The Role of Involvement as a Moderating Variable in a Country of Origin Study

19
GadjahMadaInternationalJournalof Business–January-April,Vol.19,No.1,2017
Gadjah Mada International Journal of Business
Vol. 19, No. 1 (January-April 2017): 19-34
* Corresponding author’s e-mail: r.matoati@gmail.com
ISSN: 1141-1128
http://journal.ugm.ac.id/gamaijb
The Role of Involvement as a Moderating Variable
in a Country of Origin Study
Rindang Matoati1*
and SuciParamitasariSyahlani2
1)
Facultyof EconomicsandManagementBogorAgriculturalUniversity,Indonesia
2)
FacultyofAnimalScienceUniversitasGadjahMada,Indonesia
Abstract: The aim of this study is to examine the effect that the country of design and the country of
manufacture has on the perceived quality of a product, and the role of involvement as a moderating
variable. The conceptual framework has been tested using laboratory experiments that included a 2x2x2
between the subject’s factorial designs. Participants were assigned by using a randomization method and
data was analyzed using a one-way and two-ways ANOVA. The results indicated consumers’ involve-
ment, as a moderating variable, limited the strength of the country of design and the perceived quality’s
relationship as this relationship is found to be stronger in circumstances where the consumers’ involve-
ment was greater than in the less involved group’s condition. However, consumers’ involvement did not
have any role as a moderating variable in the relationship between the country of manufacture and the
perceived quality.
Abstrak: Tujuan penelitian ini untuk menguji pengaruh negara asal desain dan negara produksi pada kualitas produk
persepsian, dan peran keterlibatan sebagai variabel pemoderasian. Penelitian ini menggunakan desain eksperimen laboratorium,
yaitu desain faktorial 2x2x2. Partisipan dibagi ke dalam kelompok eksperimen dengan metode randomisasi dan data
dianalisis dengan uji one-way dan two-way ANOVA. Hasil menunujukkan peran keterlibatan konsumen, sebagai
variabel pemoderasian, membatasi kuatnya hubungan antara negara asal desain dan kualitas persepsian, karena hanya
pada kondisi keterlibatan tinggi, negara asal desain berpengaruh pada kualitas persepsian. Namun, ketelibatan konsumen
tidak mempunyai peran pada hubungan negara asal produksi dan kualitas persepsian.
Keywords: country of design; country of manufacture; perceived quality
JEL classification: M310

MatoatiandSyahlani
20
Introduction
The impact of globalization on the in-
dustrialized world has caused competition
among companies to become much tougher.
Indonesia has entered into the ASEAN Eco-
nomic Community (AEC), in which the
ASEAN nations are transformed into a highly
competitive group with a single market and
production base. Furthermore, domestic
manufacturers are expected to grow accord-
ingly, in order to face the new competition.
An alternative way to prevail against the com-
petition is by maintaining or improving the
quality of the products being produced
(Voorhees 2013). Products which are per-
ceived as being of a poor quality, or have a
negative connotation, and are not preferred
by consumers, are not going to compete with
other products which may have better mar-
keting strategies implemented by their manu-
facturers. However, products of an inferior
quality will not out-compete better ones, even
if they have the best marketing strategy. In-
deed, there are benefits in emphasizing the
importance of maintaining a product’s per-
ceived quality, as this can increase its pre-
mium price, market share and hence profit
(Aaker 1991: 89). Marketers should note a
product’s quality in order to surpass its com-
petitors.
The consumers’ perceived quality of a
product changes over time due to increasing
information, new competition in each cat-
egory of products, and changes in the cus-
tomers’ expectations (Zeithaml 1988). Re-
modeling products by adding new features,
changing their physical appearance, or taste,
cannot change consumers’ perceptions or
evaluations of their quality. Therefore, mar-
keters must understand the consumers’ per-
ceptions every time and align their strategies
and products’ promotions in line with the
changes in the consumers’ perceptions.
Recently, the country of origin is one
of the extrinsic cues that is now essential to
use to assess a product’s quality (Ahmed and
d’Astous, 2008). Extrinsic cues are the non-
physical characteristics of the products, such
as price, brand name and country of origin
(Zeithaml 1988). The country of origin cre-
ates mental associations and beliefs triggered
by that country’s name (Kotler and Keller
2013: 636). Knowledge of the country of ori-
gin of a product is very important for con-
sumers to assess that product’s quality, as the
perception of a country could change at any
time, and may result in either a negative or
positive image (Keegan and Green 2011:
344).
On the other hand, Liefeld (1993) has
shown that the country of origin has no sig-
nificant effect on the perceived quality. This
can be explained by the fact that consumers
are not able to determine products by their
country of origin, and the issue becomes
more prominent when companies have an
outsourcing strategy which uses a country as
a place to manufacture various components
of their product. Therefore, the influence of
the country of origin cannot always be asso-
ciated with the manufacturing locations in a
country, and multidimensional research into
the country of origin is absolutely necessary
to show the actual market conditions
(Hamzaoui and Merunka 2006). Customers’
perceptions may change substantially as the
product could well be designed in one coun-
try, have its parts manufactured in another,
and then assembled in a third different county
(Chowdhury and Biswas 2011). Essoussi
(2010) used the concept of the country of
design and manufacture to assess the quality
of a product. The country of design is that

