Consumer trust on multinational brands

The trust construct is variously defined as: “a generalized expectancy held by an individual that the word of another can be relied on” (Rotter, 1967); “the extent to which a person is confident in, and willing to act on the basis of the words, actions, decisions of others” (McAllister, 1995); and, uniquely in the consumer domain, “the willingness of the average consumer to rely on the ability of the brand to perform its stated function.

When risk and price levels increase, consumers seek a safe purchase choice regarding functional brands through confidence and dependability, while in the case of symbolic brands consumers have to trust the brand in order to make a purchase choice.

Authenticity consists of three concepts, brand consistency (where brand consistency refers to ensuring that all stakeholders experience the same brand at all brand contact points (for example, packaging, advertising etc.), customer orientation (where brand customer orientation refers to the satisfaction of customer needs), and brand congruency (where brand congruency refers to staying committed to defined brand values).

The transfer of trust from person to brand There is some evidence that it is possible for trust to be transferred to a brand not from our own experience but through recommendations of people who belong to our close social environment, such as family and friends: Suspension is the mechanism of “bracketing the unknowable”, thus making expectations of the future “momentarily certain”.

Brand personality is defined as “the set of human characteristics associated with a brand” (Aaker, 1997) and research has examined the way the personality of a brand enables a consumer to express his own self, an ideal self, or numerous possible dimensions of the self through the use of a brand (Belk, 1988; Kleine et al., 1993).

Seen as multidimensional in the majority of marketing studies (Raimondo, 2000), trust is reported to be: involved, as part of “brand credibility”, in brand extension acceptance (Keller and Aaker, 1992); fundamental to the development of loyalty.

Product Quality

Product quality is rapidly becoming an important competitive issue. The quality product you produce, that will lead to a successful outcome in the long run for every business in this world. In business there are five most important dimensions which make a successful business and these are service quality, tangible, reliability, responsiveness assurance and identification (Azadavar, Shahbazi, & Teimouri, 2011). Success of a goods & services provider depends on the high quality relationship with customers (Panda, 2003) which determines customer satisfaction and loyalty (Jones, 2002 as cited by Lymperopoulos et al., 2006).

The assessment of consumer on a product based on quality is very essential characteristic in purchasing processes and consumers are conscious of quality difference of all products (Nugroho, & Wihandoyo, 2009). The service quality dimensions that play a significant role in

this equation are reliability, empathy, and assurance (Lo Liang Kheng, November, 2010). Quality is the major concern in every field of life, whether you buying some product or services. The findings show that improvement in service quality can enhance customer loyalty (IJMS November, 2010). The literature suggests that there is a significant role of product quality in buying behavior but it may vary from culture to culture.

Country of Origin: Consumers in western cultures have higher levels of domestic country bias because they exhibit

more favorable evaluations of domestic products than foreign products. (Cattin et al.1982)

When consumers know the COO, this knowledge affects their perceptions of both generic

product categories but also of specific brands. (Johansson&Nebenzahl, 1986)

Country of origin (COO) refers to information pertaining to where aproduct is made.

Marketers are particularly interested in the perceived image associated with the COO (Ahmed, et

al, 2001). COO image has been defined as "the overall perception consumers form of products of

a particular country, based on their prior perceptions of the country's production and marketing

strengths and weaknesses" (Roth and Romeo, 1992).

Baughn and Yaprak(1993) show that when customers evaluate foreign brand names,

culturally-specific factors play a role in weighing the COO as an attribute.

When consumer’s perceptions of the country of origin (COO) are favorable, they will

more likely create favorable consumer evaluations of a product based on factors such as brand

name rather than relying on their perceptions of product quality (Peterson & Jolibert, 1995).

Brand Image:Several studies show that preference for imported, branded products over domestic ones

seems to prevail among consumers in developing countries (Batra et al,2000). Consumers in

developing economies appear to perceive that products from developing countries are of lesser

quality and will result in higher levels of dissatisfaction (Okechuku & Onyemah, 1999).

Sankar (2006) conducted a study to examine consumer perception of global brands vs.

local brands in the Indian car industry. Consumer brand perceptions have substantial

implications in Marketing. The findings of the study advised that the consumers who possessed

global car brands, preferred their car brands due to factors such as global presence, worldwide

reputation, and quality of being a foreign maker. Prestige or status had a very little or no

influence in their preference for global car brands. Consumers made favorable perceptions of the

country, wherein they tend to associate factors such as superior quality, technical advancements,

modernization, etc…to the country from which the brand had taken its origin.

