Home country bias in consumers’ retailer preference formation in Hungary

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The role of cognitive, affective and normative influences, by Edina Láng and Dr. László Láng

Apropos of these recent regulations, IBS Newsdesk recommends to read a research article by Edina and László Láng published in Competicio, on the relation of consumer ideologies and preferences of food shopping in Hungary. An earlier and English-version of the paper is accessible at IBS website. The Hungarian Parliament has voted to ban large stores from opening on Sundays. Most probably this will be extended to online retailers as well. According to another rule, those shops that do not make profit in two consecutive years will be obliged to close down. These regulations, effective from March 15, 2015 in Hungary, have serious negative effects on international retail chains while most probably will give advantage to Hungarian chains of food stores, especially if they are small size. The purpose of this research, conducted in 2012, was to explore whether and through what mechanisms a politically-motivated ‘buy from nationals’ campaign that apparently has been unfolding in Hungary over the last couple of years, can influence the retailer patronage behaviour of consumers. It reviewed the streams of literature that appear to carry relevance from the viewpoint of the subject, and highlighted the need for specific knowledge regarding consumers’ preference formation for retailers of domestic versus international origin. It argued that the extensive literature on domestic bias at the product level is most useful; nevertheless, animosity/affinity vis-à-vis retailers might significantly influence consumer choices well before getting down to the product level. A representative sample (N=619) of respondents revealed their capacity to differentiate between Hungarian and foreign retailers, evaluated their experience regarding individual retailers and expressed their level of (dis)agreement with a set of affective statements.  Responses were analyzed through a complexity of statistical methods. It is shown that discriminatory retail patronage is emotional, that is, affective. In contrast, positive patronage behaviour is cognitive, that is, rational. It follows that ‘buy from nationals’ government policies need to expound and personalize emotional factors. International retailers can counter the pro-domestic tide through strengthening their advantages in attributes such as affordable quality, merchandise selection, convenience of access and service excellence. An important contribution of this study to the respective literature is, first, the finding that consumer ethnocentrism, regarded more often than not as a normative influence, may also appear as an affective factor, and second, that affective factors influence patronage choices not directly but through impacting upon consumers’ cognitive preference building processes. Read the whole paper here in English and here in Hungarian.