International Marketing Review

How global brands incorporating local cultural elements increase consumer purchase likelihood: an
empirical study in China
Jiaxun He, Cheng Lu Wang,
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Jiaxun He, Cheng Lu Wang, "How global brands incorporating local cultural elements increase consumer purchase
likelihood: an empirical study in China", International Marketing Review, https://doi.org/10.1108/IMR-08-2014-0272
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 How global brands incorporating local cultural elements increase consumer

purchase likelihood: an empirical study in China

Abstract
Purpose This paper aims at investigating the influence of incorporating Chinese
elements in global brands on consumer purchase likelihood.
Design/methodology/approach Six global brand products from three categories that
utilized Chinese elements are used to test hypotheses. The Total Effect Moderation
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Model is used to analyze by combining moderation and mediation under a general

analytical framework.
Findings The results show that cultural compatibility has direct positive effect. In
addition to an indirect effect (through local iconness), on purchase likelihood.
Meanwhile, consumer cultural identity is found to moderate the impact of brand local
iconness on purchase likelihood.
Practical implications Evaluation and improvement of cultural compatibility in a
global brand that incorporates Chinese elements is recommended for multinational
marketers entering Chinese consumer markets. Meanwhile, marketers should pay
attention to consumer cultural identity in the market segmentation process.
Originality/value This paper takes a unique perspective to investigate whether and
how global brands can succeed when adding local cultural elements to the product
design, packaging and promotion in emerging markets like China.
Keywords Global brands, Chinese elements, Cultural compatibility, Global identity,
Local identity, Brand local iconness

1
 1 Introduction

As a direct consequence of globalization, global brands have expanded quickly into

emerging markets. Meanwhile, such global brands face a strategic decision regarding

how to position itself in emerging markets, where quite different local cultures may

possess certain resistance to foreign brands. While keeping a perceived globalness is

desirable, adapting to local taste with local iconness (zsomer, 2012) is often
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necessary. Sometimes a global brand may even sacrifice its brand consistency for

larger market share in emerging markets (Roberts and Cayla, 2009). Thus, using local

cultural elements becomes an important marketing strategy for global brands to

approach local consumers in emerging markets. The combination of a global image,

which is often associated with Western cultural origins with local cultural elements

would be perceived as a culture mixing, namely, a simultaneous presentation of two

cultures in one object (Chiu et al., 2011). In the globalization process, culture mixing

can be considered a cross-cultural learning opportunity that stimulates consumer

integrative reactions, but at the same time evokes consumer exclusionary responses

due to potential identity threat (Arnett, 2002; Chiu and Cheng, 2007; Chiu et al.,

2011).

As China has developed into the world's second largest economy with an

enhanced national image, utilizing Chinese cultural elements in branding has become

a popular marketing strategy in recent years (Sheth, 2011; Wang and Lin, 2009). This

trend is not only demonstrated in many marketing campaigns of Chinese enterprises,

but also reflected in product and packaging designs of many global brands.

2
 Considering the use of Chinese elements is a common strategy for global brands to

establish brand positioning and create brand equity in Chinese markets, its theoretical

and managerial implications to marketing success call for academic inquiry to

understand the successful factors of such marketing practice. Our review of extant

literature reveals that existing studies on Chinese elements in marketing are mostly

based on conceptual discussion with anecdotal evidence and case studies (He and
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Wang, 2015; Heine and Phan, 2013; Song, 2013; Wang and Lin, 2009). However,

there is a dearth of empirical studies that systematically investigate how local cultural

elements should be used by global brands. In particular, the existing literature tends to

overlook the mechanism and boundary conditions that explain how Chinese elements

are effectively used in global brands when they enter Chinese consumers markets. To

fill such a void, and contributes the extant literature, this paper provides a theoretical

framework that identifies key factors and contingent variables leading to consumer

purchasing intention of global brands that adopt Chinese elements in product design.

Our findings demonstrates that the compatibility between the global brand and the

local cultural elements enhances consumers evaluation of the brands local iconness

and increases the purchase likelihood. Meanwhile, the impact of perceived cultural

compatibility between global brands and Chinese elements on product purchase

likelihood is mediated by perceived brand local iconness. Finally, consumer identity

plays a moderating role in that higher local identity enhances the effect of brand local

iconness on purchase likelihood whereas higher global identity weakens the effect of

brand local iconness on purchase likelihood.

3
 The paper is organized as follows: First, it provides a theoretical background and

literature review that introduce key variables such as global brands, Chinese element,

cultural compatibility, perceived brand globalness and local iconess, and cultural

identity. Second, a series of hypotheses are developed based on a theoretical

framework in terms of relationship among these variables, including mediation and

moderation effect. Third, it reports an empirical study conducted in the largest

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emerging market, China, to test such hypotheses. Finally, theoretical contributions,

managerial implications and future research directions are provided.

2 Theoretical Background and Hypotheses

2.1 Global Brands and Chinese Elements

A global brand is characterized by widely available across international markets and

enjoys high levels of recognition across the world (Dimofte, Johansson, and Bagozzi,

2010; Dimofte, Johansson, and Ronkainen, 2008). Giving its prime motive of

capitalizing economies of scale and scope, a global brand with standardized marketing

mix can generate significant cost reductions in all areas of the business system,

including R&D, manufacturing, and logistics, with generally similar and centrally

coordinated marketing strategies (Buzzell, 1968; Levitt, 1983). However, while

standardized marketing mix is more likely to be successful for countries with similar

cultural background, they are less likely to be transferrable across countries with

significant cultural differences (Griffith, Hu, and Ryans, 2000; Kustin, 2004). As such,

researchers propose that the choice of strategies is largely contingent on specific

product and country conditions (Wang, 1996). And globalization and localization are

4
 often codependent (Strizhakova, Coulter, and Price, 2012).

