Selling to the Chinese Middle Class - Livas & Norlander1

7/31/2019 Selling to the Chinese Middle Class - Livas & Norlander1

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UPPSALA UNIVERSITY

Selling to the Chinese Middle Class

Consumer based branding in China

Mikael Livas & Olov Norlander

2012-05-16

Department of Business Studies Uppsala University


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LIVAS & NORLANDER UPPSALA UNIVERSITY

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Contents

Introduction ................................................................................................................................ 2

Purpose .................................................................................................................................. 3

Question formulation ........................................................................................................... 3

Theory ....................................................................................................................................... 4

Disposition .............................................................................................................................. 4Customer Based Brand Equity (CBBE) ................................................................................... 4

Consumption Behaviour ......................................................................................................... 6

Perceived Quality ................................................................................................................ 6

Perceived Value .................................................................................................................. 7

Perceived Prestige .............................................................................................................. 7

Country of Origin .................................................................................................................... 8

Theory Summary .................................................................................................................... 9

Method ......................................................................................................................................11

Disposition .............................................................................................................................11

Product Category ...............................................................................................................11Sampling ............................................................................................................................12

Operationalisation .................................................................................................................13

Sampling method ...............................................................................................................13

Consumption behaviour and country of origin effects .........................................................14

Data collection .......................................................................................................................16

Phase I ..............................................................................................................................17

Phase II .............................................................................................................................17

Phase III ............................................................................................................................18

Method for Data Analysis.......................................................................................................19

Results ......................................................................................................................................20

Disposition .............................................................................................................................20Demographics .......................................................................................................................20

Consumption behaviour .........................................................................................................22

Country of origin effects .........................................................................................................26

Analysis ....................................................................................................................................28

Conclusion ................................................................................................................................32

References ...............................................................................................................................34

Interviews ..............................................................................................................................37

Appendix ...................................................................................................................................38

Respondent overview ............................................................................................................38

Response overview ...............................................................................................................39English questionnaire ............................................................................................................41

Chinese questionnaire ...........................................................................................................44


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Introduction

A brand is defined by the American Marketing Association (2012) as name, term, design,

symbol or any other feature that defines one sellers good or service as distinct from those of

other sellers. The importance of a strong brand and good branding strategies has increased

during the last decades. Although a brand is an intangible asset of a firm, brand equity makes up

a great deal of a firms actual value on the market. The intangible assets make up a large part of a

firms market value. The intangible assets accounted for 80 % of major companies market value

in 2005, an increase from less than 20 % in 1975 (Clifton, 2009). To build and manage a brand is

one of the great challenges for marketers today. To create an identity and awareness of a brand

firms need to develop positive associations to the brand and in order to establish and maintain

brand loyalty, they need to differentiate themselves from others (Kotler, 2001:188). In this paper

we focus on branding in emerging markets, defined as countries with rapid economic growth and

industrialisation. Studies have been conducted on the subject of marketing in emerging market.

Keller and Moorthi (2003) conclude that marketing strategies that work perfectly fine in home

countries need to be adapted to local culture and preferences. Dawar and Chattopadhyay (2002)

claim that foreign firms rush to emerging markets with hope of gaining market shares and profit,

but rarely adapt their marketing strategies to local conditions. In another research by Batra et al.

(2000), findings show that consumers in emerging markets perceive foreign brands to be of

better quality than local alternatives. One of the most prominent emerging markets is China, with

an annual GDP growth rate of 10 per cent the last three decades it has already surpassed Japan,

becoming the worlds second largest economy (World Bank, 2012). The socioeconomic

transition China has gone through the last three decades has led to rapid increase of income,

which has led to an increasing demand for consumers goods (Cui& Liu). As one of the worlds

fastest and biggest economies, the Chinese market possesses a great attraction for foreign firms

to enter. But with government policies favouring domestic firms, it can be a challenge for foreign

actors to enter the market (Economist, 2009). Branding in China is not a rarely studied area ofresearch. Schlevogt (2000) claim theres been a branding revolution in China with both

consumers and companies becoming more aware of the importance of brands. A case study

Melewar et al. shows that French food giant Danone Group failed to establish a good brand at

their initial entrance, but after adjustments to Chinese preferences they are now successful

(2008). Even a paper on how foreign multinational companies should translate their name into


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Chinese (Alon et al. 2009) has been carried out. However, most of the research focus on big

multinational companies branding and marketing activities in China and what strategies to

implement. There are nonetheless little research on smaller foreign firms and completely new

foreign brands that want to establish in the Chinese market.

Purpose

The purpose of this paper is to investigate how a consumer-centric branding strategy can

be formulated based on consumption behaviour and attitudes towards country of origin using the

example of Swedish blueberry products in China. Hopefully the findings generated by this paper

can be generalised and might be applicable to branding of Swedish premium products in other

categories on the Chinese market.

Question formulation

1. How can a Chinese consumer-oriented branding strategy for Swedish blueberry products be

formulated based on:

2a, Chinese middle class consumers attitudes toward consumption of jam and juice?

2b, Chinese middle class consumers perceptions of Sweden and products made in Sweden?


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Theory

Disposition

At first we explain the Customer Based Brand Equity (CBBE) model, which providegeneral theoretical framework regarding branding. To understand the attitudes and preferences of

the consumer we present theories on consumption behaviour and country of origin (COO) effect.

Theories on consumption behaviour and COO-effect and concepts stemming from these theories

will then be linked and incorporated with a modified CBBE model in the summary.

Customer Based Brand Equity (CBBE)

The CBBE model is used because it positions the customer in the centre when creatingbrand equity and the model incorporates practical features in understanding consumer behaviour.

To understand the customers needs and wants is the heart of successful marketing. CBBE is

formally defined as the differential effect that brand knowledge has on consumer response to

the marketing of that brand (Keller, 2008:48). As no theory or model was found for creating a

brand from scratch, the CBBE model is used since it is a general tool for brand building,

measuring and managing. The model, presented in an illustrative pyramid, see figure 1, shows

that a brand is created by different building blocks and that the foundation of a brand is deep

broad brand awareness. Brand awareness is generally created through exposure of elements

connected to the brand, such as names, logos, jingles, symbols and characters. The model

suggest that brand salience, the special features of the brand, measures the level of

recognisability and to what level the customer can recall the brand (Keller, 2008:54).

