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Global vs. Local Brands: How Home Country Bias and Price Differences Impact
Brand Evaluations
Article in International Marketing Review · April 2014

DOI: 10.1108/IMR-01-2012-0001
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International Marketing Review
Global vs local brands: how home country bias and price differences impact brand
evaluations
Warat Winit Gary Gregory Mark Cleveland Peeter Verlegh
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Warat Winit Gary Gregory Mark Cleveland Peeter Verlegh , (2014),"Global vs local brands: how home
country bias and price differences impact brand evaluations", International Marketing Review, Vol. 31 Iss 2
pp. 102 - 128
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IMR
31,2
Global vs local brands: how home
country bias and price differences
impact brand evaluations
102 Warat Winit
Faculty of Business Administration, Chiang Mai University,
Received 2 January 2012
Revised 20 June 2013 Amphor Muang, Thailand
Accepted 2 July 2013 Gary Gregory
Australian School of Business, University of New South Wales,
Sydney, Australia
Mark Cleveland
Department of Management and Organizational Studies,
The University of Western Ontario, London, Canada, and
Peeter Verlegh
Department of Communication Science, University of Amsterdam,
Amsterdam, The Netherlands
Abstract
Purpose – The purpose of this paper is to re-conceptualize the distinction between global and local
brands, providing a more comprehensive framework, which considers both geographical distribution
and ownership. It examines main and interactive effects of consumers’ perceptions of these factors,
and studies how ethnocentrism (CET) and price affect brand evaluations, considering a range of price
difference thresholds.
Design/methodology/approach – A preliminary study (n ¼ 243) examined main and interaction
effects of brand globalness and ownership on consumers’ brand quality attitudes and purchase
intentions in four different product categories. The main study (n ¼ 558) further explored brand
ownership effects by examining the interaction of CET and price differences.
Findings – The preliminary study confirmed the distinctiveness of brand globalness and ownership.
Consumers evaluated global (vs non-global) brands more positively, regardless of brand ownership
(local vs foreign). The main study found that effects of price and CET varied considerably across
product categories.
Research limitations/implications – Limitations include the use of student samples from a single
country (Thailand), and of scenarios instead of real life purchase decisions.
Practical implications – The findings suggest that perceived brand globalness positively impacts
brand evaluations. Companies may cultivate a global brand image by emphasizing global cues.
Local origin allows (global) brands to command a price premium, although this varies across product
categories. An emphasis on globalness seems valuable, especially for local brands.
Originality/value – This research offers a refined conceptualization of brand globalness, a key
construct in international marketing. Additional value is provided by studying price effects, which
have received limited attention in international marketing, and substantial data collection (total
N4800) in an understudied yet important economy (Thailand).
Keywords Consumer behaviour, Global marketing, Thailand, Ethnocentrism, Country of origin
Paper type Research paper
International Marketing Review
Vol. 31 No. 2, 2014
pp. 102-128 1. Introduction
r Emerald Group Publishing Limited
0265-1335
Markets are rapidly integrating across borders, and for many product categories,
DOI 10.1108/IMR-01-2012-0001 consumers are able to choose between global and local alternatives. Due to their
widespread recognition and distribution, many aspects favor global brands. From a Global vs local
utilitarian perspective, these include perceptions of higher quality as well as possible brands
lower prices resulting from standardization and economies of scale; whereas from
a hedonic perspective, the aspirational benefits and prestige of global brands may
accord higher esteem and status to the purchaser (Özsomer, 2012). Other aspects favor
local brands, despite – rather, because of – globalization. Chief among these are
the consumer benefits deriving from a strong association to the local environment, 103
including perceptions of cultural sensitivity, authenticity, and responsiveness to local
requirements, as well as the pride that comes from consuming brands that champion
and support the cultural heritage and national economy, respectively (Dimofte et al.,
2008; Schuiling and Kapferer, 2004; Özsomer, 2012).
The international marketing literature often portrays global and local brands as the
two opposite ends of a dimension of globalness and there appears to be an implicit
assumption that global brands are generally foreign owned (e.g. Johansson and
Ronkainen, 2005). Local brands are assumed to be distributed and owned domestically,
whereas global brands are assumed to be distributed worldwide and owned by foreign
entities. This operationalization confounds the geographical and ownership aspects of
the brand. Because this false dichotomy could account for some of the mixed findings
surrounding consumers’ reactions to global vs local brands, we submit that these
facets should be scrutinized independently as well as jointly.
The distinction between local and foreign-owned brands is particularly relevant in light
of the critical role of consumers’ home country biases (Alden et al., 2006; Shankarmahesh,
2006; Verlegh, 2007; Dimofte et al., 2008). Balabanis and Diamantopoulos (2004) report that
consumer ethnocentrism and patriotism strongly predict domestic purchasing behavior;
however, these constructs are weak in explaining foreign product purchases. One could
conjecture that home country biases would moderate country-of-origin (COO) effects.
Steenkamp et al. (2003) assert that “the positive association of perceived brand globalness
with purchase likelihood will be weaker for more ethnocentric consumers” (p. 57). Thus, as
highly ethnocentric consumers favor locally owned brands, they should have even more
favorable attitudes toward locally owned brands that have an international/global scope.
Other research showing a marginal impact of consumer ethnocentrism on global brand
attitudes (e.g. Dimofte et al., 2008) further implies that brand ownership is an overlooked
piece of the global brand concept. The first objective of our research is therefore to
examine the interplay of consumer ethnocentrism on the one hand and brand ownership
and brand globalness as separate dimensions of global brands on the other.
A second objective of our research is to study the role of pricing in this context.
Across many markets, it is often the case that in terms of market share, one (foreign)
global and one local brand occupy the top two positions in their respective categories.
Notwithstanding their similarity in market share, these directly competing product
alternatives “[y] might still differ in pricing, which might account for differences in
perceived quality, prestige, and purchase likelihood,” and how the selection from such
global/local brand pairs could depend on price difference perceptions is virtually
unknown (Özsomer, 2012, p. 89). Whereas much research examines the relationship
between brand origin perceptions and attitudes, few studies have focussed on the roles
played by external cues – first and foremost, price – on global/local brand evaluations
and choice (e.g. Hulland et al., 1996). The question arises what is the price threshold (i.e.
the point of indifference between the higher-priced local over the cheaper foreign global
brand, and vice-versa) above which consumers would switch, and to what extent does
this price threshold vary across product categories? Highly ethnocentric consumers are
IMR held to choose more-expensive local brands in order to support the economy and
31,2 culture of their nation, sometimes even when the foreign products/brands are of
demonstrably superior quality (Supphellen and Rittenburg, 2001; Shimp and Sharma,
1987). More specifically, our final research question therefore considers how price
thresholds and levels of consumer ethnocentrism independently and jointly impact
choice between local- vs foreign- owned alternatives, across a variety of product
104 categories. These questions are obviously critical for both local and international
marketing managers yet the literature is largely silent.
In our preliminary study, we re-conceptualize the operationalization of global and
local brands, in order to explicitly account for the possibility that consumers make a
distinction between geographical distribution and ownership aspects. The main and
interactive effects of these aspects on brand interviews are examined across a range of
product categories. Whereas global brands may be preferred for some product categories
(e.g. publically visible items due to signaling greater prestige and providing aspirational
value), local brands may be favored for others (e.g. privately consumed products
such as foods) (Özsomer, 2012; Cleveland et al., 2009). The main study focusses on our
principal objective: how brand ownership perceptions (local vs foreign), price sensitivity
(price difference thresholds between local/foreign alternatives) as well as consumer
ethnocentrism independently and jointly shape consumer preferences for global or
non-global product alternatives, across product categories. To our knowledge, this research
represents a novel attempt to incorporate price as a key factor affecting global vs local
brand choice. Furthermore, how price-differential sensitivities are potentially affected
by ethnocentric tendencies has yet to be examined.
2. Theoretical background and hypotheses

2.1 Global vs local brands
Global brands are those which are found in many countries around the world, under the
same name for the same product, and typically operating under the same (or similar)
positioning strategy; whereas local brands are generally defined as those available in one
country or in a narrow geographical area, although these brands may be owned by a
local, international, or global firm (Schuiling and Kapferer, 2004). Thus, the global brand
is primarily defined on the basis of the geographical aspect (i.e. level of brand
distribution), whereas the local brand definition confounds geographical distribution and
ownership. The inconclusive findings in the literature may in part be due to this
(mis)conceptualization. Global brands tend to garner positive perceptions of brand
quality, brand prestige, esteem image, and intention (Steenkamp et al., 2003; Holt et al.,
2004; Johansson and Ronkainen, 2005), whereas the research on local brand evaluations
has yielded mixed results. Furthermore, it is not entirely clear as to whether global/local
brand evaluation/intention differences are due more to brand quality perceptions or more
to brand prestige perceptions (Steenkamp et al., 2003; Schuiling and Kapferer, 2004).
The economic and psychological perspectives, respectively, provided by signalling
theory (Erdem and Swait, 1998) and associative network memory theory (e.g. Keller,
1993), are useful frameworks for explaining the evaluations and choice of consumers
deliberating between global and local brand alternatives. The former holds that by
manipulating signals, firms “use brands to inform consumers about product positions”
(Erdem and Swait, 1998, p. 131). Thus, global brands “signal” widespread recognition,
availability, and superior quality, and connote yearnings for achievement, sophistication,
and prestige, etc.; whereas local brands “signal” respect for and unique fit into
cultural traditions, and pride in representing the local economy, etc. (Özsomer, 2012).
In a related fashion, the associative network memory theory asserts that consumers’ Global vs local
brand information, attitudes, and behavioral intentions ensue from cognitive structures brands
composed of a series of nodes and links. Upon activating a brand node by way of
retrieval cues (e.g. product categories, price), various brand attributes and semantic
associations can be recalled, including other brand alternatives (Keller, 1993).
We contend that the confusion in brand ownership and globalness concepts leads to
misinterpretation in consumer perceptions and attitudes toward global/local brands. 105
Consumers may be more favorably disposed toward global brands because they, value
that the brand is sold all over the world with the same quality standard; appreciate the
status and prestige benefits conferred by the foreign-owned global brand; or value that
a brand is locally owned yet sold around the world (e.g. US consumers evaluating Nike
and Levi’s brands). There are also circumstances under which consumers have more
favorable attitudes toward local brands because they, appreciate that the brand is
owned by a local firm, irrespective of worldwide distribution; or second, want to