Adopting local cultural elements, such as Chinese elements in this study, in

product R&D, packaging and promotion design can be considered an example of a

glocal strategy that integrates localization strategy into global branding. While there

are no standard definitions given in the existing academic literature (He and Wang,

2015; Heine and Phan, 2013; Song, 2013; Wang and Lin, 2009; Wu, 2011), the term
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Chinese elements used in this study refers to symbolic and spiritual connotations of

objects or artifacts that represent typical and unique characteristics of traditional

Chinese cultural heritage. For instance, such artifacts as silk brocade, paper-cuttings,

Peking Opera facial mask, embroidery, Chinese calligraphy and ink-wash painting,

porcelain, Panda and Dragon, are well recognized and identified as Chinese elements

by the majority of Chinese people with pride. It should be noted, though, that the

utilization of Chinese elements in global brandings is different from adjusting global

marketing mix with localization strategies. For example, McDonalds recently opened

its first flagship restaurant - Eatery, in which traditional Chinese elements such as

lanterns, bun steamers and abaci are incorporated into design to penetrate the Chinese

market through localized decoration and furnishing style. As such, adding Chinese

elements as local iconness while at the same time keeping the perceived globalness in

the brand does not have to change the product (menu) or brand image (global brand).

Instead, it is a glocal strategy with a cultural mixing (Chiu et al., 2011).

2.2 Cultural Compatibility

In essence, when global brands adopt Chinese elements in product and packaging

5
 design, two different cultures co-exist in the same physical space (Chiu et al., 2011).

Torelli et al. (2011) demonstrated the existence of such a bicultural exposure effect in

marketing activities. In their empirical study, participants were exposed to

cultural-mix advertisements featuring foreign brands in an iconic product category of

heritage culture (i.e., exposing American participants to a Chinese brand of jeans) as

opposed to other conditions without this foreign infiltration of iconic heritage-culture

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(e.g., an American brand of jeans or Chinese brand of ovens). The result indicates that

cultural mixing in advertisements evoked stereotyping of in-group judgments, thus

enhancing the perceived difference and incompatibility of the two cultures. The

compatibility issue has been examined in other situations that deal with the interplay

between different perspectives, such as evaluating the inter-organizational strategic

performance (Rajaguru and Matanda, 2013; Sarkar et al., 2001) and the

consumer-to-consumer interaction performance (Brown, 1999; Johnson and Grier,

2013). In the current study, cultural compatibility is defined as the degree of

consistency between the connotations evoked by the elements of the host countrys

culture and the symbolic meanings of foreign cultures sourced from global brand

perceived by consumers in the same branded product.

The simultaneous exposure to two cultures in globalized space draws the

perceivers attention to the stereotypical qualities of the respective cultures, and hence

enhances the perceived distance between the two cultures (Chiu et al., 2011).

Conflicts will emerge when a low degree of cultural compatibility exists in a product.

According to the cognitive dissonance theory (Festinger 1957), the inconsistency or

6
 conflict between two thoughts would create uncomfortable tensions or discomfort,

which in turn prompts cognitive re-appraisal of the underlying elements in order to

alleviate the negative state. In consumer behavior cognitive dissonance effects have

been found in consumer attitude change, selective information seeking, and

repurchase tendencies (Cummings and Venkatesh, 1976). Research examining the

effect of culturally incongruent messages in international advertising on consumer

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responses shows that the type of cultural values and ethnic background of models

(foreign vs. local) significantly moderate the effect of message congruency on attitude

towards the advertisement (Cui et al., 2012). Thus, culturally incongruent messages

can be effective if they avoid conflicts on a fundamental value. In the same vein, the

cultural congruency of the brand and extension product is found to influence

extension evaluation (Torelli and Ahuwalia, 2012). The congruency between the

implied and actual country of origin is also found to have an influence on consumer

purchase likelihood (Melnyk, Klein, and Vlckner, 2012). Such research findings

suggest that the compatibility (or incompatibility) of brand concepts as

representations of human values will cause favorable (or unfavorable) brand

evaluations (Torelli, et al., 2012; Torelli, Monga, and Kaikati, 2012). When a global

brand contains local icons, the consequence of cultural mixing tends to evoke certain

degrees of cognitive incongruences in consumer perception. Such perceived

incompatibility between objects from different cultures will lead to tensions which

eventually influence consumer attitudes and behavior responses. In other words, the

degree of the fit between global brand images with the symbolic meanings of the

7
 Chinese elements will directly influence consumer purchase likelihood. Therefore, we

propose that the higher the perceived compatibility between the image of a global

brand and the Chinese elements used in the brand, the higher the purchase likelihood.