Fabrize(2013) conducted a study and findings were that the national brand elicits more

positive consumer perception than the foreign brands and the rating of a product is one of

important factors and can change consumer perception as a consequence using product rating

information to advertise a product.

A good example, Tata Motors Ltd., which is one of the largest private sector commenced

its distribution of Fiat cars across India as part of the new Tata-Fiat dealer network, is also

looking at tapping overseas markets through the partnership. The company is gearing up to re-

launch its best selling passenger car, Indica, in the United Kingdom under its own brand.

Consumers who owned a local car brand evaluated the local brand in a favorable manner,

wherein they tend to associate the brand to India’s strong automobile sector that makes quality

and technically efficient cars. Most of the respondents perceive local brands to be good in India,

but not as good as the global ones in quality, technical expertise and designs of the cars.

Moslehpour (2014) conducted a study to understand more about the customer behavior in mobile

phone industry of HTC and iPhone brands among Taiwanese college students. Nowadays, the

mobile phone industry in Taiwan is undergoing great competition.

In this study perceived brand quality (PBQ) and perceived brand prestige (PBP) were

identified as two main factors influencing consumer purchase likelihood (CPL) of HTC and

iPhone mobile phones. (DelVecchio& Puligadda,2012) indicated that lower perceived brand

quality can result in lower purchase likelihood. Meta-analyses of the related research Indicated

that perceived brand prestige is also an important influencing factor on consumer purchase

likelihood. Taiwanese consumers will choose HTC because of its perceived quality; however,

they would choose iPhone, because of its perceived prestige. Taiwanese college consumers are

more interested in keeping up with the world of fashion. They are willing to purchase high

quality foreign famous brands at high prices. Taiwanese customers consider quality is more

important than prestige when they purchase a mobile phone. Value added Features:

Large number of respondents prefer to purchase the mobile phone handset with value added

features like camera, large screen, familiar brand and low price, these results also support the

studies by Liu (2001), Karjaluoto(2003), Alkio (2004) and Gartner (2004). The respondents also

focused those service provider companies that offer the services such as SIM at low rate, free

minutes, low call rates and call clarity.

This study is exceptional in the sense that it has investigated the general opinion of young

generation regarding the purchase of mobile phone handset and mobile phone services of various

companies the study also concluded that the purchase preference is not discriminated by the

gender of the respondents.

"Customer trust is positively associated with multinational brands"

Customer trust is dependent variable and Multinational brand is an independent variable.

Pakistani consumer most probably favor multinational brands so we can say that our

hypothesis is correct that is Pakistani consumer has a trust for multinational brands. As in

Pakistan mostly consumers are people oriented i.e. they will buy those products which

are socially acceptable. Many of their purchase decision involves the suggestions of

reference groups. We also found that people trust more on multinational brands because

international brands well satisfy their needs as compare to local brands. We also conclude

that people want to look unique that's why they go for the multinational brands.

Hypothesis

For this purpose, there are Fourhypothesis are developed on the basis of literature review.

o H1; Brand image has positive relationship with customer trust on brand.

o H2: Quality has a positive relationship with customer trust on brand.

o H3: There is positive relationship between Country of Origin and Customer trust on brand

o H4:Value added features and customer trust on brand has positive relationship

Methodology

This study is a formal type of research. It means that we have taken different procedures

such as data collection, operational measures of variables, statistical tests regarding statistical

measures and distribution of questionnaires to the target population is described

comprehensively.

This study is conducted to check the impact of consumer behavior towards the

multinational brand so this is a descriptive type of study. A questionnaire is used to collect the

responses from our respondent as it would be a cross sectional study. It is mainly focused on

statistical analysis through questionnaire of breadth information rather than an in-depth of data

collection. The researchers did not have any control over variables of research study so it is an

expostfacto research. Indeed, the topic “consumer behavior towards multinational brands”

indicated the target population was youngsters including both male and female. As we have directly

interact or communicate with students representing the young generation of Pakistan and

obtained response about filling of questionnaire from them. However a non-probability sampling

was used with the convenience method. All the respondents were selected on the base of

convenience and easily availability. The sample size is consisting of 100 questionnaires.