Performance and judgment are the more tangible bricks of the CBBE pyramid. Performance is

about the functional values that meet the functional needs of the consumer. The primary

influence of the perception of the brand is the actual products and the function it has to the

consumer. Its also about reliability and durability of the brand, in otherwords how the consumer

perceives the performance of the brand in the long term. Pricing is also a factor when the

consumer evaluates the performance of the brand, how expensive or inexpensive it is and

whether it is frequently discounted or not (Keller, 2008:64). The judgement brick is based on the

personal opinion about the brand. The judgment regarding quality is particularly important and


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steams from the actual attributes of the brand and its products. The credibility as well as

superiority over other brands is taken in consideration in the judgement brick (Keller, 2008:67-

68). The more intangible buildings bricks are composed of feelings and imagery generated by the

brand. Brand imagery is about how the brand meets the psychological and social needs of the

consumer. The imagery derives from the personal experience but can be linked to information

about the brand communicated through advertisement or word of mouth. The consumption

behaviour as well as the personality of the consumer effects the perception of the brands image.

Culture and heritage are social frameworks that also effect this perception (Keller, 2008:65). The

feelings evoked by a brand are the consumers emotional response to the experience of the brand.

These feelings can be negative or positive, but ultimately what really matters is to what extent a

brand can generate positive feelings for a brand (Keller, 2008:68-71). The top building block is

brand resonance, which is about the relationship with the consumer and the level of identification

and loyalty the consumer has towards the brand. With high resonance the consumer feels that

they have a deep psychological bond to the brand and keep buying its products as well as

actively engage in the brand, spending time, energy and money outside of the activity of buying

and consuming one of the brands products (Keller, 2008:72).

Figure 1: The CBBE Pyramid of brand building with its six building blocks


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Consumption Behaviour

Consumption behaviour is not just the study on how a purchase decision is developed but

also the actual consumers response to the purchase and usage of the product. These responses

can be emotional, mental or behavioural. The study of consumption behaviour is a mix ofsociology, psychology, anthropology and economics that try to explain the underlying motives

behind consumption (Kardes et al., 2011:8-13). Complex models on how consumers make their

decision have been constructed since the 1950s, when consumption behaviour started to get a

more prominent role in the field of marketing. Early approaches considered the utility theory the

best explanation to consumption behaviour, where the consumer is assumed to base his decisions

on rational factors that optimize the outcome of the purchase. Contemporary research tends to

expand that and include other factors (Bray, 2008). Chisnall suggest these non-rational factors

are feelings, culture values, group affiliations etc. and that the needs and wants of the consumers

are too complex to be explained by rational factors only (1995). Seth et al. presents a multiple

value model to explain the choices that the consumer makes, these values are functional,

conditional, social, emotional and epistemic (1991). To get a theoretical framework for the

consumption behaviour in our research we take previous research on the subject in consideration,

but also look at research with similar purpose as our own. A study by Zhou and Wong used three

motivational factors behind a purchase in a comparable study of Chinese consumers, perceived

value, perceived quality and perceived prestige (2008). When broken down, there are more sub-

concepts within every factor that consent with previous research. Another reason for using these

three motivational factors are that we can connect them to our CBBE model in a logic way.

Relevant theories for these factors connected to food or Chinese consumers are used to get a

proper theoretical frame suitable for our purpose.

Perceived Quality

The perceived quality in a product is according to Olson and Jacoby (1972), trendsetters inthe area, an important motivator for purchase decision. They suggest that the perception of

quality consists of two cues, intrinsic and extrinsic. The intrinsic cue is the attributes and

characteristics of the product that cannot be changed, whereas the extrinsic cue is the

characteristics of the products that can be manipulated and experimented with. Rao and Monroe

(1989) further elaborate on the idea of different cues and give examples that extrinsic cues can be


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price, brand and store name, and for intrinsic cue it could be nutrition. According to Oude

Ophius and Van Trijp it is necessary to look at a multiple set of attributes within each cue as the

consumers develop an abstract belief of the products quality depending on the cues that are

connected to a specific product. So the character of the consumer highly affects how the intrinsic

and extrinsic cues are perceived and assessed as good or bad quality (1995).

Perceived Value

The perception of value is by Schwartz and Bilsky (1987) considered to be personal and

originates from three universal requirements of basic human biological needs, the need to

interact with other people and social need to survive and thrive. The values we perceive in

products are somewhat the same based on how they satisfy peoples requirements. These human

values have according to Kamakura and Novak (1992) increasingly been used to segment the

market and find the right target group based on what values the consumer seeks. They conclude

that segmentation cannot only be based on one value, but a mixture of values is requisite since

human beings hold more than just one single value. Sweeney and Soutar (2001) developed a

general theory on perceived consumer value, as they present in a multi-item scale for measuring

perceived consumer value. Their research found four value dimensions that can significantly

explain purchasing behaviour and attitudes. The four value dimensions are quality/performance,

price/value for money, emotional value and social value. The different values create different

type and different level of utility for the consumer. Quality/performance represents the functional

value the product provides to the consumer, or the utility that derives from the expected

performance and perceived quality. Price/value for money is also a functional value based on the

utility that derives from the product with the reduction of its perceived costs, both short and long

term. The emotional value is the utility that derives from feelings and emotional state the product

gives to the consumer. The last value, the social value is the utility derived from the products

capacity to enhance the consumers self-concept or lifestyle.

Perceived Prestige

The desire to gain social status and prestige is a big motivational factor for consumption


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behaviour, but there is a big difference among the consumers on how much prestige they gain.

The consumption of conspicuous status products is for the consumer an ego-boost for the

consumer as well as an aid for people struggling for social approval and self-respect. The

level, of which the consumers seek status symbols differ from people to people, but depends

highly on the consumers social class and social environment (Eastman et al., 1999). A

conceptual framework for prestige-seeking consumer behaviour (PSCB) has been developed by

Vigneron and Johnson (1999). The concept of prestige and the interpretation of the word vary

from people to people depending on their socioeconomic background. Vigneron and Johnson

define prestige of a brand as an interaction between people and their environment. Prestige-

seeking behaviour is a result of motivational factors, such as sociability and self-expression.

They have identified five prestige-seeking values: conspicuous, unique, social, emotional and

quality. Since the perceived value theory overlap some of the prestige seeking values, we only

look closer at conspicuous value and unique value. The conspicuous consumption is according to

Vigneron and Johnson used as a signal of wealth, power and status, but can only partly explain

the perceived value of prestige since many conspicuous goods are still consumed in private. The

need for uniqueness is put forward as a big motivating factor for perceived prestige. Rarity and

limited supply of products are associated with high value that commands prestige and respect.

They also emphasise that high pricing is important for brands that want to have a unique touch

(1999).

Country of Origin

The concept of marketing based on the consumers attitudes toward a certain product or a

certain category of products have for long been well known as an important aspect when

marketing strategies are composed. When determining an international marketing strategy for a

firm, consumers attitudes toward a product from a certain nation are great significance

(Nagashima, 1970). Earlier research show that this country of origin (COO) effect, influence the

consumers evaluation of a product. Some findings show that there is a positive relationship

between the evaluation of the product and the level of development in the origin country.

