An Empirical Study on the Effects of Country of Origin on Purchase Intention for Luxury Vehicle Brands - Focusing on the Market of Mercedes-Benz

Abstract

Luxury brands have generally been consumed by the well-to-do group among society. Nonetheless, from the mid 21st century, luxury item markets have been extended to customer groups with middle-class and lower-class earnings. In this perspective, this research attempts to identify Korean consumers behaviors in the context of luxury vehicle market, by confirming effects of country-of-origin images on consumers’ purchase intention, mediating brand prestige, brand credibility, and perceived quality. Furthermore, the dimensions of country-of-origin image in this study has been divided into three dimensions of functional country-of-origin, social country-of-origin, and dynamic country-of-origin. For the purpose of empirical study, a survey has been conducted to Korean consumers focusing on the effects of country-of-origin image on purchase intention by selecting the brand of Mercedes-Benz manufactured by Germany. A total of 324 questionnaires have been used for final analysis. By utilizing SPSS 22.0 and AMOS 18.0, the results of structural equation model have confirmed the positive effects of functional country-of-origin effects on brand prestige and brand credibility, while the other components of country-of-origin image have not shown significant effects on brand prestige and brand credibility. In addition, the effect of brand prestige on brand credibility has been significantly associated, and the relationship of brand prestige and brand credibility with perceived quality have also been turned out to be positively linked. Lastly, the effects of brand prestige, brand credibility, and perceived quality on purchase intention have been shown to be positively associated.