Research Findings

CorrelationsTotal Consumer trust Total Price Total Quality Total Country of origin Total brand

Total Consumer trust

Pearson Correlation 1 .333** .367** .353** .372**

Sig. (1-tailed) .001 .000 .000 .000

Value Added features

Pearson Correlation .333** 1 .435** .338** .303**

Sig. (1-tailed) .001 .000 .001 .002

Total Quality

Pearson Correlation .367** .435** 1 .251** .186*

Sig. (1-tailed) .000 .000 .009 .040

Total Country of origin

Pearson Correlation .353** .338** .251** 1 .570**

Sig. (1-tailed) .000 .001 .009 .000

Total brand

Pearson Correlation .372** .303** .186* .570** 1

Sig. (1-tailed) .000 .002 .040 .000

**. Correlation is significant at the 0.01 level (1-tailed). c. List wise N=100

*. Correlation is significant at the 0.05 level (1-tailed).

Explanation:

We have 100 samples which result have shown above correlation table. We have made one tail correlation because we made hypothesis of the variable and the results of the correlation are expressing the positive relationship of value added features, quality , brand , country of origin toward the customer trust on Multinational brand (NOKIA)

The Adjusted R square statistic ‘corrects’ this value to provide a better estimate of the true population value. If you have a small sample you may wish to consider reporting this value, rather than the normal R Square value. So our sample size was small that’s why we select .220 means22%

Model SummaryModel R R

SquareAdjusted R Square

Std. Error of the Estimate

Change StatisticsR Square Change

F Change

df1 df2 Sig. F Change

1 .505a .255 .220 2.04208 .255 7.190 4 84 .000a. Predictors: (Constant), Total Brand, Total Quality, Value added feature, Total Country of originb. Dependent Variable: Total Consumer trust

ANOVAs

Model Sum of Squares df Mean Square F Sig.

1

Regression 119.935 4 29.984 7.190 .000b

Residual 350.289 84 4.170

Total 470.225 88

a. Dependent Variable: Tot l Consumer trust

b. Predictors: (Constant), Total Brand, Total Quality, value added features, Total Country of origin

To assess the statistical significance of the result it is necessary to look in the table labeled

ANOVA. This tests the null hypothesis that multiple R in the population equals 0. The model in

this example reaches statistical significance (Sig = .000, this really means p<.0005).

CoefficientsModel Un standardized

Coefficients

Standardized Coefficients t Sig. Correlations Co linearity Statistics

B Std. Error Beta Zero-order Partial Part Tolerance VIF

1

(Constant) 1.313 1.955 .672 .504

Values added

features

.103 .095 .118 1.078 .284 .333 .117 .102 .742 1.348

Total Quality .243 .105 .243 2.309 .023 .367 .244 .217 .799 1.252

Total Country of

origin

.134 .124 .128 1.085 .281 .353 .118 .102 .638 1.568

Total brand .193 .102 .218 1.886 .063 .372 .202 .178 .662 1.511

a. Dependent Variable: Total Consumer trust

a. Dependent Variable: Total Consumer trust

Explanation:

Two values are given: Tolerance and VIF. Tolerance is an indicator of how much of the

variability of the specified independent is not explained by the other independent variables in the

model and is calculated using the formula 1–R2 for each variable. If this value is very small (less

than .10), it indicates that the multiple correlation with other variables is high, suggesting the

possibility of multi co linearity. The other value given is the VIF (Variance inflation factor),

which is just the inverse of the Tolerance value (1 divided by Tolerance). VIF values above 10

would be a concern here, indicating multi co linearity. But in the above table Both TF and VIF

are greater than .10 and 10 respectively which shows the high co linearity among variables

means that ( value added feature , quality , coo, and Brand ) will effect to consumer trust on

brand( NOKIA).

In this scatter plot values are moving bottom to top which show significance relationship between consumer trust and price quality , brand, country of origin.

Conclusion

In this study it is tried to investigate the relationship of Quality, values added features, Country of Origin and brand image of Nokia mobile toward customer trust. In this study this relationship is observed in the BZu Subcampus sahiwal, Pakistan. Four hypotheses were developed on the bases of literature review and describe them through hypothesized model. The data was collected through convenience sampling method. For getting data, questionnaire was used. The responses were analyzed through SPSS software by using Pearson’s correlation and regression method. The results described the significant relationship between the independent variables (quality, price, coo, and brand image) and(customer trust on Nokia ). These results described that all independent variable ( quality of the mobile, price of the mobile, country of origin of the mobile and the brand of the mobile effect on the consumer trust

Limitations and future research

The sample group consists of only university students.

Time of submission, due to academic schedule the researcher had the limited time frame to complete this research

Respondents non serious behavior

References

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Brand Association, Brand Loyalty, Brand Image and Perceived Quality on Brand Equity Eda Atilgan ,Serkan, Akinci Safak Aksoy ,Erdener Kaynak, Customer-Based Brand Equity for

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