dissertation sept2011

8/13/2019 Dissertation Sept2011

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COUNTRY OF ORIGIN EFFECTS AND LOYALTY FOR CEMENT BRANDS

IN UGANDA

THURANIRA THIMANGU

REG NO. 2006/HD10/8233K

A RESEARCH REPORT SUBMITED IN PARTIAL FULFILLMENT OFREQUIREMENT FOR THE DEGREE OF MASTER OF SCIENCE

IN MARKETING OF MAKERERE UNIVERSITY

DECEMBER 2010


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DECLARATION

I declare that the work presented and submitted is original and has never been done for any

other degree award in any other university before.

Signature .

T!"#$%"# T%$'!

[Student]

Signature .

D". ()*+, N-#%

[Supervisor]

Signature

C#"+* O')"

[Supervisor]


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DEDICATION

This research is heartedly dedicated to my parents(!ee "thimangu and artha won#iru$

who struggled to raise and educate us through difficulties and especially my late father !ee

%ndrew "thimangu who at one time had to chose not to pay court fine and opted to go to

#ail during the colonial era so that he could pay fees for his children(&I'$.


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ACKNOLEDGEMENT

Though I did this research report single handedly I was socially and technically offered

support by a number of individuals and parties that I feel indebted to mention.

I hereby acknowledge my supervisors )r *oseph +tayi and r. ,harles -magor who

critically guided me throughout the entire research pro#ect. ncouragement also from my

wife )amaris who mentally inspired me cannot go unmentioned and my children also

/ithin#i /arei and wendwa who always kept on asking me when I was going to graduate.

%lso to all friends who assisted and encouraged me in any way are highly acknowledged.


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TABLE OF CONTENTS

DECLARATION.............................................................................................................ii

DEDICATION...............................................................................................................iii

ACKNOWLEDGEMENT...............................................................................................iv

TABLE OF CONTENTS................................................................................................v

ABSTRACT.................................................................................................................vii

CHAPTER ONE ...........................................................................................................1

1.0 Backgro!" ............................................................................................................1

1.1 S#a#$%$!# o& #'$ (ro)*$% ....................................................................................+

1., R$-$arc' '(o#'$-$- ........................................................................................./

1. Sig!i&ica!c$ o& #'$ -#"......................................................................................,1. Co!c$(#a* &ra%$2ork...........................................................................................,

1.3 Sco($ o& #'$ -#"..................................................................................................

CHAPTER TWO4 LITERAT5RE RE6IEW...................................................................

+.1 Co!#r o& Origi! a!" )ra!" *oa*#.......................................................................

+.+ P$rc$iv$" 7a*i# a!" )ra!" *oa*#........................................................................8

+./ P$rc$iv$" 6a*$ a!" )ra!" *oa*#........................................................................9

+., Bra!" *oa*#........................................................................................................10

CHAPTER THREE4 RESEARCH METHODOLOG:..................................................1+/.1 R$-$arc' D$-ig!................................................................................................1+

/.+ Po(*a#io! a!" Sa%(*i!g "$-ig!..........................................................................1+

/./ Da#a Co**$c#io!....................................................................................................1/

/., R$-$arc' i!-#r%$!#...........................................................................................1/

/. Da#a co**$c#io! M$#'o"........................................................................................1/

/. R$-$arc' Proc$"r$............................................................................................1,

/.3 Da#a 7a*i# co!#ro*............................................................................................1

/.8 M$a-r$%$!#- o& varia)*$-.................................................................................1/.9 Da#a a!a*-i- %$#'o"-.......................................................................................1

CHAPTER FO5R4 RES5LTS AND FINDINGS OF THE ST5D:..............................13

,.0 I!#ro"c#io! ..........................................................................................................13

T'$ r$-*#- &ro% #'$ a!a*-i- o& #'$ "a#a 2$r$ (r$-$!#$" i! #'i- c'a(#$r -i!g-#a#i-#ica* #a)*$- -c' a- #'$ cro-- #a)*a#io!-; Corr$*a#io!- a!" r$gr$--io!-. T'$r$-*#- 2$r$ (r$-$!#$" a- ($r #'$ &o**o2i!g r$-$arc' o)o& #'$-$ 2$r$ Ma*$ a!" /8.> o& #'$% 2$r$ &$%a*$. I! #'$ 18 @ /0 $ar ag$ )rack$#;


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9.> 2$r$ %a*$ a!" ,0;> 2$r$ &$%a*$. I# -'o*" )$ !o#$" #'a# ov$ra**; #'$r$ 2$r$%or$ %a*$- #'a! &$%a*$- a!" #'i- 2a- o)-$rv$" #o a((* &or a** #'$ ag$ gro(ca#$gori$-;. T'$ ov$r 0 $ar ag$ )rack$# 'a" &$%a*$- co!-#i##i!g o!* +0.0> a!"#'$ "o%i!a!# g$!"$r 2$r$ #'$ %a*$ "$a*$r-..............................................................18

,.1.+ Hig'$-# *$v$* o& $"ca#io! a!" G$!"$r Di-#ri)#io! .........................................19

,.+ T'$ *$v$* o& Co!#r o& Origi! E&&$c#-; Bra!" Loa*#; P$rc$iv$" 6a*$ a!"P$rc$iv$" a*i# a%o!g C$%$!# -$r- i! 5ga!"a. ................................................+,

Ta)*$ ,.+1 T'$ *$v$* o& Co!#r o& Origi! E&&$c#-; Bra!" Loa*#; P$rc$iv$" 6a*$a!" P$rc$iv$" a*i# a%o!g C$%$!# -$r- i! 5ga!"a. .........................................+,

,./ R$*a#io!-'i(- )$#2$$! 6aria)*$- .................................................................+

Ta)*$ ,./ R$*a#io!-'i(- )$#2$$! 6aria)*$- .......................................................+

,., R$gr$--io! A!a*-i-.............................................................................................+3

Ta)*$ ,., R$gr$--io! A!a*-i-...................................................................................+3

,. Fr#'$r Fi!"i!g- ...................................................................................................+8

