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Exploring Consumer Purchase Behaviour: Foreign Versus Local

Brands

Article in Global Business Review · December 2013

DOI: 10.1177/0972150913501600

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 Article
Military-Madrasa-Mullah
A Global Threat Complex 587
587

Exploring Consumer Global Business Review

14(4) 587–600
Purchase Behaviour: © 2013 IMI
SAGE Publications
Foreign Versus Local Brands Los Angeles, London,
New Delhi, Singapore,
Washington DC
DOI: 10.1177/0972150913501600
http://gbr.sagepub.com

Alireza Nalchi Kashi

Abstract
In this study, we surveyed customers’ behaviour and influence of individual characteristics (tendency
to uniqueness and orientation towards foreign brands) and characteristics of brands (perceived quality
and emotional value) on intention to buy foreign brands in comparison to local brands. In this research,
questionnaire is used to gather data and the Kokran formula is employed to determine the volume of
sample of survey. Indeed, this research surveys the relationship between different variables using struc-
tural equation model. About 850 customers of Iranian shops are surveyed. The results reflect that the
need to be unique, within customers, influences tendency to buy foreign products or services. What is
more, increasing the tendency to purchase foreign brands causes customers to recognize quality and
the emotional value of foreign brands in a better way. Hence, by increasing acceptance of perceived
quality and emotional value of foreign brands, consumers are more motivated to buy foreign brands.
Finally, in consumers’ point of view, variable ATFP to PQ is more important. because attitudes toward
foren products that causes customer recognizing them of higher quality.

Keywords
Brand, perceived quality, need for uniqueness, customer behaviour, emotional value, purchase process

Introduction
With revolutionary changes happening in products across various categories and lifestyle trends
demonstrating a complete failure of stereotypes, the consumer can no longer be slotted in heterogeneous
compartments. Today’s consumers defy classification, but universally demonstrate a significant increase
in their spending pattern) Sondhi and Singhvi, 2006, p. 57). Nowadays, the customer’s ability to select
local and foreign brands has been increased in developing countries. In a competitive environment,
sellers of both local and foreign brands gain profit through exploring the reason of the customer’s
behaviour in selecting the products they intend to buy. In Iran, different levels of income have caused to
emerge a broad range of local and foreign products to sell. Despite the fact that there are people noticeable
who are living a low quality of life and their income is below the minimum amount of a normal life, most
in the upper brackets are interested in buying foreign brands so as to gain high levels of visibility and

Alireza Nalchi Kashi, Student, Department of Management, Naragh Branch, Islamic Azad University, Naragh,
Iran. E-mail: alireza58_89@yahoo.com India Quarterly, 66, 2 (2010): 133–149

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588 Alireza Nalchi Kashi

also differentiate their style of life from that of others. Maybe, that occurs due to their tendency to live
in the style of modern countries such as the US. This kind of behaviour is more usual with the young and
teenagers (Kumar and Kim, 2009, p. 512).
In this vein, the main question is why do people choose local or foreign brands? In this paper, we aim
to survey the reasons for preferring one brand over another. We explore the consumer`s behaviour and
effects of personal characteristics (tendency to differentiation and buy foreign brands) and the
characteristics of brands (perceived quality and emotional value) in buying foreign brand in comparison
to local brands.

Literature Review
Researchers have concluded that consumers with a high need for uniqueness tended to adopt new prod-
ucts or brands more quickly than those with a low need for uniqueness (Amaldoss and Jain, 2005;
Zimmer et al., 1999). The theory of consumers’ need for uniqueness explains how an individual’s need
for uniqueness can influence brand responses and the need to be different from others (Tian and
Hunter, 2001) through the pursuit of material goods (Dee K and Kim, 2007). Snyder and Fromkin (1977)
found it is logical to speculate that different people exhibit varying degrees of need for uniqueness in
similar circumstances and this can have a significant impact on their purchase decisions. This need for
uniqueness can be demonstrated in three types of consumer behaviour:

1. Creative choice counter-conformity

2. Unpopular choice counter-conformity and
3. Avoidance of similarity (Dee K. and Kim, 2006)

According to this theoretical perspective, an individual, despite the influence of normative pressure,
seeks differentiation and intentionally disregards prescribed social norms in order to distinguish himself
or herself from the group (Snyder and Fromkin, 1977).
Unlike an individual driven by an independence motivation, the individual is exposed to a set of
social norms and actively seeks differentiation through non-congruence (Tian and Hunter, 2001). The
effect on the individual is ultimately dependent on the good becoming a publicly recognized symbol.
Due to its recognized meaning, these expressions of uniqueness are sought in different forms and through
multiple outlets, where the social penalties for being different are not severe. This makes the acquisition
of material goods particularly valued (Tian and Hunter, 2001).
Consumers’ emotions is an interesting field of research. Organizations can deliver services to
customers in new ways and levels through recognizing the significant role of emotions and gain
competitive advantage over competitors and also increase profitability. Consumers may intend to
purchase a particular brand because they perceive the brand offers the right features, quality, or
emotional benefits (Kumar and Kim, 2008). ‘Perceived quality’ is defined as the consumer’s subjective
judgment about a brand’s overall excellence or superiority (Yoo et al., 2000). It is a competitive
necessity and many companies today have turned customer-driven quality into a potent strategic weapon.
The origin of the consumer perception of quality mainly lies in the perception of quality-related intrinsic
and extrinsic attributes (Gil, 2007). In fact, the perceived quality is different from actual or objective

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Exploring Consumer Purchase Behaviour 589

quality, product-based quality, and manufacturing quality (Aaker, 1991). Furthermore, perceived quality
may lead to consumer satisfaction, which is determined by perceived performance and expectation
(Chaudhuri, 2002). Dee K. and Kim (2006) found that the perceived quality decreased purchase intention,
while the emotional value increased purchase intention. Kumar and Kim (2008) found that emotional
value was found to be an important factor influencing purchase intention towards US brands and the
local brand as well. In the past few years, in Iran, there has been an increase in the import of foreign
goods from Western countries (for example, Korea, China and Japan). As a result, Western products and
brands are becoming increasingly popular in Iran, creating intense competitions between local products
and foreign products (Field, 2005). Foreign products, particularly home appliances, were accepted first
by Iranian women. In spite of the popularity of foreign home appliances among Iranians, there is no
empirical research on understanding consumer perceptions towards foreign home appliance brands and,
more specifically, Korean home appliance brands. Many Korean retail companies and brands, are
expanding their businesses into Iran, making their products and brands easily available to the typical
Iranian consumer. Some of the Korean home appliance brands available in Iran are LG, Samsung and
Daewoo. Iranian consumers are purchasing these brands in modern shopping formats, such as malls and
department stores. Although retailing in Iran seems to provide countless opportunities to both foreign
and local retailers, it has been the subject of relatively little research. More empirical research should be
conducted to determine factors that explain Iranian consumers’ brand choice between local brands and
Korean brands sold in Iran. Based on the results of this study, implications will be drawn for both Korean
and Iranian retailers.

Theoretical Framework
In Iran, where higher-income disparities and status mobility exist, consumers seek to emulate Western
practices by purchasing foreign brands. They may use US home appliance brands to enhance their self-
concept, to project a unique identity, or to exhibit their social standing. Thus, Iranian consumers’ percep-
tion and purchase of specific home appliance brands may reflect congruence between their self-concept
and consumption behaviour such as need for uniqueness (NFU) and attitudes towards foreign products.
In this paper, Iranian consumers’ needs for uniqueness and consumption behaviour are postulated to
be linked to brand perceptions, which are postulated to influence purchase intention. Brand perceptions
can be viewed as utilitarian (for example, quality and price) as well as non-utilitarian (for example,
display of status, wealth and prestige) (Batra et al., 2000, p. 5). Iranian consumers’ brand perception may
be influenced by their NFU, and by the level of attitudes towards foreign products. This study is designed
to determine the factors influencing Iranian consumers’ purchase intention towards a US versus local
home appliances brand. Purchase intention is explained with several variables—consumer’s NFU,
attitudes towards foreign products, perceived quality and emotional value.

