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Determinants of International Brand Recognition among
Malaysian Consumers
Khairul Anuar Mohammad Shah,
School of Management,
Universiti Sains Malaysia, Malaysia.
Email: [email protected]
Hazril Izwar bin Ibrahim,
School of Management,
Universiti Sains Malaysia, Malaysia.
Email: [email protected]
___________________________________________________________________________
Abstract
This study purposes to explain the concept of brand recognition and to shed light on what
constitutes consumer recognition of international brands among Malaysians consumers. One
of the major objectives is to determine the predictors of international brand recognition and
their relationship with the dependent variable, and measure their magnitude of influence. By
reviewing existing literatures on brand awareness and how it impacts consumer attitudes and
behaviours, the current study delve into the roles of product price, quality, design as well as
country-of-origin effects on brand awareness in which brand recognition is a subset of. Data
collected from a self-administered questionnaire indicates some form of correlation between
independent and dependent variables.
___________________________________________________________________________
Keywords: Brand Recognition, Quality, Price, Design, Country of Origin
JEL Keywords: Brand, Brand Preference
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1. Introduction
The prevalence of international business in this increasingly globalised economy has
enabled consumers to benefit from the many varieties of goods from all over the world. Of
course, every product is tied to a specific brand and consumers tend to buy what they think
will fulfil their needs and wants.
The same scenario is present in the Malaysian consumer market. Table 1.1 shows that
within 10 years, Malaysia’s total trade with foreign countries nearly doubled in 2011 since
2000. With imports amounting to RM 574.23 billion compared to just RM311.46 billion in
2000, it is a sure sign of growth as well as indicator of potential growth.
Table 1: Malaysian Trade
Source: MATRADE (http://www.matrade.gov.my/en/malaysia-exporters-section/33-trade-
statistics/1765-malaysias-trade-with-the-world-2000-2010)
The following table lists out Malaysia’s top ten partners in international trade in 2010,
together with their respective values and share of total trade. Almost half of the market
(46.4%) is dominated by China, Singapore, Japan and the United States, with trade values
exceeding RM 100 billion each.
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Table 2: Malaysian Trading Partner
Source : MATRADE (http://www.matrade.gov.my/en/malaysia-exporters-section/33-trade-
statistics/1134-malaysias-top-10-trade-statistics-for-the-year-2010-country)
Linking the trends of rising trade volume, increasing import volume indices and growing
household income, with a sizeable portion of consumer expenditure in the areas of transport
and communications, residence, leisure and recreation, and food, ceteris paribus, consumers,
who now have higher purchasing power can benefit from enjoying a more extensive variety
of goods, be it local or imported. With more goods on the shelves and higher purchasing
power, the question lies in the power of a product to attract people.
Defined broadly, a brand is a set of perceptions and images that represent a company,
product or service, which promises the customer what will be delivered or experienced.
Similarly, brand recognition is the extent to which consumers associate a brand with the
product they wish to purchase. Brands whose goods are widely recognised by the public
become household names. Some examples include brands for baby diapers (Procter &
Gamble’s Pampers), instant food (Nestlé’s Maggi), and stationeries (3M’s Post-it Notes). It is
therefore evident that consumers’ ability to recognise and associate a brand with a product
(vice-versa) impacts their spending decisions and thus the market share of certain consumer
goods.
Very often we make both conscious and unconscious decisions whether or not to
purchase a product. Managing a brand focuses on capturing the consumer market by first
establishing brand recognition among potential buyers. This can only be done when the
elements of brand recognition are determined. Much can be learnt about the factors that
consumers consider especially when they decide between foreign and local goods.
With these issues in mind, one may question the methods the average consumer use that
initiate or trigger the ability to recognise an international brand. What are the aspects that
Malaysian consumers emphasise or consider that in the end enable them to recognise
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international brands? Would the factors be product-related or would they be consumer-
oriented?