Another factor is the historical relationship between the origin country and the country in which

the consumer lives. For more unknown foreign brands, the consumer can transfer the image of


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the origin country on to their evaluation of the product (Bilkey &Nes, 1982). Hans (1989) also

concludes that the image of a country can serve as a halo where knowledge about the product or

brand is low, and thereby the COO indirectly affects the evaluation of the product. He also

suggests that as consumers knowledge about products from a certain country increases the

country image can directly influence the as is becomes a summary construct. This summary

construct is the collected beliefs the consumer has about the features of the product and can

thereby affect their opinion about the brand. Batra et al. (2000) researched the COO-effect

specifically on developing economies and findings show that a brands country of origin can

serves as a quality halo and possesses a non-localness that contributes to the status, or prestige

of the consumer. Some preferences for foreign brands can be explained that consumers in

developing countries buy well-known, trustworthy foreign brands. But as knowledge increases

consumer might return to local brands and use a mix of both local and nonlocal brands. In a

research by Veale and Quester (2009) using the example of wine to determine to what extent the

extrinsic cues of price and COO can affect the perceived quality. Their findings show that price

is a greater attribute when assessing quality, but that the COO also contributes to the subjective

assessment of the wine. Although the COO doesnt provide any actual quality enhancing

attributes, it clearly have an effect on how the consumer experience the quality in the product.

Theory Summary

The CBBE model is the theoretical framework on how a brand can be built and managed.

The CBBE model is originally a tool to create, manage and measure brand equity already

existing brands, but as we investigate a non-existing brand with focus on the consumers

attitudes and not on how to create brand awareness, we leave salience out of the equation. The

same goes with the top building block of resonance, as there is no brand or company to have

resonance with. Instead we focus on the four building blocks in the centre of the model, as they

are connected with consumption behaviour and attitudes. Infigure 2 it is shown how the differentconcepts from consumption behaviour and COO effects connects with the CBBE model.

Regarding consumption behaviour and the different values that we have presented within the

theories of perceived quality, value and prestige, we find that quality and functional values are

more tangible than intangible so we unite them on the left side of the model with performance

(functional) and judgment (quality). For the more intangible values we incorporate these on the


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right side of the model, which consists of the building blocks imagery and feelings, which are

subtler than the other two. Social, conspicuous and unique values are connected to imagery, as

the image of a brand is important in a social and prestige-seeking context. The emotional value

belongs in the building block of feelings, because the feelings generated by a brand create

emotional value for the consumer. The theory of COO effect is also integrated with feelings and

imagery since the opinion of another country is intangible. The two concepts of trust and

knowledge used within the COO will be explained in detail in the operationalisation part of the

paper.

Figure 2: Modified CBBE pyramid with sub concepts


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Method

Disposition

Firstly, as we operationalise the theories into a research we present some limitationsregarding product category and target group to be investigated. Secondly we give a detailed

explanation on how the actual operationalisation process of the research was carried out. Thirdly

we describe how the data was collected in three stages. At last, the method used for data analysis

is presented.

Product Category

To be able to investigate the consumption behaviour and COO effect among Chineseconsumers we used blueberry products from Sweden as a specific example. The wild blueberry

is a resource that grows in abundance in the Swedish forests, an underutilised resource that will

be difficult to imitate since it is of a subspecies that only grows in a few countries other than

Sweden and the fact that it is wild and not grown are factors that make it very unique and are

considered to be the healthiest in the world (Lfgren, 2009) A pre-survey questionnaire

conducted in March 2012 during Phase I showed that there is a substantial interest for organic

products in China, however the Euromonitor survey (2012:23) shows that Chinese consumers

distrust the authenticity of claims of being organic, this indicates that there is a potential in

selling organic products if the claim is trustworthy or guaranteed in some way. The pre-survey

also showed that Chinese consumers chose blueberry jam and juice when asked what type of

blueberry product they usually consume. So we narrow down the limitation further to only

include blueberry jam and juice. The market for 100% juices, for example, seem to have great

potential as carbonated soft drinks have reached a plateau in first and second tier cities and

Chinese consumers in these cities are purchasing healthier drinks and the market for juices are

expected to grow and eventually compensate for falling sales of soft drinks. Except for ready to

drink-teas, juice is the one beverage that has seen the most growth from 2006-2011(85, 3%),

beating bottled water, wine and beer (Euromonitor, 2012:26). As we have made some initial

interviews with Swedish blueberry producing companies, we found out that almost none of them

have sales activities in China and those who do, do not seem to value or prioritise that market.

According to researchers at Jilin Agricultural University, one of the characteristics of the


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Chinese blueberry market is that demand far exceeds supply (Li, Limin, et al., 2011:77). Chinese

thirst for blueberry products makes it a perfect example for our study about branding in China.

Sweden and Swedish companies are well reputed in China and there are great opportunities for

Swedish products to take greater shares of the Chinese market; however the most common

reason stated for not expanding into China were a lack of understanding of the procedures

involved and of Chinese culture (Chen, 2012 pers. Comm., 23 April).

Sampling

To further limit the paper, we chose to target a certain segment of the Chinese population.

Numerous studies have been made on the topic of segmentation of the Chinese market. Bernd

Schmitt provides a summary of the three most common ones; Geographic segmentation,

Demographic segmentation and Psychographic segmentation. The Chinese market is both

geographically immense and fragmented, a foreign brand that is popular in the big cities on

the east coast, may not be recognised on the countryside. He shows conclusions from previous

studies that younger, more affluent and better educated Chinese are more likely to try new

products, but also to buy products admired by others (Schmitt, 1997). To target the right group of

people is therefore of utterly importance. The Chinese middle class is by many foreign firms

considered to be the most interesting segment of the Chinese market, as this particular segment is

growing both in size and purchase power. The number of people considered to be of the Chinesemiddle class, has increased rapidly during the last decades. In 1995 almost no Chinese were

considered to be middle class, but in 2005 that figure was 87 million (Song & Cui, 2009). And it

is especially the young, urban, highly educated middle class with knowledge, influence and cash

that is most interesting for foreign marketers to target. In a survey from 2007 by Euromonitor

International, it is claimed that young Chinese in the age of 20-29 have already by then become

the highest earning group in China (Euromonitor, 2007). In a report concerning foodservice in

China from the same organisation, it is stated that the post 80s generation are increasingly

interested in Western life-style. Consuming western food is seen as something affluent and

inspirational (Euromonitor, 2011). To define the middle class is however not totally

uncomplicated. When middle class is used in a Chinese context it usually means a class well

above the middle, one that can be translated into upper middle class or even upper class in terms

of positioning it on the socioeconomic scale in Western terms (Li Chunling, 2010). Li Chunling


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(2012, pers. comm., 24 April) use a mixture of income, level of education, occupation and

consumption behaviour to define the people within the middle class. The person needs to be

highly educated, have a white-collar job and an income above average. It is however

occupation that is the divider when Li Chunling presents her subgroups within the middle class.