Need for Uniqueness: Attitudes towards Foreign Products

Consumers’ need for uniqueness is grounded in Snyder and Fromkin’s (1980) uniqueness theory, which
manifests itself in the individual’s pursuit of material goods to differentiate themselves from others
(Deek and Kim, 2006, p. 271). The need for uniqueness is the need of an individual to express his/her

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590 Alireza Nalchi Kashi

uniqueness from other individuals—to be ‘different’ and not ‘just another face in the crowd’ (Snyder and
Fromkin, 1980). Individuals who have a strong desire to be unique often express their individuality
through personalized products such as clothing and accessories (Solomon, 2003).
Workman and Kidd (2000) discuss that when individuals feel too similar to others, they will take
actions to regain their individuality and uniqueness. Some people need to have separated identity and
uniqueness. These kinds of consumers gain a need for uniqueness through belonging to original and
special brands so as to show themselves in a well-established social-imagination way (Tian et al., 2001).
Consumers purchase goods that express their uniqueness and also are acceptable to others (Solomon and
Rabolt 2004). Researchers have concluded that consumers with a high need for uniqueness tended to
adopt new products or brands more quickly than those with a low need for uniqueness (Amaldoss and
Jain, 2005; Zimmer et al., 1999). Tepper observed that individuals with stronger needs for uniqueness are
more likely to desire consumer choices that may be viewed as ‘nontraditional’ (Tepper 1994; Burns and
Warren, 1995, p. 6). In fact, home appliances’ selection has been considered as a uniqueness-seeking
behaviour where clothing serves as a tool to extend or reflect one’s unique self. Therefore, Iranian people
(and also developing and undeveloped countries) have noticeable orientations towards foreign brands,
because they recognize using foreign brands in higher levels of life and look at them as a symbol of
modern life. This fact is severely accepted by people who have more tendencies to be unique in
comparison to other people. In fact, it seems that when Iranian consumers’ NFU increases, their
attitudestowardhome appliances increases well.

Attitudes towards Foreign Products: Perceived Quality

One of the ways consumers form perceptions about a brand is based upon quality (Doyle, 2001).
Individuals interested in accessories (for example, home appliances) tend to pay more attention to physi-
cal properties and features it that are in higher levels of quality (Kaiser, 1998). Perceived quality is not
the real quality of a product. Actually, it`s considered as mental assessment of customer about a product
(Zeithaml, 1988, p. 5).
Also, quality has been associated with brand names (Batra et al., 2000); this association is greater to
Iranian consumers. The quality of products that are not famous brands have had many changes in
Iran and that`s why Iranian manufacturers and retailers are not harmonized with each other and their
activities encompass many different aspects and considerations. This leads Iranian consumers to
perceive branded goods to be of a superior quality, especially if Iranian consumers perceive the country
of origin of the product to be the West. Therefore, it can be posited that Iranian consumers with
attitudes towards foreign products will have a positive perception of the quality of branded goods,
whether it is a US brand or a local brand. Consequently, it seems that Iranian consumers who have
higher levels of attitude towards foreign products will perceive US home appliance brands as having
higher quality in comparison to those who have a lower level of attitude towards foreign products.

Attitudes towards Foreign Products: Emotional Value

Certain products and brands provide non-profitable experiences that generate distinct emotional value
for consumers (Holbrook, 1986). Emotional value is defined as the benefit derived from the feeling or

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affective states (that is, enjoyment or pleasure) that a product generates (Sweeney and Soutar, 2001).
Johansson has been reported that brand names generally have a higher symbolic and emotional
meaning in developing countries (for example, Iran and India). Furthermore, consumers in developing
countries see the country-of-origin as a cue to determine a brand’s desirability for symbolic, status-
enhancing reasons (Batra et al., 2000). Batra et al. (2000) found that in India, a product originating
from the West has significant positive effect on brand attitudes, even after controlling for perceived
quality, and that this effect was most powerful for consumers with a high admiration for Western
lifestyles. As a product category that induces high involvement and interest due to its symbolic and
hedonic nature, foreign goods tend to evoke emotion as consumers go through the stages of selection and
use (Kim et al., 2002).
It is anticipated that Iranian consumers who have greater interest in home appliances will perceive
greater emotional value towards the US home appliance brands they purchase. To the contrary, Iranian
consumers do not seem to perceive local brands as providing a positive brand image. It follows
that Iranian consumers who have attitudes towards foreign products do not perceive local brands as
possessing emotional value. As a result, it would be probable that Iranian consumers who have higher
levels of attitude towards foreign products will perceive US home appliance brand to gain higher
emotional value in comparison to those who have lower levels of attitude towards foreign products.

