Jan-Benedict E.M. Steenkamp & Inge Geyskens
How Country Characteristics Affect the Perceived Value of Web Sites The authors examine how country characteristics systematicaliy moderate the effects of individual-level drivers of the perceived vaiue that consumers derive from visiting a brand manufacturer's Web site. They test hypotheses on data coiiected from 8886 consumers from 23 countries on three continents, involving 30 Web sites of the world's largest consumer packaged goods companies. They find that the effect of privacy/security protection on perceived vaiue is stronger for people from countries with a weak rule of law, whereas people from countries that are high on national identity give more weight to whether there is cultural congruity between the site and themseives. People who iive in more individualistic countries give more weight to pleasure, to privacy/security protection, and to customization in their perceived vaiue judgments than people from collectivistic countries. The authors discuss implications for Web site design strategies.
T
mercial uses, including being a communication channel and offering an (additional) online sales channel, the focus of this article is on CPG sites that are primarily designed as a communication tool to forge cognitive and emotional bonds between a company's customers and its brands. Since consumer uptake of the Intemet has rocketed, the Intemet has become a major avenue for CPG companies to reach their consumers. In July 2003, the top ten sites of food and beverage makers attracted 9.5 million unique visitors, more than 75% more than a year before and only slightly fewer, for comparison's sake, than the number of visitors to the top ten university sites (Tedeschi 2003). Yet, in bonding with their consumers, "more [CPG] companies have failed than succeeded" (Curry 1999, p. 20), and 15% of the top CPG brands still lack a Web site because of a lack of understanding of what their target consumers value in using the Internet {New Media Age 2003). The contribution of this study is twofold. First, we develop a conceptual model that pertains to the moderating role of the institutional context in which consumers live on the effects of individual and Web site characteristics. Second, we test the hypotheses using a large-scale data set, involving 30 Web sites of 16 of the world's largest CPG companies from 8 different European countries and more than 8500 visitors from 23 countries on three continents (Australasia, Europe, and North America). In the following sections, we introduce the main effect hypotheses. Given previous support in the literature for these relationships, this introduction is brief and primarily serves as a basis to develop the focal country-level moderating hypotheses. These sections are followed by a discussion of the methods we used to test the hypotheses. Finally, we provide the results and discuss the implications of our findings.
he emergence and astonishing growth of the Intemet is easily one of the most important developments in societies around the globe. Increasingly, companies are creating Web sites in an attempt to add value for their consumers. Both academics and practitioners have emphasized the key role of consumer value delivery in company success (Day 1990; Gale 1994; Naumann 1995; Woodruff 1997; Zeithaml 1988), including the success of Internetbased activities (Zeithaml, Parasuraman, and Malhotra 2002). Given the global nature and reach of the Intemet, consumers across the world can access Web sites. Although academics and managers agree about which factors (e.g., privacy/security, customization) affect consumer value, there is a lack of research into how the effectiveness of various factors in creating consumer value may vary across countries. The primary purpose of this study is to test whether relationships between consumer value and its drivers are systematically and predictably moderated by the institutional context in which consumers live. We investigate this issue in the context of Web sites operated by large consumer packaged goods (CPG) companies. Whereas Web sites may be designed for various comJan-Benedict E.M. Steenkamp is C. Knox Massey Professor of Marketing and Marketing Area Chair, Kenan-Flagler Business School, University of North Caroiina, Chapel Hill (e-maii:
[email protected]). Inge Geyskens is Associate Professor of Marketing, Tiiburg University, the Netheriands (e-mail:
[email protected]). The authors gratefuiiy acknowiedge AiMark, the European Brands Association (AIM), MetrixLab, and the participating packaged goods companies (Barilla, Beiersdorf, Cadbury Schweppes, Colgate-Paimolive, Danone, Heineken, Heinz, Henkel, Kraft Foods, Lindt & Sprungli, Mars, Procter & Gamble, Reckitt Benckiser, Sara Lee, SCA Hygiene, and Unilever) for their help in deveioping the questionnaire and for their assistance in collecting the data. They also thank the anonymous JM reviewers, Marnik Dekimpe, and Els Gijsbrechts for vaiuabie comments and suggestions. Finaiiy, they extend their appreciation to the Netheriands Organization for Scientific Research for financiai assistance.