CHAPTER FI6E4 DISC5SSION; RECOMMENDATIONS AND CONCL5SIONS ..../1

.1 I!#ro"c#io! ........................................................................................................../1

.+ T'$ *$v$* o& Co!#r o& Origi! E&&$c#-; Bra!" Loa*#; P$rc$iv$" 6a*$ a!"P$rc$iv$" a*i# a%o!g C$%$!# -$r- i! 5ga!"a. ................................................/1

./ Co!#r o& Origi! $&&$c#- a!" Bra!" Loa*#........................................................./+

., Co!#r o& Origi! E&&$c#-; P$rc$iv$" 6a*$ a!" Bra!" Loa*#............................//

. Co!#r O& Origi! E&&$c#-; P$rc$iv$" a*i#; P$rc$iv$" 6a*$ A!" Bra!"Loa*#.........................................................................................................................//

. Co!c*-io!-........................................................................................................../,

.3 R$co%%$!"a#io!- .............................................................................................../,

.8 Ar$a- &or &r#'$r r$-$arc' ..................................................................................../

REFERENCES.........................................................................................................../3


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ABSTRACT

This study was aimed at e0amination of the level of the ,ountry of -rigin effects 'erceived

1alue 'erceived 2uality among the ,ement users and e0amine how these variables are

related to the 3rand 4oyalty element. To efficiently conduct the study the researcher targeted

567 8ardware dealers located in /ampala who sell cement as per the rationale of /re#cie and

organ (59:6$ to make a more scientifically #ustifiable sampling frame. The results indicated

positive relationships between the variables which were ,ountry of -rigin effects 'erceived

value and ;uality and 3rand loyalty. The regression model shows that the various

independent and intervening variables are able to e0plain of 3rand 4oyalty. %fter

these findings various recommendations were raised and these included? To attract more

demand as regards the country of origin manufacturers who import to @ganda and don"t

have plants in @ganda should rethink putting up factories here. This will have more appeal to

the citi!ens as they feel it belongs to them. This has been reflected in the results whereby

most of the respondent preferred the brands from @ganda. anufacturers of these brands

ought to communicate the value of their cement brands to key parties in their markets for

instance the opinion leaders in the construction industry and this will help form the necessary

attitudes toward brands. This can be done through advertisements in both electronic and print

media through sponsorships seminars.


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CHAPTER ONE

1.0 B#'")!$

The @ganda market has continued to attract more cement imports despite surplus production of

cement by two local cement manufacturers (Tororo and 8ima cements$. The @gandan cement

market has an annual consumption capacity of more than 5566 metric tons of cement

(www.ubos.org$.This is a market which has mostly been dominated by &ock and ultipurpose

brands from Tororo and 8ima respectively. -ther players are mostly imports from /enya ,hina

gypt South %frica Turkey 'akistan etc. The increase in imports despite the availability of

local cement brands is an indication that there is brand switching from local to imported brands.

The imported brands account for more than A:> of the total domestic consumption and their

demand is on the rise (See appendi0 5$. This increment in imports has been intensified by

competition on the local market. )ue to this competition from imports the local manufacturers

have embarked on e0ploring e0port markets for the surplus and they are reali!ing positive results

(see appendi0$. The period B66A to B667 the cement Imports increased by 5AC> while on the

other hand the 4ocal 'roduction in the country increased by B9>. This could be attributed to

increased demand in the @gandan market. 8owever the big increase for the imports is a

reflection of consumer"s preference for imported cement

The total production in @ganda is more than 5=66mt annually against a demand of 5566mt.

(www.tororocement.com and daily monitor of 5:D6:DB669$. This means there is surplus and

consumers are still buying imports and this can be attributed to ;uality issues because there has

been fake cement in the market due to adulteration and this has made the consumer perceive

imported cement as better in terms of ;uality and value (,onan 3usinge +ew 1ision of


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5D6:DB669 and Eodfrey /imono +ew 1ision of 56D65DB656$. Fith this in mind it is no surprise

that e0ports increased by 99A> and the +et )omestic ,onsumption increased by A7> between

B66AGB667 (www.ubos.org$. In addition the @ganda manufacturers association has advocated

@gandans to buy @gandan product as a way of promoting brand loyalty amongst @gandans due

to competition from imports (www.ubos.org$.

It is against this background that this study seeks to establish the relationship between ,oo

effects and brand loyalty 'erceived value and perceived ;uality.

@ganda consumption of imported cement brands has been observed to be on the rise despite

abundance of local brands (B669 @3-S Import &ecords$. There is a growing interest and

demand among @gandan consumers for imported brands for foreign brands this could be

attributed to ,ountry of -rigin effects negative effects associated with the 'erceived 2uality

and 'erceived 1alue of these local brands which have conse;uently improved the 4oyalty for

imported cement brands.

1.1 S-#-+&+$- )4 -+ ,")5+&

@ganda usage and transactions of imported cement brands among the 8ardware dealers has been

observed to be on the rise despite abundance of local brands (B669 @3-S Import &ecords$. This

growing interest and demand for imported brands for foreign brands could be attributed to

,ountry of -rigin effects negative effects associated with the 'erceived 2uality and 'erceived

1alue of these local brands which have conse;uently improved the 4oyalty for imported cement

brands.
http://www.ubos.org/http://www.ubos.org/


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1.2 P!",)*+ )4 -+ *-!

The purpose of the study was e0amine the level of the ,ountry of -rigin effects 'erceived

1alue 'erceived 2uality among the ,ement users and e0amine how these variables are related

to the 3rand 4oyalty element.

1.3 R+*+#" O5+-%7+*

i. To e0amine the level of ,ountry of -rigin ffects 3rand 4oyalty 'erceived 1alue and

'erceived 2uality among ,ement users in @ganda.

ii. To establish the relationship between country of -rigin effects and brand loyalty.

iii. To establish the relationship between country of origin effects perceived value and brand

loyalty

iv. To establish the relationship between country of origin effects perceived ;uality perceived

value and brand loyalty.