Perceived Quality: Purchase Intention

Brands strive to elicit strong, positive relationships with their target consumers. Previous studies found
that consumers respond to brands during the decision-making process in two ways—cognitive and emo-
tional (Morris et al., 2002) that have been referred to as the ‘thinking and feeling’ aspects (Sweeney and
Soutar, 2001). Consumers use numerous cues to determine brand quality, including price, country-of-
origin, performance, and image (Andaleeb, 1995; Dodds et al., 1991; Yoo et al., 2000). Similarly, Keller
(2001) defined brand judgment as consumers’ personal opinions about brands, based on how they com-
bined performance and image associations, including perceived quality, credibility, consideration, and
superiority. Although consumers may have a variety of attitudes towards brands, the most important in
terms of purchase intention relates to perceived quality, particularly for unfamiliar brands (Hoyer and
Brown, 1990). Yoo et al. (2000) also found that the perceived quality of a brand positively related to
the level of brand equity, supporting Zeithaml’s (1988) contention that perceived high quality drives
consumers to choose a particular brand over competing brands.
Consumers may intend to purchase a particular brand because they perceive the brand offers the right
features, quality, or emotional benefits. The perception of high quality may lead consumers to recognize
the differentiation and superiority of a particular brand and thus encourage them to choose that brand
over competing brands (Yoo et al., 2000). Simply put, other aspects of any two brands being equal,
consumers may purchase the brand with higher quality. This positive relationship between quality
and tendency to buy is applicable for Iranian consumers that recognizing if they buy a local brand
product or the foreign one. In fact, it would be assumed that Iranian consumers who perceive US
home appliance brands to gain higher levels of quality will have higher purchase intention towards
the US home appliances brand in comparison to those who perceive US home appliance brands as being
of lower levels of quality.

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592 Alireza Nalchi Kashi

Emotional Value: Purchase Intention

Consumers’ perceived ‘emotional value’ refers to their affective reactions to a brand (Supphellen, 2000).
General feelings for brands are often reported in elicitation sessions (for example, ‘this brand makes me
feel good’). The feelings about brands can be mild, intense and negative or positive in nature (Keller,
2001). Importantly, emotional response to a brand is a strong predictor of purchase intention and accounts
for more than twice the variance of cognition. Consumers are inundated with commercial messages rela-
tive to brands, and advertisements that evoke emotional responses can significantly affect purchase
intention (Deek and Kim, 2007, p. 273). Emotional value towards a brand is associated with positive
feelings (for example, a sense of happiness and pleasure) from using the brand, which increases con-
sumer intention to repurchase the brand (Stauss and Neuhaus, 1997). In other words, consumers who feel
good are pleased with the purchase of a brand may re-purchase the brand even when provided with other
options (Gobe, 2001).
Hence, it can be posited that Iranian consumers’ purchase intention towards a brand will increase as
their emotional value increases towards the brand. This positive relationship between emotional value
and purchase intention should be considered whether a US or local home appliances brand is chosen.
Thus, according to facts mentioned, it would be declared that Iranian consumers who perceive US home
appliance brands for gaining higher emotional value will have higher purchase intentions towards US
home appliances brand in comparison to those who perceive US home appliance brands in lower
emotional value.

Exploring the Process of Evaluation and Selection of a Brand

in Purchasing ‘Home Appliance’ Products
The objective of this work is to describe the process of selecting a special home appliance brand by a
consumer among different brands. In reality, we attempt to clarify the characteristic of customer behav-
iour in evaluation and selection of a brand as a border process of purchase decision making. Covering
the aim of this research, the main questions of the research are mentioned bellow:

1. How demographical factors of customers affect the process of selecting home appliances
products?
2. Which factors influence evaluation and selection of home appliance products?
3. In which priority can each factor influencing evaluation and selection of home appliances
products be described?