21
state’s ability to plan, design and develop
products, while a country of manufacture is
the ability of a state to create or assemble a
product. Hence, the concept of the country
of origin turns into a segmented idea, the
customer has different perceptions of a prod-
uct which may be designed and manufactured
in different locations.
Pharr (2005) emphasized the impor-
tance of moderating factors in explaining the
inconsistent effect of countries of origins’
influence. Involvement is logically possible
as one of the variables that moderate the in-
fluence the country of origin has on perceived
quality. Fischer et al. (2012) explaines that
once consumers feel deeply engaged with a
product, so all information would not
bemissed in order to evaluate the product.
However, involvement itself as a moderat-
ing variable still causes inconsistent results
when explaining the relationship between the
country of origin and the perceived quality.
For example, research conducted by Josiassen
et al. (2008) and Lee et al. (2005) shows dif-
ferent results. Josiassen et al. (2008) identi-
fied that low consumer involvement with the
product would strengthen the evaluation of
the product’s quality but in this case, the con-
sumers tend to search for all the information
related to the product’s content or intrinsic
attributes, but not to the extrinsic attributes
such as its origin and price and brand. Ahmed
and D’astous (2008) and Lee et al. (2005)
found different results; that greater consumer
involvement with the product would trigger
the consumers to consider all the product’s
attributes including its country of origin when
evaluating the product. Therefore, it is im-
portant to re-examine the assessments of the
role engagement plays with consumers’ in-
volvement in moderating the country of
origin’s effect on the perceived quality.
Previous studies show that consumer
involvement, as a moderating variable, has
been examined to a limited extent for unidi-
mensional countries of origin (Josiassen et al.
2008; Josiassen 2010; Abraham 2013).
Essoussi (2010) used complexity technology
that refers to technological advancements in
the production process, as a moderating vari-
able for the effects of the country of design
and manufacture on the perceived quality. As
described above, in relation to the changing
country of origin’s paradigm, it is important
to test the moderating effect of consumers’
involvement when explaining the effects of
multidimensional countries of origin, namely
the effects of the countries of design and
manufacture on the perceived quality.
The aim of this study is to examine the
effects of the country of design and country
of manufacture on the perceived quality, and
the role of consumers’ involvement as a mod-
erating variable for the product.
Literature Review
The country of origin, also commonly
known as “made in,” is one of the intriguing
aspects of a product. The country of origin
is associated with a country’s ability to manu-
facture certain products. In line with the
changes made because of marketing strategy
considerations, and business cooperation be-
tween countries, these now give manufactur-
ers the latitude to be able to produce, as-
semble and design their products in different
countries, Chowdhury (2010) reveals that in
the era of global brands, the country of ori-
gin has become much more complicated,
hence the need to use a multidimensional
approach to the country of origin of a prod-
uct.