H1. The compatibility between the global brand and the local cultural elements

increases the purchase likelihood

2.3 Perceived Brand Globalness and Brand Local Iconness

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Consumers tend to prefer a brand with global image over local brands and thus a

higher degree of perceived brand globalness (PBG) will create brand value and

increase brand purchasing likelihood (Steenkamp, Batra, and Alden, 2003). PBG is a

cognitive construct that measures consumers perception of the number of products

that are sold out of the local market and such perception varies by individual

consumers (Dimofte, Johansson, and Bagozzi, 2010). However, recognizing the

positive effect of PBG on consumer purchase likelihood does not necessary exclude

the impact of the local iconness on brand preference. Local iconness is the degree to

which a brand symbolizes the values, needs, and aspirations of the members of the

local country (zsomer, 2012).

Chinese elements are typically composed of representative local icons of Chinese

culture. When a global brand utilizes Chinese elements, two dissimilar cultures exist

simultaneously. Such culture mixing tend to increase consumer sensitivity to the

prototypic characteristics of a cultural group and their tendency to use culture as a

schema to organize perceptions (Chiu et al., 2009). According to self-schema theories

(Markus and Kitayama, 1991; Wang and Mowen, 1997; Wang et al., 2000),

8
 consumers expect to see a product/brand carrying symbolic meanings that fit their

familiar cultural values to affirm their cultural identity. When a global brand

possessing a high degree compatibility with local cultures, it decreases consumer

cultural sensitivity and helps them to identify and interpret local iconness in the brand.

In other words, a high level of perceived cultural compatibility of Chinese elements in

a global brand will entail consumers better understanding of the symbolic meanings
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of the local cultures and increase the perceived appropriate usage of local icnoness,

and consequently, enhance their evaluation of local iconness.

H2. The compatibility between the global brand and the local cultural elements

enhances consumers evaluation of the brands local iconness

A global brand with recognizable local icons captures consensus expressions of

particular values held dear by some members of a society (Holt, 2004, p.4). Since

such local icons often signal a closer connection with local culture, national identity

and heritage (Ger, 1999), they tend to reduce consumer resistance of potential cultural

threat from a foreign in a global brand and increase their preference for a brand.

Therefore, enhanced evaluation of local iconness is likely to positively influence on

consumer purchase likelihood (Steenkamp, Batra, and Alden, 2003). As such, we

expect that an appropriate use of a local icon in a global brand influences consumers

self-identification with the brand and consequently their purchasing behavior. The

following hypothesis is developed.

H3. The enhanced evaluation of local iconness increases purchase likelihood.

Integrating the above relationships, as depicted in Figure 1, which shows that the

9
 compatibility between the global brand and the local cultural elements increases the

purchase likelihood (H1), the compatibility between the global brand and the local

cultural elements enhances consumers evaluation of the brands local iconness (H2)

and the enhanced evaluation of local iconness increases purchase likelihood (H3), we

can see that perceived local iconness plays an important role leading to consumer

attitudinal and behavioral responses to a global brand adopting Chinese elements.

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Therefore, the following mediation hypothesis is developed.

H4: The impact of perceived cultural compatibility between global brands and

Chinese elements on product purchase likelihood is mediated by perceived brand

local iconness.

2.4 The Moderation of Cultural Identity

Globalization has an important psychological influence on consumer cultural identity,

which refers to the extent to which people in a given culture recognize and identify

with a set of focal elements that set the culture apart from others (Clark, 1990; He and

Wang, 2015). Since people from the same culture share their customs, practices,

languages and values, cultural identity is especially important for consumers from

collective cultures like China, because people often identify his/her self-concept or

self-schema based on his/her connections with others in the same culture (Markus and

Kitayama, 1991; Wang et al., 2000).

A direct consequence of globalization is the emergence of bicultural identities

(including global and local identity) due to cultural mixing (Arnett, 2002). Such

bicultural identities mean that consumer identity may be rooted in their local culture

10
 while at the same time emerges from an exposure and awareness of their relation to

the global culture. In other words, when developing their global identity, many people

retain a local identity. Local identity refers to consumers identification and respect for

local customs and traditions. Global identity, on the other hand, represents consumers

belief in the positive effect of globalization and recognition of commonalities rather

than dissimilarities among people around the world (Tu, Khare and Zhang, 2012).
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While consumers can possess both identities, individuals differ in their level of local

and global identity in that some possess stronger local identity while others possess

stronger global identity. Marketing research has shown that consumer global and local

identity are associated with their evaluation of global and local brands (Strizhakova,

Coulter, and Price, 2012; Swoboda, Pennemann, and Taube, 2012; Zhang and Khare,

2009), given that consumer attitude and behavioral responses are closely related to

their self-schema and self-identity (Wang and Mowen, 1997).

When representations of two cultures are activated simultaneously, consumers

will organize their attention, perception, and other cognitive processes with defining

characteristics of the in-group culture. Hence, according to the dynamic constructivist

theory of culture, when consumers are exposed to a culture directly or indirectly, they

develop a cognitive representation of the culture and tend to think and act in ways

expected from the activated culture (Chiu et al., 2009). Research has shown that

cultural identity is a significant predictor of consumer preference and purchasing

behavior of a product that is associated with their culture (He and Wang, 2015).

The mixing of two dissimilar cultures appear at the same time, culture will

11
 become a salient mental category for organizing perceptions and evoke a cognitive

contrast. People will become sensitive to the cultural implications of the inflow of

foreign cultures, which in turn, will strengthen the perceived incompatibility of the

two cultures (Chiu et al., 2009; Chiu et al., 2011; Toreli et al., 2011). In such a process,

considering the fact that consumer local and global identity provide an approachable

tool for them to process information in a global brand (Wheeler, Petty and Bizer,
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2005), individual differences in cultural identity would moderate the effect of local

iconness on purchasing likelihood.

