The Country-of-origin effect
Imagine I offer you a present – a watch. And I ask you to choose between a watch made in Switzerland, one made in India and one made in Brazil, or some other country. You’d most likely choose the Swiss watch (of course, the fact that the Swiss watch would cost me more than a by-pass surgery is not exactly your concern). I know I would have chosen it. I cannot point my finger at precisely why but somewhere in my head there is this perception that no on makes watches better than the Swiss.
I do not know whether the Swiss have a long heritage at this, or if they are indeed better. But the country of origin plays a key role in purchase decision as we generally associate the characteristics of countries to products, and in some cases, we even associate certain products to countries.
Swiss army knife
I’ll give you examples of both. We look for a ‘Made in Japan’ tag or atleast a Japanese name when it comes to high-tech products. We know that something made in Germany would be built with the best of quality, technology and luxury in mind. People also believe that an Italian product would be designed to be the best looking.
Now look at certain individual products – French Wine, German cars, Japanese Robots, Columbian Coffee, Italian/French fashion accessories, Swiss army knife, Swiss chocolate et al. Somewhere in our minds, these products are associated with these countries, owing to their legacy or culture or lifestyle which automatically leads us to perceive these as ‘premium’.
Häagen-Dazs
Foreign Branding is a concept that spawns from the country-of-origin effect and has become increasingly popular since the ’60s and ’70s. If you’ve read the previous article on this blog – ‘Whats in a name?’, where Pratik talks about the intricacies involved in naming a brand, you would recognise that many brands have been given foreign names to give a perceived ‘country-of-origin’ effect. Häagen-Dazs is one of the best examples of this. Based in the US of A, and started by a Polish immigrant, the brand was consciously given a Scandinavian sounding name since countries like Denmark are considered superior in dairy products and remind people of snow at the same time! The name is not even derived from actual scandinavian words, in fact, the digraphs “äa” and “zs” are not part of any native words in any of the scandinavian languages, yet the impact of the name is there for the world to see.
This foreign branding can be observed most frequently in cosmetics and fashion accessories, where an Italian or French sounding name is chosen to appeal to the style-conscious. Makes it obvious why ITC chose the names Essenza di Wills and Fiama di Wills for its frangrances and personal care products, especially since they’re battling it out in the premium segment.
In India, the government has put in place protections for domestic products which hold additional value owing to their respective place of origin. The Geographical Indications Registry is used to protect brands like Kancheepuram silk, Darjeeling tea, Basmati rice and Alphonso Mango from being misused. These measures prove the worth that certain products gain owing to their place of origin.
In retrospect, it seems quite obvious that building such connections between your brand and a certain place of origin would add credibility to your brand, but more importantly, the actual product must ultimately live up to the standards. Lets face it, if Häagen-Dazs did not make good ice-cream, the name would be as useless as me changing my name to Präshäanth de Zšamuél or something. The country/place of origin, if used wisely and backed by a credible product, would be an incredible asset.
I could go on to give you more examples, but being lazier than the others who post on this blog, I would instead ‘encourage’ you all to explore more examples, and I am conveniently using the pretext of ’starting a healthy discussion’ to stop here. Happy marketing!
(R. Prashanth Samuel is a PGDM 2011 student at IIM Calcutta. Write to him at prashanths2011@email.iimcal.ac.in)
it’s actually kind of ironical that even today, when we know that more or less every country has access to nearly the same technology in terms of making a product, we still give so much importance to the country of origin.
strange… but true…
Just taking your example of Italian/French for fashion, I’d like to quote an example here. when it comes to shoes, nearly all of the brands, at least in India try to get some association with Italy, be it Italian designs, Italian tradition, or the more concrete Italian technology (whatsoever it means, given that Italian shoe making is about hand crafting!!!).
further, we’re all well versed with the shoe brand Red Tape. it has come up with another brand called Jean Lauren, in the same price range, just to give that French appeal to essentially the same product.
How far do these associations with the country of origin hold today… is a matter of discussion.
That means, you HAVE started a healthy discussion
Something related just came to my mind:
mera joota hai japani
yeh patloon englishtani
sar pe laal topi roosi
phir bhi dil hai hindustani
actual country of origin or not… this sure creates some country-origin association
An example comes to mind. If you look at an Apple product, it has the phrase “Designed in California. Made in China” printed on the back of it. This goes to show that Apple (and most other people) realize that Chinese goods are at least perceived to be of lower quality (Even though they make almost anything, ranging from cheap t-shirts to expensive high tech hardware) and hence attaching the tagline: “Designed in California” seems to add an extra bit of value to their product.
Also, many products which are made in the US these days (they are becoming a rarity) have the words “Proudly Made in the USA” inscribed on them prominently to let the consumer know quickly that he/she is about to purchase something which is of higher implied quality/value.
@Shashank: I guess it has got to do with their culture… of course, we can imitate anything produced there, but it would not have the same impact… for example… italian sports cars are so premium cos they have a long racing legacy and they’ve passionately built some of the most radically designed cars in the recent past… Jeremy Clarkson keeps talking about Italians putting ‘their hearts and souls’ into their cars…
@Gurchetan: Exactly. A ‘Made in China’ tag does have negatives associated, and the word ‘Proudly’ is probably to inspire Americans into purchasing stuff made there… In a way, this is a form of neuro-marketing… Seeing the word ‘proudly’ would have an impact at a sub-conscious level and they’re targeting the customer’s deeply imbibed patriotism to create an emotional impact…
Its very true that “made in china” tag creates a negative impression in customer’s mind about the quality of the product even if the product is produced by a world renouned company which has stood the weather for centuries. The customer start thinking that even such companies have fallen to low levels to manufacture their products in china. I really dont know for sure whether to believe in the brand’s quality legacy as the products are designed it their home country or to be suspicious about the products quality just for the reason that they are made in china.
Apart from country of origin, the same phenomenon is applicable to Places-of-Origin (Intra-Country) as well. In India, for e.g., Mysore Sandal, Banarasi Silk, Kolhapuri Chilli and many more such products command premium.
I guess its more to do with history and pedigree of these products rather than conscious marketing efforts; being produced best at those places over the time, they have developed unique brand equities and are valued highly by customers. Thats why most of the current marketing efforts are focused on curbing counterfeiting and not exactly brand building.
As far as the relevance of place-association in a globalised world is concerned, my view point is that we will see more and more marketing efforts by the concerned companies to keep this differentiating factor intact and i don’t see the relevance waning any time soon.
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