MatoatiandSyahlani
22
Consumers’ perceptions of a product
are associated with the country that designs/
manufactures it. If the consumers’ percep-
tion of that country’s ability to design a prod-
uct is low (poor), then the lower the consum-
ers’ perceived quality of that product will be
(Essoussi and Merunka 2007). Relocating a
product’s manufacturing site can be finan-
cially rewarding. However, it can raise impor-
tant issues relating to the products perceived
quality by its consumers (Essoussi and
Merunka 2007). Consumers generally prefer
products made in developed countries, rather
than those manufactured in developing coun-
tries (Saffu and Scott 2009). Investigators
have alleged that the better the perceptions
of a country are, which has the ability to
manufacture a product, those perceptions will
improve the perceived quality of the prod-
uct. On the other hand, a country with a con-
siderably poorer image for making products,
as viewed by consumers, will see the per-
ceived quality of its products reduced. There-
fore, this study proposes two hypotheses as
follows:
H1
: The perceived quality of a product designed in
a country with a superior image is better than
that designed in a country of origin with a
lesser image.
H2
: The perceived quality of a product whose coun-
try of manufacture has a superior image is
better than a product from a country of manu-
facture with a lesser image.
Multidimensional studies of the coun-
try of origin of a product with a high level of
involvement indicate that the product’s qual-
ity, from a highly perceived country of ori-
gin, will be better than that of a product with
a low level of involvement (Saffu and Scott
2009). Chueh and Kao (2004) revealed that
by involving consumers, in an effort to col-
lect information about a product, the con-
sumers would allocate their own time to this
information gathering, so that their engage-
ment willmoderate the influence of the coun-
try of origin on the product’s quality design.
Lee et al. (2005) revealed that the effects of
a situational involvement will affect the as-
sessment of a product’s quality, when a high
level of consumers’ involvement is attached
to the product (enduring involvement). The
country of origin’s effect is stronger when
consumers evaluate a product with a higher
level of involvement (Henderson and Hoque
2010). Consumers with a high level of in-
volvement are more careful when seeking
information about the country of origin, and
the influence of a multidimensional country
Figure 1. Research Model
Involvement
H4 (+)
Country of
Design
Country of
Manufacture
Perceived
Quality
H3 (+)
H1
H2
Source: Chueh and Kao (2004); Lee et al. (2005); Pharr (2005)

23
of origin in which the country of design and
the country of manufacture are stronger in
the presence of personal involvement as a
moderating variable. Therefore, this study
developed the next hypotheses as follows:
H3
: The differences in the perceived quality of a
product from its country of design are moder-
ated by its levels of involvement. A higher level
of consumers’ involvement with the product has
a stronger influence when considering its coun-
try of design and the perceived quality’s rela-
tionship.
H4
: The differences in the perceived quality of a
product from its country of manufacture are
moderated by its levels of involvement. A
higher level of consumers’ involvement with the
product has a stronger influence when consid-
ering its country of manufacture and the per-
ceived quality’s relationship.
Methods
Pre-test
Several pre-test studies were performed
to ensure the conformity of the product and
some other information relevant to the
research’s context. The first pre-test study
(n=27) was conducted to select a product by
asking people to name 10 products that they
had decided to purchase, based on reading
the information printed on the product or its
packaging. This data were then categorized
into two groups of products, namely personal
care products (bath soap, toothpaste and
shampoo) and fashion (shoes, bags, perfume,
trousers, shirts, watches, and jackets). Per-
fume was one of the products that had fre-
quently been mentioned by our respondents
(18 times in total) therefore we chose it as
the research object. Another consideration is
that perfume does not have any sub-category
of products, unlike for example shoes, which
can be divided into sub-categories such as
sport shoes, casual shoes or formal shoes. Any
sub-category could potentially harm our ex-
perimental bias.
The second pre-test was carried out to
confirm the product category of perfume.
Thompson and Haytko, (1997) define fash-
ion “as a value system that explains the ethos
of modernity, self-improvement, status and
social mobility.” Based on this definition,
perfume can be categorized as a fashion prod-
uct. However, several previous studies had
incorporated perfume into different product
categories, such as it being a cosmetic prod-
uct (Fah et al. 2011), while Sadeghi et al.,
(2011) listed it as a body treatment. There-
fore it is important to define the object that
is used in this research. Confirmation of
perfume’s place as an item of fashion was
done by questioning a number of people (n
= 25) about various alternative product cat-
egories for perfume and the pre-test results
confirm that perfume is considered a fashion
product. This result is consistent with Seitz
(1998) who defined perfume as a fashion
product.
The next pre-test was conducted to de-
termine the country of origin (n = 34), to
decide which countries produce perfumes.
Several countries producing perfume were
identified, based on market reports detailing
the export and import of perfume in Asia in
2011 (Parker 2011). We added Indonesia to
the list as a perfume manufacturer, consider-
ing that the research is being conducted in
Indonesia, and some perfume brands are also
manufactured in Indonesia. The selection of
the country of design and manufacture was
based on the frequency of replies to our ques-
tion. France was perceived as a desirable
country of design and country of manufac-