In particular, consumers having higher local identity are more inclined to their

heritage culture and be more prone to defensive and closure-oriented response to

foreign cultures (Morris, Mok and Mor, 2011) manifested in a brand. Meanwhile,

foreign cultural elements are often perceived as a threat to their local identity. The

cognitive contrast tends to evoke defensive or elicit exclusionary reaction (Chiu et al.,

2011). In order to maintain a consistent self-schema, consumers tend to have a more

positive response towards a brand when there is a congruence between their cultural

identity and the perceived local iconness in a brand. In other words, high local identity

consumers tend to have a strong desire and expectation for local iconness and a lower

tolerance of incongruences existing in a brand. Consequently, consumers with high

local identity, compared to those with low local identity, would consider brand local

iconness a more consistent information processing tool and attach more importance to

it. Therefore, the effect of local iconness on purchase likelihood is enhanced by higher

local identity.

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 In contrast, consumers with high global identity tend to view global cultures as

intellectual resources that complement their own culture for achieving valued goals. A

global identity gives consumer a sense of belonging to a worldwide culture and an

awareness of the information that are part of the global culture (Arnett, 2002).

Consequently, they do not experience culture mixing as an impending cultural threat

and thus tend to take more open and positive reactions (Chiu et al., 2011). Meanwhile,
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being global means identifying with people around the world instead of associating

with values and customs in ones local culture (Zhang and Khare, 2009). Consumers

with high global identity, compared to those with low global identity, would treat

brand local iconness as a less consistent information processing tool and pay less

attention to it, thus dampening the impact of perceived local iconness on purchase

likelihood. The following moderating hypotheses are thus developed:

H5a: Higher local identity enhances the effect of brand local iconness on product

purchase likelihood.

H5b: Higher global identity weakens the effect of brand local iconness on

product purchase likelihood.

Based on above discussion, Figure 1 summarizes the hypotheses and integrates

them into a conceptual framework.

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Please insert figure 1 about here
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3 Method

3.1 Testing Products

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 Stimulus Products of global brands that incorporated Chinese elements were

selected from several widely referenced brand ranking sources (e.g., Interbrand Top

100 Best Global Brands, BrandZ Top 100 Most Valuable Global Brands, etc.). In the

initial stage, 39 products from 13 global brands possessing Chinese elements were

selected in terms of three categories, i.e., fast-moving consumer goods, durable

consumer goods and luxury products. Two pretests were conducted to narrow down
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the selected product list to fit the research purpose. In the first test, 42 participants

evaluated all selected products in terms of the presence and salience of typical

Chinese elements showing in the product pictures. They rated on three questions in

terms of whether, what and how obvious Chinese elements appeared in these products.

Such a process resulted in a shortlist of 13 products, based on highest rating scores.

Next, another group of 43 participants were asked to rate the congruity between the

perceived symbolic meanings of the global brand and Chinese elements used on a

7-point scale from completely incongruent (-3) to completely congruent (+3).

Eventually, three pairs or 6 products were selected, with one highest and one lowest

rating scores in terms of the compatibility on each of the three product categories. The

final stimulus products used in this study include KFC congee with minced pork and

preserved egg (high - fast moving) vs. Hagen-Dazs ice cream moon cake (low-

fast-moving); HP mini VT netbook with peony design (high - durable) vs. Dell

Inspiron1320 netbook with goldfish design (low - durable); Gucci Shanghai dragon

bag (high - luxury) vs. Tiffany Chinese luck charm necklace (low - luxury).

14
 3.2 Procedures and Sample

A consumer survey with six versions of questionnaires (varied by products) were

designed for six global brands across three categories. The introduction of each

questionnaire includes the picture with descriptions of the testing product.

Questionnaires were sent via e-mail to 455 MBA students in a Chinese university in

Shanghai. Among the 267 completed surveys (a response rate of 58.7%), 221 (or
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82.8%) were valid responses. Male and female ratio was 45.7% to 54.3%, and 33.0%

were unmarried and 67.0% were married. The average age of participants was 31.8.

The number of respondents were evenly distributed in each of the six products (range

from 35-39 in each group).

3.3 Measures

Cultural compatibility was measured by three items based on conceptual domains

defined in this paper. Brand local iconness and product purchase likelihood scales

were adopted from Steenkamp, Batra and Alden (2003). Global identity vs. local

identity were measured by eight-item scale developed by Tu, Khare and Zhang (2012).

Except for global/local identity measure (which is a 7-point Likert scale), scale items

were based on 7-point (from -3 to +3, where 0 indicated neutral). All measurement

scales, which were listed in the Appendix 1, were translated into Chinese following

the back translation procedure.

Considering other variables may influence testing results, they were measured

and controlled as covariates in the analysis. For such variables, we adopted

measurement scales from existing studies, including brand prestige, perceived brand

15
 quality, brand familiarity (adopted from Steenkamp, Batra and Alden, 2003), prior

experience (adopted from Batra et al., 2000), and product involvement (adopted from

Jain and Srinivasan, 1990). In addition, demographic information, such as gender, age,

marital status, and income level, is included as control variable. Descriptive statistics

of variables, including means and standard deviation of each variable and correlation

coefficient among variables are listed in the Table 1.