2. Literature Review
Rossiter and Percy (1987) stated that many have misconceptions about brand awareness
due to the fact that there are two types of brand awareness, namely brand recognition and
brand recall. They explained further that recall of the brand name is not necessary in brand
awareness because it is possible that consumers can identify a brand by its location (“the store
next to the school”) or its physical appearance (“the sauce with the square bottle”). However,
brand recall may not be required for purchase; mere recognition of a particular brand like
“Hey that’s the new barbeque sauce they call the X-Factor” may be enough to induce
purchase.
Brand recognition according to Howard and Sheth (1969) plays a crucial role in
determining consumers’ consideration set – which is a set of brands in which serious attention
is given by consumers when making a purchase. Baker et al. (1986) supported the importance
of the composition of this consideration set. A brand that possesses some level of brand
recognition will far more likely be considered, and thus chosen by consumers compared to
brands that are less recognised. Wilson (1981) confirmed the relevance of top-of-mind
awareness in a study which found that the higher the position of a brand in the consumer’s
mind measured by unaided recall, the higher the purchase intention and the higher the relative
purchase of the brand. With that position, it will be much easier for the consumers or potential
consumers to communicate about the brand to their friends and relatives. According to
Rossiter and Percy (1987), brand recognition is essential in a brand’s communication process.
For purchase to occur, consumers must first be made recognize of a brand, because brand
attitude cannot be formed, and the intention to buy cannot exist unless these activities take
place.
Price will always be an indicator for the quality perception and indirectly the recognition
towards certain brands. For example, Etgar and Malhotra (1981), examined the effect of price
on selected quality cues, such as price, on the comfort, durability, and style of running shoes.
Similarly, Lichtenstein, Bloch, and Black (1988) considered specific quality dimensions of
running shoes to examine price-quality inferences, just to name few of earlier studies that
includes price as a cue for product quality. For the definition, Maynes (1976) defined the
perfect information frontier as a set of points in price-quality space for which a given level of
quality can be purchased at the lowest possible price. Consumers who are perfectly informed
and are rational would only purchase goods which lie on the frontier, between the two
extreme price levels. Huang et al. (2002) stated that the belief in price-quality inference, that
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“high price translates to high quality” and “low price signals low quality”, is crucial
especially in pricing theory and in predicting consumer behaviour. The price expectancy
model of consumer choice states that evaluation of goods by consumers involves comparisons
of actual price with a reference price or expected price derived from product quality and
price-quality correlation (Ordonez, 1998).
Furthermore, Tellis and Gaerth (1990) examined the impact of information on consumers’
choice strategies and discovered that when there is imperfect information on product quality,
the price-quality correlation plays a significant role towards influencing consumer behaviour.
From their perspectives, when the information about such products are very limited (because
there are so many criteria to be considered while assessing the quality of a product),
consumers’ tend to look into the price of the products as an important cue of product quality.
Bearing this in mind, it is plausible to assume that consumers’ ability to recognise
international brands could also be affected because of the lack of information on the product
itself.
For the design of product, Townsend and Sood (2012) affirms the motivation of people
for choosing high design or in simpler terms products with relatively superior physical
attributes, is an effort to boost one’s sense of self. This innate drive for self-affirmation is not
just randomly directed at the more costly option or the generally higher quality option, but
very specifically at the more aesthetically pleasing one. Their results have also confirmed
people’s desire for beautiful objects as an intrinsic value, and consumers are almost always in
a state of seeking affirmation from external sources. Similarly, a study conducted by
Landwehr et al. (2012), they acknowledged the importance of aesthetics in creating and
maintaining favourable responses from consumers. These two studies shows the importance
of product design to attract the consumers and with that attraction, indirectly it will become
the recognition of consumers towards that brand as a step above the others. That is why
several brands getting more attentions from consumers compared to the others. Just simply
because of the design.
In the country of origin study, researchers suggested that the relevance of country-of-
origin connects to the fact that favourable perceptions of a particular country lead to
favourable consumer attitudes toward its products and brands, which in turn influence
consumers’ purchasing intentions (Martín and Cerviño, 2009). There are two main
interpretations of country-of-origin: the most common explanation for country-of-origin,
which is where a product is manufactured in, with “Made in ...” found in most product labels;
and country where the brand was originated and from where it takes its personality, regardless
of the place of manufacture or parent firm headquarters location (Martín and Cerviño, 2009).