support the brand that is available only locally, irrespective of whether ownership is
local or foreign. Subsequently, it is vital to distinguish global/local brands along
two facets. Here, brand globalness is portrayed as a continuum, based on the relative
geographical scope of the brand, regardless of brand ownership considerations. Brand
ownership catalogues brands as either foreign- or local-owned. Combining facets
yields a taxonomy of four brand categories: local-owned global (i.e. L-G), local-owned
non-global (L-NG), foreign-owned global (F-G), and foreign-owned non-global (F-NG).
2.2 The impact of brand globalness and brand ownership on product evaluation
Perceptions of brand globalness are relative: typically the more countries in which the
brand is marketed, the more global the brand is perceived to be ( Johansson and
Ronkainen, 2005). For consumers, global brands have endearing qualities. In many
product categories, global brands offer greater credibility and reduced risk, and –
particularly among emerging-market consumers – may accord prestige and power to
the owner (Dimofte et al., 2008; Holt et al., 2004; Alden et al., 1999). For these reasons,
global (vs non-global) brands should be associated with more positive perceptions of
product quality and greater purchase likelihood (Roberts and Cayla, 2009; Steenkamp
et al., 2003). In verifying these effects, we isolate consumers’ perceptions of (global)
distribution from ownership.
Next to brand globalness, brand ownership is a notion that underlies the global/
local distinction that is often made in the literature. Although brand ownership may be
a fluid concept in the era of international investments and global financing, consumers
are still found to attach considerable importance to the perceived origin of a brand (e.g.
Magnusson et al., 2011; Samiee, 2011). The direction of this influence is, however, not
unequivocal, and foreign vs local owned products/brands may be more or less
preferable to consumers, depending on factors that come into play during evaluations.
Past findings indicate that consumers’ product/brand origin evaluations are significantly
influenced not only by the level of development and socio-economic factors of the
country from which the product/brand originated (e.g. Batra et al., 2000), but also by
the level of customization to cultural needs. Here, local brands are not without their
strengths, most notably, in their responsiveness to local needs, including those needs
perhaps not precisely met by foreign brands (Schuiling and Kapferer, 2004), and by
virtue of their close connection to the local/national cultural narrative (Steenkamp
et al., 2003). Local brands are often seen as more authentic and down-to-earth,
thus offering a more intimate basis for nurturing consumer-brand relationships.
IMR Local brands may be perceived as “local icons,” associated with local culture, tradition,
31,2 heritage, and country (Dimofte et al., 2008; Özsomer, 2012), and when available
worldwide, these brands may be considered “local giants.” So, while brand globalness
generally has a positive effect on consumer perceptions, we propose that brand
globalness influences consumers’ attitude and intentions through interactions with
other variables such as brand ownership. Local brands may for example use their
106 foreign presence to signal quality, as a communication strategy. Verlegh (2007) presents
the example of Heineken ads in the Netherlands, which often boast the global presence
of Heineken in order to instill a warm glow in local consumers. Thus, local ownership
may serve to enhance the positive effects of brand globalness: an L-G brand (locally
owned brand that is high in perceived globalness in terms of distribution scope) not
only promotes local economic and cultural needs but it is also able to confer the global
brand benefits of higher quality and prestige, enhanced by pride in the achievement of
the “ingroup” firm. In comparison, consumers may feel that their cultural identity is
threatened by the availability of a global brand of foreign origin (i.e. F-G brand), which
menaces the domestic counterparts. In testing the interaction of brand globalness and
ownership, we submit that:
H1. Perceived brand globalness is positively related to brand attitude and purchase
intention, and this relationship is enhanced (i.e. is stronger) when the brand is
perceived as local- (vs foreign-) owned.
2.3 The role of price in brand evaluation

Compared against the volume of international research focussing on the promotional
aspects of the marketing mix, price perception has largely been overlooked, despite its
seemingly obvious importance in decision making and aforementioned relevance to
branding. Consumers regard price as a “give” factor that they have to sacrifice in order
to “get” the desired product (Monroe, 1984), and they mentally have an acceptable price
range encompassing what they are willing to pay. The acceptable price falls between
the consumer’s upper and lower price thresholds (Kalwani and Yim, 1992; Kalyanaram
and Little, 1994; Ofir, 2004). Consumers perceive prices below the lower threshold
either as a bargain, or as suggestive of quality deficiencies. Prices above the upper
threshold induce resistance, representing poor value for money. Within the zone
between lower and upper price thresholds, (minor) price variations may not noticeably
impact consumer choice. Price assumes greater relevance to consumers once branding
enters the situation. Consumers generally equate high-priced products to high-quality
products (Erickson and Johansson, 1985). However, if two brands are perceived to be
equal in quality (perhaps base on branding), and if the price of one is noticeably higher,
all other things being equal, consumers should be less willing to purchase the more
expensive alternative.
Global brands enjoy economies of scale and scope, emanating from efficiencies in
manufacturing, R&D, logistics, as well as potential cost reductions in packaging and
communications. As such, global brands are often able to compete more effectively
on price, not only in terms of reduced costs, but – with higher perceptions of quality
and prestige – they also have a greater ability to charge a price premium (Schuiling and
Kapferer, 2004). On the other hand if the quality perception of the local brand is
perceived as equal to (or better than) foreign/global alternatives, then so too should the
local firm have the ability to charge a price premium.
Thus, if consumers recognize the L-G brand as having a higher price but being of Global vs local
similar quality to the competing F-G brand, all other things being equal, they should be brands
less willing to purchase the expensive L-G brand and more willing to purchase the
cheaper F-G brand. Similarly, if the F-G brand is deemed more expensive than the local
alternative (again assuming equal quality perceptions), consumers should be less
willing to purchase the F-G brand and more willing to purchase the L-G alternative.
Formally stated: 107
H2. Perceived price difference moderates the relationship between the ownership of
global brands and purchase intention. Ceteris paribus:
H2a. As the price of the foreign (relative to local-)-owned brand rises, purchase
intention for the local (vs foreign-)-owned brand will be enhanced, and
vice versa.
H2b. As the price of the local- (relative to foreign-) owned brand rises, purchase
intention for the local- (vs foreign-) owned brand will be diminished, and
vice-versa.
2.4 The interaction of price and consumer ethnocentrism on intention

A consumer’s acceptance of foreign/global products is encumbered by certain values
and attitudes, including conservatism, nationalism, patriotism, and CET. Numerous
studies have investigated the antecedents and factors that influence consumers’
reactions toward price differences, yet there is a dearth of research specifically
focussing on how price difference perceptions are related to home country biases. In a
globalizing world abounding with foreign products, icons, and brands, it is plausible
that, more than ever, dispositions emanating from identity shape consumption
patterns. The ethnocentric consumer is able to symbolically express biases by
choosing, if available, local brands over foreign alternatives (Alden et al., 2006; Shimp
and Sharma, 1987). In contrast, the non-ethnocentric consumer will tend to evaluate
products more objectively, on their merits, irrespective of brand ownership, and/or
place of manufacture. Prior research indicates that highly ethnocentric consumers
are willing to purchase a brand of product from their own country even when the
foreign products/brands are objectively superior (e.g. Supphellen and Rittenburg,
2001). By extension, it is plausible that many high-ethnocentric consumers are willing
to pay more for local-owned brands than for foreign-owned brands – but likely only up
until a certain point, which we denote as the price difference acceptability threshold.
In this way, global/local brand preferences and intentions are not driven completely
by objective utilitarian factors like price, but are also influenced by consumers’
affective biases, so that more ethnocentric consumers should be less price sensitive to
the higher-priced local alternatives, whereas less ethnocentric consumers should be
more sensitive.
Country-of-origin effects may strongly influence consumers in developing
country (or emerging market) to have strong preference on foreign-owned brands
from more developed countries over locally owned brands. This may be the case
for foreign-owned brands that reflect prestige or authenticity of foreign origin
(French wine and cosmetics, Belgian chocolate, etc.). However, the interaction of
price and ethnocentrism may weaken the strength of foreign-own brands preference.
IMR It is plausible that high-ethnocentric consumers, although they may purchase
31,2 foreign-owned brands, are willing to support locally owned brands in some way.
For instance, if the price of a favorite foreign-owned brand is somewhat higher
than the price of the locally owned one, while the quality of products is equal,
then it is more likely for high-ethnocentric consumers to shift from purchasing
the foreign-own brands to a locally owned counterpart. In other words, more ethnocentric
108 consumers should be more price sensitive to the higher-priced foreign alternatives,
whereas less ethnocentric consumers should be less sensitive. In sum, we conjecture
that consumers’ home country bias diminishes the moderating effect of price differences
on consumers’ purchase intentions. Formally stated:
H3. CET moderates the relationship between perceived price difference and purchase
intention.
H3a. CET enhances the relationship between perceived price difference and purchase
intentions for locally owned brands.
H3b. CET diminishes the relationship between perceived price difference and purchase
intentions for foreign-owned brands.
3. Methodology
A quasi-experiment and a comprehensive preliminary study were conducted.
The preliminary study incorporated a 2 (brand ownership) 2 (brand globalness)
between-subjects factorial design, which allowed us to manipulate brands into the four
combinations of brand globalness and ownership discussed earlier (i.e. L-G, L-NG, F-G,
F-NG). The goals of the preliminary study were fourfold. First, it aimed to categorize
brands into two constructs – globalness and ownership. Second, it demonstrated that a
brand can contain both globalness and ownership at the same time. This supported our
proposition that global and local are in fact different constructs. Third, it aimed to
verify that the globalness of the brand creates value, as captured by perceived quality
and intention to buy. Fourth and last, we tested whether brand ownership impacted the
attitude and intention of consumers by itself, as well as in interaction with perceived
brand globalness (i.e. H1). H2 and H3 were examined in our main study, which
employed a 2 (within-subjects: brand ownership) 7 (between-subjects: price
difference levels between L-G and F-G brands) factorial design.
The samples employed for the preliminary and main studies both consist of students
recruited from Thai universities (Chang Mai and Bangkok). Students’ homogeneity on
many characteristics allows for more precise predictions, and consequently a stronger
test of a given theory. Young, urban and educated, student consumers also fit the general
characteristics of opinion leaders; and therefore, are relevant to international marketers
as well as appropriate for achieving the study’s objectives. Importantly, Verlegh and
Steenkamp (1999) reported no differences in the magnitude of COO effects between
studies employing student samples vs those utilizing consumer samples. Recruits were
all Thai citizens, thus constituting a valid sample frame for measuring CET.
3.1 Preliminary study