MatoatiandSyahlani
24
ture, while Indonesia was seen as both a poor
country for the design and manufacture of
perfume.
Manipulation Check
A manipulation check was conducted
to determine that the researcher and the par-
ticipants had the same perceptions about our
experimental treatments, that the levels of
the country of design and the country of
manufacture were agreed, meaning France is
regarded as a desirable country of design and
country of manufacture for perfume, and In-
donesia is viewed as a poor country of de-
sign and manufacture. This procedure checks
if manipulation is present by displaying a
printed perfume advertisement for a new
brand of perfume, which has information
about where the product is manufactured and
designed, namely in France or Indonesia. All
the displayed information is created equally
in all the experimental treatments except for
the name of the country where it is designed
and manufactured, in other words France or
Indonesia. Here is a picture of the perfume
products which are used as stimuli.
Subjects were asked to observe a print
advertisement for a perfume brand called
“Ëau de Perfume” and then fill out a ques-
tionnaire which contained a three-point state-
ment of how logical, reasonable and appro-
priate the design and production capability
of the two countries were (Hamzaoui and
Merunka 2006), in this case France and In-
donesia. The researcher used an independent
sample t-test to analyze the differences be-
tween France and Indonesia as the designer
and producer of the given perfume product.
Figure 2. Sample of the Experimental Stimuli with France as the Country of Design
and Country of Manufacture

25
The result, as shown in Table 1, describes a
common perception among the respondents
that France is perceived as being significantly
more capable (M = 4.277) than Indonesia (M
= 3.261) of designing (p < 0.05) and pro-
ducing (M = 3.758 to M = 3.309) (p < 0.05)
this perfume. Therefore, France is confirmed
as being a “high” country of design and coun-
try of manufacture while Indonesia is a poor
country of design and country of manufac-
ture for this Eau de Perfume product.
Subjects and Procedure
This study was implemented using the
laboratory experimental design method, in
accordance with a study conducted by
Sekaran and Bougie (2010, h.228) in a regu-
lated artificial enviroment. The main study
consists of 229 subjects who were assigned
in a 2x2x2 between the subject’s factorial
designs. The country of design and manufac-
ture was experimentally treated and manipu-
lated by the researchers, while involvement
was measured and divided using a median
split after the participants had been exposed
to the treatment.
The research’s participants were under-
graduate students aged from 17 years and
upwards. The reason for using students as the
participants was based on previous research
by Wong et al. (2008). This research was car-
ried out in China and also used students as
its participants. Students comprise part of the
young potential market for perfume products,
and about half of Indonesia’s population is
below 30 years of age (Montlake 2013: 29),
therefore using this young student population
can be the surrogate for the population as a
whole. There were six steps in the partici-
pants’ selection process. Firstly, the partici-
pants were chosen by a randomization
method in SPSS for Windows version 16.00.
Secondly, the participants were approached in
a haphazard manner and given a coupon by
the researcher, this was done to shorten the
time period of the experiment. Thirdly, the
researcher called on the participants, one by
one. Fourthly, the participants were classified
into four treatment groups. Fifthly, the par-
ticipants observed and evaluated the
perfume’s advertising, and answered ques-
tions about the product’s quality, to measure
the levels of the consumers’ involvement with
Table 1. Results of the Manipulation Check’s Independent Sample T-Test on the Coun-
try of Design and Country of Manufacture
Variable Participant Mean Mean t- value Sig. (2-tailed)
(N) Differences
HighCountry ofDesign
(France) 26 4.277 0.8160 3.513 0.010
LowCountryofDesign
(Indonesia) 23 3.261
HighCountryofManufacture
(France) 22 3.758 0.4489 2.128 0.039
LowCountryofManufacture
(Indonesia) 27 3.309