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Country of origin effects defined as any influence that a country of manufacture,
assembly or design has on a consumer’s positive or negative perception of a product (Cateora
et al., 2010). Since a company competing in the global marketplace today manufactures
products worldwide, the place of manufacture can possibly affect product or brand image
when a customer becomes aware of the country-of-origin. The country, type of product and
the image of the company and its brands all influence whether the country-of-origin will
generate a positive or negative reaction. Even so, consumers have broad but somewhat vague
stereotypes about specific countries and specific product categories that they judge “best” i.e.
English tea, French perfume, Chinese silk, Italian leather, Japanese electronics and so on.
Kinra (2006) mentioned that consumer attitudes toward a specific brand “can be
substantially changed, either favourably or unfavourably, through the brand’s country-of-
origin image, which more or less influences the brand preference of consumers. Yassin et al.
(2007) research showed the influence of a brand’s country-of-origin image on brand equity,
either directly or indirectly, through brand distinctiveness, brand loyalty and brand awareness
or association. The study also revealed that country-of-origin image positively and
significantly impacts brand distinctiveness, since consumers develop interest and preference
for a brand on the basis of their perception of the country-of-origin and other available
information pertaining to the brand.
Figure 3: Research Framework
3. Research Methodology
The causal-explanatory purpose of this research intends to explain the relationship
between the variables. In the context of this study, researcher intends to find out whether
product attributes and/or consumer attributes influence Malaysian consumers’ recognition of
international brands. This is a cross-sectional study where research is carried out once and
represents a snapshot of one point in time. It involves observation of all of a population, or in
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this case a representative subset, at one specific point in time. Although a longitudinal study
has the advantage of tracking particular changes over time, the current research are more
concerned with constraints of budget and time. Collection of data spans a period of two to
three weeks. The topical scope of this study is a statistical one. Designed for breadth rather
than depth, it attempts to capture a population’s characteristics by making inferences from a
sample’s characteristics. With hypotheses tested quantitatively, generalisations about findings
are presented based on the representativeness of the sample and the validity of the design.
The decision to use a survey research in the present study is also because it is the most
common form of research design used in country of origin studies (e.g. Jaffe and Martinez,
1995; and Balabanis and Diamantopoulos, 2004), and other consumer behaviour studies
(Wang and Rao, 1995). Strengthening the decision to use a survey approach is that it is the
most flexible means of obtaining data from respondents as well as providing an opportunity to
examine causal relationships and performing the analyzing task of a complex and
sophisticated analysis technique (Zikmund, 2000).
This study is implemented via collection of questionnaire responses from respondents
who are Malaysians from different states in Malaysia. Despite utilising neither the field
setting nor laboratory setting, and knowing that respondents are aware that their responses
will be used in this study, there is a relatively high participant perceptual awareness where
they perceive that research is being conducted and this will have implications on the
outcomes of the research. Nevertheless, the purpose of research is to ascertain the factors
affecting Malaysian consumers’ recognition of international brands, so the best possible
means to find out is through a survey in which they indicate their preferences and have them
recorded.
The target population of this study encompasses Malaysian consumers, while the
sampling frame is Malaysian consumers aged 14 and above from different generational
cohorts, that reside in different states across Malaysia, who have varying or similar
demographical profiles i.e. employment status, level of education. With a population of 29,
628, 392 (2013, July estimate), 65.7% are between 14 and 65 years. The gender ratio for the
15-64 age group averages at 1.04 male/female. However, due to time constraints, the sample
size is set at 100 respondents from different states who will record their responses in an online
questionnaire. The simple random sampling method is used provided that respondents are
Malaysians and are aged 14 and above. According to Malhotra (2010), simple random
sampling has many desirable features such as easily to understood, sample results maybe
projected to the target population and convenience. Those are the main reason why sample
random sampling technique is applied in the current research.