3.1.1 Experimental brand stimuli. To create appropriate brand stimuli, we employed
real brands that are relevant to our student samples. Brands chosen corresponded to
four product categories that differ in terms of absolute costs, relative involvement, Global vs local
tangibility, and primary benefits derived: fruit juice (low involvement, tangible, brands
utilitarian), jeans (high involvement, tangible, hedonic), coffee shop (low involvement,
hybrid service/good, hedonic), and airlines (high involvement, intangible service,
utilitarian. The following brand choices for each product category included: fruit juice
(Tipco (L-G); Freeze (L-NG); Unif (F-G); UFC (F-NG)); jeans (Mc (L-G); Nobody (L-NG);
Lee (F-G); Big John (F-NG)); coffee shop (Black Canyon (L-G); Ninety Four (L-NG); 109
Starbucks (F-G); Coffee World (F-NG)); and airlines (Thai Air (L-G); Nok Air (L-NG);
Singapore Air (F-G); Air Macau (F-NG)).
3.1.2 Experimental manipulations. Adapting from Thakor and Lavack (2003),
brand-fact information was manipulated to achieve brand globalness and ownership.
Brand information was provided in the form of a brand logo, as well as a brand-facts
table consisting of relevant information about brand globalness (e.g. geographical
availability and promotions) and brand ownership (e.g. headquarters location, nationality
of majority of shareholders, and nationality of board/executives). The combinations
of the two levels of brand globalness (global/non-global) and two levels of brand
ownership (local/foreign owned) are represented with four brand-fact scenario
conditions: L-G, L-NG, F-G, and F-NG. All other relevant product variables were kept
constant. After exposure to brand-fact information, each respondent rated, for
each brand, their perceptions of brand globalness/ownership on seven-point scales
(i.e. 1 ¼ low in globalness, 7 ¼ high in globalness; 1 ¼ locally owned, 7 ¼ foreign
owned). Brand ownership consists of two items (inter-item correlations ranged from
a low of 0.82 to a high of 0.94 across product categories) adapted from Batra et al.
(2000). Brand globalness (Steenkamp et al., 2003; Özsomer, 2012) consists of three
items (resulting Cronbach a’s ranging from 0.82 to 0.94).
3.1.3 Dependent measures. Attitude toward brand quality consisted of three items
(ranging from a ¼ 0.91-0.93) using seven-point semantic differential scales, from
Steenkamp et al. (2003). Intention toward the brand entailed three items (a ¼ 0.91-0.94)
using seven-point bipolar scales, from Cronin et al. (2000). Since brand familiarity can
influence consumers’ evaluations, we test for this bias by incorporating the three-item
brand familiarity scale (a’s ¼ 0.86-0.92) employed in Steenkamp et al. (2003)[1].
Statistics for the measurement models can be found in Table I.
3.1.4 Survey administration. Scales were translated into Thai by translators fluent
in Thai and English, and then reviewed by bilingual academic experts to verify the
accuracy of the conceptual translation and to ensure that the scale items appropriately
fit the cultural context. Minor corrections were made to augment consistency with the
original English version. Thai measures were then pretested to verify interpretation
clarity and scale reliability. Each questionnaire consisted of four brand scenarios
(i.e. one per category) in a single brand condition (i.e. L-G, L-NG, F-G, or F-NG), to avoid
response fatigue. Eight versions were developed, according to four condition types,
with two brand sequences for each to assess ordering effects (sequence 1: juice, jeans,
Model CMIN DF CMIN/DF P CFI GFI NFI TLI RMSEA SRMR RMR
Juice 25.79 24 1.08 0.36 1.00 0.98 0.99 1.00 0.02 0.02 0.05 Table I.
Jeans 28.31 24 1.18 0.25 1.00 0.98 0.99 1.00 0.03 0.03 0.06 Model fit statistics
Coffee 52.42 24 2.18 0.00 0.98 0.96 0.97 0.97 0.07 0.04 0.09 for the preliminary
Airline 52.39 24 2.18 0.00 0.98 0.95 0.97 0.97 0.07 0.04 0.10 study
IMR coffee shop, airline; sequence 2 reverses order)[2]. Respondents (n ¼ 256, 243 usable)
31,2 were randomly assigned one version.
3.2 Preliminary study results

3.2.1 Manipulation checks. ANOVAs verify that the manipulated brand conditions match
the correct brand image (Table II). Post hoc tests and homogeneous subsets consistently
110 corroborate successful manipulation of brands into the expected conditions (i.e. L-G,
L-NG, F-G, and F-NG).
3.2.2 Effects of brand globalness and ownership on evaluation and intention. In line
with our theorizing, ANOVA results (Table III) revealed a significant main effect of brand
globalness on perceptions of brand quality for all four product categories. Means for the
perceived quality of global (vs non-global) brands were consistently and significantly
higher in all categories. In other words, consumers who perceived a brand as being global
(non-global) associated the brand with higher (lower) quality. For purchase intentions,
we found a similar and significant result in all categories, except for the coffee shop result,
which was in the postulated direction but not significant. Means can be found in Table III.
The consistency of the results for perceived quality and intentions underlines the notion
that the globalness of a brand enhances perceived quality and intention to buy, regardless
of the ownership of the brand (consistent with Steenkamp et al., 2003 and others).
Brand ownershipa Brand globalnessa

Product category
and conditionb n Mean SD F (df) Mean SD F (df)
Juice
L-G 61 2.92 1.80 4.71 1.44
L-NG 60 2.74 1.59 32.42*** 3.38 1.47 21.26***
F-G 59 5.41 1.76 (3,237) 5.60 1.65 (3,237)
F-NG 61 4.70 1.99 4.50 1.54
Total 241 3.93 2.11 4.54 1.71
Jeans
L-G 61 4.87 1.81 6.24 0.83
L-NG 60 3.02 1.70 74.40*** 3.93 1.46 69.28***
F-G 59 6.56 1.08 (3,237) 6.64 0.84 (3,237)
F-NG 61 6.26 1.02 5.46 1.18
Total 241 5.17 2.01 5.57 1.51
Coffee-shop
L-G 61 4.50 2.00 5.69 1.26
L-NG 60 2.98 1.65 56.43*** 3.44 1.49 67.01***
F-G 59 6.62 0.65 (3,237) 6.60 0.61 (3,237)
F-NG 61 5.63 1.77 5.00 1.46
Total 241 4.93 2.09 5.18 1.70
Airline
L-G 61 1.33 0.49 5.97 1.05
L-NG 60 1.54 0.70 882.12*** 3.34 1.26 67.92***
F-G 59 6.81 0.51 (3,237) 5.96 0.81 (3,237)
F-NG 61 6.38 1.19 4.40 1.57
Total 241 4.00 2.70 4.92 1.64
Table II.
Brand globalness Notes: aMeans, brand quality attitudes (1 ¼ low, 7 ¼ high), purchase intentions (1 ¼ low, 7 ¼ high);
b
and ownership L-G, Local-owned, Global; L-NG, Local-owned Nonglobal; F-G, Foreign-owned Global; F-NG, Foreign-
manipulations owned Nonglobal; SD, standard deviation. *** po0.001
Brand ownershipa Brand globalnessa
Global vs local
Local vs foreign Global vs non-global Type III sum of squares Fa
brands
Brand-quality’
Juice
Local-foreign 4.87o5.13* 4.19 5.33**
Global-non-global 5.4044.62** 37.30 47.41*** 111
Interactionb 0.20 0.26
Jeans
Local-foreign 5.32o5.34 0.13 0.16
Global-non-global 5.9144.76** 79.54 95.75***
Coffee-shop
Local-foreign 5.35o5.38 0.12 0.18

Airline
Local-foreign 5.2844.63** 24.15 30.53***
Interactionb 11.14 14.09***
Purchase-intention
Juice
Local-foreign 4.9644.93 0.06 0.05
Jeans
Local-foreign 4.8744.70 1.53 1.04
Coffee-shop
Local-foreign 4.6744.60 0.22 0.14
Global-non-global 4.7544.52 3.12 1.99
Interactionb 8.55 5.45**
Airline
Local-foreign 5.4444.08** 112.16 88.10***
Interactionb 6.95 5.46** Table III.
ANOVA for brand
a
Notes: Means, brand quality attitudes (1 ¼ low, 7 ¼ high), purchase intentions (1 ¼ low, 7 ¼ high); quality attitudes and
b
interation (local-foreign global-non-global). * po0.05, ** po0.01, *** po0.001 purchase intentions
As anticipated in our theory section, we did not find such a consistent pattern of main
effects for brand ownership: on quality attitude, the main effect of local vs foreign
ownership was negative for juice, positive for airlines, and absent for jeans and coffee
shops. On purchase intention, the effect was significant for airlines, but not for the other
three categories. In addition, we found a number of significant interactions of ownership
and globalness in several categories, which confirms our idea that the effects of brand
ownership is best understood when considered in conjunction with brand globalness.
Specifically, our analyses revealed three significant interaction effects (Table III): toward
quality perceptions for the airline category, and toward intentions for coffee shop and
airline categories. For the airline brand, and consistent with H1, post-hoc tests reveal
that the general association of global airline brands with higher levels of quality was
further enhanced by local ownership (i.e. means of L-G vs F-G: 6.18 vs 5.12, po0.05),
IMR while there was no significant effect of local ownership for non-global brands. Similar
31,2 results were found for purchased intent in this category (i.e. means of L-G vs F-G: 5.93 vs
4.23, po0.05). For coffee shops, there was no interaction on the quality dimension,
but – contrary to H1 – intentions toward the F-G brand were above those of the F-NG
brand (4.91 vs 4.31, po0.05), which may have been due to the fact that respondents were
hesitant to indicate a high-purchase intention for a brand not sold in their own country.
112 Based on these findings, equivocal support was obtained for H1.
3.3 Preliminary study summary