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-----------------------------------------------
Please insert table 1 about here
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4 Results

4.1 Mediating Effect of Brand Local Iconness

Hypotheses 1 to 4 was tested with the hierarchical regression analysis. As shown in

Table 2, cultural compatibility is significantly associate with purchase likelihood (M2:

=0.68, p<0.01), thus H1 is supported. Cultural compatibility is also significantly

associate brand local iconness (M1: =0.57, p<0.01), supporting H2. Meanwhile,

Brand local iconness is positively associated with purchase likelihood (M3: =0.51

p<0.01), H3 is further supported. The mediation effect proposed in H4 was tested

following the causal steps method (Baron and Kenny, 1986). Results show that after

bringing mediator variable (brand local iconness) into the regression models (M4),

brand local iconness has a significant impact on product purchase likelihood (=0.21,

p<0.01), while the predicting effect of cultural compatibility on purchase likelihood is

still significant but with a reduced effect (=0.56, p<0.01, Sobel test statistic =7.75,

p<.01). Hence, brand local iconness has a partial mediating effect in the relationship

between cultural compatibility and purchase likelihood, which is consistent with H4.
16
 -----------------------------------------------
Please insert table 2 about here
-----------------------------------------------

4.2 The Moderating Effect of Global Identity and Local Identity

The moderating effect of cultural identity is tested with the Total Effect Moderation

Model (Edwards and Lambert, 2007, Model C, p.4), which combines moderation and

mediation under a general analytical framework. Specifically, the direct effect

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(antecedent variable to consequent variable) and indirect effect (antecedent variable to

mediator variable to consequent variable) are combined in the analysis of moderating

effects. Following the procedures described by Edwards and Lambert (2007), we

verify the moderating effects of global identity and local identity based on two

equations. Equation 1 represents the influence of cultural compatibility on brand local

iconness while Equation 2 reflects the effect of cultural compatibility on purchase

likelihood, the effect of brand local iconness on purchase likelihood, and the

moderation effects between brand local iconness and purchase likelihood respectively.

PBL=a03+ax3CC+em3 (1)

PL=b010+bx10CC+bm10PBL+bz10CIi+bmz10(PBLCIi)+ey10 (2)

where: CIi=moderator variables (global identity and local identity), PBL= brand local

iconness, CC= cultural compatibility, PL= purchase likelihood.

Results, by bootstrap estimates, as shown in Table 3, reveal that local identity has

a positive moderating effect (bmz10 = 0.35; p<0.01) whereas global identity has a

negative moderating effect (bmz10 = -0.24; p<0.01). Given bmz10 refers to the effect

coefficient of moderator variable between brand local iconness and purchase

17
 likelihood, H5a and H5b are both supported.
-----------------------------------------------
Please insert table 3 about here
-----------------------------------------------

Finally, path coefficient of indirect, direct, total effects and difference are

reported on Table 4, which further illustrates the value and significance level of each

effect size under different levels of moderator variables. In particular, low local
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identity shows no moderating effect on the influence of local iconnes on purchase

likelihood (bmz10 =0.10, ns). However, high local identity moderates the relationship

between local iconness and purchase likelihood (bmz10 = 0.79, p<0.01), and the

difference is significant (0.79-0.10=0.69, p<0.01). Such a result further verifies H5a.

Meanwhile, there are no significant differences in direct (-0.01- [-0.01)=0.00, ns),

indirect (0.09-0.01=0.08, ns) or total effects (0.09-0.01=0.08, ns).

In the same vein, the influence of brand local iconess on purchase likelihood is

moderated by both low global identity (bmz10 =0.74, p<0.01) and high global identity

(bmz10 =0.23, p<0.01) and the difference is significant (0.27-0.74=-0.47, p<0.01).

Again, 5b is verified. No significant differences were found in direct (0.02-0.02=0.00,

ns), indirect (0.02-0.09=-0.05, ns) or total effects (0.05-0.11=-0.05, ns).

----------------------------------------------
Please insert table 4 about here
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5 Discussion

This study provides an empirical support of our proposed conceptual frame, which is

summarized in five hypotheses. In particular, the results shows that cultural

18
 compatibility has a direct positive effect on purchase likelihood (H1) and an indirect

effect on purchase likelihood through the mediation of perceived local iconness (H2

and H4). In addition, while perceived local iconness also has an impact on purchase

likelihood (H3), however, such an influence is moderated by consumer cultural

identity (H5a and H5b). In particular, consumer high local identity tends to enhance

the influence of brand local iconness to purchase likelihood, whereas consumer global
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identity tends to weaken such an influence.

5.1 Theoretical Contribution

The proposed theoretical framework and conceptualization contributes to the extant

literature (e.g., Arnett, 2007; Chiu and Cheng, 2007; Chiu et al., 2011; Gelfand, Lyons,

and Lun, 2011) by revealing the psychological mechanism regarding how culture

mixing affects consumers in emerging markets responding to global brands during the

globalization process. Empirical results of this study add significant insights into our

understanding of how global brands can be success in an emerging market by

incorporating local (Chinese) cultural elements.

First, this study demonstrates the importance of cultural compatibility when

adding Chinese elements into a global brand, which comes from a quite different

cultural (mostly Western cultural) background. A cultural mixing in such a situation

tends to increase consumer attention to the in-congruency of the messages and their

symbolic meanings rooted in different cultures.