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This study utilises a questionnaire which is designed and distributed virtually to intended
respondents. It is often the lowest cost option and the least time consuming method to reach a
wider scope of participants given a limited time frame. Self-administered surveys are
perceived as more anonymous and may be a good way to minimise participant perceptual
awareness and obtain honest (and potentially extreme) responses. Data collection is done via
communication process whereby subjects are questioned and then have their responses
collected through personal or impersonal means. In this case, the collected data is a result
from self-administered instruments (structured survey composed and administered in Google
Docs) transmitted electronically (via the Internet) to Malaysians aged 14 and above who are
from different states.
4. Findings and Discussion
The target population consists of Malaysian consumers. The largest limitation during the
data collection is the time limitation. The given timeframe has resulted in a low sample size of
only 100 respondents from different states across Malaysia and have different demographic
information i.e. gender, age, occupation, level of education. All responses are recorded
virtually in a self-administered online survey form generated in Google Docs and sent via
electronic mail and its hyperlink posted public.
Of the 100 respondents who agreed to participate, 34% were male and the remaining 66%
are female. The biggest cohort has an age range of 14 to 23 years dominating 57% of the total
figure. Most of the participants in this cohort (47 of 57) are students from secondary schools,
or higher education institutions such as colleges and universities. Those aged 24 to 33 make
up the second largest group with 35 records and 26 of them (74.3%) are employed. Due to the
limitations of reaching respondents who are 34 years old and above, only eight people
responded: three in the 34 – 43 years category, two in the 44 – 53 years category, and three
aged 54 and above.
Figure 4: Demographic Profiling of Respondents
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It was noted that 66% of the respondents have or are pursuing a Bachelor’s Degree, while
15% and 10% are in the Diploma/STPM/Matriculation level and PMR/SPM level
respectively. Students comprise 48% of the respondents, while 44 are employed. Half of the
remaining eight respondents are self-employed; four are homemakers, of which, one is
pursuing post-graduate studies. From the results, the study also found that one fifth of the
respondents visit a shop (i.e. grocery store, convenience store, shopping complex) to make
purchases almost every day, while 43% does it once or twice a week. 19 of the 100 patronise
shops about twice each month, 17 once monthly, and 1 almost never does. A sizeable portion
of the participants have had experience with making purchases online, with 73 of 100
indicating “Yes”, while the remaining 27 indicated otherwise. However, only 5% of 79 (who
disclosed their frequency of shopping online) are regular e-shoppers. 36 of them spend money
online sometimes, while the remaining half (49%) does rarely. The summary of the
demographic profiles is presented in Figure 4.1.
Defined as the consistency of a measure, reliability ensures that the same results are
obtained, repeatedly. To test the reliability of the four proposed independent variables and the
dependent variable in this study as mentioned earlier, Cronbach’s Alpha coefficient
measurement is used. This analysis calculates the internal consistency of the data and shows
how well each item in a dataset is positively correlated. Results of Cronbach’s analysis of all
the variables in this research are shown in the following table (Table 4.1).
There is one exception however for “Product Price” since the alpha value obtained is a
negative one, which means that the average covariance among the items in Product Price
variable is negative. Even with one of the items removed, the highest alpha value reached is
only 0.23 which is less than half of the minimum 0.5 – not a satisfactory level to begin with.
Hence, with the reliability model assumptions violated, further analysis may be affected if
this variable is to be included in the study since it is possible that the functions of this
particular value have estimates outside theoretically possible ranges. The possible explanation
on this negative alpha is most likely with small sample sizes and small numbers of items, is
that while the true population covariances among items are positive, sampling error has
produced a negative average covariance in a given sample of cases (Nichols, 1999).
Furthermore, Nichols also explain that another possible reason may simply be the case that
the items do not truly have positive covariances, and therefore may not form a useful single
scale because they are not measuring the same thing.
Cronbach’s coefficient alpha values vary between 0.00 and 1.00. However, there is no
general agreement as to what constitutes good or very good levels of Cronbach’s alpha. Gabel
(1986) suggests that alpha coefficients in the high 0.80 or above should be considered good,
and Cortina (1993) suggests that alpha coefficients 0.85 or above are quite good. But, it is
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also important to know that Nunnally (1967) suggests that the alpha values that are above 0.5
can be considered as adequate.