Our preliminary study demonstrates the validity of distinguishing two facets of the
global-local dichotomy (brand globalness and brand ownership). The findings bolster
prior research that global brands evoke higher evaluations than non-global brands.
We examined the effects due to geographical orientation in isolation from those
due to brand ownership. The results also suggest that preference for locally owned
vs foreign-owned brands depends on the product category, and by extension, on the
availability of strong local alternatives. This is best demonstrated by the airline results,
where the interaction of global brand scope and local-ownership produced the most
favorable brand evaluations. The focal local airline enjoys a high reputation for
quality; gaining further respect from being a locally owned global brand, Thai Airlines
embodies local icon value from its brand images (e.g. logo, staffs’ uniform, aircraft
decoration theme, in-flight services theme) (Özsomer, 2012; Steenkamp et al., 2003).
Thailand enjoys a high reputation in tourism and hospitality industry; and these
effects may carry over onto consumer evaluations of the L-G airline brand. In this
regard, the results for airlines could be regard as a further validation of the notion that
preference for locally owned brands might be strongest in categories where there is a
strong match between the product and the origin country (Usunier and Cestre, 2007).
While we have confirmed that global (vs non-global) brands garner favorable
evaluations, it remains unclear as to what specific conditions consumers prefer locally
owned global brands over their foreign-owned counterparts. In many markets, the top
brands dominating product categories consist of the global and local brands, however,
“products might still differ in pricing, which might account for differences in perceived
quality, prestige, and purchase likelihood” (Özsomer, 2012, p. 89). Consumers’ home
country biases could also positively affect preferences for the locally owned alternative,
out of a motivation to support domestic jobs and the economy and to protect the local
culture (Shimp and Sharma, 1987), which could account for the unexpected results that
emerged for preliminary study. The purpose of the main study is to pinpoint how,
across different product categories, pricing (i.e. sensitivity price difference thresholds)
interacts with consumers’ home country biases (i.e. CET) to affect the choice between
local- and foreign-owned global brands, as hypothesized in H2-H3.
3.4 Main Study

Brand ownership perceptions (local- vs foreign-owned) was manipulated within subjects.
Four brand category pairs (i.e. four of each L-G vs F-G thus eight comparisons in total)
were used. Price difference conditions, via seven price-point scenarios, were also
manipulated between subjects. Most measures for the main study follow the preliminary
study, with additional measures taken from existing scales (see Appendix 1 for measures
and Appendix 2 for reliability of all measurement scales for each category).
3.4.1 Brand ownership and price manipulations. As in the preliminary study,
brand-fact information was used to manipulate brand ownership to ensure that the
local-owned brand was perceived as local by consumers, except here brand globalness Global vs local
is held constant (high for both). Two tables of brand-fact information (L-G and F-G) brands
provided respondents with information on brand globalness and ownership. Prices of
local- and foreign-owned products were equalled to establish a baseline condition
(Ahmed and d’Astous, 1993). For each category, base prices derived from pilot study
findings and reflect actual market prices and thus, real choices facing consumers.
Drawing from past research on price thresholds (Gupta and Cooper, 1992; Kalwani and 113
Yim, 1992), incremental price difference intervals (and corresponding price-points) of 5,
15, and 25 percent (for L-G4F-G prices, and vice-versa) were established, alongside
the base price scenario. This set-up is depicted in Table IV. In the questionnaire, we
represented price differences as dollar values. However, percentage differences will be used
when reporting the result as it has less complexity when comparing between conditions.
3.4.2 Survey instrument and administration. The instrument consisted of brand cues
(brand-fact information and price differences) corresponding to each of the two brands
(i.e. L-G and F-G) in the four pairs of product categories. The between-subjects design
minimized response fatigue by ensuring that each subject was exposed to only one of
seven price difference conditions. Thus, seven questionnaires were created, each with two
subversions (to assess potential ordering effects); therefore 14 versions in total. Following
the preliminary study, perceptions of brand globalness and ownership were measured.
Internal consistency assessments follow those described in the preliminary study.
Across the product categories, inter-item correlations for L-G and F-G brand ownership
ranged from 0.75-0.84 and 0.86-0.89, respectively. Reliabilities for L-G and F-G brand
globalness ranged a ¼ 0.76-0.73 and a ¼ 0.89-0.95, respectively. As dependent variable,
purchase intentions of L-G and F-G brands, we employed the single-item, seven-point Likert
scale developed by Dodds et al. (1991). CET entailed the four-item version (see Cleveland
et al., 2009) of the CETSCALE (Shimp and Sharma, 1987), consisting of seven-point Likert
measures (a ¼ 0.86). To further explore the validity of the measures, confirmatory factor
analyses was conducted for each of the four product categories (see Table V). The results
suggested a very strong fit of the data to the model.
Actual prices in Thai baht

Scenario-price difference Juice Jeans Coffee shop Airlines
1-L-G ¼ F-G price 18.00 1,200 65 12,000

2-L-G 5%4F-G price 19.00 vs 18.00 1,260 vs 1,200 68.00 vs 65.00 12,600 vs 12,000
5-F-G 5%4L-G price 18.00 vs 19.00 1,200 vs 1,260 65.00 vs 68.00 12,000 vs 12,600 Table IV.
6-F-G 15%4L-G price 18.00 vs 20.75 1,200 vs 1,380 65.00 vs 75.00 12,000 vs 13,800 Price scenarios
7-F-G 25%4L-G price 18.00 vs 22.50 1,200 vs 1,500 65.00 vs 81.00 12,000 vs 15,000 and price points
Model CMIN DF CMIN/DF P CFI GFI NFI TLI RMSEA RMR SRMR
Juice 188.24 71 2.65 0.00 0.98 0.96 0.96 0.97 0.06 0.06 0.03
Jeans 166.03 71 2.34 0.00 0.98 0.96 0.97 0.98 0.05 0.06 0.03 Table V.
Coffee 145.34 71 2.05 0.00 0.98 0.96 0.97 0.98 0.04 0.06 0.03 Model fit statistics
Airline 203.37 71 2.86 0.00 0.96 0.95 0.95 0.95 0.06 0.06 0.04 for the main study
IMR The five-item consumer price sensitivity scale (Ofir, 2004) was incorporated to
31,2 rule out consumers’ inherent price sensitivity as a possible competing explanation for
intention differences between L-G and F-G brands (with two ultimately retained,
inter-item correlations ranged 0.63-0.82).[3] The survey concluded with demographic
measures. Survey translation and review procedures mirrored the preliminary study.
Minor translation adjustments were made to ensure clarity and consistency with the
114 English version. A different sample (i.e. not part of the preliminary study) of students
(n ¼ 616) was recruited from a wide range of faculties, yielding 558 usable cases.
3.5 Results
3.5.1 Brand-ownership manipulation check. Paired-samples t-tests indicated that the
mean L-G brand-ownership score is significantly ( po0.01) lower than the mean F-G
score, across all categories: juice (2.5 vs 5.1, t ¼ 21.2), jeans (3.4 vs 6.1, t ¼ 23.4), coffee
shop (2.9 vs 6.6, t ¼ 35.6), and airlines (1.4 vs 6.6, t ¼ 60.0). Unlike the preliminary study,
the main study was a within-subjects design (although between-subjects for price
differences), whereby each participant was exposed to and compared, two brand
conditions (L-G and F-G) for four categories. One-sample t-tests assessed differences of
brand ownership and globalness against the midpoint of 4.0 (Dimofte et al., 2008). In the
L-G brand condition, the mean brand-ownership score should be significantly below
the 4.0 midpoint whereas the brand globalness mean should be significantly above the
mid-point. Such significant differences between L-G and F-G brand conditions were
indeed found across all product categories ( po0.01), thus confirming the manipulations.
3.5.2 Effects of price on intentions. Multivariate tests (Table VI) consistently show
significant main effects for price on intentions (for all categories), though, as indicated
by Wilks’ l and partial Z2 results, the magnitude of effects was not homogeneous
for L-G and F-G intentions, nor was the effect strength uniform across categories.
This heterogeneity of effects is also indicated by the strong main effect obtained
for product-category, and to a lesser extent, the significant – but with modest effect –
interaction of price and category, on both L-G and F-G intentions. These results
suggest that price differences mattered most for the utilitarian and high absolute cost
airline category, and least for the hedonic and high-involvement jeans category.
Regressions examined the impact of price difference on intentions for L-G and F-G
brands. Paired-samples t-tests compared mean purchase intention differences between
L-G and F-G brands across the four categories. H2 will be supported if price differences
between L-G and F-G brands significantly and positively impact L-G and F-G
intentions. Specifically, Ceteris paribus, the higher the F-G (L-G) brand price, the higher
should be L-G (F-G) intentions (H2a). Support for H2 will also be indicated by
diminishing intentions for L-G (with increasing F-G intentions) as the L-G price
increases (relative to F-G), and vice-versa (H2b).
As indicated by the (standardized) positive regression slopes, the results show that
the increasing the price of F-G (relative to L-G) brand alternative positive impacts
intentions for the L-G brand alternative (supporting H2a), uniformly across all
categories: juice (F ¼ 48.55, po0.01, b ¼ 0.29, t ¼ 6.97), jeans (F ¼ 28.27, po0.01,
b ¼ 0.22, t ¼ 5.32), coffee shop (F ¼ 57.2, po0.01, b ¼ 0.31, t ¼ 7.56), and airline
(F ¼ 184.91, po0.01, b ¼ 0.50, t ¼ 13.60). Likewise sustaining H2a, increasing the L-G
brand price consistently raises F-G intentions: juice (F ¼ 27.41, po0.01, b ¼ 0.22,
t ¼ 5.24), jeans (F ¼ 6.76, po0.05, b ¼ 0.11, t ¼ 2.60), coffee shop (F ¼ 42.86, po0.01,
b ¼ 0.27, t ¼ 6.55), and airline (F ¼ 186.92, po0.01, b ¼ 0.51, t ¼ 13.67). As indicated by
the (standardized) negative regression slopes, the results also show that raising L-G
L-G intentions F-G intentions
Global vs local
brands
H2: All Categories, main effect (price) F ¼ 48.77***, Z2 ¼ 0.120 F ¼ 33.84***, Z2 ¼ 0.087
L ¼ 0.850 F12 ¼ 30.22***, Z2 ¼ 0.078
Main effect (category) F ¼ 103.8***, Z2 ¼ 0.127 F ¼ 48.85***, Z2 ¼ 0.064
L ¼ 0.858 F6 ¼ 57.05***, Z2 ¼ 0.074
Interaction effect (price category) F ¼ 3.27***, Z2 ¼ 0.027 F ¼ 4.79***, Z2 ¼ 0.039 115
L ¼ 0.949 F36 ¼ 3.14***, Z2 ¼ 0.026
H2: Juice, main effect (price) F ¼ 9.47***, Z2 ¼ 0.095 F ¼ 5.07***, Z2 ¼ 0.053
L ¼ 0.888 F12 ¼ 5.49***, Z2 ¼ 0.058
H2: Jeans, main effect (price) F ¼ 5.01***, Z2 ¼ 0.053 F ¼ 1.70, Z2 ¼ 0.019
L ¼ 0.937 F12 ¼ 2.97***, Z2 ¼ 0.032
H2: Coffee shop, main effect (price) F ¼ 9.74***, Z2 ¼ 0.098 F ¼ 8.91***, Z2 ¼ 0.090
L ¼ 0.862 F12 ¼ 6.93***, Z2 ¼ 0.072

