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Country of Origin

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Submitted By Dirkvdw
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Pages 15
Country-of-Origin: An Overvalued Phenomenon?

Date: 18 September 2014
Course: Marketing Management
Workgroup: 2
Amount of words: 3,487
Authors:
Dirk van der Wardt - 10868496

1. Introduction

‘Made in China, something we are proud of’

This sentence is the slogan of MISTERCHI, a company that sells scooters and motors fabricated in China. Their statement is an example of what academics call country-of-origin (COO). Just like MISTERCHI, multiple companies mention COO in their communication (Magnusson, 2011). In doing so, attempting to create positive product associations and increase purchase intentions amongst customers (Bilkey & Nes, 1982). Though COO is widely used, scientists debate its effectiveness (Balabanis & Diamantopoulos, 2008).

Before commencing this discussion, it is important to formulate an accurate understanding of this phenomenon. Jaffe & Nebenzahl defined COO as follows:

‘The country which a consumer associates with a certain product or brand as being its source, regardless of where the product is actually produced.’ (2006: 29).

According to Herz and Diamantopoulos (2013) the association can relate to both the country of manufacturing or the geographical origin of the product.

Dichter (1962) was the first to claim that the mention of COO by companies has ‘a tremendous influence on the acceptance and success of products’ (p.116). This was later proved by Schooler (1965), turning COO into a topic of interest for academics (Johanson, 1985; Godey et al., 2012). As mentioned before, the effectiveness of COO is debated. Recently some scientist opted that its effects have been inflated (Liefeld, 2004; Balabanis & Diamantopoulos, 2008). They therefore argue that COO has no significant effect on customer behavior.

Based on this development a claim counter arguing the influence of COO will be

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