In accordance with the above notion, consumer and consumer behaviour are critical and influential
parts of all commercial activities that in this paper we aim to explore and elaborate on.

Research Methodology
This study attempts at identifying factors that are significant in determining the purchase intention of
US home appliance brands versus a local home appliance brand in Iran. In this research, structural

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Exploring Consumer Purchase Behaviour 593

equation modelling with LISREL 8.5 was used to analyze the data and parameters were estimated using
the maximum likelihood method. Overall fit of the model was assessed by statistic indexes: Chi-square
(χ2), comparative fit index (CFI), and root mean square estimated approximation (RMSEA). In order to
gather data, a questionnaire was utilized. Chronbach’s α was conducted to test the reliability of gathered
data with the questionnaire. In this research, customers of the most popular shopping centres in four
cities of Iran (Tehran, Isfahan, Shiraz and Mashhad) are surveyed and the volume of sample is 850 using
simple random sampling.

Research Model
The research model consisted of five latent variables with 14 observed variables as is shown in
Figure 1. In other words, the proposed model consisted of one exogenous variable (NFU) and four
endogenous variables (attitudes towards foreign products, perceived quality, emotional value and
purchase intention). The scale items for NFU were adapted from Tian et al. (2001) and the scale items
for attitudes towards foreign products were developed by the researcher. What is more, perceived
quality is extracted from Dee and Kim (2007), emotional value from Sweeney and Soutar (2001) and
also the purchase intention is extracted from Kumar et al. (2008).

Measures and Variables

The measures used in this research consisted of self-oriented variable (that is, NFU), product-oriented
variable (that is, attitudes towards foreign products), and brand-specific variables (that is, perceived

Atfp1 Atfp2 Atfp3 Pq1 Pq2

23
PI1
Nfu1
2+
#6(2
0(7

Nfu 2 PI 2
'8

EV1 EV2 EV3 EV4 EV5

Figure 1. Research Model

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594 Alireza Nalchi Kashi

Table 1. Relationship between Questions and Variable

Variable Number of Question

NFU 1–2
ATFP 3–4–5
PQ 6–7
EV 8–9–10–11–12
PI 13–14

quality, emotional value and purchase intention). Each item was rated on a five-point Likert scale
anchored by ‘completely disagree’ to ‘completely agree’ for each of 14 questions. Chronbach’s Alpha
was conducted to test the reliability of gathered data with the questionnaire. The results illustrated that
the Alpha coefficient equals 0.917, which is considered acceptable as an indication of good reliability for
this research. Table 1 illustrates the relationship between research variables and number of each question
in questionnaire.

Sampling
Customers of the most popular shopping centres in four cities of Iran (Tehran, Isfahan, Shiraz, Mashhad)
are surveyed. As collected data demonstrated, all of the consumers surveyed, used both local and foreign
brands. In this research, brands of refrigerator and vacuum cleaner were selected for surveying. For local
brands of refrigerator, the brands chosen were ‘Emersan’ and ‘Golsan’, and for foreign brands, the
selected names were ‘LG’ and ‘Samsung’. Furthermore, local brands of vacuum cleaner chosen were
‘Parskhazar’ and ‘Sanam’ and for foreign brands, ‘LG’ and ‘Samsung’ were selected. Since it’s not pos-
sible to ask all members of Statistical Society to fill the questionnaire, simple random sampling was
used. The reason behind using this method is that we assumed that there is no difference between cus-
tomers of any shop in all cities of province. What is more, customers usually visit many shops and gather
sufficient information before buying anything. As a result, Statistical Society is assumed harmonized and
homogeneous using the Kokran formula (for unlimited societies) so as to estimate the volume of sample.
Considering value a = 0.05 and d = 0.0333, volume of sample is 850. In order to gather data, 478 ques-
tionnaires in Tehran, 163 questionnaires in Mashhad, 113 questionnaires in Isfahan and 96 question-
naires in Shiraz were distributed. Since the refrigerator was recognized of high importance, about 75 per
cent (637) of questionnaires were devoted to customers of refrigerator and about 25 per cent (213) of
questionnaires to vacuum cleaner customers.