Drivers of Perceived Vaiue
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The focal construct in our study is the "perceived value" that consumers derive from visiting a brand manufacturer's Web site. Drawing on Holbrook's definition and theory of Journal of Marketing Voi. 70 (Juiy 2006), 136-150
perceived value (Holbrook 1994, 1999; Holbrook and Corfman 1985), we define the perceived value of a Web site as an interactive, relativistic, preference experience that results from visiting the Web site. It is "interactive" in that a value judgment is neither wholly subjective nor wholly objective but rather entails a subject-object interaction, meaning that it is affected by aspects of the person (e.g., emotions, sociodemographics) visiting the Web site and the characteristics of the Web site (e.g., privacy/security). It is "relativistic" in that value judgments differ among Web site visitors, just as consumer characteristics and perceptions of Web site characteristics may differ among people. Value involves "preference," which Holbrook and Corfman (1985, p. 40) interpret as "favorable disposition"; this encompasses evaluations (e.g., the Web site is useful) and intentions to act on these evaluations (e.g., intention to visit the Web site again; see also Chen, Clifford, and Wells 2002; Wells and Prensky 1996). Finally, value is an "experience" in that it resides in the consumption of the object, that is, in surfing the Web site. Figure 1 presents our conceptual framework, delineating drivers of perceived value of Web sites. We discuss the hypotheses underlying this framework subsequently.
Hirschman 1982). This also applies to the Intemet context; thus, it becomes cmcial to evaluate "Web sites in terms of the extent to which they deliver these two types of experience" (Novak, Hoffman, and Yung 2000, p. 39). By visiting a Web site, consumers may acquire useful information to help them in their decision process. That is, the Web site may be instrumental in the attainment of utilitarian consumption goals, which is valued by consumers (Shankar, Smith, and Rangaswamy 2003). Consumers may also derive value from the emotions generated during the Web site visit per se. In many cases, the consumer can even achieve flow while visiting the site (Novak, Hoffman, and Yung 2000). Various emotion typologies have been proposed in the literature, of which the pleasure-arousal typology is among the most prominent (e.g., Eliashberg and Sawhney 1994; Olney, Holbrook, and Batra 1991; Reisenzein 1994). "Pleasure" refers to the affective feelings generated by the Web site, and "arousal" pertains to the level of activation or excitement generated by the Web site. The higher the feelings of pleasure evoked by a site, the more positive its evaluation will be. On the basis of the Wundt curve (Berlyne 1971), we hypothesize that the relationship between the arousal evoked in a person by visiting the Web site and that person's evaluation of the Web site takes the form of an inverted U shape; that is, moderate degrees of arousal are preferred over low and high levels of arousal. Formally,
Consumption Experience The consumption experience has both a cognitive (utilitarian) and an emotional component (Holbrook and
FIGURE 1 Conceptual Framework Country Characteristics •Rule of law •National identity •Individualism
Consumption Experience •Utilitarian experience •Emotionai experience -Pleasure -Arousal
Perceived Value
•
r
Web Site Characteristics •Privacy/security •Customization •Consumer-site congruity
i
Covariates •Demographics •Site-specific dummies •Accessibility
Country Characteristics and the Perceived Vaiue of Web Sites /137
H|: The perceived value derived from a Web site visit (a) is positively related to the utilitarian experience associated with visiting the site, (b) is positively related to the pleasure associated with visiting the site, and (c) exhibits an inverted U-shaped relationship with the arousal induced by the site.
Web Site Characteristics Two Web site characteristics that are consistently mentioned in the literature as being among the most important characteristics affecting consumer evaluations of sites are privacy/security and customization (Sultan et al. 2002; Zeithaml, Parasuraman, and Malhotra 2002). Given the intemational scope of our study, a third characteristic appears pertinent: the cultural congruity between the site and its visitor (Luna, Peracchio, and De Juan 2002). Perceived privacy and security are two related key drivers of consumer value (Hoffman, Novak, and Peralta 1999; Zeithaml, Parasuraman, and Malhotra 2002). Both involve protecting Web site users' personal information. The higher a site scores on privacy and security protection in the minds of consumers, the more the risk that consumers perceive to exist when supplying private information online will be mitigated (Lwin and Williams 2004), and thus perceived value will increase. The Intemet also provides unique opportunities to customize information. Customization refers to the extent to which the Web site's content is adapted to an individual's unique needs versus being presented as a standardized package. People value personalized experiences (see, e.g., Feldman and Lynch 1988). The Intemet allows global access to a Web site. This offers the opportunity for cross-border information flow, but it also means that there may be cultural incongruity between the site and the visitor. Cultural congruity refers to whether the Web site is translated into the visitor's local country-specific language; offers local content; and exhibits localization in the form of country-specific dates, zip codes, currency formats, and so forth (Singh, Furrer, and Ostinelli 2004). Exposure to a culturally congmous site facilitates processing of the site's content (Luna, Peracchio, and De Juan 2002) and conveys the marketer's respect for the visitor's culture (Koslow, Shamdasani, and Touchstone 1994), both of which consumers value. Thus: H2: The perceived value derived from a Web site visit (a) is positively related to the perceived privacy/security protection of the site, (b) is positively related to the site's degree of customization, and (c) is higher when there is cultural congruity between the site and the consumer.
