UPPSALA UNIVERSITY

Selling to the Chinese Middle Class

Consumer based branding in China
Mikael Livas & Olov Norlander 2012-05-16

Department of Business Studies Uppsala University

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Contents
Introduction ................................................................................................................................ 2 Purpose .................................................................................................................................. 3 Question formulation ........................................................................................................... 3 Theory ....................................................................................................................................... 4 Disposition .............................................................................................................................. 4 Customer Based Brand Equity (CBBE)................................................................................... 4 Consumption Behaviour ......................................................................................................... 6 Perceived Quality ................................................................................................................ 6 Perceived Value .................................................................................................................. 7 Perceived Prestige .............................................................................................................. 7 Country of Origin .................................................................................................................... 8 Theory Summary .................................................................................................................... 9 Method ......................................................................................................................................11 Disposition .............................................................................................................................11 Product Category ...............................................................................................................11 Sampling ............................................................................................................................12 Operationalisation .................................................................................................................13 Sampling method ...............................................................................................................13 Consumption behaviour and country of origin effects .........................................................14 Data collection .......................................................................................................................16 Phase I ..............................................................................................................................17 Phase II .............................................................................................................................17 Phase III ............................................................................................................................18 Method for Data Analysis.......................................................................................................19 Results ......................................................................................................................................20 Disposition .............................................................................................................................20 Demographics .......................................................................................................................20 Consumption behaviour .........................................................................................................22 Country of origin effects .........................................................................................................26 Analysis ....................................................................................................................................28 Conclusion ................................................................................................................................32 References ...............................................................................................................................34 Interviews ..............................................................................................................................37 Appendix ...................................................................................................................................38 Respondent overview ............................................................................................................38 Response overview ...............................................................................................................39 English questionnaire ............................................................................................................41 Chinese questionnaire ...........................................................................................................44

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Introduction
A brand is defined by the American Marketing Association (2012) as name, term, design, symbol or any other feature that defines one sellers good or service as distinct from those of other sellers. The importance of a strong brand and good branding strategies has increased during the last decades. Although a brand is an intangible asset of a firm, brand equity makes up a great deal of a firms actual value on the market. The intangible assets make up a large part of a firms market value. The intangible assets accounted for 80 % of major companies market value in 2005, an increase from less than 20 % in 1975 (Clifton, 2009). To build and manage a brand is one of the great challenges for marketers today. To create an identity and awareness of a brand firms need to develop positive associations to the brand and in order to establish and maintain brand loyalty, they need to differentiate themselves from others (Kotler, 2001:188). In this paper we focus on branding in emerging markets, defined as countries with rapid economic growth and industrialisation. Studies have been conducted on the subject of marketing in emerging market. Keller and Moorthi (2003) conclude that marketing strategies that work perfectly fine in home countries need to be adapted to local culture and preferences. Dawar and Chattopadhyay (2002) claim that foreign firms rush to emerging markets with hope of gaining market shares and profit, but rarely adapt their marketing strategies to local conditions. In another research by Batra et al. (2000), findings show that consumers in emerging markets perceive foreign brands to be of better quality than local alternatives. One of the most prominent emerging markets is China, with an annual GDP growth rate of 10 per cent the last three decades it has already surpassed Japan, becoming the worlds second largest economy (World Bank, 2012). The socioeconomic transition China has gone through the last three decades has led to rapid increase of income, which has led to an increasing demand for consumers goods (Cui & Liu). As one of the worlds fastest and biggest economies, the Chinese market possesses a great attraction for foreign firms to enter. But with government policies favouring domestic firms, it can be a challenge for foreign actors to enter the market (Economist, 2009). Branding in China is not a rarely studied area of research. Schlevogt (2000) claim theres been a branding revolution in China with both consumers and companies becoming more aware of the importance of brands. A case study Melewar et al. shows that French food giant Danone Group failed to establish a good brand at their initial entrance, but after adjustments to Chinese preferences they are now successful (2008). Even a paper on how foreign multinational companies should translate their name into 2

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Chinese (Alon et al. 2009) has been carried out. However, most of the research focus on big multinational companies branding and marketing activities in China and what strategies to implement. There are nonetheless little research on smaller foreign firms and completely new foreign brands that want to establish in the Chinese market.

Purpose
The purpose of this paper is to investigate how a consumer-centric branding strategy can be formulated based on consumption behaviour and attitudes towards country of origin using the example of Swedish blueberry products in China. Hopefully the findings generated by this paper can be generalised and might be applicable to branding of Swedish premium products in other categories on the Chinese market.

Question formulation 1. How can a Chinese consumer-oriented branding strategy for Swedish blueberry products be formulated based on: 2a, Chinese middle class consumers attitudes toward consumption of jam and juice? 2b, Chinese middle class consumers perceptions of Sweden and products made in Sweden?

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Theory
Disposition
At first we explain the Customer Based Brand Equity (CBBE) model, which provide general theoretical framework regarding branding. To understand the attitudes and preferences of the consumer we present theories on consumption behaviour and country of origin (COO) effect. Theories on consumption behaviour and COO-effect and concepts stemming from these theories will then be linked and incorporated with a modified CBBE model in the summary.

Customer Based Brand Equity (CBBE)

The CBBE model is used because it positions the customer in the centre when creating brand equity and the model incorporates practical features in understanding consumer behaviour. To understand the customers needs and wants is the heart of successful marketing. CBBE is formally defined as the differential effect that brand knowledge has on consumer response to the marketing of that brand (Keller, 2008:48). As no theory or model was found for creating a brand from scratch, the CBBE model is used since it is a general tool for brand building, measuring and managing. The model, presented in an illustrative pyramid, see figure 1, shows that a brand is created by different building blocks and that the foundation of a brand is deep broad brand awareness. Brand awareness is generally created through exposure of elements connected to the brand, such as names, logos, jingles, symbols and characters. The model suggest that brand salience, the special features of the brand, measures the level of recognisability and to what level the customer can recall the brand (Keller, 2008:54). Performance and judgment are the more tangible bricks of the CBBE pyramid. Performance is about the functional values that meet the functional needs of the consumer. The primary influence of the perception of the brand is the actual products and the function it has to the consumer. Its also about reliability and durability of the brand, in other words how the consumer perceives the performance of the brand in the long term. Pricing is also a factor when the consumer evaluates the performance of the brand, how expensive or inexpensive it is and whether it is frequently discounted or not (Keller, 2008:64). The judgement brick is based on the personal opinion about the brand. The judgment regarding quality is particularly important and 4

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steams from the actual attributes of the brand and its products. The credibility as well as superiority over other brands is taken in consideration in the judgement brick (Keller, 2008:6768). The more intangible buildings bricks are composed of feelings and imagery generated by the brand. Brand imagery is about how the brand meets the psychological and social needs of the consumer. The imagery derives from the personal experience but can be linked to information about the brand communicated through advertisement or word of mouth. The consumption behaviour as well as the personality of the consumer effects the perception of the brands image. Culture and heritage are social frameworks that also effect this perception (Keller, 2008:65). The feelings evoked by a brand are the consumers emotional response to the experience of the brand. These feelings can be negative or positive, but ultimately what really matters is to what extent a brand can generate positive feelings for a brand (Keller, 2008:68-71). The top building block is brand resonance, which is about the relationship with the consumer and the level of identification and loyalty the consumer has towards the brand. With high resonance the consumer feels that they have a deep psychological bond to the brand and keep buying its products as well as actively engage in the brand, spending time, energy and money outside of the activity of buying and consuming one of the brands products (Keller, 2008:72).

Figure 1: The CBBE Pyramid of brand building with its six building blocks

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Consumption Behaviour
Consumption behaviour is not just the study on how a purchase decision is developed but also the actual consumers response to the purchase and usage of the product. These responses can be emotional, mental or behavioural. The study of consumption behaviour is a mix of sociology, psychology, anthropology and economics that try to explain the underlying motives behind consumption (Kardes et al., 2011:8-13). Complex models on how consumers make their decision have been constructed since the 1950s, when consumption behaviour started to get a more prominent role in the field of marketing. Early approaches considered the utility theory the best explanation to consumption behaviour, where the consumer is assumed to base his decisions on rational factors that optimize the outcome of the purchase. Contemporary research tends to expand that and include other factors (Bray, 2008). Chisnall suggest these non-rational factors are feelings, culture values, group affiliations etc. and that the needs and wants of the consumers are too complex to be explained by rational factors only (1995). Seth et al. presents a multiple value model to explain the choices that the consumer makes, these values are functional, conditional, social, emotional and epistemic (1991). To get a theoretical framework for the consumption behaviour in our research we take previous research on the subject in consideration, but also look at research with similar purpose as our own. A study by Zhou and Wong used three motivational factors behind a purchase in a comparable study of Chinese consumers, perceived value, perceived quality and perceived prestige (2008). When broken down, there are more subconcepts within every factor that consent with previous research. Another reason for using these three motivational factors are that we can connect them to our CBBE model in a logic way. Relevant theories for these factors connected to food or Chinese consumers are used to get a proper theoretical frame suitable for our purpose.