Second, while existing research finds that the evaluation of brand local iconness

influences purchase likelihood directly (Steenkamp, Batra, and Alden, 2003), this

19
 study not only explores the antecedents (i.e., the cultural compatibility of global

brands and local elements) of local iconness on purchase likelihood, but also

demonstrates that the effect of local iconness on purchase likelihood is further

moderated by cultural identity. As our results shows that consumer high local identity

tends to enhance the impact of brand local iconness on purchase likelihood, whereas

consumer global identity weakens such an impact. Such a finding further explains the
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conditions that the effective usage of local iconess in a global brand is depending on

consumer cultural identity.

Third, this study extends previous research on cultural mixing and bicultural

exposure effect showing that an exposure to a commercial advertising that embodies

symbols of two dissimilar cultures can enhance perceptibility of cultural differences

and perceptions of cultural incompatibility (Cheng, Leung, and Wu, 2011; Chiu et al.,

2009; Morris, Mok, and Mor, 2011; Torelli et al., 2011). Our results further

demonstrate that the perceived cultural compatibility from cultural mixing has a direct

and indirect impact (through the mediation of brand local iconness) on consumer

purchasing likelihood. The mediation effect of local iconness found in this study

provides empirical evidence of influencing mechanism of bicultural exposure effect.

Fourth, cultural identity differs from consumer ethnocentrism in that the former is

derived from a collective identification of ones culture whereas the latter is based on

nationalism mindset (He and Wang, 2015). Previous research showed that consumer

ethnocentrism failed to moderate the relationship between local iconness on purchase

likelihood (Steenkamp, Batra, and Alden, 2003). Therefore, the moderating role of

20
 cultural identity in the relationship between local iconness and purchase likelihood

found in this study provides additional evidence confirming the different

psychological mechanism between these two constructs, as explained in He and

Wangs (2015) empirical study that explores and compares the differences between

consumer ethnocentrism and consumer cultural identity.

5.2 Managerial Implications

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Considering the huge market size and fast growth purchasing power of Chinese

consumers, global brands entering Chinese consumer markets has an increasing trend

using Chinese element in product R&D, including product design, packaging and

promotion campaign (Lin and Wang, 2010). While such a glocal strategy can lead to

positive influence on consumer purchase likelihood for a global brand in many

situations, sometimes such marketing practices by multinational companies can also

be abused and may not result in positive consumer responses if there is a mismatch

between the brand and the symbolic meanings of Chinese elements in terms of the

compatibility of such different cultures. For instance, the Starbucks outlet at the

Imperial Palace in China was forced to close in July 2007, due to the important

symbolic meanings of Imperial Palace to Chinese people and such a place is not

supposed to be occupied by a foreign business according to many Chinese people,

especially among those with strong nationalism mentality. Therefore, implications for

multinational marketers of global brands can be drawn from following aspects.

First, there is a growing trend that global brands adapt local elements when

entering emerging markets. Chinese elements has inspired many Western designers

21
 and has been wildly adopted by global brands (He and Wang, 2015; Wang and Lin,

2009). Examples include Dragon icon appearing on Adidas apparel and Gucci bags; a

Panda depicted in Cartiers Watch; Peking Opera facial mask and blue flower

porcelain decorated Swatch watch band; and Chinese zodiac signs appearing on Coca

Cola cans. However, not all product designs or promotions that adopt local cultural

elements will be effective and managers of global brands need a good understanding
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of the connotation, traditional values and usage stations of the local cultural elements

and appropriately blend the cultural mixing into a brand. Therefore, it is important to

continuously identify, measure and improve the cultural compatibility when

incorporating Chinese elements into a global brand before and after this strategy is

used. Particular attention should be paid to the symbolic meaning of Chinese elements

used in product R&D and packaging design. In particular, when promoting global

brands, cultural conflicts and negative connotations associated with Chinese elements

should be avoided in commercials, especially when in a cultural mixing situation. For

instance, when Nike began using the Chinese elements in the Chamber of Fear"

commercial in 2004, its failure in China is predictable due to its being interpreted as

American culture defeating Chinese culture (He and Wang, 2015).

Second, based on the moderating effect of cultural identity between brand local

iconness and consumer purchase likelihood, multinational marketers should further

develop segmentation and positioning strategies in terms of consumer local identity

and global identity. Local iconness in global brand can exert a strong influence on

product attitude for consumers with high local identity, given their high tendency to

22
 identify symbols and values of their local culture. On the other hands, perceived

globalness in a brand will have a strong impact on consumers with high global

identity, who have a more open mindset towards globalization and foreign cultural

elements depicted in a global brands. Given both perceived globalness and local

iconness have been shown to have positive effects on purchase likelihood,

differentiation strategies should be used to target different consumer segments.

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Third, as our results show, brand local iconness still has a significant effect on

consumer attitudinal and behavioral response to a global brand when such factors as

perceived brand quality, brand prestige, brand familiarity, prior experience and

product involvement are controlled. Therefore, while perceived globalness will

continuous influencing perceived brand equity and prestigious, which eventual lead to

purchase likelihood (Steenkamp, Batra, and Alden, 2003), brand local iconess will

still be an effective means used by multinational managers entering China or other

emerging markets in order to reduce cultural resistance and to increase high

acceptance by consumers.

