This paper tests a model of combined effects of country, corporate and brand image on consumers’ evaluation and purchase intention, in the context of international marketing of a higher education service. Results indicate that all three images have the power to influence a student’s overseas study destination choice

Lawley, Meredith

Zhou, Peng

English

Peng, Z

Lawley, M A

USC Research Bank - University of the Sunshine Coast

Consumer Image Effects in International Marketing of a Service

University of Southern Queensland ePrints

  1 CONSUMER IMAGE EFFECTS IN INTERNATIONAL MARKETING OF A SERVICE  Zhou Peng, University of Southern Queensland, Australia Meredith Lawley, University of the Sunshine Coast, Australia  ABSTRACT  This paper tests a model of combined effects of country, corporate and brand image on consumers’ evaluation and purchase intention, in the context of international marketing of a higher education service. Results indicate that all three images have the power to influence a student’s overseas study destination choice.   INTRODUCTION  Country, corporate and brand images have been researched in different areas of business such as international business (Phau and Prendergast 1999; Han 1990), marketing (Lapierre 1998) and consumer behaviour (Bhat and Reddy 1998). However, most past studies tend to approach these images separately, while consumers may employ all three images in their purchase decisions. Moreover, services have not been well represented in the image literature (Phau and Prendergast 1999), despite their growing importance in international trade (Mazzarol and Soutar 1999). The problem for this research is: What are the interrelationships between country, corporate, and brand images and a consumer’s purchase intention for an international service? This problem is addressed by testing the combined effects of country, corporate and brand images on consumers’ purchase intention for an education service, MBA programs from four English-speaking countries, that is, the USA, the UK, Canada and Australia, to prospective students in China.  MODEL DEVELOPMENT  This research draws on image theory and student destination choice theory. Based on this literature review, a structural model (Figure 1) was developed including the five constructs of country image, corporate (university) image, brand (program) image, product evaluation and purchase intention. The proposed model was developed with reference to the Fishbein-Ajzen notion. Earlier image studies suggested that consumers’ rational mental activities in high involvement situations were most likely to follow such a procedure of beliefs→attitude→intention (for example, Han 1990), as implied in the Fishbein-Ajzen (1975) behavioural intention model. Despite this procedure being tested as applicable to manufactured goods (Chung and Pysarchik 2000; Chan and Lau 1998), this research attempts to examine its applicability to international trade of higher education services. Figure 1 illustrates this model. Seven propositions were formulated. Firstly, country image was assumed to be the first source that consumers consider in their evaluation for three reasons. Firstly, country image is of increasing importance in the era of globalisation (Samiee 1994). Secondly, country image locates at the highest level in a consumer’s hierarchical image structure (Papadopoulos and Heslop 1993). Finally, country image has been found to positively impact consumers’ product evaluation (Peterson and Jolibert 1995). While little is known about country image’s effect upon consumers’ attitudes for services (Phau and Prendergast 1999), past studies on student destination choice suggest a relationship (Lawley 1998). Thus, the first proposition is: P1 Country image positively influences consumers’ product evaluation for a service.  Consumers’ perceptions of a company are thought to impact their attitudes toward products originating from that company (Lapierre 1998). However, supporting evidence for these arguments is scarce, particularly in relation to services (Nguyen and LeBlanc 1998). Hence, the second proposition is: P2 Corporate image positively influences consumers’ product evaluation of a service. Similarly, brand image is assumed to be an antecedent of product evaluation. Past studies have indicated that brand image could be an important information cue consumers use in their product assessments (Nebenzahl and Jaffe 1996). Given the importance of brand image for services (Onkvisit and Shaw 1989) and the lack of research in this area (Padgett and Allen 1997), the third proposition is: P3 Brand image positively influences consumers’ product evaluation of a service.    2 Firstly, country image was assumed to be the first source that consumers consider in their evaluation for three reasons. Country image is of increasing importance in the era of globalisation (Samiee 1994). Secondly, country image locates at the highest level in a consumer’s hierarchical image structure (Papadopoulos and Heslop 1993). Finally, country image has been found to positively impact consumers’ product evaluation (Peterson and Jolibert 1995). While little is known about country image’s effect upon consumers’ attitudes for services (Phau and Prendergast 1999), past studies on student destination choice suggest that a similar relationship between country image and product evaluation can be expected in international marketing of higher education services (Lawley 1998). Thus, the first proposition is: P1 Country image positively influences consumers’ product evaluation for a service.  Consumers’ perceptions of a company are thought to impact their attitudes toward products originating from that company (Lapierre 1998). However, supporting evidence for these arguments is scarce, particularly in relation to services (Nguyen and LeBlanc 1998). Hence, the second proposition is: P2 Corporate image positively influences consumers’ product evaluation of a service.   Similarly, brand image is assumed to be an antecedent of product evaluation. Past studies have indicated that brand image could be an important information cue consumers use in their product assessments (Nebenzahl and Jaffe 1996). Given the importance of brand image for services (Onkvisit and Shaw 1989) and the lack of research in this area (Padgett and Allen 1997), the third proposition is: P3 Brand image positively influences consumers’ product evaluation of a service.  