MatoatiandSyahlani
26
the product, since personal involvement had
not been assigned as a treatment in the ex-
periment. Then for the final step we measured
and used a median split to divide the partici-
pants into two-group subjects (high and low
personal involvement), so that the partici-
pants could be classified into eight groups.
The research stimuli were the perfume’s
print media advertisements. The specific
brand of perfume used was a hypothetical
brand named “RR Eau de Perfume” to avoid
any familiarity with existing brands’ bias. The
advertisements contained information about
the product itself and its country of design
and country of manufacture. All the infor-
mation, except for the name of the country
of design and manufacture were kept exactly
the same. Syahlani and Citra (2008) revealed
in their study that the influence of the coun-
try of origin would reduce if there was other
information attached to a product.
To test the hypotheses, an experiment
was conducted by using paper and a pencil.
The participants were grouped into four ran-
dom groups, and each group was given one
treatment of the image which included where
the product was designed and manufactured.
Then, the participants assessed the quality of
the perfume based on a print media adver-
tisement. To prevent any bias from gender,
the perfume pictured in the treatment was
divided into two types, for males and females.
The participants analyzed both types. To give
a clearer picture of the experimental design,
it is shown in Table 2.
Measures
The questionnaire was developed to
measure the perceived quality of the prod-
uct, which is defined as the consumers’ over-
all assessment of the advantages of the prod-
uct, or the product’s superiority (Zeithaml
1988). The measurement used was adopted
from Dodds et al. (1991) who developed a
perceived quality measurement with 5 point
statements to assess customers’ trust in the
product, the product’s quality, their evalua-
tion of the scent, the product’s capability and
the product’s reliability.
The measurement was also designed to
measure the moderating variable used in this
experiment, namely the consumers’ involve-
ment, which was adopted from the work of
Jain and Srinivasan (1990), which assessed
the interest, attention to and the information
search process of individuals associated with
certain products. Laurent and Kapferer
(1985) explain that involvement is an indi-
vidual difference variable that motivates
people’s purchasing and communication
behaviour, but has a number of conse-
quences. Therefore, it can be assumed that
one product might result in different levels
of consumer involvement, as they have dif-
Table 2. Matrix of Experimental Design
Involvement
High Low
Country of Design High A B High Country of Manufacture
C D Low
Low E F High
G H Low

27
ferent levels of personal factors that might
apply to the buying decision making process.
Analysis
A confirmatory factor analysis and
Cronbach’s Alpha were employed to measure
the validity and reliability of the measure-
ment. An independent sample T-test was used
to examine the manipulation check, and fi-
nally, an ANOVA test was conducted to find
the differences between the subjects in the
sample. An indicator test, a one-way ANOVA
and a two-way ANOVA used a significance
level () of 5 percent or 0.05. The hypoth-
eses will be accepted if p is equal to or less
than 0.05, while they will be rejected if the
p-values are greater than 0.05.
Result and Discussion
There are four proposed hypotheses to
test the effect of the country of design and
manufacture on the perceived quality, and to
test the moderating effect of the consumers’
involvement on the relationship between the
country of design and manufacture and the
product’s perceived quality. Table 3 shows
that H2
and H3
are supported, as shown by
their p values being < 0.05 while H1
and H4
are not supported as their p values are > 0.05.
H1
testing showed that there is no dif-
ference in the perceived quality between a
high and low country of design. This result
supports the research conducted by Essoussi
(2010) that revealed the technological com-
plexity of the production process can affect
the relationsip between the country of de-
sign and the perceived quality. The technol-
ogy used to develop perfume products is eas-
ily adapted, and now perfumes are not only
designed in France, but many other countries
are also designing perfumes, such as Japan,
the U.S., and Italy (Moeran 2005). Hamzaoui
and Merunka (2006) revealed that the coun-
try of design has an influential role when a
consumer has a high level of involvement,
because of the feeling of being associated
with the country’s prestige and social status.
To fulfill this requirement, consumers will
look for information, and the role of the
Table 3. Hypotheses Testing Result
Hypotheses Hypothesesstatement P value Results
Code
H1
Theperceivedqualityofaproductdesignedinacountrywith 0.418 Rejected
asuperior imageisbetterthan thatdesignedina countryof
originwithalesserimage
H2
Theperceivedqualityofaproductwhosecountryof 0.009 Accepted
manufacturehasasuperiorimageisbetterthanaproduct
fromacountryofmanufacturewithalesserimage.
H3
Thedifferencesintheperceivedqualityofaproductfrom 0.0496 Accepted
itscountry ofdesignaremoderatedbyitslevelsofinvolvement.
H4
Thedifferencesintheperceivedqualityofaproductfromits 0.320 Rejected
countryofmanufacturearemoderatedbyitslevelsofinvolvement.