H2: Airline, main effect (price) F ¼ 37.59***, Z2 ¼ 0.299 F ¼ 32.87***, Z2 ¼ 0.272
L ¼ 0.633 F12 ¼ 22.59***, Z2 ¼ 0.205
H3: All Categories, main effect (price) F ¼ 39.34***, Z2 ¼ 0.099 F ¼ 31.26***, Z2 ¼ 0.080
L ¼ 0.875 F12 ¼ 24.89***, Z2 ¼ 0.065
Main effect (CET) F ¼ 5.29*, Z2 ¼ 0.002 F ¼ 6.13**, Z2 ¼ 0.003
L ¼ 0.996 F2 ¼ 3.99*, Z2 ¼ 0.004
Interaction effect (price CET) F ¼ 0.60, Z2 ¼ 0.002 F ¼ 1.84, Z2 ¼ 0.005
L ¼ 0.991 F12 ¼ 1.60, Z2 ¼ 0.004
H3: Juice, main effect (price) F ¼ 9.00***, Z2 ¼ 0.092 F ¼ 5.10***, Z2 ¼ 0.054
L ¼ 0.890 F12 ¼ 5.28***, Z2 ¼ 0.056
Main effect (CET) F ¼ 0.06, Z2 ¼ 0.000 F ¼ 0.89, Z2 ¼ 0.002
L ¼ 0.998 F2 ¼ 0.47, Z2 ¼ 0.002
L ¼ 0.974 F12 ¼ 1.16, Z2 ¼ 0.013
H3: Jeans, main effect (price) F ¼ 4.82***, Z2 ¼ 0.052 F ¼ 2.02, Z2 ¼ 0.022
L ¼ 0.936 F12 ¼ 2.98***, Z2 ¼ 0.033
L ¼ 0.992 F2 ¼ 2.12, Z2 ¼ 0.008
Interaction effect (price CET) F ¼ 0.60, Z2 ¼ 0.007 F ¼ 2.61*, Z2 ¼ 0.029
L ¼ 0.966 F12 ¼ 1.54, Z2 ¼ 0.017
H3: Coffee shop, main effect (price) F ¼ 9.25***, Z2 ¼ 0.095 F ¼ 9.55***, Z2 ¼ 0.097
L ¼ 0.858 F12 ¼ 7.06***, Z2 ¼ 0.074
Main effect (CET) F ¼ 21.88***, Z2 ¼ 0.040 F ¼ 17.71***, Z2 ¼ 0.032
L ¼ 0.948 F2 ¼ 14.64***, Z2 ¼ 0.052
L ¼ 0.988 F12 ¼ 0.54, Z2 ¼ 0.006
H3: Airlines, main effect (price) F ¼ 35.17***, Z2 ¼ 0.289 F ¼ 31.42***, Z2 ¼ 0.266
L ¼ 0.642 F12 ¼ 21.49***, Z2 ¼ 0.199
L ¼ 0.997 F2 ¼ 0.86, Z2 ¼ 0.003
L ¼ 0.987 F12 ¼ 5.55, Z2 ¼ 0.006
Notes: aL, Wilks’ l represents prop. of variance in the combination of dependent variables
unaccounted for by independent variable. A large prop. of variance accounted for by independent
variable suggests an effect from the grouping variable and that the groups (here, L-G and F-G Table VI.
intentions) have different mean values; Z2, partial Z2, a measure of effect size (i.e. prop. of total variance Multivariate results
accounted by independent variable(s)). * po0.05, ** po0.01, *** po0.001 for H2 and H3 a
IMR prices (relative to F-G) consistently dampens L-G intentions: juice (F ¼ 48.55, po0.01,
31,2 b ¼ 0.29, t ¼ 6.97), jeans (F ¼ 28.27, po0.01, b ¼ 0.22 t ¼ 5.32), coffee shop
(F ¼ 57.15, po0.01, b ¼ 0.31, t ¼ 7.56), and airline (F ¼ 184.91, po0.01, b ¼ 0.50,
t ¼ 13.60). Likewise, raising F-G prices dampens F-G intensions: juice (F ¼ 27.41,
po0.01, b ¼ 0.22, t ¼ 5.24), jeans (F ¼ 6.76, po0.05, b ¼ 0.11 t ¼ 2.60), coffee shop
(F ¼ 42.86, po0.01, b ¼ 0.27, t ¼ 6.55), and airline (F ¼ 186.92, po0.01, b ¼ 0.51,
116 t ¼ 13.67). These results are consistent with H2b.
Figure 1 illustrates the changes in consumers’ purchase intentions for each
of seven price point differentials. When prices were equal, participants preferred
L-G over F-G brands for the juice (5.00 vs 4.46, t ¼ 1.75, po0.10) and airline (6.05 vs
3.60, t ¼ 7.98, po0.001) categories. Participants preferred F-G over L-G brands for
the jeans (4.00 vs 4.80, t ¼ 2.70, po0.01) and coffee shop (3.63 vs 5.30, t ¼ 5.34,
po0.001) categories. As expected, consistent across all four categories, when F-G
prices increase relative to L-G prices, L-G brand intentions increase (relative to F-G).
Figure 3 suggests, however, that this relationship varies across product categories.
For example, preference switched from L-G to F-G juice not until the L-G price
was 25 percent higher than the F-G price (3.78 vs 4.85, t ¼ 2.45, po0.05). Also as
expected, when the L-G price exceeded the F-G price, all categories demonstrated
consumer preference for the F-G vs L-G brands; however, this too occurred at
difference price thresholds, depending on the category. For instance, respondents
switched preference from L-G to F-G airline at the point where the L-G price was
6.00 5.53*** 7.00

5.45*** 5.36*** 6.31*** 6.26*** 6.32***
4.85** 4.85 5.00* 6.05***
4.78
5.00 6.00 5.52***
Mean Purchase Intention
5.08**
5.00 4.74
4.00 4.46
4.27 4.27
3.94 3.88
3.78 4.00 4.45
3.00 3.52 4.04
3.00 3.31 3.60
2.00 3.00
2.65
2.00 2.32
L-G Juice Intention
1.00 *p <0.10, ** p < 0.05, *** p < 0.01 L-G Airline Intention
F-G Juice Intention 1.00 *p < 0.10, **p < 0.05, *** p < 0.01
F-G Airline Intention
0.00 0.00
G
% G
5% FG
LG FG
5% FG
10 LG
% G
LG
20 FG
G
10 FG
5% FG
LG FG
5 FG
10 LG
% G
LG
20 F
15 F
10 > F
15 L
20 L
25 > L
15 F
15 > L
20 > L
25 > L
>
FG % >
FG % >
>
FG % >
>
LG % >
LG % >
LG >
>
FG =
LG % >
LG % >
LG % >
LG >
>
FG =
%
FG %
FG %
FG %
%
%
25
25
FG
FG
LG
LG
LG
Price Conditions Price Conditions
6.00
5.13*** 5.05*** 4.80**
7.00
4.88*** 5.84***
5.00 4.69***
6.00 5.56***
4.37 4.46 5.30***

5.20*** 5.27***
4.00 4.38 5.00 4.54 4.44
4.00 4.06
3.72 4.00 4.48
3.00 3.49
3.24 3.99
2.96 3.66 3.63 3.81
3.00
2.00 2.94
2.63
2.00
L-G Jeans Intention L-G Coffee Shop Intention
1.00 *p < 0.10, **p < 0.05, *** p < 0.01
F-G Jeans Intention 1.00 *p < 0.10, ** p < 0.05, *** p < 0.01
F-G Coffee Shop Intention
0.00 0.00
Figure 1.
G
% G
5% FG
LG FG
5% FG
10 LG
% G
LG
% G
5% FG
LG FG
5% FG
10 LG
% G
LG
Intentions toward L-G

20 F
15 F
10 F
15 > L
20 > L
25 > L
20 > F
15 F
10 > F
15 L
20 > L
25 > L
>
>
>
>
>
LG % >
LG % >
LG % >
LG >
>
FG =
LG % >
LG >
>
FG =
FG %
FG %
FG %
FG %
FG %
%
%
and F-G brands across

