The effects of ethnocentrism and economic development on the formation of brand and ad attitudes in transitional economies

The aim of this research was to investigate how ethnocentrism and economic development within transitional economies affects the formation of brand attitudes and attitude toward the ad.

Kazakhstan and Slovenia were chosen as representative transitional economies – Kazakhstan in the early stages and Slovenia highly advanced. A random sample of adults was surveyed in both countries and in the USA, which served as a control group. Questionnaires were distributed that contained measures of ethnocentricity (CETSCALE), attitude toward the brand (Ab) and attitude towards the ad (Aad). Expectations based on theory and previous studies suggested the following: ethnocentricity leads to negative Aad and Ab for foreign products and ethnocentricity will have a greater effect on Aad and Ab in new transitioning economies. All hypotheses were tested using structural equation modeling (LISREL).

Ethnocentricity did result in negative Aad, but only for Kazakhstan, not Slovenia. The effect of ethnocentrism on Aad was stronger in the newly transitioning economy. Ethnocentricity affected Ab formation only indirectly through Aad, not directly as predicted by previous research. There was limited support for the idea that the effect of ethnocentrism on Ab was stronger in newly transitioning economies.

Because ethnocentric attitudes transfer directly to negative Aad, it indicates that developing a superior brand in newly transitioning economies is preferable to relying on mass advertising to make one's case. The brand will develop its reputation based on quality and status, which are not directly affected by ethnocentricity. A further protection from ethnocentric attitudes would be to form a joint venture with a local firm or set up a foreign subsidiary. In more advanced transitioning economies, a shift to mass communication of product benefits will work more readily.

International marketers have better decision‐making information now available. The relationships of economic development and ethnocentricity are more clearly laid out as they relate to attitude formation for foreign products. Researchers in this field have more advanced theory to work from, as the path by which ethnocentricity affects attitude formation has been delineated more clearly.