Fourthly, the relationship between product evaluation and purchase intention is assumed to follow the theory of reasoned action in high involvement situations. Product evaluation is induced by a sum of belief expectations on a set of attributes (Fishbein and Ajzen 1975). In turn, product evaluation is regarded as a predictor of consumers’ purchase intention. Earlier studies confirmed this relationship for manufactured goods (for example, Han 1990). To investigate the applicability of this relationship to services, the fourth proposition as denoted by the research model in figure 1 is: P4: Product evaluation positively influences a consumer’s purchase intention for a service. Finally, relationships may exist between the three images because they are engaged in a network of marketing leverage (Dowling 1994). Therefore, three more propositions are developed to reflect these relationships respectively: P5: Country image and corporate image influence each other. P6: Country image and brand image influence each other. P7: Corporate image and brand image influence each other. In short, the research model postulates that all three images may jointly influence a consumer’s product evaluation and purchase intention, while the three images may relate to each other.   METHODOLODY  The research incorporated both qualitative and quantitative methodologies. Qualitatively, two focus groups and five in-depth interviews were conducted with 20 Chinese postgraduate students in Australia to operationalise the three image constructs. A set of 26 measures was verified through an online test with 12 prospective MBA applicants in China. Four English-speaking countries were chosen as competing countries because they are the top four destination countries for Chinese students (that is, the USA, Canada, the UK and Australia) (Böhm and King 1999). One MBA program available from one university of each of these four countries was selected because they had been identified as representative ones for each country and had many details with which they could be compared (IDP 1994). The second, quantitative stage tested the model with data from 199 usable questionnaires collected from two cities of Beijing and Shanghai. Structural equation modelling, using a two-step approach, was used to analyse the data (Anderson and Gerbing 1988). The first step comprised confirmatory factor analysis of the three image constructs. Eight poor indicator variables were detected and removed from further analysis. As a result, eighteen measurement variables were verified for the three image constructs.   RESULTS AND DISCUSSION  The second step involved testing the structural model with results reported in Table 1. Considering the research tests joint effects of the three images for the first time and the measurement instrument developed has never been tested before, the model fit results are considered acceptable. Four out of the five goodness-  3 of-fit criteria are well met across the four destination countries while results for AGFI are within (0.902 for the United Kingdom) or close to (0.899 for Australia, 0.899 for Canada and 0.888 for the United States) the threshold value as noted in Table 1. In addition to the goodness-of-fit indexes for the overall model, significance of individual parameters, in terms of critical ratios and standardized regression weights, was consulted to evaluate proposed relationships between the three image constructs and product evaluation and purchase intention as reported in Table 2. All propositions are supported by the data. Relationships between the three images and product evaluation and purchase intention are confirmed because all but one of the standardized regression weights are significant. Only one insignificant standardized regression weight was detected between program image and product evaluation for the USA, but even in this case the critical ratio (which is 1.912) is close to the threshold value of 1.96. Relationships between the three image constructs are also evidenced because correlation coefficients are momentous across the four destination countries. For example, the standardized correlation coefficient for Australia is 0.814 between country image and university image, 0.870 between country image and program image, and 0.878 between university image and brand image.  In brief, all three images of country, corporate and brand can influence consumers’ product evaluation to different extents depending on the specific research context. For example, while country image was found to have greater impact on consumers’ overall attitudes than brand image for Canada, the UK and the USA, the contrary situation is true for Australia. Similarly, while corporate image was found to be more important than brand image for Canada and the USA, it had less effect on consumers’ product evaluations than brand image for Australia and the UK. Thus, findings of this research suggest that past arguments about whether brand image or country image is more important can now be redirected to whether results of different research are comparable. That is, because different researchers may identify different items to operationalise the same image construct in different contexts, results of most past image studies are generally incomparable about which image has greater influence on consumers’ product evaluation. Indeed, this finding of the context-specific nature of image effect is supported by an earlier meta-analysis of country-of-origin studies (Peterson and Jolibert 1995). Two further findings relating to the research problem can be noted. Firstly, while reciprocal relationships between country, corporate and brand image have been tentatively proposed, this research empirically confirmed these reciprocal relationships. Secondly, consistently with earlier studies (for example, Lawley 1998), this research confirmed the proposition that consumers’ product evaluation will positively influence their purchase intention for a high involvement international service.   CONCLUSIONS, IMPLICATIONS AND LIMITATIONS  This research contributes to theory by bringing together the existing knowledge in country, corporate and brand image studies and using these three images to predict consumers’ attitudes and intentions, specifically in the context of international education.  