PurposeThe purpose of this paper is to examine the effects of country stereotyping, bad press, and consumer ethnocentrism on the prices a country can command and be competitive.Design/methodology/approachA total of 767 consumers were given prices for products in 11 different categories, then told each product was made in China. They were then asked how much more (if anything) they would be willing to pay if the product was made in Germany, the USA, or India.FindingsPrice premiums were significant for all categories, and increased for those scoring higher on a Consumer Ethnocentric Tendencies Scale (CET Scale). However, completing the CET Scale before answering price questions caused respondents to have a lower price premium for US products. The size of the price premium was also positively correlated with the amount of exposure to negative news concerning Chinese products.Research limitations/implicationsIt is unknown how consumers would respond to categories not studied.Practical implicationsThe cost of setting up government controls and industry oversight is expensive. However, the cost of negative news with product recalls is also expensive. Countries who avoid such negative news may be able to price their products 14 percent to 100 percent higher.Originality/valueThis study quantifies price premiums available to countries with a positive COO image. It also allows a manager to determine the feasibility of developing domestically produced products in specific categories, by identifying categories where consumers would pay a premium for domestically produced products.
Purpose -Studies on optimal discount levels have sometimes yielded contradictory results, leaving practitioners with unclear direction. This paper proposes clarifying the optimum discount levels. Design/methodology/approach -This study asked 453 consumers to choose their own optimal discount levels (from 0-80 percent) for eight product categories across two distribution channels (physical store and online merchant). Then they were asked if the reason if they did not always select the deepest discount. Findings -Only 13 percent selected the 80 percent discount level for each product and each channel, despite seeing the exact price they would pay at each level. In support of attribution theory, 88 percent of the consumers attributed at least one cause for the deepest discounts. Most frequently cited were concerns about quality problems, damaged goods, or stolen goods. Consumers also opted for lower discount levels from the online merchant than from the physical store. There was a wide divergence by product category, with consumers selecting smaller discounts on tires and cereal and the deepest discounts on shirts. Research limitations/implications -Given the divergence across product categories, it is unknown how consumers would respond to categories not studied.Practical implications -This paper has revealed strong consumer perceptions about discount risks and the tradeoffs consumer make between risk and financial benefit across different product categories, both online and off -which can help marketing practitioners in setting discount levels. Originality/value -By allowing consumers to select their own preferred discount levels, it is shown that most customers attribute some risk to them.
The results from the authors's applied research studies of communications‐effect and electroencephalographic (EEG) recording, which took place over the last ten years, employing thousands of respondents, are integrated in this paper. Application of EEG methodology to ad research, rather than theory, is stressed. Brain Wave Analysis
, an EEG technique, is described. A positive relationship determined between Brain Wave Analysis and sales is discussed, as well as various applications such as “brain typing” the target market. The application of Brain Wave Analysis in determining effective advertising frequency is discussed as it relates to Krugman's three exposure theory. The continuing development of EEG analysis is briefly discussed.
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