5.3 Limitations and Future Research Directions

This study has limitations in its scope and opens new avenues for future research

directions. First, cultural compatibility is conceptualized and measured as single

dimensional construct in terms of the degree of conflict or congruencies between

different cultures. However, future research may benefit from further exploring

multi-dimensionality cultural compatibility, that is, from what aspects and what

factors do consumers evaluate cultural compatibility in cultural mixing situations.

23
 Such knowledge would shed lights on understanding of those factors for marketers to

develop specific strategies when incorporating local elements into global brands.

Second, this study did not explore other potential mediating or moderating

variables, such as processing fluency (Lee, Keller, and Sternthal, 2010) and positive

or negative emotions (Cheng, Leung, and Wu, 2011), which may extend our

knowledge regarding how brand local iconness influences purchase likelihood.

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Moreover, it would be worthwhile to probe into other variables, in addition to the

cultural compatibility as an antecedent of brand local iconness, that could further the

research on influencing mechanisms of consumer attitude towards global brands with

Chinese elements.

Third, this study doesnt examine the effectiveness of using Chinese elements in

global brands under the context of competition, which can be an essential

precondition for brand positioning. Future research should further expand the research

scope to including market competition and market turbulence situations.

Fourth, this study is focusing on consumer attitudinal and behavioral responses in

an emerging market, China. Research shows that consumers in emerging markets,

compared to those from more developed countries, typically perceive a global brand

from a higher country-of-origin as possessing more prestigious brand image (Wang

and Chen, 2004). There is a possibility that when a global brand integrating local

elements, it may be perceived less authentic and less prestigious, especial to those

brand conspicuous consumers. Future research may further explore whether the

reduced conspicuous image of such a cultural mixing will negatively influence

24
 consumer purchase likelihood of a global brand.

Fifth, it should be cautious when drawing conclusions based on a single study. To

ensure the external validity or applicability of the research findings from this study,

the Chinese elements used in global brands were varied in the forms of

product/ingredients (e.g., congees or moon cake) vs. design or decoration (e.g.,

dragon or Chinese luck charm), it would be interesting to further examine whether

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such different Chinese elements would lead to different effects and whether

incorporating local cultural elements into product design or product decoration will

enhance or hurt the image of a global brand.

Finally, while Chinese elements and foreign elements in a global brand are

seemingly incompatible, it is necessary to find the means and conditions that improve

cultural compatibility. Therefore, future research that investigate the specific aspects

of global brands concepts and the cultural meanings reside in Chinese elements and

the conditions that increase cultural compatibility is warranted.

25
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33
 Appendix 1. Measures and Reliability of Constructs
Constructs Item
Cultrual Compatibility Not congruent/completely congruent; not compatible/ completely
(Cronbachs =0.937 ) compatible; not conflicting/completely conflicting.
Brand local iconness (Steenkamp, I associate this brand with things that are Chinese/I do not associate
Batra, and Alden, 2003) this brand with things that are Chinese; To me, this brand represents
(Cronbachs =0.902) what Chinese is all about/To me, this brand does not represent what
Chinese is all about; To me, this brand is a very good symbol of
Chinese/To me, this brand is not a very good symbol of Chinese.
Global identity (Tu, Khare, and My heart mostly belongs to the world; I believe people should be made
Zhang, 2012) more aware of how connected we are to the rest of the world; I
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(Cronbachs =0.750) identify that I am a global citizen; I care about knowing global
events.
Local identity (Tu, Khare, and My heart mostly belongs to my local community; I respect my local
Zhang, 2012) traditions; I identify that I am a local citizen; I care about knowing
(Cronbachs =0.781) local events.
Perceive brand quality (Steenkamp, This brand is very low on overall quality/ This brand is very high on
Batra, and Alden, 2003) overall quality; This is a brand of inferior quality/ This is a brand of
(Cronbachs =0.811) superior quality.
Brand familiarty (Steenkamp, Batra, This brand is very familiar to me/ This brand is very unfamiliar to me;
and Alden, 2003) Im not at all knowledgeable about this brand/ Im very knowledgeable
(Cronbachs =0.847) about this brand.
Prior experience (Batra et al., 2000) Never tried it even once/ Use it all the time; I have no personal usage
(Cronbachs =0.976) experience with it/ I have extensive personal usage experience with it.
Product involvement (Jain and It is not a big deal if I make a mistake in choosing it/ It is a big deal if I
Srinivasan, 1990) make a mistake in choosing it; It is really annoying to make an
(Cronbachs =0.803) unsuitable purchase/ It is not annoying to make an unsuitable purchase;
A poor choice wouldnt be upsetting/ A poor choice would be
upsetting.
Brand prestige (Steenkamp, Batra,
This is a very prestigious brand/ This is not a very prestigious brand
and Alden, 2003)
Product purchase likelihood I would not buy it (assuming it was available)/ I would certainly buy it
(Steenkamp, Batra, and Alden, 2003) (assuming it was available); Im not at all likely to buy it (if available)/
(Cronbachs =0.976) Im very likely to buy it (if available).
Note. N=221. The Cronbachs of all scales are over 0.700. For the scales which adopt the measures of -3 to 3 are
changed to 1-7, then calculate the reliability.