The Moderating Role of a Country's Institutional Context Web site visitors are members of larger institutional systems and thus are subject to the confiicts and compatibilities between their own evaluative structure and the priorities of the institutional system. Institutions are "the most enduring features of social life ... giving 'solidity' [to social systems] across time and space" (Giddens 1984, p. 24). A society's institutional priorities reflect the basic issues and
138 / Journal of Marketing, July 2006
problems that societies must confront to regulate human activity. The shared institutional priorities in a society help shape the social and economic reward contingencies to which people must adapt to function smoothly and effectively (Schwartz 1994). A society's institutional priorities stimulate the activation of beliefs that are in line with and conducive to maintaining these priorities, and beliefs that run counter to these priorities are discouraged (Scott 2001; Triandis 1989). Thus, as standards, these priorities influence how individual beliefs and emotions are evaluated and what kinds of expressions are encouraged or discouraged. These positive or negative institutional reinforcement mechanisms, which operate between the two types of constructs, give rise to interactions between society-level and individual-level variables (Schwartz 1994). Scott (2001) distinguishes three interrelated but distinct "pillars of institutions": the regulative, moral, and cultural systems (see also Grewal and Dharwadkar 2002; Suchman 1995). Each of these systems has been identified by various social theorists as a vital component of a country's institutional context (Scott 2001). These three systems form a continuum that moves "from the conscious to the unconscious, from the legally enforced to the taken for granted" (Hoffman 2001, p. 36). We summarize some of the key characteristics of the three pillars of institutions in Table 1. The "regulative" system involves the capacity to establish formal mles, inspect society members' conformity to them, and, if necessary, impose sanctions (Scott 2001). It includes the presence and efficacy of regulatory institutions and the associated legal system that exists to ensure stability, order, and continuity of societies (Amdt 1979). The "moral" system involves societal norms of right and wrong and "introduces a prescriptive, evaluative, and obligatory dimension in social life" (Scott 2001, p. 54). It defines goals or objectives (e.g., making a profit, loving one's country) but also specifies appropriate ways to pursue them (e.g., conceptions of fair business mles, purchase of domestic products). The "cultural" system represents the culturally supported beliefs, attitudes, habits, and behaviors. It maintains that extemal cultural frameworks shape intemal interpretive processes and shared understanding (Triandis 1989). Certain routines (e.g., shaking hands when meeting someone) are followed because they are taken for granted "as the way we do these things" (Scott 2001, p. 57). In this study, we include one key component of each of these pillars of institutions, namely, rule of law (regulative; Oxley and Yeung 2001), national identity (moral; Giddens 1981), and national-cultural individualism (cultural; Oyserman, Coon, and Kemmelmeier 2002).
Reguiative System: Rule of Law In general, it is recognized that the mle of law is an essential component of the regulative subsystem (Licht, Goldschmidt, and Schwartz 2003; North 1990; Oxley and Yeung 2001; Scott 2001). It is a central tenet in the "good governance" agenda of the major intemational institutions, such as the Intemational Monetary Fund and the World Bank (Kaufmann, Kraay, and Zoido-Lobaton. 1999). These bodies define governance as the traditions and institutions by
TABLE 1 Three Pillars of Institutions
Basis of compliance Basis of order Mechanisms Basis of legitimacy
Primary scientific domain
Regulative
Moral
Cultural
Expedience
Social obligation
Taken-for-grantedness Shared understanding
Regulative rules
Binding expectations
Constitutive schema
Coercive
Normative
Mimetic
Legally sanctioned
Morally governed
Comprehensible Recognizable Culturally supported
Economics
Sociology Psychology
Anthropology Sociology
Source: Adapted from Scott (2001).