25
25
FG
FG
FG
LG
LG
LG
LG
four categories
15 percent higher (L-G 4.04 vs F-G 5.08, t ¼ 2.33, po0.05). Taken together, these Global vs local
findings support H2. brands
3.5.3 Effects of CET and price on intentions. MANOVAs (Table VI) tested the
significance and intensity of the main effects of price differences and CET, as well as
the price CET interaction, on L-G and F-G intensions across product categories.
The findings for the main effects of price naturally mirrored the results obtained for
H2. The main effect findings for CET on L-G/F-G intentions were significant overall 117
(i.e. combined across categories) but only weakly accounted for variance in intentions.
At the product-category level, MANOVA confirms a significant main effect of CET
on L-G/F-G intentions only for the hedonic, low-involvement coffee shop category.
The sole significant CET price interaction effect was for the hedonic, high-involvement
jeans category, and here, only with respect to F-G intentions.
It is possible that CET’s effects on intentions are obscured across the price
differential thresholds. To test H3, H3a, and H3b, a median-split divided respondents
into low- and high-CET groups. Similar to H2, t-tests were conducted for each price
condition to compare intentions between low-/high-CET groups for L-G vs F-G brands,
across each product-category. As with H2, intentions for L-G brand should recede
(with F-G intentions mounting), as the L-G price increases relative to that of the F-G.
However, with H3, we expect that these effects will be diminished among high (vs low)
ethnocentric consumers, under the assumption that high-ethnocentric consumers will
be more tolerant of local brands’ price premium over foreign brands. By the same
token, when the F-G price increases (relative to L-G), the difference in intentions
between F-G and L-G brands (i.e. decreasing for F-G and increasing for L-G) should be
enhanced for high (relative to low) CET group.
The L-G/F-G intention findings for juice and airline categories are shown in
Figure 2. For juice, when L-G and F-G prices are equal, the low-CET group shows
higher intention toward the L-G vs F-G (4.94 vs 4.00, t ¼ 1.71, po0.10). The points of
indifference in intention were found when the L-G price was 5 percent (4.65 vs 4.16,
t ¼ 0.95, p40.10) and 15 percent (4.35 vs 4.67, t ¼ 0.67, p40.10) higher than that of
the F-G. These results imply that low-ethnocentric consumers started decreasing their
L-G intention while increasing their F-G intention as the price of the former increased.
When the price of the L-G exceeded the F-G by 25 percent, the low-CET group reported
higher F-G (vs L-G) intention (i.e. 4.75 vs 3.63, t ¼ 1.98, po0.10), indicating this price
level was the threshold where the low-CET group switched intentions from L-G to
F-G brands. High-ethnocentric consumers, however, exhibited indifference between
L-G and F-G juice brands when prices were equal (5.04 vs 4.80, t ¼ 0.69, p40.10), when
L-G prices were 5 percent higher (5.05 vs 4.38, t ¼ 1.11, p40.10), and even 15 percent
higher (4.14 vs 4.96, t ¼ 1.42, p40.10), than the F-G prices. The impact of high CET on
intention was still pronounced when the L-G (vs F-G) price was 25 percent higher.
At this price level, while low-ethnocentric consumers switched their intention
preference to the F-G brand, high-ethnocentric consumers were indifferent between L-G
and F-G alternatives (3.97 vs 4.93, t ¼ 1.37, p40.10).
The airline findings were similar to those for juice. When prices are equal, higher
intentions toward L-G (vs F-G) were reported for both the low- (6.15 vs 3.52, t ¼ 6.09,
po0.001) and high-CET groups (5.98 vs 3.66, t ¼ 5.36, po0.001). When the price
of L-G was 5 percent higher than F-G, both groups showed indifference in L-G vs F-G
intentions (low CET: 4.81 vs 4.89, t ¼ 0.14, p40.10; high CET: 4.68 vs 4.03, t ¼ 1.00,
p40.10). The impact of CET was more pronounced when the L-G price was 15 percent
higher. At this price level, high-ethnocentric consumers exhibited indifference
IMR 6.00
5.05 5.04
5.62***
5.10** 5.15**
7.00
4.93 4.96 5.80***
31,2 5.00 6.00 5.45** 5.52***

4.80 4.94*
4.75* 4.67 4.65
5.00
4.00 4.14
4.38
3.97 4.02
3.76 4.00 4.35 4.16
3.00 3.30 4.00 4.07
3.63 3.73 3.68
3.00
L-G Juice Intention
118 2.00 (High Ethnocentrism)
2.00
L-G Juice Intention
(Low Ethnocentrism)
F-G Juice Intention
1.00 (High Ethnocentrism) *p < 0.10, **p < 0.05, *** p < 0.01 F-G Juice Intention
1.00 (Low Ethnocentrism) *p < 0.10, ** p < 0.05, *** p < 0.01
0.00 0.00
G
% G
5% FG
LG G
5% G
10 LG
% G
LG
% G
5% FG
LG G
5% FG
10 LG
% G
LG
20 > F
15 F
10 F
15 L
20 L
25 L
20 > F
15 F
10 F
15 L
20 L
25 L
>
FG % >
FG % >
FG % >
>
>
FG % >
FG % >
FG % >
>
LG % >
LG % >
LG >
>
FG =
LG % >
LG % >
LG >
>
FG =
%
%
25
25
FG
FG
LG
LG
LG
LG
7.00 7.00 6.35***

6.25*** 6.27*** 6.26*** 6.49***
6.07*** 6.15***
5.98***
6.00 5.62*** 6.00 5.43***
5.21

5.00* 4.89
5.00 4.68 5.00
4.81
4.00 4.00
4.11 4.03 4.00
3.66 3.45
3.00 3.00 3.52
3.14 3.08
2.93
L-G Airline Intention 2.63 L-G Airline Intention 2.67
2.00 2.33 2.00 2.31
(High Ethnocentrism) (Low Ethnocentrism)
1.00 F-G Airline Intention *p < 0.10, ** p < 0.05, *** p < 0.01 1.00 F-G Airline Intention
*p < 0.10, ** p < 0.05, ***p < 0.01
(High Ethnocentrism) (Low Ethnocentrism)
Figure 2. 0.00 0.00
Juice and airline
G
% G
5% FG
LG G
5% G
10 LG
% G
LG
% G
5% FG
LG G
5% G
10 LG
% G
LG
20 F
15 F
10 F
15 L
20 L
25 L
20 F
15 F
10 F
15 L
20 L
25 L
intentions: comparing
>
FG % >
FG % >
FG % >
>
>
FG % >
FG % >
FG % >
>
LG % >
LG % >
LG % >
LG >
>
FG =
LG % >
LG % >
LG % >
LG >
>
FG =
25
25
high- vs low-CET
FG
FG
LG
LG
consumers
(4.11 vs 5.21, t ¼ 1.64, p40.10), whereas low-ethnocentric consumers reported higher

intention for the F-G vs L-G brand (5.00 vs 4.00, t ¼ 1.70, po0.10). However, when the
L-G price was 25 percent higher than the F-G, intention toward the latter brand
exceeded that for the former, among both low- (5.43 vs 3.45 t ¼ 3.89, po0.001) and
high-CET groups (5.62 vs 3.14, t ¼ 3.90, po0.005).
Overall, juice and airline category results imply that the impact of the L-G
price increase was dampened among high-ethnocentric consumers. In other words,
high-ethnocentric consumers showed greater tolerance for higher-priced local brands,
whereas low-ethnocentric consumers’ lower tolerance of price differences meant
that they more readily switched intentions toward the F-G juice and airline brands,
lending support to H3a for these two categories.
As illustrated in Figure 3, the coffee shop and jeans categories yielded somewhat
similar findings. When L-G equalled F-G prices, F-G (vs L-G) intentions were higher,
among both low- and high-CET groups. For jeans this difference was, however, not
significant – although in the hypothesized direction – for the low-CET group (L-G 3.88
vs F-G 4.35, t ¼ 0.86, p40.10). For both categories, when the L-G exceeded the F-G
price, both CET groups reported similar sensitivities, exhibiting significantly higher
intentions toward the F-G alternatives.
For jeans, with a 5 percent F-G price premium, low-ethnocentric consumers
indicated higher F-G vs L-G intentions (5.07 vs 3.42, t ¼ 3.09, po0.005), whereas
6.00
5.03*** 5.04*** 5.13***
6.00
5.27***
5.06*** 5.07*** 5.11**
Global vs local
5.00 4.68** 4.64
4.78* 5.00 4.70** 4.66 brands