Perceived Quality The perceived quality in a product is according to Olson and Jacoby (1972), trendsetters in the area, an important motivator for purchase decision. They suggest that the perception of quality consists of two cues, intrinsic and extrinsic. The intrinsic cue is the attributes and characteristics of the product that cannot be changed, whereas the extrinsic cue is the characteristics of the products that can be manipulated and experimented with. Rao and Monroe (1989) further elaborate on the idea of different cues and give examples that extrinsic cues can be 6

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price, brand and store name, and for intrinsic cue it could be nutrition. According to Oude Ophius and Van Trijp it is necessary to look at a multiple set of attributes within each cue as the consumers develop an abstract belief of the products quality depending on the cues that are connected to a specific product. So the character of the consumer highly affects how the intrinsic and extrinsic cues are perceived and assessed as good or bad quality (1995).

Perceived Value The perception of value is by Schwartz and Bilsky (1987) considered to be personal and originates from three universal requirements of basic human biological needs, the need to interact with other people and social need to survive and thrive. The values we perceive in products are somewhat the same based on how they satisfy peoples requirements. These human values have according to Kamakura and Novak (1992) increasingly been used to segment the market and find the right target group based on what values the consumer seeks. They conclude that segmentation cannot only be based on one value, but a mixture of values is requisite since human beings hold more than just one single value. Sweeney and Soutar (2001) developed a general theory on perceived consumer value, as they present in a multi-item scale for measuring perceived consumer value. Their research found four value dimensions that can significantly explain purchasing behaviour and attitudes. The four value dimensions are quality/performance, price/value for money, emotional value and social value. The different values create different type and different level of utility for the consumer. Quality/performance represents the functional value the product provides to the consumer, or the utility that derives from the expected performance and perceived quality. Price/value for money is also a functional value based on the utility that derives from the product with the reduction of its perceived costs, both short and long term. The emotional value is the utility that derives from feelings and emotional state the product gives to the consumer. The last value, the social value is the utility derived from the products capacity to enhance the consumers self-concept or lifestyle.

Perceived Prestige The desire to gain social status and prestige is a big motivational factor for consumption 7

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behaviour, but there is a big difference among the consumers on how much prestige they gain. The consumption of conspicuous status products is for the consumer an ego-boost for the consumer as well as an aid for people struggling for social approval and self-respect. The level, of which the consumers seek status symbols differ from people to people, but depends highly on the consumers social class and social environment (Eastman et al., 1999). A conceptual framework for prestige-seeking consumer behaviour (PSCB) has been developed by Vigneron and Johnson (1999). The concept of prestige and the interpretation of the word vary from people to people depending on their socioeconomic background. Vigneron and Johnson define prestige of a brand as an interaction between people and their environment. Prestigeseeking behaviour is a result of motivational factors, such as sociability and self-expression. They have identified five prestige-seeking values: conspicuous, unique, social, emotional and quality. Since the perceived value theory overlap some of the prestige seeking values, we only look closer at conspicuous value and unique value. The conspicuous consumption is according to Vigneron and Johnson used as a signal of wealth, power and status, but can only partly explain the perceived value of prestige since many conspicuous goods are still consumed in private. The need for uniqueness is put forward as a big motivating factor for perceived prestige. Rarity and limited supply of products are associated with high value that commands prestige and respect. They also emphasise that high pricing is important for brands that want to have a unique touch (1999).

Country of Origin
The concept of marketing based on the consumers attitudes toward a certain product or a certain category of products have for long been well known as an important aspect when marketing strategies are composed. When determining an international marketing strategy for a firm, consumers attitudes toward a product from a certain nation are great significance (Nagashima, 1970). Earlier research show that this country of origin (COO) effect, influence the consumers evaluation of a product. Some findings show that there is a positive relationship between the evaluation of the product and the level of development in the origin country. Another factor is the historical relationship between the origin country and the country in which the consumer lives. For more unknown foreign brands, the consumer can transfer the image of 8

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the origin country on to their evaluation of the product (Bilkey & Nes, 1982). Hans (1989) also concludes that the image of a country can serve as a halo where knowledge about the product or brand is low, and thereby the COO indirectly affects the evaluation of the product. He also suggests that as consumers knowledge about products from a certain country increases the country image can directly influence the as is becomes a summary construct. This summary construct is the collected beliefs the consumer has about the features of the product and can thereby affect their opinion about the brand. Batra et al. (2000) researched the COO-effect specifically on developing economies and findings show that a brands country of origin can serves as a quality halo and possesses a non-localness that contributes to the status, or prestige of the consumer. Some preferences for foreign brands can be explained that consumers in developing countries buy well-known, trustworthy foreign brands. But as knowledge increases consumer might return to local brands and use a mix of both local and nonlocal brands. In a research by Veale and Quester (2009) using the example of wine to determine to what extent the extrinsic cues of price and COO can affect the perceived quality. Their findings show that price is a greater attribute when assessing quality, but that the COO also contributes to the subjective assessment of the wine. Although the COO doesnt provide any actual quality enhancing attributes, it clearly have an effect on how the consumer experience the quality in the product.

Theory Summary
The CBBE model is the theoretical framework on how a brand can be built and managed. The CBBE model is originally a tool to create, manage and measure brand equity already existing brands, but as we investigate a non-existing brand with focus on the consumers attitudes and not on how to create brand awareness, we leave salience out of the equation. The same goes with the top building block of resonance, as there is no brand or company to have resonance with. Instead we focus on the four building blocks in the centre of the model, as they are connected with consumption behaviour and attitudes. In figure 2 it is shown how the different concepts from consumption behaviour and COO effects connects with the CBBE model. Regarding consumption behaviour and the different values that we have presented within the theories of perceived quality, value and prestige, we find that quality and functional values are more tangible than intangible so we unite them on the left side of the model with performance (functional) and judgment (quality). For the more intangible values we incorporate these on the 9

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right side of the model, which consists of the building blocks imagery and feelings, which are subtler than the other two. Social, conspicuous and unique values are connected to imagery, as the image of a brand is important in a social and prestige-seeking context. The emotional value belongs in the building block of feelings, because the feelings generated by a brand create emotional value for the consumer. The theory of COO effect is also integrated with feelings and imagery since the opinion of another country is intangible. The two concepts of trust and knowledge used within the COO will be explained in detail in the operationalisation part of the paper.

Figure 2: Modified CBBE pyramid with sub concepts

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Method
Disposition
Firstly, as we operationalise the theories into a research we present some limitations regarding product category and target group to be investigated. Secondly we give a detailed explanation on how the actual operationalisation process of the research was carried out. Thirdly we describe how the data was collected in three stages. At last, the method used for data analysis is presented.

Product Category To be able to investigate the consumption behaviour and COO effect among Chinese consumers we used blueberry products from Sweden as a specific example. The wild blueberry is a resource that grows in abundance in the Swedish forests, an underutilised resource that will be difficult to imitate since it is of a subspecies that only grows in a few countries other than Sweden and the fact that it is wild and not grown are factors that make it very unique and are considered to be the healthiest in the world (Lfgren, 2009) A pre-survey questionnaire conducted in March 2012 during Phase I showed that there is a substantial interest for organic products in China, however the Euromonitor survey (2012:23) shows that Chinese consumers distrust the authenticity of claims of being organic, this indicates that there is a potential in selling organic products if the claim is trustworthy or guaranteed in some way. The pre-survey also showed that Chinese consumers chose blueberry jam and juice when asked what type of blueberry product they usually consume. So we narrow down the limitation further to only include blueberry jam and juice. The market for 100% juices, for example, seem to have great potential as carbonated soft drinks have reached a plateau in first and second tier cities and Chinese consumers in these cities are purchasing healthier drinks and the market for juices are expected to grow and eventually compensate for falling sales of soft drinks. Except for ready to drink-teas, juice is the one beverage that has seen the most growth from 2006-2011(85, 3%), beating bottled water, wine and beer (Euromonitor, 2012:26). As we have made some initial interviews with Swedish blueberry producing companies, we found out that almost none of them have sales activities in China and those who do, do not seem to value or prioritise that market. According to researchers at Jilin Agricultural University, one of the characteristics of the 11

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Chinese blueberry market is that demand far exceeds supply (Li, Limin, et al., 2011:77). Chinese thirst for blueberry products makes it a perfect example for our study about branding in China. Sweden and Swedish companies are well reputed in China and there are great opportunities for Swedish products to take greater shares of the Chinese market; however the most common reason stated for not expanding into China were a lack of understanding of the procedures involved and of Chinese culture (Chen, 2012 pers. Comm., 23 April).