1. R+*+#" ,)-+*+*

i. Fhat is the level of ,ountry of -rigin ffects 3rand 4oyalty 'erceived 1alue and

'erceived 2uality among ,ement users in @gandaH

ii. Fhat is the relationship between country of -rigin effects and brand loyaltyH

iii. Fhat is the relationship between country of origin effects perceived value and brand

loyaltyH

iv. Fhat is the relationship between country of origin effects perceived ;uality perceived

value and brand loyaltyH


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1.9 S%'$%4%#$+ )4 -+ *-!

indings of thisstudy will help the manufacturers of ,ement in understanding how the country

of origin effect affects their e0port market. This will help them in laying down fundamental

competitive strategies for share of mind survival market share e0pansion customer retention

building on customer loyalty etc.

The study will also help marketers" especially in e0port markets in understanding the importance

of country of origin and will use the marketing tools of marketing mi0 at their disposal to capture

either consumer"s positiveDnegative perception about their respective brands. This will lead to

increased market share.

,onsumers will also benefit in understanding their own behavior. Fith such knowledge

consumers will be able to make fast viable decisions. or academicians various proposals will

be suggested for further research. The research will also be of fundamental importance to both

future researchers and academicians in pursuing this sub#ect further.

1.6 C)$+,-!# 4"#&+:)"

The conceptual framework will be based on three independent variables vi!J country of origin

perceived ;uality and perceived value. 8owever there are other variables like word of mouth

price promotion packaging etc which also have effects on country of origin and brand loyalty.

There are also other moderating variables like government policies and various associations

which also have effects on coo and brand loyalty. The conceptual frame work was mostly

influenced by the following scholars" works? ,armina and ,arlos lavian (Intrinsic and e0trinsic

;uality attributes loyalty and buying intentionJ an analysis for a ')- product$.


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F%' 1; S):* )$+,-!#%


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CHAPTER TO; LITERATURE REVIE

2.0 I$-")!-%)$

This section presents a review on the related literature on the sub#ect under study. It

encompasses review on various studies presented by various scholars researchers analysts and

the authors. aterials will be drawn from various sources closely related to the ob#ectives of the

study. Fhere appropriate models will be used to demonstrate the various subtopics mentioned in

the ob#ectives.

2.1 C)!$-" )4 O"%'%$ #$ 5"#$ )#-.

,ountry of origin is defined as the country with which a particular product or service is

associated. The ,ountry of manufacture (,-$ in the case of products or the ,ountry where

the head;uarters are located in the case of both products and services. ,ountry of origin effect

(,-$ can be defined as any influence that the ,ountry of manufacture assembly or design has

on a consumer"s positive or negative perception of a product (c/en!ieGinifie B66:$.

%ccording to @sunier (B66C$ country of origin effect poses a barrier to enter new markets in the

form of negative consumer bias toward imported products.

The country of origin as the country where corporate head;uarters" of the company marketing

the product or brand is located. This is the home country for the company (@sunier B66C$.

,ountry of origin (,--$ perceptions is the mental associations and beliefs triggered by a

,ountry. ,ountry image may be an asset when it is positive and a liability when it is negative. %

positive image is important to strengthen a ,ountry"s image and help domestic marketers who


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e0port and to attract foreign firms and investors (%hmed et al., B66A$. arketers want to use

country of origin perceptions in the most advantageous way possible to sell their products and

services

4iberali!ation and deregulation of world markets have driven many companies to

internationali!e their marketing activities to survive and grow. Success internationally clearly

depends on the acceptability of products by consumers in different countries (/aynak B666$.

)uring the past several decades countryGofGorigin research has attracted significant attention

from researchers and practitioners alike around the globe (rickson 597A? 4usk et al., B66C$.

'art of the reason for this continuous interest in the sub#ect area is attributable to increased global

competition among foreign firms operating in different parts of the globe. These firms in most

cases are not only offering more variety and assortment of products but also offering them at

very competitive prices. This coupled with the increased standards of living and improved

lifestyles of consumers around the world and improved global communication and increased use

of InternetGbased communication means target customers in markets worldwide are e0posed to

and are selecting from a wider range of foreign productsDbrands than ever before. rom a

marketing standpoint ,ompanies that are operating in competitive domestic and foreign markets

need to understand consumers" perceptions and evaluations of foreign made products more than

ever before (4usk et al., B66C$. %ccordingly marketers have shown a growing interest in

understanding the factors that affect consumers" evaluations of foreign products against domestic

ones.

Therefore researchers in marketing started investigating the marketplace behavior of consumers

in crossGculturalDnational settings more than before. )espite this increased interest studies that
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investigate the product perceptions and #udgments of consumers in developing countries and

newly emerging economies are relatively low (Eolan et al. B66:$. This scarcity e0ists even

though multinational companies around the world have e0panded their operations in many

developing countries of 4atin %merica %frica the iddle ast and %siaG'acific region and

have faced significant challenges (&oth and &omeo 599B? 3haskaran and Sukumaran B66:$.

%lso a significant population growth and increased consumer wealth and purchasing power in

advanced developing countries offer greater market opportunities to western companies whose

domestic markets in most cases have already reached maturity stage andDor are highly

competitive due to significant numbers of foreign competitors in those markets and saturated

home market demand.

,ountry of origin effects are of particular interest to international marketing researchers because

of their impact on the evaluations that help to influence customers" purchase decisions. Fe often

hear comments like L*apanese cars are reliable" and that Eermany leads the world in engineering

technology. 8ence we can conclude that country of origin perceptions help to form overall

attitudes on certain product attributes and also have some impact on customers.

2.2 P+"+%7+ >!#%- #$ 5"#$ )#-

%ccording to business dictionary perceived ;uality is the ,onsumerMsopinionof aproductMs(or a

brand$ abilityto fulfill his or her e0pectations. It may have little or nothing to do with the actual

e0cellence of the product and is based on the firms (or brandMs$ current public image.