The four subgroups are group is the Capitalists (Business owner with more than 20 employees),

New Middle Class (Managers, Professionals, Government Officials), Old Middle Class (Private

business owners, employers with few employees, self-employed) and Marginal Middle Class

(Low wage white collars and other workers). We chose to follow Li Chunlings definition of

Chinese middle class, as it is a well-recognized and comprehensive classification that can fairly

easy be operationalised.

Operationalisation

Sampling method

As a comprehensive definition of the middle class is used, we had to have strict

requirements for each classifier that respondents needed to live up to in order to be qualified to

take part in the survey. For the income level, Li Chunling uses Li Peilins (2008) strict level of

income as an indicator of belonging to the middle class. For urban areas to be people with an

annual income 2, 5 times bigger than the average urban income are considered to qualify.According to the National Bureau of Statistics of China (NBSC) that figure for 2011 is 23.979

RMB (NBSC, 2012). So to be defined as middle class based on the income, the annual salary

need to be higher than 59.948 RMB (2, 5*23.979. So an income level above 60.000 RMB is

required. The occupation requirement is set to be an occupation within the top three middle class

subgroups, Capitalist, New Middle Class and Old Middle Class. Education is an important factor

for determining socioeconomic class in China and people with less than a high school graduate

are less likely to be representative of the middle class (Li Chunling, 2012, pers. comm., 24

April). To be a part of our target group, respondents need to have at least 12 years in school,

which is equivalent to a high school graduate in China. In our survey we aim to target people in

the age span of 20-45 as this is the age span that characterises the capitalist, new- and old middle

classes and people in this age span have spent their entire adult lives in the post-Mao era. These

three groups constitute our group of interest and consist of people in positions considered


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important on social, political and economic levels (Li, Chunling, 2010:144-147).

Consumption behaviour and country of origin effects

The theory of perceived quality with the intrinsic and extrinsic cues, as attributes that

affects the consumers perceived quality, has been operationalised by many; one of the most

interesting for us is Verd Jover et al. research about perception of quality of wines. They have

identified a numerous of dimensions within each cue that are measured and analysed. Examples

of intrinsic dimensions in their research are age, harvest, aroma, colour, taste et cetera. For the

extrinsic dimensions they use price, brand, reputation, distribution channels, et cetera (Verd

Jover, et al., 2004). Some of the dimensions used for wine can be analogically transferred to

blueberries, but we also have to use additional dimensions. The intrinsic cues that we have

identified are Taste, Health effects and Wild, while the extrinsic cues are put into operation as

Price, Origin, Brand, Safety, Percentage of berries in the productand Organic. As for perceived

values and prestige, both of them include different types of values that need to be rendered into

questions. We use blueberry products from Sweden as an example and try to find out what

values the Chinese middle class consumer emphasize when consuming jam or juice. The

perceived values derive from the utility that the consumer recognises when purchasing a product.

So we break down the value into different utilities that we have identified as being connected to

the specific product. For the perceived prestige, Vigneron and Johnson (1999) suggest that theconspicuous values and unique values are important. Earlier research on conspicuous values by

Zhu (2011) show that the self-referential values, as opposed to conspicuous values, are more

important for Chinese consumers. However Li Chunling (2012, pers. comm., 24 April) say that

the middle class is partly defined by their different forms of conspicuous consumption. So

there is a problem we have in mind when formulating the questions on conspicuous consumption

in order to get honest and valid answers.

The COO effect is as shown an important factor explaining the motives behind purchase

decisions as well as the perceived quality in the product. There is a positive correlation between

perceived high quality and high economic development of the COO. In our survey we need to

find out the Chinese consumers knowledge and trust for Sweden and foreign countries in general

and their attitudes toward (we use the word Western in the questionnaire to exclude other Asian

countries with similar culture to China) food and beverage products. By doing this we can see


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what attributes and characteristics of Swedish blueberry products that can be used when branding

them on the Chinese market. In research conducted by Kwok et al. (2006) the COO effect on

urban Chinese consumers was examined. They studied purchasing behaviour of typical Chinese

products such as packaged noodles and soy sauce as well as typical western products like red

wine and butter. The result showed that Chinese consumers say they prefer to buy domestic

grocery brands and that they believe it is important to buy local products in both categories,

typical Chinese products and typical Western products. However their actual purchasing

behaviour did not reflect their preferences of domestic brands. Lack of knowledge could

according to Kwok et al. be one reason that preferences are not reflected in their actual

purchasing behaviour (Kwok, et al., 2006). The questionnaire used in the Kwok study is useful

for us when designing our own study because of similarities in research and purpose. In recent

years, after numerous food scandals, country of origin seems to play a large role in China when it

comes to food as Chinese consumers are more careful buying domestic brands and usually only

trust the top-tier Chinese brands. They often choose foreign brands, as they are perceived to hold

to a higher standard and quality, much of the distrust for domestic brands stems from the recent

food scandals in China (Euromonitor, 2012:23). The Chinese consumer might have preferred

foreign grocery brands before but claimed to shop domestic brands, now however they openly

claim to prefer foreign brands due to the scandals surrounding Chinese ones. We find that trust

and knowledge are two central concepts explaining the COO-effect in developing countries,

including China. So from an origin of Sweden-point of view, these concepts will be our

variables for the COO-effect. According to Liu (2012, pers. comm, 25 April) the knowledge of

Sweden is limited and that might constitute a barrier when using Swedens brand and COO-

effect in branding a Swedish product.

To measure each sub concept of behaviour and country of origin effects we used 2-6

variables for each sub concept. Some are, by definition of Saunders et al., opinion variables as

they measure what people feel about something, whereas others are behaviour variables, as they

measure what people have done before (2009:368). For each sub concept from the theories, a

series of questions arose that needed to get answers in order to understand the Chinese consumer.

So the questionnaire was designed on the basis of the following questions.

Perceived Quality:

Intrinsic and extrinsic cues: What attributes defines the quality in juice and jams the most?


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Perceived Value:

Quality/Performance: What are the main functional needs for buying juice and jam?

Price/Value for money: The perception of the relationship between price and quality and if a

discounted price detracts from the perceived value/quality?

Emotional Value: What attribute generates most positive feelings, what characteristic of Swedish

blueberry juice and jam is most attractive?

Social Value: How consumption behaviour affects their self-concept and social status and the

relationship between consumption of exclusive/Western food and beverages and social status?

Perceived Prestige:

Conspicuous Value: In which setting they prefer to consume Western food and beverages? Do

they want to show off or not and what are their design preferences?