In addition, the findings have practical implications for international education practitioners. For those in destination countries, perceptions of prospective Chinese students can be used to re-examine and adjust their China-specific marketing policies and strategies. For educational agents in China, the items verified as important in prospective students’ overseas study choices can be used to improve their consultation services.   Three limitations of this research are noted. Firstly, although the measurement instrument was sensitive enough to capture variances of the observed variables, further refinement of the scales is needed to improve validity and reliability. Secondly, caution should be taken when generalizing results of this research across China because the data was collected from only two metropolitan areas. Finally, good model fit does not necessarily imply that a model represents a valid reflection of reality. All that can be expected from good fit indexes is some indication that the model could be a good representation of relations between variables (Mueller 1997).    4 REFERENCES  Anderson, James C. and David W. Gerbing 1988. “Structural Equation Modeling Practice: A Review and Recommended Two-Step Approach.” Psychological Bulletin 103 (3): 411-423.  Bhat, Subodh and Srinivas K. Reddy 1998. “Symbolic and Functional Positioning of Brands.” Journal of Consumer Marketing 15 (1): 32-43.  Böhm, Anthony and Roger King 1999. Positioning Australian Institutions for the Future: An analysis of the international education markets in the People’s Republic of China. Sydney: IDP Education Australia.  Chan, Ricky Yee-Kwong and Lorett Lau 1998. “A Test of the Fishbein-Ajzen Behavioral Intentions Model under Chinese Cultural Settings: Are there any Differences between PRC and Hong Kong Consumers?” Journal of Marketing Practice: Applied Marketing Science 4 (3): 85-101.  Chung, Jae-Eun and Dawn Thorndike Pysarchik 2000. “A Model of Behavioral Intention to Buy Domestic versus Imported Products in a Confucian Culture.” Marketing Intelligence & Planning 18 (5): 281-291.  Dowling, Grahame R. 1994. Corporate Reputations: Strategies for Developing the Corporate Brand. Melbourne: Longman Professional.  Fishbein, Martin and Icek Ajzen 1975. Belief, Attitude, Intention and Behaviour: An Introduction to Theory and Research. Reading: Addison-Wesley Publishing Company.  Han, C. Min 1990. “Testing the Role of Country Image in Consumer Choice Behaviour.” European Journal of Marketing 24 (6): 24-40.  IDP 1994. Comparative Analysis of Costs of Postgraduate Courses for Overseas Students in Australia, New Zealand, the UK, Canada and the US. Canberra: IDP Education Australia Limited.  Lapierre, Jozée 1998. “The Role of Corporate Image in the Evaluation of Business-to-Business Professional Services: The Case of Consulting Engineers.” Journal of Professional Services Marketing 16 (1): 21-41.  Lawley, Meredith 1998. “Choice of Destination in International Education: A Cross National Model.” PhD thesis. The University of Southern Queensland at Toowoomba.  Mazzarol, Tim and Geoffrey Soutar 1999. “Sustainable Competitive Advantage for Educational Institutions: A Suggested Model.” The International Journal of Educational Management 13 (6): 287-300.  Mueller, Ralph O. 1997. “Structural Equation Modeling: Back to Basics.” Structural Equation Modeling 4(4): 353-369.  Nebenzahl, Israel D. and Eugene D. Jaffe 1996. “Measuring the Joint Effect of Brand and Country Image in Consumer Evaluation of Global Products.” International Marketing Review 13 (4): 5-22.  Nguyen, Nha and Gaston LeBlanc 1998. “The Mediating Role of Corporate Image on Customers’ Retention Decisions: An Investigation in Financial Services.” International Journal of Bank Marketing 16 (2): 52-65.  Onkvisit, Sak and John J. Shaw 1989. “Service Marketing: Image, Branding, and Competition.” Business Horizons January-February: 13-18.  Padgett, Dan and Douglas Allen 1997. “Communicating Experiences: A Narrative Approach to Creating Services Brand Image.” Journal of Advertising 26 (Winter): 49-63.    5 Papadopoulos, Nicolas and Louise A. Heslop 1993. Product-Country Images: Impact and Role in International Marketing. New York: International Business Press.  Peterson, Robert A. and Alain J. P. Jolibert 1995. “A Meta-Analysis of Country-of-Origin Effects.” Journal of International Business Studies 26 (Fourth Quarter): 883-900.  Phau, Ian. and Gerard Prendergast 1999. “Integrating Country of Origin Research: Concepts, Methods and Strategies.” Journal of International Marketing and Exporting 4 (August): 71-83.  Samiee, Saeed 1994. “Customer Evaluation of Products in a Global Market.” Journal of International Business Studies 25 (Third Quarter): 579-604.  Figure 1. The structural model with associated research propositions              Table 1. Results of goodness-of-fit evaluation across the four destination countries  Destination country χ2 p DF CMIN/DF GFI AGFI RMSEA  170.112 0.376 165 1.031 0.920 0.899 0.013 Canada 175.763 0.269 165 1.065 0.920 0.899 0.018 The United Kingdom 178.626 0.222 165 1.083 0.923 0.902 0.020 The United States 185.133 0.135 165 1.122 0.912 0.888 0.025  Note: Cut-off values are: χ2 associated p>0.05, CMIN/DF<3, GFI>0.90, AGFI>0.90, RMSEA<0.08.    Table 2. Parameter estimates of the structural model   Parameters Australia Canada UK US S.E. C.R. S.E. C.R. S.E. C.R. S.E. C.R. Regression weights  Country image → Product  evaluation 0.164 2.717 0.407 7.066 0.468 8.332 0.601 6.891  University image → Product evaluation 0.233 3.253 0.362 6.645 0.267 5.663 0.353 6.159  Program image → Product evaluation 0.618 6.934 0.277 5.104 0.367 6.863 0.101 1.912*  Product evaluation → Purchase intention  0.879 25.891 0.812 19.551 0.707 14.048 0.828 20.747 Correlation coefficients  Country image ↔ University image  0.814  0.815  0.608  0.717   Country image ↔ Program image  0.870  0.821  0.680  0.712   University image ↔ Program image  0.878  0.830  0.515  0.624   Note: S.E. stands for standardized estimate, C.R. is abbreviation of critical ratio, figure with an asterisk (‘*’) is insignificant.      Country image Corporate (university) image  Brand (program) image Product evaluation Purchase intention +P1 +P3 +P4 +P2 P6 P5 P7 