,onsumer"s e0periencewith the firmMs other products and the influenceof theopinion leaders

consumerMspeer group and others. -lshavsky (597= in &owley 5997$ views ;uality views as a

form of overall evaluation of a product. Similarly 8olbrook and corfman (5975 in &owley
http://www.businessdictionary.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/opinion.htmlhttp://www.businessdictionary.com/definition/product.htmlhttp://www.businessdictionary.com/definition/ability.htmlhttp://www.businessdictionary.com/definition/expectation.htmlhttp://www.businessdictionary.com/definition/current.htmlhttp://www.investorwords.com/3930/public.htmlhttp://www.businessdictionary.com/definition/image.htmlhttp://www.businessdictionary.com/definition/experience.htmlhttp://www.businessdictionary.com/definition/influence.htmlhttp://www.businessdictionary.com/definition/opinion-leaders.htmlhttp://www.businessdictionary.com/definition/opinion-leaders.htmlhttp://www.businessdictionary.com/definition/peer-group.htmlhttp://www.businessdictionary.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/opinion.htmlhttp://www.businessdictionary.com/definition/product.htmlhttp://www.businessdictionary.com/definition/ability.htmlhttp://www.businessdictionary.com/definition/expectation.htmlhttp://www.businessdictionary.com/definition/current.htmlhttp://www.investorwords.com/3930/public.htmlhttp://www.businessdictionary.com/definition/image.htmlhttp://www.businessdictionary.com/definition/experience.htmlhttp://www.businessdictionary.com/definition/influence.htmlhttp://www.businessdictionary.com/definition/opinion-leaders.htmlhttp://www.businessdictionary.com/definition/peer-group.html


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5997$ suggested that ;uality acts as a relatively global value #udgment which is created in

relationship between customers and suppliers. ,oo and its level of development and brand

familiarity leads to positive brand evaluation and hence brand loyalty.

2.3 P+"+%7+ V#!+ #$ 5"#$ )#-

%ccording to different authors customer perceived value is a multidimensional concept which

presents a tradeGoff between benefits and sacrifices perceived by customers in a supplier"s

offering (e.g.Foodruff et al. 599


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2. B"#$ )#-

-ne of the definitions of brand loyalty that has made the greatest impact in the specialist

proposes that loyalty reflectsJ a deeply held commitment to rebuy or repatroni!e a preferred

productDservice consistently in the future thereby causing repetitive sameGbrand or same brand

buying despite situational influences and marketing efforts having the potential to cause

switching behaviour (-liver 5999? rdem et al. B66C$.

This definition brings out the differences between the two analytic perspectives considered in the

ma#ority of recent papers (3arroso and artin 5999? ,aruana B66B$J

I. rom a behavioral standpoint loyalty is seen as effective consumer behavior toward a

specific product brand or establishment over time. In this approach loyalty is analy!ed on

the basis of repeat purchase or relative purchase volume patterns for the same brands or

establishments ()unn and Frigley 597A? Sniehotta et al. B66=$.

II. rom the attitudinal standpoint the behavioral approach is considered insufficient to

e0plain how and why true loyalty develops and is maintained ()ick and 3asu 599A?

Sniehotta et al. B66=$. These authors argue that loyalty can only be viewed as an attitude

when positive affects and feelings toward a product or brands are involved.

Similarly the concept of buying intentions reflects consumersM foreseeable behavior in shortG

term future buying decisions (e.g. what product or brand the consumer will buy when he visits

the supermarket ne0t.

ore specifically we would point out that buying intention is a future pro#ection of consumer

behavior that will significantly contribute to the configuration of attitudes. Indeed if we e0amine
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the basic components of the attitudes model we find that attitudes in fact develop due to a

combination of three basic elements associated with beliefs emotional responses and the

foreseeable actions of the consumer (%sael 599=? Sno# et al. B66A$.

Specifically the cognitive component reflects individualsM knowledge of and beliefs about a

given product or service (Food B66A$ while the affective component arises as a result of a

personMs emotions or feelings toward a product or service. inally the conative or behavioral

component would be the e0pression of the consumerMs buying intention (Shukla B669$

eanwhile attitudes develop over time via a process of learning and are affected by family

influences the social groups to which the individual belongs or aspires to belong the

information received e0perience and personality.


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CHAPTER THREE; RESEARCH METHODOLOGY.

3.0 I$-")!-%)$

This is a chapter that describes the ethodology that was used as an aid to carrying out the

research study. It is a plan for selecting the sources and types of information used to answer the

research ;uestion. It provides answers for such ;uestions as? what techni;ues will be used to

gather dataH Fhat population will be studiedH Fhat kind of sampling will be usedH 8ow will

data be collectedH %nd how will data be analy!ed.

3.1 R+*+#" D+*%'$.

The study took on the form of a crossGsectional survey to effect the study. This survey approach

allowed the researcher to collect the information and conduct the study over a short period of

time as opposed to a longitudinal approach which involves studies over longer periods normally

in years.. This was coupled with a ;uantitative approach to analy!ing the research data. This

research used ;uantitative design and a field survey was conducted as well. The survey design

was based on the use of ;uestionnaires that were used as data collection instruments. This study

focused only on the /ampala based firms.

3.2 P),!#-%)$ #$ S#&,%$' +*%'$.

3.2.1 P),!#-%)$ #$ *#&,+ *%


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3.2.2 S#&,%$' T+$%>!+*.

The researcher used convenient sampling until the desired number of respondents had been

attained.

3.3 D#-# C)+-%)$.

3.3.1 T,+ )4 D#-#?

)ata used can be divided into two categories? primary and secondary data. 'rimary data sources

included data ac;uired using ;uestionnaires while the secondary data sources included #ournals

websites and other relevant publications.

3. R+*+#" %$*-"!&+$-

The 'rimary data was gathered using a preGtested and structured ;uestionnaire. The

;uestionnaire was delivered physically to the potential respondents participating in the study for

the purpose of ensuring that a high response rate is attained (/othari B66=$. The ;uestionnaire

Fas designed using items for each of the variables which were tapped using a = point likert scale

such that 5 represents Strongly %gree B O )isagree < O @ncertain AG )isagree and =G Strongly

%gree.