Unique Value: The level of which Chinese consumers pursue uniqueness and prestige. It they

want to be trendsetters or not?

COO-effect:

Knowledge: Awareness about Sweden and products from Sweden. Do they see Sweden as exotic

or not?

Trust: The level of trust towards Western food and beverage products compared to domestic

ones. What is Swedens level of credibility and reliability in the eye of the Chinese consumers?

Data collection

To investigate consumption behaviour and COO-effect in the questionnaire, the Likert 7-

grade psychometric scale is used for all questions where the respondents are asked to specify

their level of agreement or disagreement on a statement. The main advantage using this scale is

that it is symmetrical meaning that there are as many options on either side of the middle option.

The effect of this is that there is no structural bias for a positive or negative answer (Carifio &

Perla, 2007:131). A study on the Chinese consumers changing value system by Ge Xiao also

used a Likert 7-grade scale to measure behaviour and attitudes among Chinese consumers (Ge,

2005). Kwok et al. (2006) also used a Likert scale when conducting their research on brand

preferences among young Chinese consumers. They used a 5-grade scale to measure their

attitudes towards foreign and domestic brands (Kwok et al., 2006). As we are to conduct a


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similar research, we find it best to use a similar questionnaire design to increase validity,

reliability and comparability. Despite limiting the survey to selected parts of the middle class

there is still a large group of Chinese population that meet our qualifications, which demands a

large sample. Our data collection method is adapted to the need of a large sample, as well as the

limits of time and resources. For the final version of the questionnaire we use a self-administered

questionnaire, administered electronically and by hand. The collection of data can be divided

into three phases.

Phase I

To make sure that we get the desired result of our survey we first made a pilot study with

high variety of both questions and types of questions in order to be as prepared as possible for

the real survey. The pilot study was broad and provided a wide spectrum of questions touching

upon segmentation, behaviour and the perception of Sweden. It was conducted to give us

information for further development of our study and the opportunity for us to narrow it down on

the most interesting aspects of the issue. The types of questions in the questionnaire were also

varied on purpose to see what type of question gave the best and valid answers. To get as many

respondents as possible in a short period of time we conducted an online questionnaire that was

spread to Chinese friends through email and social media, convenience sampling according to

Saunders (2009:241). Altogether we got 46 responses within the one-week (23-30 March 2012)the online questionnaire was open. By conducting this pilot survey we have been able to pinpoint

the topics and type of questions most relevant for the purpose of this paper. Phase I was

necessary in order to better formulate the questions and themes for the final survey in Phase II.

Some of the questions regarding prestige in the pilot study were perceived as too straightforward

and somewhat rude. This was an important observation as we aimed to get as honest answers as

possible.

Phase II

After finding relevant theories for our paper, we started to operationalise them into survey-

questions with the help of the results from the pre-survey questionnaire described above. Since

we focus on specific products, blueberry jam and juice, little knowledge on how to operationalise

the theories into specific questions were given from the theories. However, the theories provided


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us with well-needed terminology in defining the market segment and consumption behaviour. To

operationalise this into a questionnaire, we used support from methodology literature. When

formulating the questions, there were a number of facts and circumstances we had to take into

consideration mainly the problems encountered with some of the questions being perceived as

rude or too forward in the pilot study. We used our experience from the pilot-study to correct

errors and used previous research (Ge, 2005) when designing our questionnaire. During phase

two we translated the questionnaire into Chinese to be able to make a design suitable for the

Chinese language.

Phase III

The survey was first tested on 20 Chinese consumers and some minor changes were made

in design and formulation of some questions. The changes that we made were; correction of one

mistranslated sentence and larger headlines in the questionnaire, no changes were made to the

actual content of the questionnaire. After final version was completed we started to collect

answers. We used a combination of convenience sampling and snowball sampling. As we used

online-based questionnaire administration software Surveymonkey we could use snowballing

sampling by sending it to friends in the right target group and ask them to pass it forward. This

collection method generated 94 answers. Another 431 answers were collected in high-end

shopping malls and on the streets of wealthier areas in Beijing during four days (23-26) in April2012. This was done manually by asking people to participate in the survey and fill out the

questionnaire on the. The questionnaire took about five minutes for the average respondent to fill

out and most people took it were very serious. To maximize the sampling we handed out

questionnaires to more people at the same time. As more than 4/5 of the data was collected by

hand we had a fairly good control of the actual data gathering we could answer any questions

from the respondents that arose during the completion of the survey. We approached people that

appeared to be middle class, by definitions presented earlier, and were in the right age-span. This

minimised the number of answers from people outside of the intended group. The time when the

data was collected was intentionally varied in order to allow people with different working hours

to participate. Altogether 524 answers were collected, out of which 425 were complete and

corresponded to the requirements for being in the survey.


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Method for Data Analysis

We use descriptive analysis for the demographic distribution of our respondents to provide

an overview of the data sample. For the consumption behaviour and country of origin analysis

we use exploratory analysis. Exploratory Data Analysis (EDA) is according to EDA pioneerTukey (1977:3) the only way to lay a foundation to further analysis. Saunders et al. also

emphasise the usage of diagrams to explore and analyse the data. EDA is also according to

Saunders et al. a flexible tool that gives the user opportunity to introduce alternative explanations

and analyse to new findings (2009:428). By looking at the specific value (Average and Most

frequent response, MFR) of each parameter within the each sub concept, we then see the

tendencies of the respondents consumption behaviour and preferences. To be able to analyse the

material we will present it in a table, complete with all the answers as well as bar charts to

provide a clear picture of each sub-concept. Each sub-concept will then be analysed based on the

average and MFR-values. The tendencies in the answers will be guideline for us when creating

the building blocks of a Swedish blueberry brand. The tendencies in the answers will also

provide us with information when analysing the consumption behaviour of the Chinese middle

class consumer. Finally we use our reveised CBBE model to interpret the findings in the survey

from a brand-building perspective.


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Results

Disposition

Here the results of the data collection will be presented in the form of diagramsaccompanied by explanatory text describing the findings. The general tendencies will be shown

here, displayed by an average score and most frequent response, there are exceptions to the

tendencies were some respondents have given very different answers compared to the other

respondents, these answers together with a chart of all the answers and data can be found in the

appendix.

DemographicsMost of the respondents (136) were in the age group of 25-29 and there are slightly more

females than males in this age group. 111 respondents are to be found in the age span of 30-34,

making it the second largest group, with substantially more male than female respondents, the

same tendency for male overrepresentation is also present in the third largest group, the 35-39

year olds, totalling 103 respondents. The second smallest group of 58 answers, 20-24 year olds

have significantly more female than male respondents. The smallest group spanning the ages of

40-45 of only 17 respondents has almost twice as many male to female respondents.