Table 1: Cronbach's Alpha for Variables
Variables Number
of items
Number of items
Discarded Cronbach's Alpha
Product Price *3 - -0.110
Product Quality 3 - 0.594
Product Design 3 - 0.733
Country of Origin 3 - 0.500
International Brand Recognition 4 - 0.514
Alternative explanations for a low alpha value include inappropriate item coding and
weak association among items in one variable. This means that there is a low degree of
homogeneity or similarity among the items. It was therefore decided that the Product Price
variable is to be removed from this study in order not to compromise further analyses. As far
as this research is concerned, the remaining valid variables are now Product Quality, Product
Design, Country of Origin, and International Brand Recognition.
The summary of the descriptive statistics of the variables is shown below in Table 4.2.
Based on computations in SPSS, product quality recorded the highest mean of 4.2067,
followed by product design at 3.9354, country of origin with 3.9048, and international brand
recognition at 3.8119.
The standard deviations for all the variables lie between the range of 0.60 and 0.74. The
figures show how far every value in a given dataset varies from the mean.
Table 2: Descriptive Statistics
When the current study takes the observed values of X to estimate or predict
corresponding Y values, the process is called simple prediction. Multiple Xs (predictors) call
for multiple predictions – and this can be done using regression analysis. The variables were
tested significant with (p<0.01) and the F-value is 9.902. R2 is 0.248 which goes to show that
around 24.8% variations of international brand recognition can be explained by the quality,
Variables Number of items Mean Std. Deviation
Product Quality 3 4.2067 0.69110
Product Design 3 3.9354 0.73007
Country of Origin 3 3.9048 0.64926
International Brand Recognition 4 3.8119 0.60060
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design and country of origin of the product. Adjusted R2 is 0.223 while the Durbin-Watson
value is 2.079 – within the range of 1.5 – 2.5. This confirms that there is no autocorrelation of
the error terms.
Referring to Table 4.3, Product Design (denoted by DSN) is significant at 0.01 whereas
the value for the other two predictors QUA and COO are less significant with 0.125 and 0.070
respectively.
Table 3: Linear Regression Results
Model
Unstandardized Coefficients
Standardized
Coefficients
t Sig. B Std. Error Beta
1 (Constant) 1.526 .453 3.365 .001
QUA .127 .082 .147 1.547 .125
DSN .276 .078 .345 3.539 .001
COO .170 .093 .184 1.831 .070
a. Dependent Variable: REC
As we can see from the summary of the current study results in Table 4.4, only one
hypothesis is supported and the other two hypotheses are rejected. Surprisingly, not as
expected, product quality is not one of the important factors for the respondents to identify
and giving the recognition the global brands. Possible explanation on this insignificant result
is perhaps all peoples know that when we talk about brand recognition, it is no way that can
be separate from the existence of product quality. So it is impossible for people to recognize
certain brand without knowing the quality of such products. Hence, it is not important for
them to give the accurate answer to the question given.
Table 4: Summary of Hypothesis Testing
Hypothesis Descriptions Result
(Accept /Reject)
Beta
Value
H2 Product Quality is positively related to
International Brand Recognition Rejected 0.147
H3 Product Design is positively related to
International Brand Recognition Accepted 0.345**
H4 Product Country of Origin is positively related
to International Brand Recognition Rejected 0.184
** Significant at 0.01
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Similarly, for country of origin effects, many previous studies empirically show that it
will affect the attitudes of consumer. Contrastingly, for Malaysia consumer, at least for the
current study perspective, country of origin is not an important characteristic for the
consumers. In this case, perhaps Malaysian consumers are more liberal, i.e., they can actually
recognize any products from any country as long as its display the satisfaction level of
product quality for them. This is perhaps why country of origin is not an important indicator
of brand recognition for respondents of the current study.