4.35
4.08
4.00 4.00
4.09 4.12 3.98 4.15 4.09
3.88
3.53 3.56 3.46 3.42
3.00 3.18
3.00 3.27
3.10 2.92
L-G Jeans Intention L-G Jeans Intention
2.00 (High Ethnocentrism) 2.00 (Low Ethnocentrism) 119
F-G Jeans Intention F-G Jeans Intention
1.00 (High Ethnocentrism) 1.00 * p < 0.10, ** p < 0.05, *** p < 0.01 (Low Ethnocentrism)
* p < 0.10, ** p < 0.05, *** p < 0.01
0.00 0.00
20 FG
% G
5% FG
LG G
5% FG
10 LG
% G
25 LG
LG
20 FG
% G
5% FG
LG G
5% FG
10 LG
% G
25 LG
LG
15 F
10 F
15 L
20 L
15 F
10 F
15 L
20 L
>
FG % >
FG % >
>
>
>
FG % >
FG % >
>
>
>
LG % >
LG % >
LG >
>
FG =
>
LG % >
LG % >
LG >
>
FG =
%
%
%
%
25
25
FG
FG
FG
FG
LG
LG
LG
LG
6.00 7.00
5.57*** 5.39***
5.00* 6.08***
4.91** 4.94 4.94** 5.82***
6.00 5.65*** 5.53***
5.00 4.65 5.39***
4.95
5.00 4.49
4.00 4.44
4.11 4.13
3.95 4.00 4.32
3.00 3.13 3.32 4.07
3.31
3.00 3.37 3.30
L-G Coffee Shop Intention 2.97
2.00 (High Ethnocentrism) 2.73
L-G Coffee Shop Intention
2.00 2.27
(Low Ethnocentrism)
F-G Coffee Shop Intention
1.00 (High Ethnocentrism) 1.00 F-G Coffee Shop Intention
*p < 0.10, **p < 0.05, ***p < 0.01 (Low Ethnocentrism)
0.00
*p < 0.10, ** p < 0.05, ***p < 0.01 Figure 3.
0.00
Coffee shop and jeans
20 FG
% G
5% FG
LG G
5% FG
10 LG
% G
25 LG
LG
20 FG
% G
5% FG
LG G
5% FG
10 LG
% G
25 LG
LG
15 F
10 F
15 L
20 L
15 F
10 F
15 L
20 L intentions: comparing
>
FG % >
FG % >
>
>
>
FG % >
FG % >
>
>
>
LG % >
LG % >
LG >
>
FG =
>
LG % >
LG % >
LG >
>
FG =
%
%
%
high- vs low-CET
25
25
FG
FG
FG
FG
LG
LG
LG
LG
consumers
the high-CET group indicated indifference (4.64 vs 4.12, t ¼ 0.91, p40.10). With a
15 percent F-G price premium, no difference in intentions was found for either
group (low: 4.15 vs 4.66, t ¼ 0.98, p40.10; high: 3.98 vs 4.08, t ¼ 0.23, p40.10).
The impact of CET was more pronounced when the F-G price premium was 25 percent
higher. Here, the low-CET group still reported higher F-G (vs L-G) intentions (5.11 vs
4.09, t ¼ 2.41, po0.05); whereas the high-CET group switched intentions toward
the L-G (vs F-G) brand (4.78 vs 3.56, t ¼ 1.94, po0.10). Similarly, with a 5 percent
F-G coffee shop price premium, low-ethnocentric consumers reporting higher
F-G (vs L-G) intentions (5.53 vs 3.30, t ¼ 4.62, po0.001), whereas high-ethnocentric
consumers expressed indifference (4.94 vs 4.44, t ¼ 0.82, p40.10). When the F-G price
was 15 percent higher, both low- (4.32 vs 4.95, t ¼ 1.22, p40.10) and high- (4.65 vs 4.13,
t ¼ 1.16, p40.10) CET groups were indifferent. The impact of CET became more
pronounced when F-G price was 25 percent higher. At this level, the low-CET group
expressed indifference between L-G and F-G brands (4.07 vs 4.49, t ¼ 0.77, p40.10),
whereas the high-CET group reported higher L-G intention (4.94 vs 3.31, t ¼ 2.38,
po0.05).
Taken together, the jeans and coffee shop findings indicate that the impact of
a F-G price increase was more pronounced among the high-CET group, chiefly
manifesting at the highest price difference level. High-ethnocentric consumers
IMR appeared to have higher sensitivity to increasing F-G prices than their low-CET
31,2 counterparts, as they tended to increase (reduce) their L-G (F-G) intentions. In contrast,
the low-CET group maintained higher F-G vs L-G intentions, even when the price of
the former was higher than that of the latter. H3b is thus supported, with respect
to the jeans and coffee shop categories. Overall, support for H3 is consistent across
H3a and H3b.
120
4. Discussion
In this paper, we assessed the stability of consumers’ perceptions of brand globalness –
distinguishing geographic and ownership connotations – on brand attitudes and
purchasing intentions, across two goods and two services categories. We demonstrated
that when brands are perceived as global, consumers express more favorable quality
assessments and purchase intentions, whereas perceptions of brand non-globalness
associates negatively with the same, corroborating past research. Regardless of brand
ownership, consumers prefer global over non-global brands. However, as suggested
by Steenkamp et al. (2003), we showed that brands can be simultaneously global and
local. Our re-conceptualization revealed the effects of distribution globalness is distinct
from ownership globalness. This implies that any brand (foreign or local) could
stand to garner positive attitudes and purchase intentions so long as it has a global
image (Özsomer, 2012; Schuiling and Kapferer, 2004). When comparing between locally
owned vs foreign-owned of global brands, consumers may prefer one brand over
another depending on other supporting cues such as local icon value, country of origin,
and home country bias. Steenkamp et al. (2003) reported that brand prestige and
purchase likelihood are enhanced when a local brand is perceived as having local icon
value. However, they did not observe a positive relationship between local icon value
and perceived brand quality, which we did for Thai Airways. This brand likely
assumes high-local icon value, which is then further enhanced by the brand’s global
scope, as evidenced by the significant interaction effect. Contrary to what Özsomer
(2012) hypothesizes (non-significant relationship between local iconness and perceived
brand quality of local brands in all categories except foodstuffs), we show the effect
of local iconness in high-price/high-involvement categories of airlines. Most airline
companies strongly emphasize geographic source (e.g. American, Air Canada, British
Airways). Starbucks coffee and Lee jeans, considered as F-G, are the most preferable
over other combinations of brand globalness-brand ownership because Thai consumers
prefer western icon value from these products in order to get authentic taste of grounded
coffee and original fashion of western jeans, which is then also further enhanced by the
brand’s global scope.
We further demonstrated the variable impact of local- vs foreign-ownership on
attitudes and intentions, depending on the extrinsic cues provided by product
categories and price, country of origin, and, to a lesser extent, how these effects
fluctuate due to the internal disposition of CET. When foreign- and local-owned global
brand prices were equal, two distinct patterns of intentions were observed. Consumers
preferred local- vs foreign-owned brands for two primarily utilitarian categories ( juice
and airline), whereas, vice-versa for the two primarily hedonic categories ( jeans and
coffee shop). The results imply that these focal products/categories vary in terms
of COO image effects (Zeugner-Roth et al., 2008), and/or perceived brand equity/
reputation (Dimofte et al., 2008). These perception biases are manifested, for example,
by consumers’ preferences for French wines and perfumes, Japanese electronics,
German automobiles, Italian fashion, etc. Our respondents evaluated Thai-owned
juice/airline brands as superior and preferable to their foreign-owned counterparts; Global vs local
whereas Thai-owned jeans/coffee shop brands were perceived inferior and less brands
desirable to the foreign-owned alternatives. Thailand enjoys a strong image/reputation
in the food products and hospitality/tourism sectors (Nuttavuthisit, 2007). Evidently
these impressions did not extend into the local fashion and coffee shop categories, where
perhaps projecting a western image is preferable. In Thailand and most other emerging
countries, the most famous jeans and coffee shop brands are foreign, primarily American 121
and European. In the current research, Lee and Starbucks are powerful brands with
superior brand equity when compared to their Thai global counterparts (Mc Jeans and
Black Canyon coffee). Starbucks utterly dominates its category, enjoying strong brand
symbolism worldwide. Consumers patronizing Starbucks seek benefits beyond product
quality, including enhanced self-esteem and/or perceived social standing. A locally
owned coffee shop may not be suitable for cultivating a sophisticated, cosmopolitan
image (Batra et al., 2000). Over time, however, the emergence of high-quality locally
owned, locally produced emerging-market brands may eventually shift consumer
preferences from foreign- to locally owned global alternatives, particularly when CET
dispositions are operational.
We further demonstrated that perceived brand ownership is more salient when
accompanied by brand pricing cues. Consumers are generally sensitive to prices,
and our findings imply that perceived price gaps between local- and foreign-owned
brands dampens potential COO effects, and/or attenuates consumer ethnocentrism.
This sensitivity to price differences varies substantially along product categories, and
there was some evidence that the magnitude of these effects is partly a function of CET.
Considering the juice and airline categories, CET diminished the negative impact of the
higher-priced L-G brand. Highly ethnocentric consumers maintained their domestic
preferences, even when prices were relatively higher than the foreign alternatives.
Consumers were also more sensitive to absolute price differentials, as evidenced in the
airline vs juice findings. Consumers are expected to be less (more) sensitive to
increasing price differentials in a low (high) involvement decisions characterized by
low (high) absolute financial costs. On the other hand, the jeans and coffee shop
results demonstrate that there are circumstances whereby CET enhances the negative
impact of a higher foreign price vs local alternative. Here, high- and low-CET
groups both reported higher intentions for foreign (vs local) brands when prices
were equal; however, high-ethnocentric consumers more quickly switched their
intentions to the local alternatives when foreign brand prices increased relative to local
brand prices.
Thus, our study delineates two roles played by consumer ethnocentrism on intentions:
CET enhances L-G preferences by maintaining consumers’ bias toward local-owned
brands even when these are higher priced; CET diminishes F-G preferences by influencing
consumers who initially prefer foreign-owned global brands to more readily switch
intentions toward local-owned counterparts as the F-G price increases relative to that
of the L-G.
5. Managerial implications
Companies are scrambling to develop truly international brands. Instead of a market
development strategy (i.e. existing brands introduced to new markets), one way to
allow the international company to quickly enter a new market is to acquire a local
brand (e.g. the Chinese brand Lenovo’s acquisition of IBM’s PC division). Marketers
will often endeavor to camouflage foreign ownership, so as to retain the benefits
IMR of brand resonance among locals (e.g. the Belgian brewing conglomerate AB
31,2 InBev’s ownership of Corona, Budweiser, and Alexander Keith’s brands of Mexico,
USA, and Canada, respectively[4]). Schuiling and Kapferer (2004) recommend “[y]
that international marketers encourage the development of international brand
portfolios that combine a balanced number of both strong local and international
brands” (p. 108).
122 Our findings further underscore that brands perceived as global enjoy positive
perceptions of quality and concomitant intentions. Foreign and local-owned
companies alike can cultivate a global brand image by emphasizing global cues
(i.e. widespread distribution and availability), as well as crafting appeals to
emphasize the social status and prestige gained by consuming the global brand.
However, brand-ownership cues have mixed effects on consumers’ attitudes and
intentions. Consumers may prefer either local-owned or foreign-owned global
brands, depending on contextual factors other than perceived brand globalness,

such as the particular product-category and these preferences can be constrained
by price difference perceptions. Furthermore, these effects play out somewhat
differently according to the relative level of CET. These findings lend credence to van
Ittersum and Wong’s (2010) contention that consumers “make purposive tradeoffs
between the cultural and economic consequences of preserving local divergence and
promoting global convergence [y] sometimes favouring the global, at other times
the local” (p. 108). Thus, the benefits accrued from brand-ownership positioning
depend largely on how these cues are combined with the appropriate external
cues (e.g. pricing).
5.1 When do consumers prefer local- vs foreign-owned global brands?