Figure 3: Respondents divided between sex and age (n=425)

11

68

71

63

18

6

35

40

73

40

0 20 40 60 80 100 120 140 160

40-45

35-39

30-34

25-29

20-24

Age and Sex

Men

Women


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The respondents with less than 12 years of education were sorted out, leaving 353 respondents

with 12-16 years of education and 72 with more than 16 years of education.

Figure 4: Respondents level of Education (n=425)

The most common category of occupation is Professional with 125 respondents belonging to this

group, the second most common is Office Worker with 98 responses belonging to this group.

Following this is the Managercategory with 77 responses and Government Official with 50

people belonging to this group.Business owners with fewer than 20 employees (32) are followed

by the Self-employed and Business owners with more than 20 employees, totalling 20

respondents.

Figure 5: Respondents current occupation (n=425)

The most common income bracket is 60.000 - 100.000 RMB/year at 255 respondents followed

by 100.000-300.000 with 154 responses. The smallest group is 300.000-500.000 a year with 16

respondents belonging to this income group, the largest earning group option available on the

questionnaire received 0 responses.

72

353

0 50 100 150 200 250 300 350 400

16+ (Higher than Bachelor)

12-16 (Bachelor)

Level of Education

Education

1

98

22

32

50

125

77

20

0 20 40 60 80 100 120 140

Other

Office Worker

Self-employed

Business owner 20 emp.

Current Occupation

Occupation


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Figure 6: Respondents annual income (n=425)

Consumption behaviour

The results from the questions regarding the respondents perception of quality generated

the following results. The most important aspect of a high quality berry product is Safety with an

average score of 6,32 and the MFR being 7. This is followed by Health Effects and Taste both

with MFRs of 7 and average scores of 6,25 and 6,05 respectively. Organic receives an average

score of 5,99 and an MFR of 6, this is followed by % of Berry/Fruit with an average of 5,66 and

MFR of 6. The fact that the berry is wild (avg. 5,52/ MFR 6) follows this along with Brand (avg.

5,6/MFR 6), Origin (avg. 5,5/MFR 6) and the least important factor, Price (avg. 4,47/MFR 4)

Figure 7: Respondents average and MFR regarding attributes defining quality (n=425)

0

16

154

255

0 50 100 150 200 250 300

>500.000

300.000 - 500.000

100.000 - 300.000

60.000 - 100.000

Annual Income

Income

5,66

5,996,32

5,6

5,5

4,47

5,52

6,25

6,05

6

6

7

6

6

4

6

7

7

0 1 2 3 4 5 6 7

% of Berry/Fruit

Organic

Safety

Brand

Origin

Price

That the berry is wild

Health Effects

Taste

Defining Quality

MFR

Average


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Regarding Functional value the findings indicate that the respondents value the Health Effects

the most (avg. 6,02/MFR 6) followed by Good taste (avg. 5,62/MFR 6) and lastly the products

ability to Quench or satiate thirst or hunger (avg. 4,75/MFR 4).

Figure 8: Respondents average and MFR regarding what functional value juice and jam provide them (n=425)

The respondents agree with the statement that High price equates high quality (avg. 5,62/MFR 5)

and are neutral/leaning slightly towards agreeing with the statement that a discounted product is

less valuable (avg. 4,8/MFR 4). The same tendencies can be seen regarding the statement on

Large packages making products feel less valuable/exclusive (avg. 4,9/MFR 4).

Figure 9: Respondents average and MFR regarding their view on pricing and value for money (n=425)

Concerning the respondents positive feelings toward features of imported Swedish berry

products we find that the feature associated most with positive feelings is Natural (avg.

6,23/MFR 7), closely tailed by Organic (avg. 6,06/MFR 7). This is in turn followed by Wild

Berries (avg. 5,9/MFR 6), Made in Sweden (avg. 5,38/MFR 6) and Imported jam/juice (avg.

5,62

4,75

6,02

6

4

6

0 1 2 3 4 5 6 7

Good Taste

Quench/Satiate Thirst/Hunger

Health Effects

Functional Value

MFR

Average

4,9

4,8

5,62

4

4

5

0 1 2 3 4 5 6 7

Large packages make a product feel less

valuable/exclusive

A discounted product is less valuable

High price equates high quality

Price/Value for Money

MFR

Average


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5,25/MFR 6). All of the listed features received high scores and are generally associated with

positive feelings.

Figure 10: Respondents average and MFR regarding how positive they feel about certain features of imported

Swedish juice and jam (n=425)

The results from questions concerning the social value derived from consumption of foods and

beverages showed the following tendencies; that the respondents agree with the statement that

What I eat and drink defines my lifestyle (avg. 5,49/MFR 6) and that they are neutral to

somewhat affected by their friends preferences in food and beverage (avg. 4,77/MFR 4).

However they are neutral/slightly disagree with the statements that consuming exclusive food

and beverage gives them social status (avg. 3,8/MFR 4) and that consuming Western food and

beverage gives them social status(avg. 3,75/MFR 4 )

Figure 11: Respondents average and MFR regarding social value that jam/juice consumption give them (n=425)

Questions associated with conspicuous consumption behaviour came back with answers

generally confirming some sort of conspicuous behaviour, respondents are neutral/slightly

agreeing with the statement that they prefer to consume Western food in public settings (avg.

5,38

6,23

6,06

5,9

5,25

6

7

7

6

6

0 1 2 3 4 5 6 7

Made In Sweden

Natural

Organic

Wild Berries

Imported Jam/juice

Emotional Value - Positive feelings

MFR

Average

3,75

3,8

4,77

5,49

4

4

4

6

0 1 2 3 4 5 6 7

Consuming western food and beverages

give me social status

Consuming exclusive food and beverages

give me social status

My friends preferences in food and

beverages effects what I eat and drink

What I eat and drink defines my lifestyle

Social Value

MFR

Average


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4,17/MFR 4) and slightly agree that they like to consume these types of goods in the company of

friends rather than alone (avg. 4,43/MFR 4). They seem to agree with the notion that they prefer

to buy imported food and drink with Western packaging design (avg. 5,22/MFR 5) and that they

like to buy imported food and drink original Western name on packaging (avg. 5,52/MFR 6).

Figure 12: Respondents average and MFR regarding their conspicuous consumption behaviour (n=425)

Regarding the uniqueness of a product and the value derived from that, the respondents concur

with the statement that they are in fact looking to buy unique products when shopping for

premium food and beverages (avg. 5,52/MFR 6). The respondents also agree with the statement

that they like to try new food and beverage before their friends (avg. 5,72/MFR 6) and they agree

with the statement that they buy Western food and beverage because of their prestigious nature

(avg. 5,72/MFR 6).

