When a local brand is seen as a foreign brand

Researchers have been debating for years about country-of-origin effects, i.e. how do consumers view products from other countries based on the halo effect of that country’s reputation. In virtually every case, this research has been about true non-local products and how they are perceived.

However, Eckhardt (2005) examined a case in which a local product was perceived as being in a “foreign” category and was, therefore, evaluated by that category’s characteristics. In the Eckhardt research, the perceptions studied were of a local pizza restaurant in Andhra Pradesh, India.

This restaurant was not a Western chain transplanted to India; rather, it is a local chain owned by a local entrepreneur. The pizzas themselves were completely localized, i.e. the most popular pizza on the menu is onion, peppers, carrots, and grated beetroot, covered with paneer (a sort of thick cottage cheese) on a bread similar to naan.

Yet, virtually all the customers perceived this restaurant chain as being “Western”, and the environment itself imbued with western values, such as:

Freedom from tradition – the interviewed customers saw eating pizza as a sort of freedom from eating traditional foods at home, which is normally rice-based, eaten with families (not friends), and is a brisk, non-conversational activity. In contrast, the restaurants are designed for lingering and having conversations with friends, and more importantly, with the opposite sex (something normally not done in this area). The perceived “foreignness” of the restaurant makes these activities acceptable. The food itself is seen as a form of cultural tourism, eaten as an occasional treat rather than a regular option.

High status yet unaffordable – the restaurants were perceived as places to “see and be seen” – a middle-class status symbol. While younger people came more frequently to take advantage of the fraternizing opportunities, their parents and families only came on special occasions. Yet, ironically, the price of a pizza for four was essentially equivalent to the cost of preparing a meal at home. In many cases, young men took their dates to these restaurants when they wanted to truly impress them.

Non-transformable to local culture – even though the food was almost completely localized, retaining perhaps only the round shape of Western pizza, it was still seen as being a foreign concoction. Customers were surprised to find out that pizza toppings were different in other countries, seeing their localized pies as being the Western norm.

Eckhardt’s research puts a new spin on the local vs. global branding debate, since it appears that there are local brands that struggle with being perceived as global brands. The restaurant in this study struggled financially due to the customer’s pre-conceived ideas about pizza, since it meant that pizza was not seen as a daily food option. It could mean that a local brand in this situation may have to abandon standard “local” marketing practices and, instead, brand itself as a foreign product.

References:

Eckhardt, G. (2005) “Local branding in a foreign market category in an emerging market.” Journal of International Marketing. 13 (4) pp. 57-79.

 

 

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