Sampling To further limit the paper, we chose to target a certain segment of the Chinese population. Numerous studies have been made on the topic of segmentation of the Chinese market. Bernd Schmitt provides a summary of the three most common ones; Geographic segmentation, Demographic segmentation and Psychographic segmentation. The Chinese market is both geographically immense and fragmented, a foreign brand that is popular in the big cities on the east coast, may not be recognised on the countryside. He shows conclusions from previous studies that younger, more affluent and better educated Chinese are more likely to try new products, but also to buy products admired by others (Schmitt, 1997). To target the right group of people is therefore of utterly importance. The Chinese middle class is by many foreign firms considered to be the most interesting segment of the Chinese market, as this particular segment is growing both in size and purchase power. The number of people considered to be of the Chinese middle class, has increased rapidly during the last decades. In 1995 almost no Chinese were considered to be middle class, but in 2005 that figure was 87 million (Song & Cui, 2009). And it is especially the young, urban, highly educated middle class with knowledge, influence and cash that is most interesting for foreign marketers to target. In a survey from 2007 by Euromonitor International, it is claimed that young Chinese in the age of 20-29 have already by then become the highest earning group in China (Euromonitor, 2007). In a report concerning foodservice in China from the same organisation, it is stated that the post 80s generation are increasingly interested in Western life-style. Consuming western food is seen as something affluent and inspirational (Euromonitor, 2011). To define the middle class is however not totally uncomplicated. When middle class is used in a Chinese context it usually means a class well above the middle, one that can be translated into upper middle class or even upper class in terms of positioning it on the socioeconomic scale in Western terms (Li Chunling, 2010). Li Chunling 12

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(2012, pers. comm., 24 April) use a mixture of income, level of education, occupation and consumption behaviour to define the people within the middle class. The person needs to be highly educated, have a white-collar job and an income above average. It is however occupation that is the divider when Li Chunling presents her subgroups within the middle class. The four subgroups are group is the Capitalists (Business owner with more than 20 employees), New Middle Class (Managers, Professionals, Government Officials), Old Middle Class (Private business owners, employers with few employees, self-employed) and Marginal Middle Class (Low wage white collars and other workers). We chose to follow Li Chunlings definition of Chinese middle class, as it is a well-recognized and comprehensive classification that can fairly easy be operationalised.

Operationalisation
Sampling method As a comprehensive definition of the middle class is used, we had to have strict requirements for each classifier that respondents needed to live up to in order to be qualified to take part in the survey. For the income level, Li Chunling uses Li Peilins (2008) strict level of income as an indicator of belonging to the middle class. For urban areas to be people with an annual income 2, 5 times bigger than the average urban income are considered to qualify. According to the National Bureau of Statistics of China (NBSC) that figure for 2011 is 23.979 RMB (NBSC, 2012). So to be defined as middle class based on the income, the annual salary need to be higher than 59.948 RMB (2, 5*23.979. So an income level above 60.000 RMB is required. The occupation requirement is set to be an occupation within the top three middle class subgroups, Capitalist, New Middle Class and Old Middle Class. Education is an important factor for determining socioeconomic class in China and people with less than a high school graduate are less likely to be representative of the middle class (Li Chunling, 2012, pers. comm., 24 April). To be a part of our target group, respondents need to have at least 12 years in school, which is equivalent to a high school graduate in China. In our survey we aim to target people in the age span of 20-45 as this is the age span that characterises the capitalist, new- and old middle classes and people in this age span have spent their entire adult lives in the post-Mao era. These three groups constitute our group of interest and consist of people in positions considered 13

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important on social, political and economic levels (Li, Chunling, 2010:144-147). Consumption behaviour and country of origin effects The theory of perceived quality with the intrinsic and extrinsic cues, as attributes that affects the consumers perceived quality, has been operationalised by many; one of the most interesting for us is Verd Jover et al. research about perception of quality of wines. They have identified a numerous of dimensions within each cue that are measured and analysed. Examples of intrinsic dimensions in their research are age, harvest, aroma, colour, taste et cetera. For the extrinsic dimensions they use price, brand, reputation, distribution channels, et cetera (Verd Jover, et al., 2004). Some of the dimensions used for wine can be analogically transferred to blueberries, but we also have to use additional dimensions. The intrinsic cues that we have identified are Taste, Health effects and Wild, while the extrinsic cues are put into operation as Price, Origin, Brand, Safety, Percentage of berries in the product and Organic. As for perceived values and prestige, both of them include different types of values that need to be rendered into questions. We use blueberry products from Sweden as an example and try to find out what values the Chinese middle class consumer emphasize when consuming jam or juice. The perceived values derive from the utility that the consumer recognises when purchasing a product. So we break down the value into different utilities that we have identified as being connected to the specific product. For the perceived prestige, Vigneron and Johnson (1999) suggest that the conspicuous values and unique values are important. Earlier research on conspicuous values by Zhu (2011) show that the self-referential values, as opposed to conspicuous values, are more important for Chinese consumers. However Li Chunling (2012, pers. comm., 24 April) say that the middle class is partly defined by their different forms of conspicuous consumption. So there is a problem we have in mind when formulating the questions on conspicuous consumption in order to get honest and valid answers. The COO effect is as shown an important factor explaining the motives behind purchase decisions as well as the perceived quality in the product. There is a positive correlation between perceived high quality and high economic development of the COO. In our survey we need to find out the Chinese consumers knowledge and trust for Sweden and foreign countries in general and their attitudes toward (we use the word Western in the questionnaire to exclude other Asian countries with similar culture to China) food and beverage products. By doing this we can see 14

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what attributes and characteristics of Swedish blueberry products that can be used when branding them on the Chinese market. In research conducted by Kwok et al. (2006) the COO effect on urban Chinese consumers was examined. They studied purchasing behaviour of typical Chinese products such as packaged noodles and soy sauce as well as typical western products like red wine and butter. The result showed that Chinese consumers say they prefer to buy domestic grocery brands and that they believe it is important to buy local products in both categories, typical Chinese products and typical Western products. However their actual purchasing behaviour did not reflect their preferences of domestic brands. Lack of knowledge could according to Kwok et al. be one reason that preferences are not reflected in their actual purchasing behaviour (Kwok, et al., 2006). The questionnaire used in the Kwok study is useful for us when designing our own study because of similarities in research and purpose. In recent years, after numerous food scandals, country of origin seems to play a large role in China when it comes to food as Chinese consumers are more careful buying domestic brands and usually only trust the top-tier Chinese brands. They often choose foreign brands, as they are perceived to hold to a higher standard and quality, much of the distrust for domestic brands stems from the recent food scandals in China (Euromonitor, 2012:23). The Chinese consumer might have preferred foreign grocery brands before but claimed to shop domestic brands, now however they openly claim to prefer foreign brands due to the scandals surrounding Chinese ones. We find that trust and knowledge are two central concepts explaining the COO-effect in developing countries, including China. So from an origin of Sweden-point of view, these concepts will be our variables for the COO-effect. According to Liu (2012, pers. comm, 25 April) the knowledge of Sweden is limited and that might constitute a barrier when using Swedens brand and COOeffect in branding a Swedish product. To measure each sub concept of behaviour and country of origin effects we used 2-6 variables for each sub concept. Some are, by definition of Saunders et al., opinion variables as they measure what people feel about something, whereas others are behaviour variables, as they measure what people have done before (2009:368). For each sub concept from the theories, a series of questions arose that needed to get answers in order to understand the Chinese consumer. So the questionnaire was designed on the basis of the following questions. Perceived Quality: Intrinsic and extrinsic cues: What attributes defines the quality in juice and jams the most? 15

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Quality/Performance: What are the main functional needs for buying juice and jam? Price/Value for money: The perception of the relationship between price and quality and if a discounted price detracts from the perceived value/quality? Emotional Value: What attribute generates most positive feelings, what characteristic of Swedish blueberry juice and jam is most attractive? Social Value: How consumption behaviour affects their self-concept and social status and the relationship between consumption of exclusive/Western food and beverages and social status? Perceived Prestige: Conspicuous Value: In which setting they prefer to consume Western food and beverages? Do they want to show off or not and what are their design preferences? Unique Value: The level of which Chinese consumers pursue uniqueness and prestige. It they want to be trendsetters or not? COO-effect: Knowledge: Awareness about Sweden and products from Sweden. Do they see Sweden as exotic or not? Trust: The level of trust towards Western food and beverage products compared to domestic ones. What is Swedens level of credibility and reliability in the eye of the Chinese consumers?

