Country-of-Origin Effect and Consumer Psychology in the International Trade of Ceramics

Abstract

This paper focuses on how the perception linked to a product national image influences the judgment and the behavioural reactions in heritage based products markets. Based on information processing and signaling approaches, the study hypothesizes a two-path mediation hypothesis whereby brand trust and perceived risk convey the effect of the national image cues on the perceived quality, purchase intention, and willingness to pay. Structural Equation Modeling and multigroup were used to analyze a quantitative, cross-sectional survey of 100 respondents representing different countries and product categories. The findings suggest that positive national image perceptions contain a good effect on perceived quality and brand trust besides having a negative effect on perceived risk. Trust was found as the most positive mediator of the purchase intention of willingness to pay and the perceived risk had lesser albeit significant negative effect. The analysis has also identified a significant level of heterogeneity in terms of demographic and cultural groups: older and high-income respondents were more likely to use trust cues, and the low-income groups were more sensitive to perceived risk. Comparisons between products of different types indicated that heritage-focused daily-use products were the ones that expressed the best connection between the image of a nation and the perceived quality. The results contribute to theory by conceptualizing national image as psychological capital with positive (trust) and negative (risk) processes and developing practical implications to the heritage-product branding, segmentation, and risk-reduction strategies in international markets.