MatoatiandSyahlani
28
country of design needs to be part of that
information.
A different result was shown for the
country of manufacture (H2
). The hypothesis
which states that the perceived quality of a
product from a country of manufacture with
a superior image is better than from a coun-
try with a lesser image is supported. The par-
ticipants noticed significant differences be-
tween the perfumes produced in Indonesia
and France. This is consistent with research
conducted by Stafu and Scott (2009). Their
research revealed that in certain countries
personal fulfillment is derived from imported
goods, because the consumers have a ten-
dency to choose products that come from
countries which are perceived to have a su-
perior image, rather than products manufac-
tured intheir own country. The people in these
countries are not familiar with their own
home produced products. This could also
occur in Indonesia, which has been flooded
with imported products after making free
trade agreements with different countries.
Therefore, the country of manufacture is the
dominant factor in a product’s perceived qual-
ity assessment.
The hypothesis that states that the dif-
ferences in the perceived quality of a prod-
uct from its country of design are moderated
by the level of the consumers’ involvement
(H3
) is also supported. The more consumers
became involved with a product, the greater
is the effect of the country of design on the
perceived quality (Figure 3). The changes in
the level of involvement led to changes in
the mean values of the perceived quality for
superior and lesser countries of design. Table
4 shows the results indicating the interaction
of involvement on the relationship between
the country of design and the perceived qual-
ity (F = 3.8973; p = 0.0496 < 0.05).
Figure 3 shows that high involvement
strengthened the relationship of the country
of design and the perceived quality of the
product (mean difference = 0.227), compared
to the interaction between the country of
design and the perceived quality with low lev-
els of consumer involvement (mean differ-
ence = 0.106). The moderation effect works
when the relationship between the indepen-
dent and dependent variable is influenced by
the existence of another variable, which is
the moderating variable (Nahartyo 2012: 118).
The different levels of consumers’ involve-
ment impact differently on the perceived qual-
ity from high and low level countries of de-
sign. Figure 3 shows that in the high involve-
ment group, perceived quality increases with
a change in the level of the country of de-
sign. In other words, participants notice the
Tabel 4.Analysis of Consumers’ Involvement as a Moderating Variable on the Relation-
ship between Country of Design and the Perceived Quality
Dependent High Country Mean N Low Country Mean N F P
Variable of Design of Design Statistic
Perceived HighInvolvement 3.371 68 HighInvolvement 3.144 54 3.8973 0.0496
quality
LowInvolvement 2.920 60 LowInvolvement 3.026 47
Source:Proceed Data (2012)

29
different levels of the country of design and
absorb all the information contained in the
printed advertisement more carefully. Con-
trarily, participants in the low involvement
group did not notice the difference in the level
of the country of design and even assesed
products from a higher country of design as
having a lower perceived quality.
The last hypothesis stated that the dif-
ferences in the perceived quality of a prod-
uct from its country of manufacture are mod-
erated by the levels of involvement is not
supported. Figure 4 shows that the inter-
action’s line between involvement and the
country of manufacture is parallel. Changes
from a low involvement condition (low in-
volvement; the mean of a low country of
manufacture = 2.893, while the mean of a
high country of manufacture = 3.047) to a
high involvement level (high involvement; the
mean of a low country of manufacture =
3.134, the mean of a high country of manu-
facture = 3.454) did not lead to a different
pattern. As shown in Table 5 this interaction
does not occur, thus hypothesis 4 is not sup-
ported (F = 0.922; p = 0.320 > 0.05).
Essoussi (2010) explains that consumers in
developing countries are more familiar with
the country of manufacture idea. Indonesia,
as a developing country which isgrowing rap-
idly (Charitaou et al. 2012), generally con-
siders developed countries to be superior than
the developing countries currently are at pro-
ducing products. Therefore, because of the
familiriaty with the “made in” concept, con-
sumers are more focused on information
about the country of manufacture, and it has
no difference even with high or low levels of
involvement as shown in Table 5. Figure 4
shows that consumers with low and high in-
volvement have similarities when assesing
the country of manufacture, which they val-
ued higher for a “high” country of manufac-
ture, and vice versa.
Figure 3. Interaction Relationship between Involvement and Country of Design
2.90
3.00
3.10
3.20
3.30
3.40
HIGH
3.144
3.371
3.026
LOW
2.92
Country of Design
Involvement
LOW
HIGH
PerceivedQuality
LOW HIGH