Data collection
To investigate consumption behaviour and COO-effect in the questionnaire, the Likert 7grade psychometric scale is used for all questions where the respondents are asked to specify their level of agreement or disagreement on a statement. The main advantage using this scale is that it is symmetrical meaning that there are as many options on either side of the middle option. The effect of this is that there is no structural bias for a positive or negative answer (Carifio & Perla, 2007:131). A study on the Chinese consumers changing value system by Ge Xiao also used a Likert 7-grade scale to measure behaviour and attitudes among Chinese consumers (Ge, 2005). Kwok et al. (2006) also used a Likert scale when conducting their research on brand preferences among young Chinese consumers. They used a 5-grade scale to measure their attitudes towards foreign and domestic brands (Kwok et al., 2006). As we are to conduct a 16

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similar research, we find it best to use a similar questionnaire design to increase validity, reliability and comparability. Despite limiting the survey to selected parts of the middle class there is still a large group of Chinese population that meet our qualifications, which demands a large sample. Our data collection method is adapted to the need of a large sample, as well as the limits of time and resources. For the final version of the questionnaire we use a self-administered questionnaire, administered electronically and by hand. The collection of data can be divided into three phases.

Phase I To make sure that we get the desired result of our survey we first made a pilot study with high variety of both questions and types of questions in order to be as prepared as possible for the real survey. The pilot study was broad and provided a wide spectrum of questions touching upon segmentation, behaviour and the perception of Sweden. It was conducted to give us information for further development of our study and the opportunity for us to narrow it down on the most interesting aspects of the issue. The types of questions in the questionnaire were also varied on purpose to see what type of question gave the best and valid answers. To get as many respondents as possible in a short period of time we conducted an online questionnaire that was spread to Chinese friends through email and social media, convenience sampling according to Saunders (2009:241). Altogether we got 46 responses within the one-week (23-30 March 2012) the online questionnaire was open. By conducting this pilot survey we have been able to pinpoint the topics and type of questions most relevant for the purpose of this paper. Phase I was necessary in order to better formulate the questions and themes for the final survey in Phase II. Some of the questions regarding prestige in the pilot study were perceived as too straightforward and somewhat rude. This was an important observation as we aimed to get as honest answers as possible.

Phase II After finding relevant theories for our paper, we started to operationalise them into surveyquestions with the help of the results from the pre-survey questionnaire described above. Since we focus on specific products, blueberry jam and juice, little knowledge on how to operationalise the theories into specific questions were given from the theories. However, the theories provided 17

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us with well-needed terminology in defining the market segment and consumption behaviour. To operationalise this into a questionnaire, we used support from methodology literature. When formulating the questions, there were a number of facts and circumstances we had to take into consideration mainly the problems encountered with some of the questions being perceived as rude or too forward in the pilot study. We used our experience from the pilot-study to correct errors and used previous research (Ge, 2005) when designing our questionnaire. During phase two we translated the questionnaire into Chinese to be able to make a design suitable for the Chinese language.

Phase III The survey was first tested on 20 Chinese consumers and some minor changes were made in design and formulation of some questions. The changes that we made were; correction of one mistranslated sentence and larger headlines in the questionnaire, no changes were made to the actual content of the questionnaire. After final version was completed we started to collect answers. We used a combination of convenience sampling and snowball sampling. As we used online-based questionnaire administration software Surveymonkey we could use snowballing sampling by sending it to friends in the right target group and ask them to pass it forward. This collection method generated 94 answers. Another 431 answers were collected in high-end shopping malls and on the streets of wealthier areas in Beijing during four days (23-26) in April 2012. This was done manually by asking people to participate in the survey and fill out the questionnaire on the. The questionnaire took about five minutes for the average respondent to fill out and most people took it were very serious. To maximize the sampling we handed out questionnaires to more people at the same time. As more than 4/5 of the data was collected by hand we had a fairly good control of the actual data gathering we could answer any questions from the respondents that arose during the completion of the survey. We approached people that appeared to be middle class, by definitions presented earlier, and were in the right age-span. This minimised the number of answers from people outside of the intended group. The time when the data was collected was intentionally varied in order to allow people with different working hours to participate. Altogether 524 answers were collected, out of which 425 were complete and corresponded to the requirements for being in the survey.

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Method for Data Analysis

We use descriptive analysis for the demographic distribution of our respondents to provide an overview of the data sample. For the consumption behaviour and country of origin analysis we use exploratory analysis. Exploratory Data Analysis (EDA) is according to EDA pioneer Tukey (1977:3) the only way to lay a foundation to further analysis. Saunders et al. also emphasise the usage of diagrams to explore and analyse the data. EDA is also according to Saunders et al. a flexible tool that gives the user opportunity to introduce alternative explanations and analyse to new findings (2009:428). By looking at the specific value (Average and Most frequent response, MFR) of each parameter within the each sub concept, we then see the tendencies of the respondents consumption behaviour and preferences. To be able to analyse the material we will present it in a table, complete with all the answers as well as bar charts to provide a clear picture of each sub-concept. Each sub-concept will then be analysed based on the average and MFR-values. The tendencies in the answers will be guideline for us when creating the building blocks of a Swedish blueberry brand. The tendencies in the answers will also provide us with information when analysing the consumption behaviour of the Chinese middle class consumer. Finally we use our reveised CBBE model to interpret the findings in the survey from a brand-building perspective.

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Results
Disposition
Here the results of the data collection will be presented in the form of diagrams accompanied by explanatory text describing the findings. The general tendencies will be shown here, displayed by an average score and most frequent response, there are exceptions to the tendencies were some respondents have given very different answers compared to the other respondents, these answers together with a chart of all the answers and data can be found in the appendix.

Demographics
Most of the respondents (136) were in the age group of 25-29 and there are slightly more females than males in this age group. 111 respondents are to be found in the age span of 30-34, making it the second largest group, with substantially more male than female respondents, the same tendency for male overrepresentation is also present in the third largest group, the 35-39 year olds, totalling 103 respondents. The second smallest group of 58 answers, 20-24 year olds have significantly more female than male respondents. The smallest group spanning the ages of 40-45 of only 17 respondents has almost twice as many male to female respondents.

Age and Sex

20-24 25-29 30-34 35-39 40-45 0 11 6 20 40 60 80 100 120 140 160 18 63 71 68 35 40 40 73 Men Women

Figure 3: Respondents divided between sex and age (n=425)

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The respondents with less than 12 years of education were sorted out, leaving 353 respondents with 12-16 years of education and 72 with more than 16 years of education.

Level of Education
12-16 (Bachelor) 353 Education 16+ (Higher than Bachelor) 72

50

100

150

200

250

300

350

400

Figure 4: Respondents level of Education (n=425)

The most common category of occupation is Professional with 125 respondents belonging to this group, the second most common is Office Worker with 98 responses belonging to this group. Following this is the Manager category with 77 responses and Government Official with 50 people belonging to this group. Business owners with fewer than 20 employees (32) are followed by the Self-employed and Business owners with more than 20 employees, totalling 20 respondents.

Current Occupation
Bussiness owner >20 emp. 20 Manager Professional Government Official 50 Business owner <20 emp. 32 Self-employed 22 Office Worker Other 1 0 20 77 125 Occupation 98 40 60 80 100 120 140

Figure 5: Respondents current occupation (n=425)

The most common income bracket is 60.000 - 100.000 RMB/year at 255 respondents followed by 100.000-300.000 with 154 responses. The smallest group is 300.000-500.000 a year with 16 respondents belonging to this income group, the largest earning group option available on the questionnaire received 0 responses. 21

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Annual Income
60.000 - 100.000 100.000 - 300.000 300.000 - 500.000 16 154 Income 255

>500.000 0 0 50 100 150 200 250 300

Figure 6: Respondents annual income (n=425)

Consumption behaviour
The results from the questions regarding the respondents perception of quality generated the following results. The most important aspect of a high quality berry product is Safety with an average score of 6,32 and the MFR being 7. This is followed by Health Effects and Taste both with MFRs of 7 and average scores of 6,25 and 6,05 respectively. Organic receives an average score of 5,99 and an MFR of 6, this is followed by % of Berry/Fruit with an average of 5,66 and MFR of 6. The fact that the berry is wild (avg. 5,52/ MFR 6) follows this along with Brand (avg. 5,6/MFR 6), Origin (avg. 5,5/MFR 6) and the least important factor, Price (avg. 4,47/MFR 4)

Defining Quality
Taste Health Effects That the berry is wild Price Origin Brand Safety Organic % of Berry/Fruit 0 1 2 3 4

6,05 6,25 5,526

4,47 5,5 6 5,6 6

7 7

MFR Average

6,32 7 6 5,99 6 5,66 6 7

Figure 7: Respondents average and MFR regarding attributes defining quality (n=425)

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Regarding Functional value the findings indicate that the respondents value the Health Effects the most (avg. 6,02/MFR 6) followed by Good taste (avg. 5,62/MFR 6) and lastly the products ability to Quench or satiate thirst or hunger (avg. 4,75/MFR 4).