5,52

5,22

4,98

4,43

4,17

6

5

5

4

4

0 1 2 3 4 5 6 7

I prefer to buy imported food and

beverage with original western brand

name on packaging

I prefer to buy imported food and

beverage with western design on

packaging

Design of the package is important when

purchasing premium food and beverage

I prefer to consume western food and

beverages with friends rather than alone

I prefer to consume western food and

beverages in public places, rather than in

private

Conspicuous Value

MFR

Average


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Figure 13: Respondents average and MFR regarding their pursue of uniqueness when consuming food and

beverages (n=425)

Country of origin effects

The knowledge and perception of Sweden is very positive with high scores on all questions, the

highest being that Sweden is a welfare country (avg. 6,34/MFR 7) followed by the statement that

Sweden is an advanced (avg. 6,2/MFR 7) and clean country (avg. 6,2/MFR 6/7). They also think

that Sweden is an exotic country (avg. 6,08/MFR 7) with beautiful nature (avg. 5,9/MFR 6).

Figure 14: Respondents average and MFR regarding their knowledge about Sweden (n=425)

5,72

4,9

5,52

6

5

6

0 1 2 3 4 5 6 7

I purchase western-brand food and

beverage products because they are

prestigious

I like to try new food and beverages

before my friends

I look for unique products when

purchasing premium food and beverages

Unique Value

MFR

Average

5,9

6,08

6,34

6,2

6,2

6

7

7

6,5

7

1 2 3 4 5 6 7

Sweden is a country with beautiful nature

Sweden is an exotic country

Sweden is a welfare country

Sweden is a clean country

Sweden is an advanced country

COO - Knowledge

MFR

Average


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Regarding the respondents trust of domestic, Western and Swedish products we found that they

think that Western food and beverage products are trust worthier than Chinese ones (avg.

5,57/MFR 6) and that Swedish products in particular are trust worthier than Western food

products in general (avg. 5,42/MFR 6). Their perceive products made in Sweden to stand for

quality (avg. 5,74/MFR 6), reliability (avg. 5,7/MFR 6), and credibility (avg. 5,74/MFR 6).

Figure 15: Respondents average and MFR regarding their trust of products from abroad and from Sweden (n=525)

5,74

5,7

5,74

5,42

5,57

6

6

6

6

6

1 2 3 4 5 6 7

Products made in Sweden stands for

credibility


reliability


quality

I believe Swedish food and beverage

brands a trust worthier than other

western ones

I believe Western food and beverage

brands a trust worthier than domestic

ones

COO - Trust

MFR

Average


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Analysis

Using the results generated from the questionnaire we will here analyse the perceptions and

preferences of the Chinese middle class. When defining quality in juice and jam products the

most important factor is, according to the survey, safety followed by health effects, taste and

organic. As the result clearly show regarding the quality in products, the Chinese middle class

seek safe and healthy food and beverages. In order to understand why this is so important, the

background of the food scandals has to be understood. As described earlier China has been

subjected to numerous of serious food scandals and as a result of this the consumers are now

very wary of how products are made and what they contain, this to avoid unsafe food products

that may result in sickness, injury or even death. Price on the other hand is not seen as a clear

indicator of quality and by far scores the lowest, getting only a neutral score. This is somewhat

contradictory as respondents show a tendency to later on agree with the statement that a high

price equates high quality. One explanation to this discrepancy could be that the respondents

consider price not to be important when it is mixed with other more product-related attributes,

but when confronted with a statement that high price equates high price they tend to agree to a

greater extent. Veale and Quester (2009) clearly show that price has a substantial effect on the

perceived quality in product evaluation, but consumers might not want acknowledge that price is

an indicator of good quality in an open survey. There is also a small indication that larger

packages and a discounted price detracts from the perceived quality, resulting in a product that is

seen as less exclusive. We suspect that in a theoretical situation, such as the participation in a

survey, the actual attitude toward large packages and discounted price might not be reflected

accurately. In the survey the effect of large packages and discounts might be downplayed and

can possibly have a larger effect in reality. As for the functional values that we used in our

survey, the indication was that the respondents consumed juice and jam for their health effect

and good taste rather than just as a way to quench thirst or satiate hunger. We interpret the

inclination towards health and taste as values the consumer seek outside of the functional need ofsatiating hunger and thirst. As for feelings evoked by characteristic features of blueberry

products from Sweden, organic and natural are valued high in relation to the other attributes in

the survey. This is most likely because the bulk of the respondents live in inner city Beijing,

heavily polluted and far from clean nature. Demick (2011) report that the air quality in Beijing is

on a steady decline since the 2008 Olympics when air quality was at its best. Since then number


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of cars have increased from 3,5 million to 5 million in just four years. The reason why natural

and organic have very positive connotations in the minds of the Chinese urban consumers could

be explained by the poor environmental situation in Beijing and other major cities in China. As

for Sweden, the tendency is that the respondents have a positive image of Sweden as a welfare

state with clean and beautiful nature. Although the questions were a bit leading with only

positive statements a high average score was generated on the knowledge about positive features

of Sweden. Lack of knowledge about Sweden was put forward as an obstacle for Swedish firms

to overcome by Liu (2012), but support for a high level of positive knowledge about Sweden is

found in our research, although it might just be a perception of an exotic country in the West and

not actual knowledge, it is still real in the mind of a marketer. Nevertheless, the perception of

Sweden and Western countries is positive and Western products in general and Swedish ones in

particular are seen as more trustworthy than Chinese products. This might help Swedish firms to

take a large part of the growing market for organic produce as it is trending but the labeling and

certification is generally not trusted. As shown by the results from our questionnaire Sweden is

seen as a clean country with quality products that are reliable and credible, this might mean that

Swedish organic products can benefit from Swedens reputation and be seen as reliable,

trustworthy and credible. Our questionnaire shows that in general Chinese middle class

consumers concur with the notion that Western food and beverage products are partly consumed

because they are prestigious. However the survey shows that respondents are reluctant to show

that consumption of imported juice or jam would have any effect on their social status or that

their social spheres affect their preferences in food and beverage. This might seem contradictory

but it is possible that they like to consume prestigious products not to show off to others but in a

self-referential way, this is supported by their views of food and beverage consumption as

lifestyle defining. Zhu (2011) also arrives at the conclusion that parts of the Chinese middle class

consumption are self-referential in nature rather than conspicuous. This however does not

exclude conspicuous behaviour as a factor, there might be discrepancies between expressed

opinions and actual behaviour as found by Kwok et al. (2006). The scores on questions regarding

conspicuous consumption are generally low but this can be due to respondents wanting to appear

humble when answering the questions, some answers might indicate conspicuous behaviour such

as the ones regarding packaging design and the prevalence of Chinese middle class conspicuous

consumption has been documented (Debnam & Svinos, 2007). Regarding the unique value,


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another value for prestige, there is a tendency that they seek unique food and beverage products

but that they dont want to be seen as show-offs, so the tendency for agreeing on the statement of

being the first to try new products isnt as strong. Respondents might have answered that foreign

food and beverages dont provide them with much prestigious value due to national pride or

humbleness. Since we were guaranteed not to get accurate and honest answers if we asked some

of the more sensitive questions straight on, some concepts were operationalised in such a way

that they could be asked without being perceived as too rude, straightforward or compromising.