3.9 D#-# )+-%)$ M+-).

Survey method of data collection was used for collecting the primary data for this research. The

survey method involved ;uestioning people and recording their responses for analysis. Since the

research was about country of origin and the factors that influence brand loyalty the survey

method was the most appropriate data collection methods since it was to enable the researcher

collect primary data on opinions and attitudes towards each brand of cement.


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3.6 R+*+#" P")+!"+.

The procedure that was followed in data collection was as follows?

(a$ our research assistants were recruited by the researcher two weeks prior to

commencement of the survey. They were trained on how to administer the ;uestionnaires and to

understand the research problems and ob#ectives at hand.

(c$ -n a random basis research assistants interviewed any 8ardware dealer who was availed

information and also consumers who came to the hardware to buy cement.

(d$ %ll the filled ;uestionnaires were brought to a central place as they were completed and

were edited and coded as soon as a satisfactory number had been received. ull analysis of the

raw data was done using computer package S'SS to make statistical inferences. The researcher

oversaw the entire process of data collection and was personally monitored the analysis of data.


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3.= D#-# >!#%- )$-")

3.=.1 R+%#5%%- #$ V#%%-

The purpose of reliability was to e0amine the level of consistence among the ;uestionnaire

items. This study employed the ,ronbach alpha value as a tool for reliability e0amination the

bigger the ,ronbachMs alpha value the higher internal consistency was. 1alidity has to do with

ensuring that the items measure what they are supposed to. The validity was a measured using

the ,ontent 1alidity Inde0.

T#5+ 3.=.1 R+%#5%%- #$ V#%%-

Variable Anchor Cronbach Alpha

Content

Validity Index

,ountry of -rigin = 'oint 6.7C6 6.:7C

'erceived 2uality = 'oint 6.7


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3.8.2 P+"+%7+ V#!+

The multiGdimensional measure developed by Sweenay and Soutar (B665$ was used to measure

perceived value.

3.8.3 P+"+%7+ Q!#%-

To measure perceptions of overall ;uality a twoGitem semantic differential scale was used

patterned after scales used in previous studies (8an 597C. 599A$.

3.8. B"#$ )#-

This variable was measured with reference to the scale developed by 3eatty and /ahle (5977$.

3.@ D#-# #$#*%* &+-)*.

The researcher generated information by analy!ing data after collection. The data analy!ed using

statistical procedures. The data was analy!ed through the use of descriptive and inferential

statistics. ,ross tabulations ,hiGs;uare correlation and regression among others were employed

to ade;uately address the research re;uirements. urther the researcher interpreted these

findings in the light of the research ;uestions. The researcher mainly used the S'SS (Statistical

'ackage for the Social Scientist$ computer package to analy!e the data in this study.


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CHAPTER FOUR; RESULTS AND FINDINGS OF THE STUDY

.0 I$-")!-%)$

The results from the analysis of the data were presented in this chapter using statistical tables

such as the cross tabulations ,orrelations and regressions. The results were presented as per

the following research ob#ectives?

i. To e0amine the level of ,ountry of -rigin ffects 3rand 4oyalty 'erceived 1alue and

'erceived 2uality among ,ement users in @ganda.

ii. To establish the relationship between country of -rigin effects and brand loyalty.

iii. To establish the relationship between country of origin effects perceived value and brand

loyalty

iv. To establish the relationship between countries of origin effects perceived ;uality

perceived value and brand loyalty.


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#. S#&,+ #"#-+"%*-%*

.1.1 A'+ G")!, #$ G+$+" D%*-"%5!-%)$

The results in the table below show the age group and the gender of the individuals that were

interviewed.

T#5+ .1.1 A'+ G")!, #$ G+$+" D%*-"%5!-%)$

G+$+"T)-#

M#+ F++

A'+ )4 -+ "+*,)$+$-

57 G A6.=> 566.6>

C5.A> 566.6>

A5 G =6 yrs,ount 5A B 5C

&ow > 7:.=> 5B.=> 566.6>

-ver =6 yrs,ount A 5 =

&ow > 76.6> B6.6> 566.6>

T)-#,ount C: C=.:>

Source :'rimary )ata

&esults in table A.5.5 show that C=.:> are male and

were female. It should be noted that overall there were more males than females and this

was observed to apply for all the age group categories. The over =6 year age bracket had

females constituting only B6.6> and the dominant gender were the male dealers.


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.1.2 H%'+*- +7+ )4 +!#-%)$ #$ G+$+" D%*-"%5!-%)$

&esults for the highest level of education and the gender of the respondents were as indicated

belowJ

T#5+ .1.2 H%'+*- +7+ )4 +!#-%)$ #$ G+$+" D%*-"%5!-%)$

G+$+"T)-#

M#+ F++

H%'+*- +7+ )4

+!#-%)$

O +7+,ount 9 9

&ow > 566.6> 566.6>

A +7+,ount 5A 5B BC

&ow > = AC.B> 566.6>

D%,),ount B9 5A A C:.A> 566.6>

D+'"++,ount 7 7 5C

&ow > =6.6> =6.6> 566.6>

P)*- G"#!#-+,ount < 5 A

&ow > :=.6> B=.6> 566.6>

O-+"*,ount A A

&ow > 566.6> 566.6>

T)-#,ount C: C=.:>


%mong females there were no dealers holding only the - level certificate. Fith 'ost Eraduate

;ualifications the ma#ority of the respondents were ale (:=.6>$ and only B=.6> were female.

Fith the 3achelors degree the researcher noted that there was an e;ual proportion for both male

and female dealers each category taking up =6.6> of the respondents.


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.1.3 P+"%) -+ 5!*%$+** 5++$ ),+"#-%$' #$ N#-!"+ )4 )!" 5!*%$+** D%*-"%5!-%)$

The results the business nature and the number of years it has been operating.