Data Analysis and Results

Measurement Model
The research model consisted of five latent variables with 14 observed variables, which is shown in
Table 2. The measurement models showed acceptable model-data fit: χ2 = 422.8, (df = 66, p < 0.001),
χ2/df ratio = 6.4, comparative fit index (CFI) = .93, and root mean square errors of approximation

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Exploring Consumer Purchase Behaviour 595

Table 2. Measurement Items and Reliabilities for Brands

Items (Measurement
Latent Variables Variables) Parameter l t Cronbach’s a
Need for Uniquesness nfu1 l11 1.003 47.42
nfu2 l21 .997 47.166 .84
(NFU)
atfp1 l12 1.078 63.97
Attraction to Foreign atfp2 l22 .964 54.52 .90
Products (ATFP)
atfp3 l32 .958 58.98
pq1 l13 1.00 78.15
Perceived Quality (PQ) .91
pq2 l23 1.00 78.18
ev1 l14 1.02 59.05
ev2 l24 1.02 53.11
Emotional Value (EV) ev3 l34 1.04 61.75 .86
ev4 l44 .929 38.65
ev5 l54 .975 37.59
pi1 l15 .912 61.24
Purchase Intention (PI) .89
pi2 l25 1.08 73.14

(RMSEA) = .08. The construct validities of the latent constructs were evaluated by both convergent and
discriminated validity. For home appliance brands, all path weights were significant ( p < 0.001).
Considering the significance of 0.05, the research model is accepted. The composite reliabilities of all
constructs were greater than the minimum criteria of 0.70 (Nunnally and Bernstein, 1994), indicating
adequate convergent validity (Table 2).
Research model is analyzed based on structural equation. Since factors employed in the model are
independent in an equation, they are dependent on each other in other equations. This fact causes all
equations to be interdependent and all of them should be considered simultaneously. According to the
research model, the following structural models are driven:

ATFP = g12 NFU + z1

   PQ = b23 ATFP + z2

EV = b24 ATFP + z3

     PI = b35 PQ + b45 PI + z4

As seen, in order to create a factor, there are some measurement factors that conform equations
encompassing factors. Regarding each factor, the following equations can be defined:

• Equation for need for uniqueness (NFU)

nfu1 = l11 NFU + d11
nfu2 = l21 NFU + d21

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596 Alireza Nalchi Kashi

• Equation for attraction to foreign products (ATFP) – As dependent factor in level 2

atfp1 = l12 ATFP + e12
atfp2 = l22 ATFP + e22
atfp3 = l32 ATFP + e32
• Equation for perceived Quality (PQ) – As dependent factor in level 2
Pq1 = l13 PQ + e13
Pq2 = l23 PQ + e23
• Equation for Emotional Value (EV) – As dependent factor in level 2
ev1 = l14 EV + e14
ev2 = λ24 EV + ε24
ev3 = λ34 EV + ε34
ev4 = λ44 EV + ε44
ev5 = λ54EV + ε54
• Equation for Purchase Intention (PI) – As dependent factor in level 1
pi1 = λ15 PI + ε15
pi2 = λ25PI + ε25

As is mentioned in Table 3 and Figure 2, the value of influence of (NFU) over (ATFP) equals to 0.176
and the value of influence of (ATFP) over (PQ) equals to 0.799.
Also, the value of influence of (ATFP) over (EV) equals to 0.688, the value of influence of (PQ)
over (PI) equals to 0.794, and also the value of influence of (EV) over (PI) equals to 0.678.

Prioritizing Factors in Consumer’s Point of View

As shown in Table 4, factor (ATFP) affects factor (PQ) more than other factors due to attraction
of foreign brands that causes customer recognizing them of higher quality and attract customers to
buy them.