which authority in a country is exercised for the common good. The rule of law addresses the degree to which the behavior of individuals and organizations (including government authorities) is guided by formal, transparent, legal rules that apply to everyone, regardless of rank and status (Licht, Goldschmidt, and Schwartz 2003). A country with a strong rule of law has sound political institutions and a strong, independent court system. Its citizens are entitled to equal protection under the law and are willing to accept the established institutions to make and implement laws and resolve disputes (Oxley and Yeung 2001). A strong rule of law generates greater transparency and stability regarding the boundaries of acceptable behavior. It reduces Web site visitors' uncertainty about what legal protection they can expect and enhances their ability to successfully litigate at least the most serious cases of fraudulent online dealings. In countries in which the rule of law is weak, this ability is undermined and online visitors have greater need for other safeguards against fraud and misuse of their trust. A particularly important type of online safeguard is the privacy/security protection offered by the Web site (Zeithaml, Parasuraman, and Malhotra 2002), which therefore is expected to be (even) more important in countries that are characterized by a weak rule of law. H3: The effect of perceived privacy/security protection on perceived value is stronger in countries with a weak rule of law. Moral System: National Identity Previous research in marketing has noted the important role of one particular moral construct in explaining consumer attitudes and behavior: consumer ethnocentrism (Balabanis et al. 2001; Shimp and Sharma 1987; Steenkamp, Batra, and Alden 2003), defined as "the beliefs held by [American] consumers about the appropriateness, indeed morality of buying foreign-made products" (Shimp and Sharma 1987, p. 280, emphasis added). There are systematic differences in consumer ethnocentrism among countries (e.g., Balabanis et al. 2001). The construct of national identity is conceptually closely related to consumer ethnocentrism (cf. Baughn and Yaprak 1996) in that both constructs provide prescriptions
for morally motivated behavior. However, whereas consumer ethnocentrism is a consumer-domain-specific construct, national identity is a more abstract, "central" construct (cf. Lastovicka 1982) and, as such, is more central to a society's moral system (Scott 2001). The theoretical basis of national identity is social identity theory, which distinguishes between in-groups and out-groups and posits the incorporation of the in-group as part of the self of its members (Mackie and Smith 1998; Tajfel 1981). Various theorists have argued that nations can be viewed as communities, whose members form a social group. For example, Giddens (1981) stated that a nation's inhabitants have "an overall awareness ... of belonging to an inclusive community with a certain identity." In a similar vein, Druckman (1994, p. 63) argues that nations "achieve personal relevance for individuals when they ... gain a sense of identity and self-esteem through their national identification." Countries that are high on national identity take pride in and display a positive bias toward their country's symbols, language, and culture (Billig 1995). These daily reminders of national identity, as well as its omnipresence in education and mass media, provide a continuous reinforcement of the feeling of belonging to a national group (Verlegh 2001). The level of national identification differs widely among countries (International Social Survey Program [ISSP] 1998), and differences in national identity are related to differential tendencies to favor culturally adapted products and other culturally congruous symbols (cf. Kowalski and Wolfe 1994; Steenkamp, Batra, and Alden 2003). Consistent with this body of research, we expect that people from countries that are high on national identity attach more importance to the cultural congruity of the Web site in shaping their value perceptions. H4: The effect of^cultural congruity on perceived value is stronger in countries characterized by high national identity. Cultural System: National-Cultural individualism National-cultural individualism pertains to the degree to which people in a country prefer to act as individuals. Conversely, collectivism pertains to the extent to which people in a country prefer to act as members of a group. People in Country Characteristics and the Perceived Vaiue of Web Sites /139
individualistic societies place their personal goals, motivations, and desires ahead of those of others, whereas collectivistic cultures are conformity oriented and show a higher degree of group behavior and concem to promote their continued existence (Kagitcibasi 1997). Individualism's "pivotal role" (Allik and Realo 2004, p. 32) in the cultural system has been consistently emphasized by social science researchers (Oyserman, Coon, and Kemmelmeier 2002). It has been studied as such in a wide range of disciplines, including philosophy, history, anthropology, sociology, psychology, and business (Triandis 1995). Kagitcibasi (1997, p. 3) notes that "about one-third of recently published studies cited this construct [individualism/collectivism] as at least a partial explanation of observed cross-cultural differences." Psychologists have found that compared with collectivistic societies, in individualistic societies, emotions feature more prominently in people's judgments because emotions provide direct feedback about the fit between personal needs and goals and the stimulus experienced (Schimmack and Diener 1997; Schimmack et al. 2002). In coUectivistic societies, fulfillment of personal goals is also important, but relatively more weight is given to following cultural norms. In these cultures, there is relatively more emphasis on acquiring