T#5+ .1.3 P+"%) )4 5!*%$+** ),+"#-%)$ #$ N#-!"+ )4 5!*%$+**

N#-!"+ )4 )!" 5!*%$+**T)-#

)+*#+" R+-#%+" O-+"*

P+"%) -+ 5!*%$+**

5++$ ),+"#-%$'

1 9 "*,ount C B9 B 5C.B> :7.A> =.A> 566.6>

6 10 "*,ount 59 B7 A:

&ow > A6.A> =9.C> 566.6>

11 19 "*,ount A 7 5B

&ow >

O7+" 19 "*,ount < B 5 C

&ow > =6.6>

T)-#,ount C=.:> B.9> 566.6>


ost of the firms are retailers with C=.:> followed by wholesalers with and finally others

with B.9>. It should be noted that most of the business which is 5G=years CG56yrs and 55G5=yrs

old are retailers (:7.A> =9.C> and CC.:> respectively$. irms over 5=yrs are mostly

wholesalers (=6.6$.


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.1. N!&5+" )4 +&,)++* -+ 5!*%$+** #* ')- #$ B!*%$+** #-+')" D%*-"%5!-%)$

&esults for the number of employees in different business categories.

T#5+ .1. N!&5+" )4 +&,)++* %$ -+ 5!*%$+** #$ B!*%$+** #-+')" D%*-"%5!-%)$

B!*%$+** #-+')"

T)-#S)+

P"),"%+-)"*%,P#"-$+"*%,

L%&%-+

L%#5%%-

C)&,#$

N!&5+" )4

+&,)++* -+

5!*%$+** #* ')-

0 ,ount AC 55 =:

&ow > 76.:> 59. 566.6>

9 @,ount 5B 5= 5= AB

&ow > B7.C> 566.6>

90 @@

,ount B 5 CC.:> =7.7> BC.=> 5A.:> 566.6>


Sole proprietorship had the highest number of employee"s (=7.7>$ followed by

'artnership (BC.=>$ and then 4td 4iability ,ompany (5A.:>$. ost firms also have some =GA9

employees and also a small proportion had =6G 99 employees.


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.1.9 M)*- ,"+4+""+ +&+$- 5"#$ #$ -+ #&)!$- )4 #,%-# -#- -+ 5!*%$+** %*

),+"#-%$' :%- D%*-"%5!-%)$.

&esults for the amount of capital the firms are operating with and their preferred brands.

T#5+ .1.9 M)*- ,"+4+""+ +&+$- 5"#$ #$ O,+"#-%)$# #,%-#

T+ #&)!$- )4 #,%-# -#- -+ 5!*%$+**

%* ),+"#-%$' :%- T)-#

1 9 @ 10 1 19 A5)7+

M)*- ,"+4+""+

+&+$- 5"#$

B#&5!"%,ount : 5 7

&ow > 7:.=> 5B.=> 566.6>

H%,ount = 55 5B 5B A6

&ow > 5B.=> B:.=> 566.6>

B!+ T"%#$'+,ount B B

&ow > 566.6> 566.6>

T)")"),ount C 5: 55 5: =5

&ow > 55.7>


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.1.6 P+"%) -+ 5!*%$+** 5++$ ),+"#-%$' #$ C)!$-"%+* :)*+ 5"#$* #"+ ,"+4+""+

D%*-"%5!-%)$

&esults for the country of origin preference as per the number of years it has been in business.

T#5+ .1.6 P+"%) )4 5!*%$+** ),+"#-%$' #$ C)!$-"%+* :)*+ 5"#$* #"+ ,"+4+""+

C)!$-"%+* :)*+ 5"#$* #"+

,"+4+""+ T)-#

K+$# U'#$# D!5#% P#%*-#$

P+"%) -+ 5!*%$+**

5++$ ),+"#-%$'

1 9 "*,ount 566.6>

6 10 "*,ount 5 AC A:

&ow > B.5> 9:.9> 566.6>

11 19 "*,ount 5B 5B

&ow > 566.6> 566.6>

O7+" 19 "*,ount B < 5 C

&ow > 566.6>

T)-#,ount < 9: 5 5 56B

Sample > B.9> 9=.5> 5.6> 5.6> 566.6>


3rands from @ganda are the most preferred (9=.5>$ followed by /enyan brands with B.9> and

then 'akistan and )ubai with 5> each. The firms which have operated for 55G5=yrs have

preference for mainly @gandan brands. This indicates the challenge faced by importers of

foreign brands and gives a hint for the marketing communication that should be employed.


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.2 T+ +7+ )4 C)!$-" )4 O"%'%$ E44+-* B"#$ L)#- P+"+%7+ V#!+ #$ P+"+%7+

Q!#%- #&)$' C+&+$- !*+"* %$ U'#$#.

The results in the table below were presented to e0plore the level of ,ountry of -rigin ffects

3rand 4oyalty 'erceived 1alue and 'erceived 2uality among ,ement users in @ganda. The

;uestionnaire had options such that 5 represents Strongly )isagree B O )isagree


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T#5+ .2.2 A--"%5!-+ )$*%+"+ 5 -+ C+&+$- D+#+"*

A--"%5!-+* P+"+$-#'+ C!&!#-%7+ P+"+$-#'+

,ement %ppearance


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.3 R+#-%)$*%,* 5+-:++$ V#"%#5+*

'earson (r$ correlation ,oefficient helped the researcher to understand the nature of the

relationships between the variables.

T#5+ .3 R+#-%)$*%,* 5+-:++$ V#"%#5+*

Country

of Origin

Perceived

Quality

Perceived

Value

Brand

Loyalty

,ountry of -rigin 5.666

'erceived 2uality .B7B 5.666

'erceived 1alue .


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.3.3 C)!$-"%+* )4 )"%'%$ +44+-* ,+"+%7+ >!#%- ,+"+%7+ 7#!+ #$ 5"#$ )#-.

The country of origin effects and perceived ;uality were positively and significantly related

(r.B7B pU6.65$. This means if consumers believe that cement from a certain country is of

good ;uality they will continue buying cement brand.

P+"+%7+ >!#%- #$ 5"#$ )#-.

'erceived ;uality and brand loyalty are positively and significantly related (r .


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,ountry of -rigin 'erceived 2uality and 'erceived value have the potential to e0plain of

1ariances in 3rand 4oyalty (%d#usted & S;uare value .