Functional Value
Health Effects 4 4,75 6 5,62 0 1 2 3 4 5 6 7 6 6,02 MFR Average Good Taste

Quench/Satiate Thirst/Hunger

Figure 8: Respondents average and MFR regarding what functional value juice and jam provide them (n=425)

The respondents agree with the statement that High price equates high quality (avg. 5,62/MFR 5) and are neutral/leaning slightly towards agreeing with the statement that a discounted product is less valuable (avg. 4,8/MFR 4). The same tendencies can be seen regarding the statement on Large packages making products feel less valuable/exclusive (avg. 4,9/MFR 4).

Price/Value for Money

High price equates high quality A discounted product is less valuable Large packages make a product feel less valuable/exclusive 0 1 2 3 4 4 4 5

5,62 MFR Average

4,8 4,9 6 7

Figure 9: Respondents average and MFR regarding their view on pricing and value for money (n=425)

Concerning the respondents positive feelings toward features of imported Swedish berry products we find that the feature associated most with positive feelings is Natural (avg. 6,23/MFR 7), closely tailed by Organic (avg. 6,06/MFR 7). This is in turn followed by Wild Berries (avg. 5,9/MFR 6), Made in Sweden (avg. 5,38/MFR 6) and Imported jam/juice (avg.

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5,25/MFR 6). All of the listed features received high scores and are generally associated with positive feelings.

Emotional Value - Positive feelings

Imported Jam/juice Wild Berries
Organic Natural Made In Sweden 0 1 2 3 4 5 5,38 6 6 7 5,25 6 6 5,9 6,06 6,23 7 7 MFR Average

Figure 10: Respondents average and MFR regarding how positive they feel about certain features of imported Swedish juice and jam (n=425)

The results from questions concerning the social value derived from consumption of foods and beverages showed the following tendencies; that the respondents agree with the statement that What I eat and drink defines my lifestyle (avg. 5,49/MFR 6) and that they are neutral to somewhat affected by their friends preferences in food and beverage (avg. 4,77/MFR 4). However they are neutral/slightly disagree with the statements that consuming exclusive food and beverage gives them social status (avg. 3,8/MFR 4) and that consuming Western food and beverage gives them social status(avg. 3,75/MFR 4 )

Social Value
What I eat and drink defines my lifestyle My friends preferences in food and beverages effects what I eat and drink Consuming exclusive food and beverages give me social status 4 4 3,8 4 3,75 0 1 2 3 4 5 6 7 4,77 6 5,49

MFR Average

Consuming western food and beverages give me social status

Figure 11: Respondents average and MFR regarding social value that jam/juice consumption give them (n=425)

Questions associated with conspicuous consumption behaviour came back with answers generally confirming some sort of conspicuous behaviour, respondents are neutral/slightly agreeing with the statement that they prefer to consume Western food in public settings (avg. 24

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4,17/MFR 4) and slightly agree that they like to consume these types of goods in the company of friends rather than alone (avg. 4,43/MFR 4). They seem to agree with the notion that they prefer to buy imported food and drink with Western packaging design (avg. 5,22/MFR 5) and that they like to buy imported food and drink original Western name on packaging (avg. 5,52/MFR 6).

Conspicuous Value
I prefer to consume western food and beverages in public places, rather than in private I prefer to consume western food and beverages with friends rather than alone Design of the package is important when purchasing premium food and beverage I prefer to buy imported food and beverage with western design on packaging I prefer to buy imported food and beverage with original western brand name on packaging 0 1 2 3 4 5 4 4,17 4 4,43 5 4,98 MFR Average

5
5,22 6 5,52 6 7

Figure 12: Respondents average and MFR regarding their conspicuous consumption behaviour (n=425)

Regarding the uniqueness of a product and the value derived from that, the respondents concur with the statement that they are in fact looking to buy unique products when shopping for premium food and beverages (avg. 5,52/MFR 6). The respondents also agree with the statement that they like to try new food and beverage before their friends (avg. 5,72/MFR 6) and they agree with the statement that they buy Western food and beverage because of their prestigious nature (avg. 5,72/MFR 6).

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Unique Value
I look for unique products when purchasing premium food and beverages I like to try new food and beverages before my friends I purchase western-brand food and beverage products because they are prestigious 0 1 2 3 4 5 6 5,52

5 4,9
6 5,72 6 7

MFR Average

Figure 13: Respondents average and MFR regarding their pursue of uniqueness when consuming food and beverages (n=425)

Country of origin effects

The knowledge and perception of Sweden is very positive with high scores on all questions, the highest being that Sweden is a welfare country (avg. 6,34/MFR 7) followed by the statement that Sweden is an advanced (avg. 6,2/MFR 7) and clean country (avg. 6,2/MFR 6/7). They also think that Sweden is an exotic country (avg. 6,08/MFR 7) with beautiful nature (avg. 5,9/MFR 6).

COO - Knowledge
Sweden is an advanced country Sweden is a clean country Sweden is a welfare country Sweden is an exotic country Sweden is a country with beautiful nature 1 2 3 4 5 6 6,2 6,5 6,2 6,34 6,08 6 5,9 7 7 7 MFR Average 7

Figure 14: Respondents average and MFR regarding their knowledge about Sweden (n=425)

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Regarding the respondents trust of domestic, Western and Swedish products we found that they think that Western food and beverage products are trust worthier than Chinese ones (avg. 5,57/MFR 6) and that Swedish products in particular are trust worthier than Western food products in general (avg. 5,42/MFR 6). Their perceive products made in Sweden to stand for quality (avg. 5,74/MFR 6), reliability (avg. 5,7/MFR 6), and credibility (avg. 5,74/MFR 6).

COO - Trust
I believe Western food and beverage brands a trust worthier than domestic ones I believe Swedish food and beverage brands a trust worthier than other western ones Products made in Sweden stands for quality Products made in Sweden stands for reliability Products made in Sweden stands for credibility 1 2 3 4 5 6 5,57 6 5,42 6 5,74 6 5,7 MFR Average

6 5,74
6 7

Figure 15: Respondents average and MFR regarding their trust of products from abroad and from Sweden (n=525)

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Analysis
Using the results generated from the questionnaire we will here analyse the perceptions and preferences of the Chinese middle class. When defining quality in juice and jam products the most important factor is, according to the survey, safety followed by health effects, taste and organic. As the result clearly show regarding the quality in products, the Chinese middle class seek safe and healthy food and beverages. In order to understand why this is so important, the background of the food scandals has to be understood. As described earlier China has been subjected to numerous of serious food scandals and as a result of this the consumers are now very wary of how products are made and what they contain, this to avoid unsafe food products that may result in sickness, injury or even death. Price on the other hand is not seen as a clear indicator of quality and by far scores the lowest, getting only a neutral score. This is somewhat contradictory as respondents show a tendency to later on agree with the statement that a high price equates high quality. One explanation to this discrepancy could be that the respondents consider price not to be important when it is mixed with other more product-related attributes, but when confronted with a statement that high price equates high price they tend to agree to a greater extent. Veale and Quester (2009) clearly show that price has a substantial effect on the perceived quality in product evaluation, but consumers might not want acknowledge that price is an indicator of good quality in an open survey. There is also a small indication that larger packages and a discounted price detracts from the perceived quality, resulting in a product that is seen as less exclusive. We suspect that in a theoretical situation, such as the participation in a survey, the actual attitude toward large packages and discounted price might not be reflected accurately. In the survey the effect of large packages and discounts might be downplayed and can possibly have a larger effect in reality. As for the functional values that we used in our survey, the indication was that the respondents consumed juice and jam for their health effect and good taste rather than just as a way to quench thirst or satiate hunger. We interpret the inclination towards health and taste as values the consumer seek outside of the functional need of satiating hunger and thirst. As for feelings evoked by characteristic features of blueberry products from Sweden, organic and natural are valued high in relation to the other attributes in the survey. This is most likely because the bulk of the respondents live in inner city Beijing, heavily polluted and far from clean nature. Demick (2011) report that the air quality in Beijing is on a steady decline since the 2008 Olympics when air quality was at its best. Since then number 28