MatoatiandSyahlani
30
Conclusion
It can be concluded that the country of
manufacture is seen as the more important
factor than the country of design, when as-
sessing the perceived quality of a perfume.
This result proved to be consistent with the
moderating variable’s analysis, that shows
both high and low levels of consumers’ in-
volvement assumes that the manufacturing
location is an important consideration, and
therefore the consumers’ influence does not
moderate its effect. However, consumer in-
volvement does moderate the influence of
the country of design on the perceived value,
since only those with a high consumer in-
volvement consider this variable when they
assess a product’s perceived quality.
This study uses only one type of prod-
uct and measures the perceived quality as a
Tabel 5.Involvement Slope as Moderating Variable between County of Manufacture and
Perceived Quality
Dependent High Country Mean N Low Country Mean N F P
Variable of Manufactruring of Manufactruring Statistic
Perceived HighInvolvement 3.454 52 HighInvolvement 3.144 70
quality
LowInvolvement 3.047 51 LowInvolvement 2.893 56 0.992 0.320
Source:Proceed Data (2012)
2.90
3.20
HIGH
Country of Manufacture
PerceivedQuality
LOW HIGH
3.00
3.40
2.893
LOW
3.047
3.134
3.454
Involvement
LOW
HIGH
Figure 4. Interaction Relationship between Involvement and Country of Manufacture

31
unidimensional variable, while according to
Chowdhury and Ahmed (2009), perceived
quality variables are divided into two dimen-
sions, namely the perceived qualities of the
design, and the manufacture of the products.
This study uses a median split as a method to
divide the participants into groups with high
and low levels of involvement, which might
create bias due to such grouping. The results
may differ significantly when another method
is employed.
Experimental design studies allow for
the presence of confounding background
variables, therefore gender, as a souce of a
background variable, was controlled for by
providing two types of perfume for men and
women in the experimental tools. With the
presence of two perfumes, the internal va-
lidity can be assured since there is no selec-
tion bias occurring due to the influence of
gender, as is also shown by the assessment
of the effects of possible background factors
on the quality of the products. Internal va-
lidity is also secured by using a random as-
signment to prevent such threats (Christensen
1988:. 174).
This study has several theoretical im-
plications. This study shows that during a
product’s perceived quality assessment, con-
sumers are able to distinguish the country of
origin as a multidimensional variable. The
country of manufacture of the product, bet-
ter known by the term “made in” is a more
important consideration than the country of
design. Then, the consumers’ involvement
only acts to strengthen the effects of the
country of design on the product’s perceived
quality, since the country of design only works
on products with high consumer involve-
ment.
The practical implications of this study
show that the country of manufacture is
highly perceived as being more powerful in
influencing the quality of a product than its
country of design. Therefore, “made in” in-
formation is important and needs to be put
on the product’s labeling or advertising to
make it easier for consumer to have knowl-
edge of it. Marketers should understand
which countries are perceived as superior
countries for the manufacturing of their prod-
ucts. This may well be different for different
categories of products as well as potential
market groups. Furthermore, information of
the country of design should also be consid-
ered for inclusion on the promotional tools
since it works for products with high levels
of consumer involvement.
Suggestion
Based on the research conducted there
are some suggestions, we can make. This
study was conducted to demonstrate that the
country of manufacture of products plays an
important role in influencing the quality of
the product, which is in line with previous
empirical studies (Essousssi 2010). The de-
veloping countries have growing numbers of
consumers who tend to use products which
are made in developed countries, or are from
countries that are perceived as being supe-
rior in making the products. So, it is impor-
tant to conduct further comparative research
to analyze how consumers in different coun-
tries, with different backgrounds, such as their
cultural and social economic factors, would
see the multiple dimensions of the country
of origin of a product.
Experimental design was applied here
to get a value for the internal validity of the
research by controlling the other variables that
can lead to confusing effects. On the other
hand, this approach causes weaknesses that
decrease the natural aspects of the research’s

MatoatiandSyahlani
32
conduct, ultimately leading to limited gener-
alizations. This also means there is a trade-
off between the internal and external valid-
ity, as experimental design was developed to
increase the internal validity, and will, by its
very nature, decrease the external validity
(Christensen 1988: 173, 403). Therefore, it
is important to carry out further studies to
get a wider view of the generalization by con-
ducting surveys designed for multidimen-
sional country of origin topics in developing
countries.
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