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These businesses were noted to differ significantly on 'erceived 2uality 'erceived 1alue and

3rand 4oyalty (sig. U.6=$. It is only on the ,ountry of -rigin effects that these firms did not

differ significantly as far as ownership is concerned.


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.9.2 A$#*%* )4 7#"%#$+ "+*!-* 4)" N!&5+" )4 +&,)++* 5 7#"%#5+.

The results for the variance in the number of employees for the firms.

T#5+ .9.2 A$#*%* )4 7#"%#$+ "+*!-* 4)" N!&5+" )4 +&,)++* 5 7#"%#5+.

N M+#$ S-. D+7%#-%)$ S-. E"")" F S%'.

C)!$-" )4 O"%'%$

6 O A=

=


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CHAPTER FIVE; DISCUSSION RECOMMENDATIONS AND CONCLUSIONS

9.1 I$-")!-%)$

This chapter contains the discussion recommendation conclusions and areas of future research

that should be pursued by the scholars in time to come to add to the knowledge base relating to

the variables. The discussion was done as per the research ob#ectives contrasting the findings

with what other scholars have been able to discover in the same field. &ecommendations which

indicate the actual course of action that should be taken by the ,ement manufacturers are also

contained in this chapter.

9.2 T+ +7+ )4 C)!$-" )4 O"%'%$ E44+-* B"#$ L)#- P+"+%7+ V#!+ #$ P+"+%7+

Q!#%- #&)$' C+&+$- !*+"* %$ U'#$#.

indings indicated that the cement manufacturers have a lot to do to make sure that the ,ountry

of -rigin effects of the various cement brands appeal to the consumers so that they may remain

loyal to their cement brands. They too need to improve the perceptions of value and ;uality of

their respective cement brands if they are to sustain business operations in the country. In an

effort to enhance the country of origin effects so that consumers perceive the cement brands

more favourably researchers have pointed out the need to precisely determine whether to

standardise or localise the marketing communications. This dilemma research indicates is a

ma#or challenge for companies that operate at levels beyond their borders (inbaeva et al.

B66:$. This becomes a challenge given that there are normally vast cultural and geographical

differences between the different markets or countries. In addition depending on the differences

and the way the marketing communications are designed it could altogether have a positive or


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negative impact on the perceptions of the target market regarding both value and ;uality of the

product from the foreign country. This notion is shared by other writers like 'owers and 4oyka

(B66:$.

&esearchers have pointed out a difference between product knowledge levels about brands from

particular countries their value and ;uality and the conse;uent perceptions among the consumers

('ecotich and Fard B66:$. Fhen consumers are highly knowledgeable about a certain product

they are bound to rate it the same way even when the manufacturer sets up a plant in a different

country for the brand. -n the other hand when consumers have little or limited knowledge about

the product they are more likely to rate its value and ;uality as per the country or origin

(8am!aoui and erunka B66C$. This calls for a critical review and knowledge of the market

before the sellers decide on the kind of marketing campaign they are to use.

9.3 C)!$-" )4 O"%'%$ +44+-* #$ B"#$ L)#-

The results in the previous chapter showed a positive and significant relationship between the

country of -rigin effects and the nature of brand loyalty among the cement buyers. These results

tell us that if the customers attach certain ;uality attributes to cement brands from a certain

country for instance going ahead to relate brands from a particular country with reliability these

customers are also likely. This can further be understood when we consider the research work of

8olland (B66:$ which shows that when manufacturers switch the country from which they are

producing their products it has a significant impact on the 4oyalty towards their brands. This is

because these customers often feel comfortable when these products are produced from specific


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countries. These findings are also supported by EurhanG,anli and aheswaran (B666$.

&esearchers now contend that the country of origin affect the image portrayed by a certain

product or service to the consumers and conse;uently their willingness to purchase or not

'urchase the product (-uellet B66:$.

9. C)!$-" )4 O"%'%$ E44+-* P+"+%7+ V#!+ #$ B"#$ L)#-

,ountry of -rigin effects were positively related to 'erceived 1alue and 3rand 4oyalty. This

link between 'erceived value and the country of origin indicate that if the consumer believes

cement brands from a particular country are of better monetary value then the consumer will

continue buying cement brands from that particular country. %lso perceived value and brand

loyalty were positively and significantly related. This means that if the buyers believe the worth

of their money is good then they will continue being loyal to that particular cement brand. This

is further supported by the work of Singh and Sirdeshmukh (B666$ who argue that some

antecedes like investment in assets price and post purchase evaluation leads to perceived value

of a product either positively or negatively.

arketing activities have a direct link with perceived value as The marketers try to woo buyers

on their product so that they can by them as has been advocated by oh (B66


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customers ;uality attributes to the cement brand then they will remain and continue being loyal

to the brand. This is supported supported by the research work ofDawar and Parker (1994)

whereby its has been argued that success goes with quality and marketers should promote

strategies that will promote consumers perception on product quality.

ccording to work o! Duong et al ("##4)$ Percei%ed quality is related to the le%el o! ser%ice

satis!action. &urther$ 'addad et al says that percei%ed quality is a product o! ratings accorded as

per the speci!ic aspects o! ser%ices. t is there!ore prudent that the le%el o! quality perception is

determined by some attributes associated with that ser%ice.

9.6 C)$!*%)$*

The country of origin effects for a certain cement brand affect the loyalty towards the brand

among the customers. This implies that cement manufacturers have to make it a point to develop

the right attitude about their countries among their clients.

The ,ountry of origin effects the 'erceived loyalty and the 'erceived 2uality and 3rand

4oyalty have not been well addressed by the cement dealers in @ganda. This leaves a gap for

e0ample with communication? consumers are left to rely on word of mouth for information about

the ;uality and value of the various brands like 8ima 3lue Triangle and Tororo cement.

9.= R+)&&+$#-%)$*

The manufacturers of these brands should ensure that they communicate the value of the cement

from those particular countries to key parties in the destination country for instance the opinion

leaders in the construction industry and this will help form the necessary attitudes toward brands

from those countries.


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,ement manufacturers should avoid standardised communications because they don"t have the

same impacts in different markets or regions. This calls for localised communication strategies

which will suit that specific market or region so that clients can understand the value of cement.