34
 Figure1. A Conceptual Framework of the Influence of Cultural Compatibility on
Product Purchase Likelihood

H4

Brand
H2 Local Iconness H3

Cultural H1 Product
Compatibility Purchase Likelihood
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H5b H5a

Global Identity Local Identity

35
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Table1. Descriptive Statistics of the Constructs

Constructs 1 2 3 4 5 6 7 8 9 10 11 12 13 14
1. Cultural compatibility 1
2. Brand local iconness 0.51** 1
**
3. Global identity 0.17 0.09 1
4. Local identity 0.07 0.06 -0.17** 1
** ** **
5. Purchase likelihood 0.68 0.49 0.19 -0.03 1
** **
6. Perceived Brand Quality 0.07 -0.09 0.23 0.24 0.07 1
7. Brand familiarity 0.03 0.06 0.21** 0.10 0.05 0.24** 1
**
8. Prior experience 0.04 0.10 0.20 0.04 0.07 0.00 0.57** 1
* *
9. Product involvement -0.17 0.04 -0.03 0.06 -0.07 0.16 0.11 0.03 1
10. Brand prestige -0.05 -0.06 0.19** 0.25** 0.01 0.77** 0.26** 0.09 0.16* 1
** **
11. Gender -0.06 -0.04 -0.10 0.07 -0.07 0.24 -0.09 -0.29 -0.02 0.20** 1
* *
12. Age -0.03 0.03 -0.03 -0.08 -0.00 -0.13 -0.04 0.01 0.05 -0.16 -0.17** 1
13. Marriage -0.01 0.01 -0.01 -0.05 0.12 -0.10 -0.07 0.05 0.02 -0.09 -0.12 0.43** 1
* * ** **
14. Income -0.03 0.03 0.06 -0.08 0.01 -0.08 0.07 0.17 -0.02 -0.16 -0.19 0.56 0.49** 1
M 3.78 3.79 4.96 5.43 3.53 5.83 5.58 4.38 4.30 5.91 0.54 31.83 0.67 6.10
SD 1.69 1.72 1.00 0.96 1.90 0.74 1.00 1.82 1.63 0.94 0.50 4.11 0.47 2.75
* **
Note. N=221. The variables adopted the measures of -3 to 3 are changed to 1-7, then calculate the means and standard deviation. p<.05, p<.01.

36
 Table 2. The Results of Hierarchical Regression Model
M1 M2 M3 M4
Variables Brand local iconness Purchase likelihood Purchase likelihood Purchase likelihood
Step 1 Step 2 Step 1 Step 2 Step 1 Step 2 Step 1 Step 2

Control variables

Gender 0.02 0.07 -0.09 -0.03 -0.09 -0.09 -0.09 -0.04

Age 0.02 0.02 -0.03 -0.03 -0.03 -0.04 -0.03 -0.03
* * * ** *
Marriage -0.01 -0.03 0.18 0.15 0.18 0.18 0.18 0.16*
Income 0.00 0.06 -0.09 -0.03 -0.09 -0.10 -0.09 -0.04
** **
Perceived brand quality -0.10 -0.28 0.21 -0.01 0.21 0.26 0.21 0.05
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Brand familiarity 0.04 0.03 0.03 0.02 0.03 0.01 0.03 0.01
Prior experience 0.08 0.06 0.05 0.01 0.05 0.01 0.05 0.00
Product involvement 0.05 0.15* -0.09 0.03 -0.14 -0.13* -0.09 -0.00
Brand prestige -0.01 0.14 -0.14 0.04 -0.09 -0.12 -0.14 0.01
Independent Variable

Cultural compatibility 0.57** 0.68** 0.56**

**
Brand local iconness 0.51
Mediator variable
Brand local iconness 0.21**
R2 0.02 0.30 0.05 0.43 0.05 0.25 0.05 0.46
F 0.51 9.22** 1.28 17.97** 1.28 7.82** 1.28 18.26**
R2 0.02 0.32 0.05 0.48 0.05 0.30 0.05 0.51
2
Adjusted R -0.02 0.28 0.01 0.45 0.01 0.27 0.01 0.48
Note. N=221. All are standardized coefficient estimates. *p<.05, **p<.01.

37
 Table 3. Coefficient Estimates
Moderator
a03 ax3 R2 b010 bx10 bm10 bz10 bmz10 R2
variables
Local identity 0.00 0.12 0.01 -0.02 -0.01 0.45** -0.07 0.35** 0.38
Global identity 0.00 0.12 0.01 0.02 0.02 0.50** 0.14** -0.24** 0.32
Note. N=221. All are unstandardized coefficient estimates. *p<.05, **p<.01.
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38
 Table 4. Analysis of Simple Effects

Moderator Stage Effect

variable First Second Direct Indirect Total
CC to PBL PBL to PL CC to PL First + Second Direct + Indirect
Local identity
Low-score group 0.12 0.10 -0.01 0.01 0.01
High-score group 0.12 0.79** -0.01 0.09 0.09
Differences 0.00 0.69** 0.00 0.08 0.08

Global identity
Low-score group 0.12 0.74** 0.02 0.09 0.11
High-score group 0.12 0.27** 0.02 0.03* 0.05
Differences 0.00 -0.47** 0.00 -0.06 -0.06
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Note: N=221. For rows labeled low-score group and high-score group, table entries are simple effects computed from Equation (2) using
coefficient estimates from Table 3. Two groups are formed based on Zhigh=mean+1sdZlow=mean-1sd. Differences of local identity in
simple effects were computed by subtracting the effects for low-score group from the effect for high-score group. It is reversed for the
differences of global identity in simple effects. *p<.05, **p<.01.

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