It is possible that the intention of some of the sensitive questions was poorly concealed and that

we were obviously looking for information that the respondents were unwilling to give, and

some questions were successfully formulated as non-sensitive ones. This would explain why

there are differences in answers to questions concerning similar concepts.

The CBBE theory has been the theoretical framework used to connect the theories of

consumption behaviour and COO effect to an actual brand building. For the tangible building

blocks of the model (performance and judgement) it could be argued that Swedish blueberry jam

and juice should be promoted as health products as this is the primary functional need Chinese

consumer wish to satisfy. A high premium price ought to be set as long as it is justified by good

performance and high quality, as the findings regarding price show that Chinese middle class

consumers might think that a lower price detracts from the perceived value of a premium

product. As the respondents do not give a univocal answer, it could mean that they are price

sensitive if the premium price does not live up to a premium performance. Price therefore has to

be carefully calibrated to not be too high in relation to its qualities, neither too low and risk being

perceived as non-premium. For the perceived quality, the intrinsic health effects of Swedish

blueberries should have a central role in the branding process as it is considered to be an

important factor when determining the quality in juice and jams. To further appeal to the Chinese

middle class consumers, extrinsic values of safety and being organic are to be highlighted in the

branding process. It also has to be backed up by a credible production process in order to avoid

food scandals that can be the end of a food and beverage brand in China. Concerning the

intangible building blocks (imagery and feelings) there is strong support that Sweden and

products from Sweden evoke positive images and feelings. Clean and natural production

processes are images that should be emphasised in the communication with the consumer in the

brand building process. The major social value consumption of food and beverages was that it


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defines ones lifestyle, it could therefore be argued that a healthy and natural lifestyle should be

promoted with the brand. The Chinese middle class consumer also look for unique products,

limited production quantities, exclusive design and select sales channels can be used to enhance

the image of something unique. As the respondents were reluctant to be perceived as show-offs,

it is advisable to employ a branding strategy that is not too conspicuous in character and try to

appeal to the humbleness of the Chinese, as this seems to be a characteristic that they wish to

possess. To generate positive feelings related to the brand, emotional values created by natural

and organic production should be promoted and used in the building of the brand as this appeals

to the Chinese middle class. The most significant findings in each sub concept have been

integrated into the modified CBBE model, see figure 16, where the results from the questions in

the survey are divided according to the sub concepts from which the questions were formulated.

Figure 16: Modified CBBE pyramid with most important findings incorporated in each building block.


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Conclusion

One should keep in mind that our conclusion is based on data collected through

convenience sampling and a modest approach interpreting the result ought to be adopted.

However tendencies in our research show that Swedish blueberry products have a great branding

potential on the Chinese market as many characteristics of blueberries from Sweden appeal to the

Chinese consumers. The conclusions will be in three parts, first the most important findings on

consumption behaviour and the target groups attitudes toward jam and juice products. This will

be followed by an account of the most significant results from a country of origin perspective,

lastly consumption behaviour and attitudes will be combined with country of origin effects.

1. How can a Chinese consumer-oriented branding strategy for Swedish blueberry

products be formulated based on:

2a, Chinese middle class consumers attitudes toward consumption of jam and juice?

The Chinese middle class consumption behaviour regarding jam and juice is characterised

by a search for natural, scandals. This fact in combination with a generally good perception of

Safe and healthy products that have been organically produced, as their food and beverage

consumption is claimed to define their lifestyle to a certain extent. Other values that is attractive

to the Chinese consumers are prestige and uniqueness, two values that need to be put forward in

a way that not conflict with the Chinese consumers endeavor to appear humble. They also give

the impression of be willing to pay a premium price as long as the product quality and

performance is premium.

2b, Chinese middle class consumers perceptions of Sweden and products made in Sweden?

Foreign food and beverage products have an advantage over domestic, probably because

domestic brands are often distrusted and a target for suspiciousness in the wake of recent food

scandals. Sweden, being perceived as clean and exotic, and Swedish products, as reliable and

credible, gives further support to the importance of the COO effect in China, an effect that

Swedish brands can free ride on when entering the market as a foreign actor.


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For a consumer based branding strategy, the factors in 2a ought to be emphasised, as they

are the values that Chinese consumers look for in actual products. A premium pricing strategy

can be motivated due to the exclusiveness and the proved health effects Swedish blueberries

possess. Swedens reputation as a reliable, clean and credible country can serve as a quality

halo and guarantee that claims about the products are substantiated and true. Our hopes are that

our conclusions can serve as a guideline for Swedish or foreign brands when formulating their

branding strategies for the Chinese market.


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Interviews

Chen, Yvonne, General Manager, Swedish Chamber of CommerceBeijing office. Interviewconducted in Beijing on April 23rd 2012.

Li, Chunling, Professor of Sociology, Institute of Sociology, Chinese Academy of SocialScience. Interview conducted in Beijing on April 24th 2012.

Liu, Xia, Assistant Professor of Marketing, School of Economics and Management, TsinghuaUniversity. Interview conducted in Beijing on April 25 th 2012.


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Appendix

Respondent overview

Demographic Characteristics Valid Percentage Quantity (n=425)

GenderMaleFemale

54,4 %45,6 %

231194

Age20-2425-2930-34

35-3940-45

13,6 %32,0 %26,1 %

24,2 %4,0 %

58136111

10317

Level of Education12-16 years (Bachelor)16+ years (Higher than Bachelor)

83,1 %16,9 %

35372

Current OccupationBusiness owner with >20 employeesManagerProfessional (Lawyer, Doctor, Teacher, etc.)Government official

Small business owner with 500.000

60,0 %36,2 %3,8 %0 %

255154160


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Response overview

When defining quality of jam and juice, the

following attributes are important

Strongly Neutral Strongly

Disagree Agree

1 2 3 4 5 6 7 Avg

7 Taste 0,7 %

(3)

0,9 %

(4)

2,6 %

(11)

6,1%

(26)

14,1 %

(60)

29,4 %

(125)

46,1 %

(196)6,05

8 Health effects 1,2 %

(5)

0,9 %

(4)

1,2 %

(5)

2,6 %

(11)

7,8 %

(33)

34,8 %

Documents

Selling to the Chinese Middle Class - Livas & Norlander1