A Model of Behavioral Intention to Buy Domestic versus Imported Products in a Confucian Culture.”

A Test of the Fishbein-Ajzen Behavioral Intentions Model under Chinese Cultural Settings: Are there any Differences between PRC and Hong Kong Consumers?”

Belief, Attitude, Intention and Behaviour: An Introduction to Theory and Research.

Choice of Destination in International Education: A Cross National Model.” PhD thesis.

Communicating Experiences: A Narrative Approach to Creating Services Brand Image.”

Comparative Analysis of Costs of Postgraduate Courses for Overseas Students

Corporate Reputations: Strategies for Developing the Corporate Brand.

Customer Evaluation of Products in a Global Market.”

Integrating Country of Origin Research: Concepts, Methods and Strategies.”

Positioning Australian Institutions for the Future: An analysis of the international education markets in the People’s Republic of China.

Structural Equation Modeling Practice: A Review and Recommended Two-Step Approach.”

Structural Equation Modeling: Back to Basics.” Structural Equation Modeling

Sustainable Competitive Advantage for Educational Institutions: A Suggested Model.”

Symbolic and Functional Positioning of

Testing the Role of Country Image in

The Mediating Role of Corporate Image on Customers’ Retention Decisions: An Investigation in Financial Services.”

The Role of Corporate Image in the Evaluation of Business-to-Business Professional Services: The Case of Consulting Engineers.”

Consumer image effects in international marketing of a service

http://eprints.usq.edu.au/6597/2/Peng_Lawley_2003_PV.pdf

Consumer image effects in international marketing of a service

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