5. Discussions and Conclusions
The hypothesis stating that product quality is positively related to international brand
recognition is rejected due to its significance value of 0.125 and a standardised beta value of
0.147. Monroe (1979) concept of a best purchase decision proposed a measure of objective
value in the ratio: Value = Quality/Price. Since quality is part of the function, an increase in
quality would also increase value, provided that price remains the same or decreases.
Consumers base their purchase decisions on their willingness to pay for a certain value of a
product, and if the price-quality inference holds true, consumers would have a positive
attitude towards products with relatively higher quality. Being not significant at 0.01, this
study suggests that product quality is insufficient to exert considerable influence on
international brand recognition by consumers.
Similarly for brand country-of-origin, the hypothesis testing also does not accept that the
country-of-origin for a brand has a significant positive effect on international brand
recognition – with a standardised beta value of 0.184 and its significance at 0.07. Although
Yassin et al. (2007) research showed that a brand’s country-of-origin image influences brand
equity through brand distinctiveness, brand loyalty and brand awareness or association, and
having found that the country-or-origin image positively impacts brand distinctiveness (which
could facilitate brand recognition, Samiee et al. (2005) study of brand country-of-origin
recognition accuracy proved that consumers’ knowledge of brand origin is limited. Therefore,
it could be the reason why this hypothesis testing was less significant, given that consumers’
failure of associating brands with their country-of-origin weakens the influence of country
image on their attitudes and purchase behaviour. Hence, brand recognition would be more
difficult in this situation. Furthermore, Paswan and Sharma (2004) proposed that a
consumer’s perceived country-of-origin is likely to influence the perceptions of a brand from
that country, only if the consumer is aware of the brand’s country-of-origin.
However, the design of a product was the only independent variable found to be
significant in positively influencing international brand recognition in this study – based on
the hypothesis that product design is positively related to international brand recognition. Its
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standardised beta value is 0.345 – highest of the three, and the variable is significant at the
0.01 level. This validates Schoormans and Robben (1997) statement that deviations in well-
known stimuli attract attention, and Landwehr et al. (2012) acknowledgement of the
importance of aesthetics in creating and maintaining favourable responses from consumers.
Attractive, appealing designs tend to be more persuasive and have powerful influence on
consumers’ decision processes, and that includes their recognition of the product brand, too.
Wang (2012) empirical results indicated that attitudes towards visual packaging directly
influence consumer-perceived quality and brand preference in his study on food products. If
people have a desire for beautiful (as well as eye-catching) objects and wish to acquire them,
adding that they are continuously seeking for self-affirmation, the effect of product design on
international brand recognition is definitely a substantial one in terms of the magnitude of
impact.
The current study comes out with several implications. First, product attributes can be
said as one of the main pull factors that lead to consumers deciding to buy a certain product –
by first paying attention to that particular brand or product. Price-quality inferences and
product design can be strategically modified in the short term to strengthen and enhance the
recognition of the brand a certain product carries, since brand image which is partly
influenced by consumers’ perceptions of the brand’s country-of-origin, takes a longer time to
build and is more static compared to the two former elements.
Furthermore, it is certain that the global market for consumer products has become very
complex and undoubtedly is continuously evolving just as these words are being typed out.
Product characteristics however are not the only factors that shape international brand
recognition. In fact, the personal profile and background also immensely affect their
perspective and later on their attitudes toward purchase. Hence, international marketers ought
to be equipped with the psychology of consumer behaviour as well as the production and
research and development departments do, in terms of ensuring product quality and
appealing, functional design. This can be done via extensive product and market research of
target markets. Because ultimately, the success of a brand and retailer – local or international,
is determined by how closely the product measure up to the image of the selling organisation
and in the end meets the different expectations of transnational consumers.
As a conclusion from the subject matter introduction, to reviews of published works by
scholars, the presentation and analyses of data, one thing is certain, that consumer recognition
is a fundamental element required for brands to establish themselves and make themselves
known through strategic brand management so that enhanced brand image and equity will
lead to improved consumer perception and attitudes towards the product, which ultimately
encourages purchase.
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