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of cars have increased from 3,5 million to 5 million in just four years. The reason why natural and organic have very positive connotations in the minds of the Chinese urban consumers could be explained by the poor environmental situation in Beijing and other major cities in China. As for Sweden, the tendency is that the respondents have a positive image of Sweden as a welfare state with clean and beautiful nature. Although the questions were a bit leading with only positive statements a high average score was generated on the knowledge about positive features of Sweden. Lack of knowledge about Sweden was put forward as an obstacle for Swedish firms to overcome by Liu (2012), but support for a high level of positive knowledge about Sweden is found in our research, although it might just be a perception of an exotic country in the West and not actual knowledge, it is still real in the mind of a marketer. Nevertheless, the perception of Sweden and Western countries is positive and Western products in general and Swedish ones in particular are seen as more trustworthy than Chinese products. This might help Swedish firms to take a large part of the growing market for organic produce as it is trending but the labeling and certification is generally not trusted. As shown by the results from our questionnaire Sweden is seen as a clean country with quality products that are reliable and credible, this might mean that Swedish organic products can benefit from Swedens reputation and be seen as reliable, trustworthy and credible. Our questionnaire shows that in general Chinese middle class consumers concur with the notion that Western food and beverage products are partly consumed because they are prestigious. However the survey shows that respondents are reluctant to show that consumption of imported juice or jam would have any effect on their social status or that their social spheres affect their preferences in food and beverage. This might seem contradictory but it is possible that they like to consume prestigious products not to show off to others but in a self-referential way, this is supported by their views of food and beverage consumption as lifestyle defining. Zhu (2011) also arrives at the conclusion that parts of the Chinese middle class consumption are self-referential in nature rather than conspicuous. This however does not exclude conspicuous behaviour as a factor, there might be discrepancies between expressed opinions and actual behaviour as found by Kwok et al. (2006). The scores on questions regarding conspicuous consumption are generally low but this can be due to respondents wanting to appear humble when answering the questions, some answers might indicate conspicuous behaviour such as the ones regarding packaging design and the prevalence of Chinese middle class conspicuous consumption has been documented (Debnam & Svinos, 2007). Regarding the unique value, 29

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another value for prestige, there is a tendency that they seek unique food and beverage products but that they dont want to be seen as show-offs, so the tendency for agreeing on the statement of being the first to try new products isnt as strong. Respondents might have answered that foreign food and beverages dont provide them with much prestigious value due to national pride or humbleness. Since we were guaranteed not to get accurate and honest answers if we asked some of the more sensitive questions straight on, some concepts were operationalised in such a way that they could be asked without being perceived as too rude, straightforward or compromising. It is possible that the intention of some of the sensitive questions was poorly concealed and that we were obviously looking for information that the respondents were unwilling to give, and some questions were successfully formulated as non-sensitive ones. This would explain why there are differences in answers to questions concerning similar concepts. The CBBE theory has been the theoretical framework used to connect the theories of consumption behaviour and COO effect to an actual brand building. For the tangible building blocks of the model (performance and judgement) it could be argued that Swedish blueberry jam and juice should be promoted as health products as this is the primary functional need Chinese consumer wish to satisfy. A high premium price ought to be set as long as it is justified by good performance and high quality, as the findings regarding price show that Chinese middle class consumers might think that a lower price detracts from the perceived value of a premium product. As the respondents do not give a univocal answer, it could mean that they are price sensitive if the premium price does not live up to a premium performance. Price therefore has to be carefully calibrated to not be too high in relation to its qualities, neither too low and risk being perceived as non-premium. For the perceived quality, the intrinsic health effects of Swedish blueberries should have a central role in the branding process as it is considered to be an important factor when determining the quality in juice and jams. To further appeal to the Chinese middle class consumers, extrinsic values of safety and being organic are to be highlighted in the branding process. It also has to be backed up by a credible production process in order to avoid food scandals that can be the end of a food and beverage brand in China. Concerning the intangible building blocks (imagery and feelings) there is strong support that Sweden and products from Sweden evoke positive images and feelings. Clean and natural production processes are images that should be emphasised in the communication with the consumer in the brand building process. The major social value consumption of food and beverages was that it 30

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defines ones lifestyle, it could therefore be argued that a healthy and natural lifestyle should be promoted with the brand. The Chinese middle class consumer also look for unique products, limited production quantities, exclusive design and select sales channels can be used to enhance the image of something unique. As the respondents were reluctant to be perceived as show-offs, it is advisable to employ a branding strategy that is not too conspicuous in character and try to appeal to the humbleness of the Chinese, as this seems to be a characteristic that they wish to possess. To generate positive feelings related to the brand, emotional values created by natural and organic production should be promoted and used in the building of the brand as this appeals to the Chinese middle class. The most significant findings in each sub concept have been integrated into the modified CBBE model, see figure 16, where the results from the questions in the survey are divided according to the sub concepts from which the questions were formulated.

Figure 16: Modified CBBE pyramid with most important findings incorporated in each building block.

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Conclusion
One should keep in mind that our conclusion is based on data collected through convenience sampling and a modest approach interpreting the result ought to be adopted. However tendencies in our research show that Swedish blueberry products have a great branding potential on the Chinese market as many characteristics of blueberries from Sweden appeal to the Chinese consumers. The conclusions will be in three parts, first the most important findings on consumption behaviour and the target groups attitudes toward jam and juice products. This will be followed by an account of the most significant results from a country of origin perspective, lastly consumption behaviour and attitudes will be combined with country of origin effects.

1. How can a Chinese consumer-oriented branding strategy for Swedish blueberry products be formulated based on: 2a, Chinese middle class consumers attitudes toward consumption of jam and juice?

The Chinese middle class consumption behaviour regarding jam and juice is characterised by a search for natural, scandals. This fact in combination with a generally good perception of Safe and healthy products that have been organically produced, as their food and beverage consumption is claimed to define their lifestyle to a certain extent. Other values that is attractive to the Chinese consumers are prestige and uniqueness, two values that need to be put forward in a way that not conflict with the Chinese consumers endeavor to appear humble. They also give the impression of be willing to pay a premium price as long as the product quality and performance is premium. 2b, Chinese middle class consumers perceptions of Sweden and products made in Sweden?

Foreign food and beverage products have an advantage over domestic, probably because domestic brands are often distrusted and a target for suspiciousness in the wake of recent food scandals. Sweden, being perceived as clean and exotic, and Swedish products, as reliable and credible, gives further support to the importance of the COO effect in China, an effect that Swedish brands can free ride on when entering the market as a foreign actor. 32

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For a consumer based branding strategy, the factors in 2a ought to be emphasised, as they are the values that Chinese consumers look for in actual products. A premium pricing strategy can be motivated due to the exclusiveness and the proved health effects Swedish blueberries possess. Swedens reputation as a reliable, clean and credible country can serve as a quality halo and guarantee that claims about the products are substantiated and true. Our hopes are that our conclusions can serve as a guideline for Swedish or foreign brands when formulating their branding strategies for the Chinese market.

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Tukey, J.W (1977). Exploratory Data Analysis, Addison-Wesley Publishing Company Verd Jover A., Monter, Javier, del Mar Fuentes Fuentes, M. (2004). Measuring Perceptions of Quality in Food Products: The Case of red wine, Food Quality and Preference 2004:15 pp. 453-469. Veale, R. & Quester, P. (2009). Do Consumer Expectation Match experience? Predicting the Influence of Price and Country of Origin on Perception of Quality, International Business Review, 2009:18 pp.134-144 Vigneron, F. & Johnson, L. W. (1999). A Review and Conceptual Framework of PrestigeSeeking Consumer Behaviour, Academy of Marketing and Science Review, 1999:1 Wang, H. H. (2010). The Chinese Dream: The Rise of the Worlds Largest Middle Class and What it means to You, Bestseller Press World Bank, (2012). http://databank.worldbank.org/ddp/htmljsp/QuickViewReport.jsp?RowAxis=WDI_Ctry~&ColAxis=WDI_Time~&PageAxis=WDI_ Series~&PageAxisCaption=Series~&RowAxisCaption=Country~&ColAxisCaption=Time~& NEW_REPORT_SCALE=1&NEW_REPORT_PRECISION=0&newReport=yes&IS_REPO RT_IN_REFRESH_MODE=true&IS_CODE_REQUIRED=0&COMMA_SEP=true (201205-09) Zhou, L. & Wong, A. (2008). Exploring the Influence of Product Conspicuousness and Social Compliance on Purchasing Motives of Young Chinese Consumers for Foreign Brands, Journal of Consumer Behavior, 2008:7 pp. 470-483 Zhu D. (2011). Consumption Patterns of the Chinese Middle Class: In the Case of Beijing. PhD Thesis, University of Manchester, Manchester.