%lso different markets have their diversified cultures and appeals which might call for different

communication strategies.

,ement manufacturersD players should get locals to market their products because the consumers

feel its one of their own. %lso it is important because the locals can speak the local languages

when trying to convince their prospective buyers and clearly bring out the value or advantages of

their cement attributes.

,S& (,orporate Social &esponsibility$ In order for cement manufacturers Ddealers to identify

with the locals and create a conducive relationship with the communities they should come up

with corporate social responsibility programmes like building schools by donating cement

reclaiming the ;uarries by planting trees sponsoring sports etc.

%lso i would advise the players who don"t have plants in @ganda to evaluate putting up factories

here. This will have more appeal to the citi!ens as they feel it belongs to them.

,ement manufacturers should promote the country of manufacture image through their

governments" bilateral relationships? advertisements etc to create perception amongst the

consumers those products from specific country are of high value.


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Information from the country of manufacture reflecting the product heritage should be clearly

displayed and visible. 4abelling should be mandatory for the country of manufacture.

,omments of consumers who have used the cement before should be on the company"s website

testifying on the value and ;uality of their brands. This will help the prospective buyers to

perceive that the cement is of good ;uality and value and will be encouraged to buy it.

9.8 A"+#* 4)" 4!"-+" "+*+#"

uture researchers are encouraged to investigate the relationship between the ,ountry of

-rigin effects and the profitability of the brand. This will highlight which attributes the

companies should focus upon if they are to realise their set profitability targets. I would also

encourage further researchers to investigate other relationship between the country of origin and

price promotions.

%lso future researchers can e0plore on the relationship between country of origin ffects and

,onsumer ethnocentrism.


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REFERENCES

%ssael 8. (599=$. Con"uer #ehavior and $ar%eting Action Athed. 'FSG /ent

publishing company 3oston %.

3arroso ,.,. artin %.. (5999$.$ar%eting &elational d. SI, adrid.

3haskaran S. and Sukumaran +. (B66:$. ,onte0tual and methodological issues in ,-- studies.

$ar%eting Intelligence ' Planning, Vol. () *o. +,pp. CCG75.

,aruana %.( B66B$. Service loyalty. The effects of service ;uality and the mediating

role of customer satisfaction.uropean -ournal of $ar%eting, Vol. / *o.012

pp. 755GB7.

,unningham &. (59C5$. ,ustomer loyalty to store and brand. 3arvard #u"ine"" &evie4, Vol. 5

pp.5B:G


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)unn &. and Frigley +. (597A$. Store loyalty for grocery productsJ an empirical study. Area

Vol. Vol. +/ *o. pp.


47/56

8amin Ereg liot. % less developed country respective of consumer ethnocentrism and Pcountry

of originQ effectsJ IndonesiaG evidence.

8am!aoui 4. and erunka ). (B66C$.The impact of country of design and country of

manufacture on consumer perceptions of biGnational products" ;ualityJ an empirical

model based on the concept of fit. -ournal of Con"uer $ar%eting, Vol. ( *o. , pp.

5A=G==.

8olland 4. (B66:$.*o4 Sartie" leave erany. )aily 0press 4ondon.

*ohansson *./. )ouglasS. +onaka I. (597=$.%ssessing the impact f country of origin on

product evaluationsJ a new methodological perspective. -ournal of $ar%eting &e"earch,

Vol. (( pp


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ugenyi &. (B656$. /ampala ,ity ,ouncil (/,,$ Interview.

4usk *.4. 3rown *. ark T. 'roseku I. Thompson &. and Felsh *. (B66C$. ,onsumer

behavior public policy and countryGofGorigin labeling.&evie4 of Agricultural

conoic", Vol. (2 *o. ( pp. B7AG9B.

Schiffman,?.>. and /anuk?. ?.8(7779.,onsumerbehavior, Prentice Hall.

-h 8. (B66


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Sniehotta .. Schol! @. and Schwar!er &. (B66=$. 3ridging the intentionGbehaviour gapJ

planning self efficacy and action control in the adoption and maintenance of physical

e0ercise.P"ychology and 3ealth Vol. (7 *o. ( pp. 5A


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Appendix ! P")!-%)$ I&,)"-* #$ N+- D)&+*-% C+&+$- C)$*!&,-%)$ %$ T)$+* 4)"

-+ ,+"%) 200 -) 2008

T#5+ 1; P")!-%)$ I&,)"-* #$ N+- D)&+*-% C+&+$- C)$*!&,-%)$ %$ T)$+* 4)" -+

,+"%) 200 -) 2008

I-+& 200 2009 2006 200= 2008

Imports 5B==:7


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Appendix II R+*+#" I$*-"!&+$-

MAKERERE UNIVERSITY BUSINESS SCHOOL

D+#" R+*,)$+$-

;hi" ue"tionnaire i" intended to facilitate the "tudy on Country of Origin. ;he purpo"e of the

"tudy i" purely acadeic and your re"pon"e" 4ill be treated 4ith uto"t confidentiality. =indly

"pare "oe tie and an"4er the follo4ing ue"tion" a" candidly a" po""ible. Bour nae8Copany *ae9 i" Optional.

S+-%)$ A; B#'")!$ I$4)"-%)$

5. Eender ale emale

B. %ge of the respondent

A'+ Y+#"*18 3031 0 1 90 O7+" 90

5 B < A


52/56


53/56

7. 'lease state the amount of capital that the business is operating with

9. i.$ 'lease state your most preferred cement brand (Eive only one$

ii.$ /indly state why you prefer that brand

...

iii.$ Fhich of these countries produces cement brands you prefer above all the restH

iv.$ Fhy do you prefer cement brands from that particular countryH

...

F)" -+ %-+&* %$ -+ -#5+ 5+): %$ %$%#-+ )!" +7+ )4 #'"++&+$- 4)" +# :%- )!"

&)*- ,"+4+""+ C+&+$- 5"#$ %$ &%$ .

C)!$-" )4 O"%'%$Strongly

ree !

i"agree

dissertation sept2011

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