Table 3. Relationship of Factors on Each Other

Comparison to
Relationship Parameter Structural Value T Critical Value Significance Value
NFU → ATFP λ12 .176** 6.098    6.098 > 1.96 Acceptable
ATFP → PQ β23 .799** 41.07 41.07 > 1.96 Acceptable
ATFP → EV β24 .688** 26.55 26.55 > 1.96 Acceptable
PQ → PI β35 .794** 34.81 34.81 > 1.96 Acceptable
EV → PI β45 .678** 27.25 27.25 > 1.96 Acceptable
Note: **p < 0.001.

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Exploring Consumer Purchase Behaviour 597

–5.65 3.73 1.79 –.930 .930

Atfp1 Atfp2 Atfp3 Pq1 Pq2

54.52 58.98 78.15 78.18

63.97 10.33 2.42

23 61.24 6.53
Pi1
2.43 Nfu 47.42
6.098 34.81
1 41.071 2+
#6(2
0(7 26.55
27.25
–2.43 Nfu –6.53
73.14 Pi2
2 47.16 '8
35.28 7.024

59.05 37.59
3.11 61.75 38.65

EV1 EV2 EV3 EV4 EV5

.461 .250 –3.99 4.30 –1.86

Figure 2. T-value for Each of Factors

Table 4. Important Factors in Consumers’ Point of View

Comparison to
Relationship Parameter Structural Value T Critical Value Significance Value
ATFP → PQ β23 .799 41.07 41.07 > 1.96 Acceptable
PQ → PI β35 .794 34.81 34.81 > 1.96 Acceptable
EV → PI β45 .678 27.25 27.25 > 1.96 Acceptable
ATFP → EV β24 .688 26.55 26.55 > 1.96 Acceptable
NFU → ATFP λ12 .176 6.098 6.098 > 1.96 Acceptable

Conclusions and Implications

This study identified factors influencing of purchase intention towards a US versus local brand based
on NFU, attitudes towards foreign products, brand perception, and purchase intention. In research
model, NFU directly influenced attitudes towards foreign products. Perceived quality and emotional
value were other important variables that directly influenced purchase intention. This study provides

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598 Alireza Nalchi Kashi

valuable implications for both existing Iranian home appliances retailers or manufacturers and US
home appliance retailers or manufacturers who plan to enter the Iranian market. Regarding results
attained from analyzing data according to theoretical model of research, need to be uniqueness
increases orientations to foreign products and this orientation actually has a direct and meaningful
relationship with perceived quality and emotional value of foreign brands. US retailers entering
Iran could focus on uniqueness and perceived quality and emotional aspects of US home appliance
brands in order to appeal to Iranian consumers, especially those who exhibit higher interest in
home appliances. The positive relationship between attitudes towards foreign products, perceived qual-
ity and emotional value for foreign brands supports previous findings that products from developed
countries are positively evaluated in terms of product quality and emotional benefits (Han and
Terpstra ,1988). However, this positive relationship did not exist for a local brand but maybe it would be
explained by the fact that consumers from developing countries prefer foreign brands over brands from
their own country because foreign brands are associated with status symbols and quality while local
brands are not (Kinra, 2006). Positive perceptions of quality and emotional value are important for
the long-term success of a brand (Yoo and Lee, 2000). Therefore, it is recommended that Iranian
manufacturers and retailers employ aggressive strategies to improve consumer perception of their
brands in terms of quality and emotional appeal among those who have higher interest in home
appliances. One strategy is to hire Iranian celebrities to endorse their brands in advertisements in order
to form positive consumer attitudes towards the brand (Bhushan, 2004). Other possible strategies to
improve Iranian consumers’ perception towards local brands include strategic alliances, licensing
agreements, or joint ventures in order to sell under US brand names associated with higher status and
quality. Such partnerships may enable local brands’ weaknesses to be balanced by US brands’ strengths.
This study used two home appliance brands that are usually associated with symbolic and hedonic
attributes, which may have resulted in a greater influence of emotional value on purchase intention. It is
recommended for future researchers to explore other factors that probably influence the research model
so as to change it in a way that leads to a more comprehensive casual model. What is more, personal
preferences and the style of selecting brands differ from one country to another. So, these patterns should
be localized and specialized for each society, based on their cultures and style of life.

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