Interviews
Chen, Yvonne, General Manager, Swedish Chamber of Commerce Beijing office. Interview conducted in Beijing on April 23rd 2012. Li, Chunling, Professor of Sociology, Institute of Sociology, Chinese Academy of Social Science. Interview conducted in Beijing on April 24th 2012. Liu, Xia, Assistant Professor of Marketing, School of Economics and Management, Tsinghua University. Interview conducted in Beijing on April 25th 2012.

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Appendix
Respondent overview
Demographic Characteristics Gender Male Female Age 20-24 25-29 30-34 35-39 40-45 Level of Education 12-16 years (Bachelor) 16+ years (Higher than Bachelor) Current Occupation Business owner with >20 employees Manager Professional (Lawyer, Doctor, Teacher, etc.) Government official Small business owner with <20 employees Self-employed Office worker Others Annual Income 60.000 - 100.000 RMB 100.000 - 300.000 RMB 300.000 - 500.000 RMB >500.000 Valid Percentage 54,4 % 45,6 % 13,6 % 32,0 % 26,1 % 24,2 % 4,0 % 83,1 % 16,9 % 4,7 % 18,1 % 29,4 % 11,8 % 7,5 % 5,2 % 23,1 % 0,2 % 60,0 % 36,2 % 3,8 % 0% Quantity (n=425) 231 194 58 136 111 103 17 353 72 20 77 125 50 32 22 98 1 255 154 16 0

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Response overview
When defining quality of jam and juice, the following attributes are important 7 8 9 10 11 12 13 14 15 Taste Health effects That the berry or fruit is wild grown Price Origin Brand Safety Organic Percentage of berry/fruit in the product Do you agree to the following statements regarding juice/jam consumption? 16 17 18 19 20 21 I consume juice/jam mainly for the health effects I consume juice/jam mainly to quench/satiate thirst/hunger I consume juice/jam mainly for the good taste High price equates high quality A discounted product is less valuable Large packages make a product feel less valuable/exclusive Do you agree that the following words give you a positive feeling? Imported Jam/juice Wild Berries Organic Natural Made in Sweden Strongly Disagree 1 0,7 % (3) 1,2 % (5) 0,9 % (4) 1,6 % (7) 0.9 % (4) 0,9 % (4) 0,5 % (2) 0,7 % (3) 0,7 % (3) Strongly Disagree 1 0,7 % (3) 2,6 % (11) 1,2 % (5) 2,6 % (11) 3,8 % (16) 2,1 % (9) Strongly Disagree 1 1,2 % (5) 0,7 % (3) 0,5 % (2) 0,5 % (2) 0,7 % Neutral 2 0,9 % (4) 0,9 % (4) 1,4 % (6) 4,9 % (21) 0,7 % (3) 0,5 % (2) 0,2 % (1) 0,7 % (3) 0,7 % (3) 3 2,6 % (11) 1,2 % (5) 1,9 % (8) 10,6 % (45) 1,2 % (5) 0,9 % (4) 0,7 % (3) 0,5 % (2) 0,7 % (3) 4 6,1% (26) 2,6 % (11) 3,4 % (57) 38,4 % (163) 10,4 % (44) 11,3 % (48) 3,1 % (13) 3,3 % (14) 7,8 % (33) Neutral 4 6,6 % (28) 33,2 % (141) 8,5 % (36) 8,0 % (34) 23,1 % (98) 24,9 % (106) Neutral 4 20,2 % (86) 6,4 % (27) 4,9 % (21) 6,6 % (28) 15,8 % 5 14,1 % (60) 7,8 % (33) 24,9 % (106) 25,9 % (110) 29,6 % (126) 22,6 % (96) 12,9 % (55) 16,9 % (72) 26,4 % (112) 6 29,4 % (125) 34,8 % (148) 37,2 % (158) 8,9 % (38) 45,9 % (195) 49,4 % (210) 25,6 % (109) 47,5 % (202) 47,1 % (200) Strongly Agree 7 46,1 % (196) 51,5 % (219) 20,2 % (86) 9,6 % (41) 11,3 % (48) 14,4 % (61) 56,9 % (242) 30,4 % (129) 16,7 % (71) Strongly Agree 7 37,6 % (160) 9,9 % (42) 19,3 % (82) 27,1 % (115) 6,1 % (26) 6,6 % (28) Strongly Agree 7 9,9, % (42) 33,4 % (142) 40,5 % (172) 54,6 % (232) 14,8 %

Avg 6,05 6,25 5,52 4,47 5,50 5,60 6,32 5,99 5,66

2 0,2 % (1) 2,1 % (9) 0,2 % (1) 1,6 % (7) 2,6 % (11) 0,9 % (4)

3 1,4 % (6) 7,8 % (33) 2,6 % (11) 3,3 % (14) 5,9 % (25) 7,3 % (31)

5 14,1 % (60) 24,2 % (103) 25,6 % (109) 19,5 % (83) 33,2 % (141) 30,8 % (131)

6 39,3 % (167) 20,2 % (86) 42,6 % (181) 37,9 % (161) 25,4 % (108) 27,3 % (116)

Avg 6,02 4,75 5,62 5,62 4,80 4,90

22 23 24 25 26

2 0,7 % (3) 0,5 % (2) 0,7 % (3) 0,2 % (1) 0,5 %

3 2,1 % (9) 1,6 % (7) 2,1 % (9) 1,9 % (8) 2,8 %

5 28,9 % (123) 20,7 % (88) 13,2 % (56) 9,6 % (41) 31,3 %

6 36,9 % (157) 36,7 % (156) 38,1 % (162) 26,6 % (113) 34,1 %

Avg 5,25 5,90 6,06 6,23 5,38

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(3) Strongly Disagree 1 0,5 % (2) 1,9 % (8) 7,5 % (32) 8,5 % (36) 5,2 % (22) 4,0 % (17) 0,9 % (4) 1,2 % (5) 0,9 % (4) 0,5 % (2) 0,9 % (4) 0,5 % (2) Strongly Disagree 1 0,2 % (1) 0,2 % (1) 0,2 % (1) 0,2 % (1) 0,2 % (1) 0,9 % (4) 0,9 % (4) 0,5 % (2) 0,5 % (2) 0,5 % (2) (2) (12) (67) Neutral 4 14,1 % (60) 27,8 % (118) 31,8 % (135) 28,9 % (123) 36,2 % (154) 32,5 % (138) 24,2 % (103) 19,1 % (81) 13,6 % (58) 11,1 % (47) 29,4 % (125) 8,5 % (36) Neutral 4 6,4 % (27) 5,6 % (24) 5,4 % (23) 6,8 % (29) 8,5 % (36) 10,1 % (43) 14,8 % (63) 11,1 % (47) 10,8 % (46) 11,1 % (47)

UPPSALA UNIVERSITY
(133) (145) (63) Strongly Agree 7 16,5 % (70) 10,4 % (44) 5,2 % (22) 4,7 % (20) 3,8 % (16) 5,2 % (22) 8,5 % (36) 12,0 % (51) 17,6 % (75) 15,1 % (64) 9,4 % (40) 16,0 % (68) Strongly Agree 7 45,2 % (192) 42,8 % (182) 53,2 % (226) 40,7 % (173) 32,2 % (137) 18,6 % (79) 14,4 % (61) 27,8 % (118) 22,4 % (95) 25,2 % (107

Do you agree to the following statements regarding food consumption? 27 28 29 30 31 32 33 34 35 36 37 38 What I eat and drink defines my lifestyle My friends preferences in food and beverages effects what I eat and drink Consuming exclusive food and beverages give me social status Consuming western food and beverages give me social status I prefer to consume western food and beverages in public places, rather than in private I prefer to consume western food and beverages with friends rather than alone Design of the package is important when purchasing premium food and beverage I prefer to buy imported food and beverage with western design on packaging I prefer to buy imported food and beverage with original western brand name on packaging I look for unique products when purchasing premium food and beverages I like to try new food and beverages before my friends I purchase western-brand food and beverage products because they are prestigious Do you agree to the following statements regarding Sweden? Sweden is an advanced country Sweden is a clean country Sweden is a welfare country Sweden is an exotic country Sweden is a country with beautiful nature I believe Western food and beverage brands a trust worthier than domestic ones I believe Swedish food and beverage brands a trust worthier than other western ones Products made in Sweden stands for quality Products made in Sweden stands for reliability Products made in Sweden stands for credibility