Preference for L-G goods and services extends to categories in which the home country
has a positive reputation (COO) among focal consumers. Thus when targeting local
consumers, firms should emphasize local brand ownership; perhaps more so in emerging
markets such as Thailand. Being aware of the price thresholds target consumers
have for a particular category, firms might have the option of pricing their L-G brand at
a premium to F-G competitors. Local consumers might be persuaded that preserving
local brand alternatives (and/or uniquely addressing local needs) is worth the higher
price point (van Ittersum and Wong, 2010). Our results suggest that these price
thresholds relate to consumers’ product-category involvement, as well as absolute
(actual cost) vs proportional price difference perceptions.
When L-G brands are being considered by local ethnocentric consumers, it is
particularly beneficial to emphasize local ownership (e.g. “proud to be local-owned,”
but also, “a global company/brand, proudly locally owned”). Such campaigns should
emphasize the benefits of derived from buying L-G brands rather than pointing
out the negative impact of purchasing F-G alternatives, to avoid unwittingly drawing
attention to other, desirable qualities associated with the foreign brands such as quality
and prestige.
5.2 When do consumers prefer foreign- vs local-owned global brands?

Preference for F-G brands occurs in categories in which these foreign countries
enjoy positive reputations among target consumers (e.g. symbolizing production
expertise or connoting sophistication), as implied by our jeans and coffee shop
findings. Here companies owning F-G brands should assert a strong global image.
These firms might even consider pricing their F-G products/services above their L-G
competitors, to convey impressions of quality and/or exclusivity. L-G companies Global vs local
can respond by targeting high-ethnocentric consumers with promotional imagery brands
triggering ethnocentric tendencies (e.g. “proud to be local-owned”), without neglecting
global image promotion so as to sustain resultant positive attitudes and intentions.
L-G brand companies could instead target low-ethnocentric consumers by emphasizing
greater value vis-a`-vis the F-G alternative (e.g. “same quality but lower price”).
F-G brands gain more by positioning away from L-G alternatives. This might entail 123
targeting low-ethnocentric consumers with the benefits (e.g. status, prestige) accorded
“only” by the F-G brand, rather than merely competing on price (i.e. “more for same
price,” or “more for more”).
6. Limitations and future research

The student sample employed limits generalizations to the broader population.
The contrived contexts may overstate the importance of brand ownership/globalness

and price factors, while omitting extraneous factors that possibly influence consumer
decision making (competitors’ sales promotion, product substitutes, etc.). On the other
hand, since younger and more educated people are less committed to exacting ways of
life and more flexible toward different perspectives and objects, including brands
(de Mooij, 2004), our findings constitute a conservative test of theory. The experimental
design limited brand/category choices, restricting generalizability to other purchasing
contexts, including big ticket items (i.e. greater financial, performance, and possibly
social risks), B2B and ecommerce environments. Only brand pairs were considered,
whereas in the marketplace brands have numerous competitors. In that regard,
it is relevant to note that the strong effects that we find for the airline category in
our preliminary study might be explained by a negative attitude toward iconic
brands from Singapore, rather than a positive attitude toward iconic domestic
brands. Future research should consider incorporating country-specific feelings
and cognitions as possible contributing factors to consumers’ responses to local vs
foreign brands.
Future studies should strive for a more realistic decision-making setting, and
a more representative/diverse sample. Other emerging markets should be examined
(possibly in comparison to developed economies). Different cultural characteristics
(e.g. BRIC nations), could be assessed, as well as how CET manifests within more
nationalistic or closed cultures (e.g. Korea and Japan). Our study consisted of
a limited range of products and alternatives from only a few countries. Future
studies should incorporate brands from countries perceived with positive/negative
COO images; which themselves differ substantially depending on the nationality
of the evaluator. An extended range of products/categories should also be considered,
in terms of type and level of involvement, utilitarian vs hedonic, private vs
conspicuous consumption, etc. Further explanations for the impacts of category
differences on outcomes such as product/brand evaluation and purchase intention
should be examined. Finally, given the positive association between price and
perceived quality, research should also consider how absolute vs relative quality
perceptions affect the relationships analyzed herein.
7. Conclusion
Our results show that consumers’ reactions to globalization may be more diverse
than previously assumed (van Ittersum and Wong, 2010). Marketers should
avoid assuming that the motives underlying global brand purchases are universal.
IMR Potential cross-national segments, much like the domestic segments examined in
31,2 this paper, are almost certainly product-category specific. The re-conceptualization
of the global-local dichotomy along the distinct facets of brand globalness and
ownership provides practical strategic insights for international and local marketing
managers seeking to precisely position their brand as global and/or as part of the
local culture, and aids in identifying the appropriate bases for targeting consumers
124 for each type of brand. As such, this research yields a greater understanding
of the trade-offs made and relative importance placed upon pricing cues when
consumers evaluate brands, and sheds new light on when and how CET affects
brand choice.
Notes
1. Brand familiarity correlates positively with evaluations/intentions, across all brand/category
conditions. Familiarity associates with the dependent variables; however, this does not
unduly bias any one brand/category condition.
2. ANOVA assessed potential differences due to ordering for each product-category in each
of four versions (L-G, L-NG, F-G, F-NG). Aside from a single effect on intention for F-NG
coffee-shop ( po0.05), no significant differences emerged between versions, precluding major
ordering effects.
3. Few significant correlations emerged between price sensitivity and intention of L-G and F-G
brands (as calculated for each product-category, and for each price condition), no consistent
pattern emerged for any price condition or product-category, for neither L-G nor F-G brands.
Price sensitivity does not appear to bias any one specific price-difference condition and/or
specific product-category.
4. www.ab-inbev.com, accessed June 6, 2011.
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Corresponding author
Peeter Verlegh can be contacted at: pverlegh@uva.nl
Appendix 1. Measures Global vs local
Brand globalness:
brands
(1) This brand is sold only in Thailand/This brand is sold all over the world.
(2) I don’t think consumers overseas know this brand/I think consumers overseas know this
brand.
(3) I don’t think this brand is available in shops overseas/I think this brand is available in 127
shops overseas.
Brand ownership:
(1) I consider this brand to be Thai-owned/I consider this brand to be foreign-owned.

(2) I think this brand belongs to a Thai company/I think this brand belongs to
a foreign company.
Consumer ethnocentrism (CETSCALE):
(1) Purchasing foreign-made product is non-Thai people.

(2) Thai people should not buy foreign products, because this hurts Thai business and
causes unemployment.
(3) A real Thai people should always buy Thai-made products.
(4) It is not right to purchase foreign products, because it puts Thai out of jobs.
Purchase intention:
(1) At the price shown, I would consider buying the (product) of (brand): very unlikely/very
likely.
31,2
IMR
128
Table AI.
Latent construct
reliability coefficients
Appendix 2
Construct/indicator Fruit Juice Jeans Coffee shop Airline
Globalness L-Ga 0.80, –, 0.64 0.80, –, 0.63 0.87, –, 0.76 0.52, –, 0.27
1 0.89, 31.48***, 0.79 0.93, 25.93***, 0.87 0.91, 29.63***, 0.84 0.85, 11.67***, 0.72
2 0.92, 31.96***, 0.84 0.95, 26.24***, 0.90 0.91, 29.30***, 0.82 0.82, 11.66***, 0.68
3
CA, CR, Pveb 0.90, 0.90, 0.76 0.92, 0.92, 0.80 0.93, 0.93, 0.81 0.76, 0.78, 0.56
Globalness F-Ga 0.87, –, 0.75 0.85, –, 0.72 0.89, –, 0.79 0.75, –, 0.57
1 0.93, 31.46***, 0.86 0.97, 33.46***, 0.94 0.89, 30.41***, 0.79 0.92, 21.68***, 0.84
2 0.94, 31.99***, 0.88 0.95, 32.63***, 0.91 0.94, 33.64***, 0.89 0.90, 21.42***, 0.80
3
CA, CR, Pveb 0.94, 0.94, 0.83 0.95, 0.95, 0.86 0.93, 0.93, 0.83 0.89, 0.89, 0.74
CETa 0.68, –, 0.46 0.68, –, 0.46 0.68, –, 0.46 0.68, –, 0.46
1 0.83, 16.32***, 0.69 0.83, 16.30***, 0.68 0.83, 16.40***, 0.69 0.82, 16.26***, 0.68
2 0.78, 15.64***, 0.61 0.78, 15.65***, 0.61 0.78, 15.70***, 0.61 0.78, 15.66***, 0.61
3 0.82, 16.19***, 0.67 0.82, 16.20***, 0.67 0.82, 16.27***, 0.67 0.82, 16.23***, 0.67
4
CA, CR, Pveb 0.86, 0.86, 0.61 0.86, 0.86, 0.61 0.86, 0.86, 0.61 0.86, 0.86, 0.61
a b
Notes: Standard loadings, t-value (CR *** po0.001 (two-tailed)), squared multiple correlations; coefficient a, composite reliability, variance extracted
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2. Theoretical background and hypotheses

owned by a local firm, irrespective of worldwide distribution; or second, want to

2.3 The role of price in brand evaluation

2.4 The interaction of price and consumer ethnocentrism on intention

3.1 Preliminary study

3.2 Preliminary study results

Brand ownershipa Brand globalnessa

Local-foreign 5.35o5.38 0.12 0.18

3.3 Preliminary study summary

3.4 Main Study

Actual prices in Thai baht

1-L-G ¼ F-G price 18.00 1,200 65 12,000

L ¼ 0.862 F12 ¼ 6.93***, Z2 ¼ 0.072

6.00 5.53*** 7.00

Mean Purchase Intention

Price Conditions Price Conditions

4.37 4.46 5.30***

Intentions toward L-G

and F-G brands across

Mean Purchase Intention

Mean Purchase Intention

Price Conditions Price Conditions

7.00 7.00 6.35***

Mean Purchase Intention

(4.11 vs 5.21, t ¼ 1.64, p40.10), whereas low-ethnocentric consumers reported higher

Mean Purchase Intention

brands, depending on contextual factors other than perceived brand globalness,

5.1 When do consumers prefer local- vs foreign-owned global brands?

5.2 When do consumers prefer foreign- vs local-owned global brands?

6. Limitations and future research

The contrived contexts may overstate the importance of brand ownership/globalness

(1) I consider this brand to be Thai-owned/I consider this brand to be foreign-owned.

(1) Purchasing foreign-made product is non-Thai people.

Construct/indicator Fruit Juice Jeans Coffee shop Airline

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