynamism (or long-term orientation) might be acceptable to some as might Mueller's context work. To others, however, generalizations of culture can often be more harmful than useful. there are issues of generalizability because the results are from a single country (albeit one with a significant presence in the sector) and a single product category (Rau & Preble, 2007). Although a variety of other electronic products (e.g., DVD players, television sets) are also the brands investigated herein, thus offering some scope for generalization beyond the specific product category, future studies should examine the phenomena of COO misclassification and nonclassification in different contexts (e.g., less globalized industries) and other countries with a lower or higher presence of local brands in the focal product category (Balabanis & Diamantopoulos, 2011).

Two fallacies appear to exist. First, that segmentation studies are useless unless the 'segment must be substantial and accessible' dictum applies. Second, that self-actualization is an individualistic concept therefore self-actualizers will only exist in low-context cultures. A cornerstone of the systems that have been developed to look at cross-cultural classification is the original VALS system devised by Maslow and Rockeach in 1975. VALS 2 came along in 1989 (Maheswaran, 2004). Others have followed. Here we are concerned not only with how advertising may work creatively but also with the international setting. Do we simply like the advertising - and hopefully the brand - or does it also pro- vide a real proposition? This is an area where literature abounds. Prescriptions from admen, theories from academics, social commentary from journalists - it seems that most people are fascinated by advertising and how it works and this has been the staple diet of many a Sunday newspaper supplement. The approach taken to international advertising will very much depend on the company and its understanding of international marketing. International communication may be seen as being designed to help market the same product in different countries and cultures (Janda & Rao, 2007). However, this implies that the communication can be standardized; many authors agree that this is not the case, with even companies such as Benetton who may appear to be creating standardized images perhaps not quite getting things right.

Mueller uses Frazer's 1985 definition of creative strategy, i.e. 'a policy or guiding principle that specifies the general nature and character of messages to be designed. Strategy states the means selected to achieve the desired audience effect over the term of the campaign- in other words 'what is said'. This includes consideration of both verbal and non-verbal approaches to message content. Creative themes and concepts This can be viewed as 'how it is said' rather than what is said and involves copy and dialogue (verbal) and visual and illustrative (non-verbal) communications. The two broad kinds of appeal are, on the one hand, rational and, on the other, emotional - often referred to as hard sell and soft sell respectively. The reality of situations is more complex than this rather simple distinction (Michell & Joel, 1995). Mueller uses her own and others' work on the differences between Japan and the U.S.A. (referring back to high- and low-context cultures) but it should be remembered that most would agree that these are very large generalizations. The French are said to like humour and sex appeal, while the British display a great fondness for class division, eccentric behaviour and puns. Mueller's comparison between the U.S.A. And Japan is a very useful one. With verbal communication (copy and dialogue) things like brand names come to the fore but it is much more than this. Mueller gives both linguistic and managerial guidelines. For example, with non-verbal communication (visuals and illustrations), the usual claim is that less confusion will be the outcome because of the lack of translation difficulties. Mueller recognizes settings, backdrops, etc. As having different meaning to different people of different cultures. These hinder standardized campaigns (Lusch & Brown, 1996).

In the same vein, it is dangerous to ignore symbolism. The assumption that there are universals available is also made. De Mooij (1994) makes the distinction between the appeal and the execution whereby the strategy may be universal but the execution may well be localized. The family appeal of McDonald's is universal but, within Spain, the execution is, for example, Catalan and presumably different again in other parts of Spain. Ideas generated centrally might remain while surface level treatments differ. Bilkey & Nes, (2002) lists universal themes and concepts as case histories (difficult but worthwhile, usually offering solutions to problems and a mixture of landscapes and environments), improved quality or productivity (especially useful B-to-B wise), basic everyday themes (for example motherhood or jealousy) new products (novel features or new concerns such as environmentalism), service (particularly in industrial marketing), special expertise (particularly technology or engineering), the 'made in' concept (country of origin effect, appealing to national pride or particular expertise), demonstration, universal images (such as the Red Cross), media-driven concepts (such as the youthfulness of MTV), lifestyle concepts (but where adaptation of execution may be necessary) and heroes (possible but with adaptation of execution) (Janda & Rao, 2007; Thakor & Katsanis, 1997).

Culture-bound themes and concepts are personal ideas and opinions (for example, the notion of slimness being attractive is not universally held), customs and moral values (for example, nudity in France is not such a big deal as it seems to be in the UK), humour (does not travel well apart from the use of incongruity, i.e. contrast highlighted by that which is expected and unexpected; other writers might add slapstick comedy of the Chaplin kind to be a universal), motivation (can be seen in examples of household products that are convenient, i.e. there is an incentive so that time can be freed up), individuality and the role of women (involving clothing and sexual overtones) and comparative advertising (the differences between markets, for example Japan and the U.S.A., where losing face is looked on very differently in these two cultures).

In publications having content predominantly in a language that differs from that of the nationality where the brands they advertise originated, several communicative strategies can be identified that have utilized language in contrasting ways. As the following examples illustrate, language serves not only its expected function as information is communicated through written advertising copy; language is also employed in a symbolic manner to identify a brand's country of origin (Michell & Joel, 1995).

Retention of Different Language in Copy. One approach has been to ignore the language barrier entirely. For example, an advertisement for Hongkong Bank in a French magazine provided a discussion of the advantages of international electronic banking completely in English. However, it is of interest to note that this verbal copy occupied only about 20% of a two-page advertisement (Bilkey & Nes, 2002). The remaining area was filled with a pictorial montage combining images of an executive, a container ship, and computer screens displaying a logo and a menu on trade financing. Thus, the verbal copy was accompanied by pictorial information concerning the ease of communication and the scope of available transactions. In this example, the considerable verbal component of the advertisement was still given far less prominence than the visual material.

Parallel Texts. Provision of parallel texts in the languages of both the country where the product originated and the country in which it is advertised provide another approach. For example, an advertisement for "PAKETA, the Original Russian Watch," that appeared in an American magazine, consisted of two segments. The first segment confronts the reader with text wholly in Russian. The text appears alongside a clenched fist and bare wrist on a red background, reminiscent of a wartime poster from an earlier era. The second segment, on a separate page, provides the fully translated text. In this segment, the wrist, formerly bare, now wears the wristwatch, whereas the clenched fist has been transformed into a victory sign. Considering the advertisement as a whole, the red background, the images of the hand, and the unexpected encounter with copy in Russian serve both to involve the reader and to evoke associations of the originating country. One might speculate that the initial encounter with printed Russian, arguably an unusual event in an American magazine, might prompt the reader to examine more closely the subsequent copy in English. In this instance the Russian copy, rather than serving a purely linguistic purpose, functions both to emphasize a national boundary and to reinforce the idea that the brand is imported (Fern & Brown, 1984).