2 0,5 % (2) 3,3 % (14) 10,6 % (45) 10,6 % (45) 6,4 % (27) 4,7 % (20) 0,7 % (3) 0,7 % (3) 0,2 % (1) 0,5 % (2) 0,7 % (3) 0,2 % (1)

3 3,8 % (16) 10,4 % (44) 20,9 % (89) 22,4 % (95) 12,2 % (52) 8,7 % (37) 6,6 % (28) 3,5 % (15) 2,4 % (10) 1,6 % (7) 6,8 % (29) 0,9 % (4)

5 24,0 % (102) 24,2 % (103) 18,8 % (80) 19,8 % (84) 26,1 % (111) 32,2 % (137) 34,8 % (148) 32,9 % (140) 25,6 % (109) 32,2 % (137) 32,9 % (140) 20,7 % (88)

6 40,7 % (173) 22,1 % (94) 5,2 % (22) 5,2 % (22) 10,1 % (43) 12,7 % (54) 24,2 % (103) 30,6 % (130) 39,5 % (168) 39,1 % (166) 19,8 % (84) 53,2 % (226)

Avg 5,49 4,77 3,80 3,75 4,17 4,43 4,98 5,22 5,52 5,52 4,90 5,72

39 40 41 42 43 44 45 46 47 48

2 0,0 % (0) 0,2 % (1) 0,0 % 0,0 % 0,0 % 0,2 % (1) 0,2 % (1) 0,5 % (2) 0,5 % (2) 0,5 % (2)

3 0,7 % (3) 0,7 % (3) 0,7 % (3) 0,9 % (4) 0,5 % (2) 1,2 % (5) 1,4 % (6) 0,7 % (3) 0,5 % (2) 0,5 % (2)

5 9,4 % (40) 7,5 % (32) 4,9 % (21) 15,5 % (66) 23,1 % (98) 31,8 % (135) 32,9 % (140) 24,9 % (106) 25,2 % (107) 23,8 % (101)

6 38,1 % (162) 42,8 % (182) 35,5 % (151) 35,8 % (152) 35,5 % (151) 37,2 % (158) 35,3 % (150) 34,6 % (147) 40,2 % (171) 38,6 % (164)

Avg 6,20 6,20 6,34 6,08 5,90 5,57 5,42 5,74 5,70 5,74

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English questionnaire

Final Thesis Survey

We are two students studying business administration at Uppsala University in Sweden. We currently are writing our final thesis about branding in China. We are conducting a survey investigating the branding possibilities of Swedish blueberries on the Chinese market. Blueberry is a small blue colored berry that grows wild in Sweden. The survey is anonymous. Please mark the most suitable answer. 1. How old are you? <20 35-39 Male 20-24 40-45 Female Rural Area 25-29 >45 30-34

2. 3. 4.

Gender? Where do you currently live? What is your level of education?

Urban Area

0-6 year (Elementary School) 6-9 year (Junior High School) 9-12 year (Senior High School) 12-16 year (Bachelor Degree) 16+ year (Higher than bachelor degree) Business owner with more than 20 employees Manager Professional (Lawyer, Doctor, Teacher, etc.) Government official Small business owner with less than 20 employees Self-employed Office worker Worker Retired Student Unemployed Other: <40.000 RMB 40.000 60.000 RMB 60.000 100.000 RMB 100.000 300.000 RMB 300.000 500.000 RMB >500.000 RMB

5.

What is your current occupation?

6.

What is your annual income?

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For the further questions please circle the answer that indicates your level of agreement with the statement (1= Strongly Disagree, 4=Neutral, 7= Strongly Agree) When defining quality of jam and juice, the following attributes are important 7 8 9 10 11 12 13 14 15 Taste Health effects That the berry or fruit is wild grown Price Origin Brand Safety Organic Percentage of berry/fruit in the product Do you agree to the following statements regarding juice/jam consumption? 16 17 18 19 20 21 I consume juice/jam mainly for the health effects I consume juice/jam mainly to quench/satiate thirst/hunger I consume juice/jam mainly for the good taste High price equates high quality A discounted product is less valuable Large packages make a product feel less valuable/exclusive Do you agree that the following words give you a positive feeling? 22 23 24 25 26 Imported Jam/juice Wild Berries Organic Natural Made in Sweden Do you agree to the following statements regarding food consumption? 27 28 29 30 31 32 33 What I eat and drink defines my lifestyle My friends preferences in food and beverages effects what I eat and drink Consuming exclusive food and beverages give me social status Consuming western food and beverages give me social status I prefer to consume western food and beverages in public places, rather than in private I prefer to consume western food and beverages with friends rather than alone Design of the package is important when purchasing premium food and beverage
Strongly Disagree Neutral Strongly Agree

1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4
Neutral

5 5 5 5 5 5 5 5 5

6 6 6 6 6 6 6 6 6

7 7 7 7 7 7 7 7 7

Strongly Disagree

Strongly Agree

1 1 1 1 1 1

2 2 2 2 2 2

3 3 3 3 3 3

4 4 4 4 4 4
Neutral

5 5 5 5 5 5

6 6 6 6 6 6

7 7 7 7 7 7

Strongly Disagree

Strongly Agree

1 1 1 1 1

2 2 2 2 2

3 3 3 3 3

4 4 4 4 4
Neutral

5 5 5 5 5

6 6 6 6 6

7 7 7 7 7

Strongly Disagree

Strongly Agree

1 1 1 1 1 1 1

2 2 2 2 2 2 2

3 3 3 3 3 3 3

4 4 4 4 4 4 4

5 5 5 5 5 5 5

6 6 6 6 6 6 6

7 7 7 7 7 7 7

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34 35 36 37 38 I prefer to buy imported food and beverage with western design on packaging I prefer to buy imported food and beverage with original western brand name on packaging I look for unique products when purchasing premium food and beverages I like to try new food and beverages before my friends I purchase western-brand food and beverage products because they are prestigious Do you agree to the following statements regarding Sweden? 39 40 41 42 43 44 45 46 47 48 Sweden is an advanced country Sweden is a clean country Sweden is a welfare country Sweden is an exotic country Sweden is a country with beautiful nature I believe Western food and beverage brands a trust worthier than domestic ones I believe Swedish food and beverage brands a trust worthier than other western ones Products made in Sweden stands for quality Products made in Sweden stands for reliability Products made in Sweden stands for credibility

UPPSALA UNIVERSITY
1 1 1 1 1 2 2 2 2 2 3 3 3 3 3 4 4 4 4 4
Neutral

5 5 5 5 5

6 6 6 6 6

7 7 7 7 7

Strongly Disagree

Strongly Agree

1 1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4 4

5 5 5 5 5 5 5 5 5 5

6 6 6 6 6 6 6 6 6 6

7 7 7 7 7 7 7 7 7 7

Thank you for your participation!

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Chinese questionnaire

1. 2. 3. 4.

<20

20-24

25-29

30-34

35-39

40-45

>45

0-6 () 6-9 () 9-12 () 12-16 (/) 16+ () 20 20 / 100.000 300.000 300.000 500.000 >500.000

5.

6.

<40.000 40.000 60.000 60.000 100.000

1= , 4=, 7=

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8 9 10 11 12 13 14 15 / / / 16 17 18 19 20 21 / // / / 22 23 24 25 26 / 27 28 29 30 31 32 33 34 35 36 37 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2

UPPSALA UNIVERSITY
3 3 3 3 3 3 3 3 4 4 4 4 4 4 4 4

5 5 5 5 5 5 5 5

6 6 6 6 6 6 6 6

7 7 7 7 7 7 7 7

1 1 1 1 1 1

2 2 2 2 2 2

3 3 3 3 3 3

4 4 4 4 4 4

5 5 5 5 5 5

6 6 6 6 6 6

7 7 7 7 7 7

1 1 1 1 1

2 2 2 2 2

3 3 3 3 3

4 4 4 4 4

5 5 5 5 5

6 6 6 6 6

7 7 7 7 7

1 1 1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4 4 4

5 5 5 5 5 5 5 5 5 5 5

6 6 6 6 6 6 6 6 6 6 6

7 7 7 7 7 7 7 7 7 7 7

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LIVAS & NORLANDER

38 39 40 41 42 43 44 45 46 47 48 1 2

UPPSALA UNIVERSITY
3 4

1 1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4 4

5 5 5 5 5 5 5 5 5 5

6 6 6 6 6 6 6 6 6 6

7 7 7 7 7 7 7 7 7 7

46