skills and gaining expertise than in individualistic societies (Hofstede 2001; Schimmack et al. 2002). Consequently, we expect that emotional experience receives more weight in the value derived from a Web site visit in individualistic societies than in coUectivistic societies, whereas the utilitarian experience is given more emphasis in coUectivistic societies than in individualistic societies. In individualistic societies, the social fabric and group norms are much looser. These societies emphasize the private self, whereas the social self receives relatively more weight in coUectivistic societies (Trafimow, Triandis, and Goto 1991). Individualistic societies emphasize that "everyone has a right to a private life," whereas in coUectivistic cultures, "private life is invaded by institutions and organizations to which one belongs" (Hofstede 2001, p. 227). Personal security is also given more weight in individualistic cultures because the mechanism operant in coUectivistic societies—namely, that security is provided by the organization or society—is relied on less in individualistic societies (Hofstede 2001, pp. 226-27, 267). In summary, it can be expected that personal privacy and security are given more weight in individualistic societies. In their seminal article, Oyserman, Coon, and Kemmelmeier (2002) conclude that desire for uniqueness and independence are core elements of cultural individualism. In individualistic societies, a person's attitudes and behavior are regulated largely by individual preferences, whereas in coUectivistic societies, attitudes and behavior are heavily influenced by society's preferences (Triandis 1989). In individualistic countries, children are socialized to think of themselves as "I." That is, an individual's identity is clearly distinct from other people's "I's" (Hofstede 2001, p. 227). People in individualistic societies value consumption experiences that are customized to their own unique needs more than people in coUectivistic societies. In summary, we propose the following moderating effects involving nationalcultural individualism:
140 / Journal of Marketing, July 2006
H5: The effect of utilitarian experience on perceived value is stronger when national-cultural individualism is lower. Hg: The effect of emotional experience on perceived value is stronger when national-cultural individualism is higher. H7: The effect of perceived privacy/security protection on perceived value is stronger when national-cultural individualism is higher. Hg: The effect of perceived customization on perceived value is stronger when national-cultural individualism is higher.
Method Data Coiiection Data collection was carried out in close collaboration with 16 U.S. and European CPG companies. They allowed us to post a questionnaire on their Web sites in one or more of the following countries: Belgium, France, Gennany, Italy, the Netherlands, Spain, Sweden, and the United Kingdom. We obtained information on the individual-level constructs using questionnaires. We used secondary sources for the country characteristics. Furthermore, we conducted indepth interviews with ten consumers to augment the quantitative results with qualitative insights into why the Web sites provided high or low perceived value. These consumers were not aware of the results of the large-scale quantitative study. Questionnaires. We posted a survey on 30 Web sites and requested that online visitors fill out the survey. Electronic data collection was conducted in collaboration with the global market research agencies Taylor Nelson Sofres and GfK and the Intemet market research agency MetrixLab. Online questionnaires were completed by 9546 consumers in 107 countries. We excluded 370 respondents because they had an excessive number of missing responses. In addition, for this study, we used only the countries from which at least 15 responses were returned. This rule resulted in the exclusion of an additional 290 completed surveys from further analysis' Our final data set consisted of 8886 consumers from 23 countries (Australia, Austria, Belgium, Canada, Croatia, Denmark, France, Germany, Ireland, Italy, Macedonia, the Netherlands, New Zealand, Poland, Romania, Russia, Serbia and Montenegro, Slovenia, Spain, Sweden, Switzerland, the United Kingdom, and the United States) reporting on 30 Web sites of 16 CPG companies. The list of companies and Web sites examined appears in Table 2. Secondary data. We obtained country data from external sources (Hofstede 2001; ISSP 1998; Kaufmann, Kraay, and Zoido-Lobaton 1999; Suh et al. 1998). iVIeasures
We developed the questionnaire in English in close collaboration with an advisory committee of Intemet experts (e.g., vice president of Intemet marketing) of five of the participating CPG companies. We subsequently discussed the questionnaire in field interviews with 14 senior managers from ten of the participating CPG companies and pretested it on a Web site. After we made the necessary modifications, the questionnaire was finalized, back-translated into
TABLE 2 Firms, Brands, Product Categories, and Web Sites Examined Firni
Web Site
Brand
Product Category
www.barilla.com www.barilla.it
Barilla Barilla
Pasta and pasta sauces Pasta and pasta sauces
www.nivea.de
Nivea
Personal care
Cadbury Schweppes
www.schweppeseuro.com
Schweppes
Beverages
Colgate-Palmolive
www.colgate-palmolive.de
Multiple brands (e.g., Colgate, Ajax)
Personal care, household care, pet food
Danone
www.danoneconseils.com
Danone, Lu
Dairy products, biscuits, beverages
www.heineken.com
Heineken
Beer
Heinz
www.heinz.co.uk
Heinz
Ketchup, beans, spaghetti
Henkel
www.DonnaD.it
Dixan, Pril, Vernel, Testanera
Household care, personal care
Kraft Foods
www.milka.de www.milkaski.de www.jacobs.de www.estrella.se
Milka Milka Jacobs Estrella
Chocolate confectionery Chocolate confectionery Coffee Salty snacks
www.lindt.com
Lindt
Chocolate confectionery
www.mypetstop.com/fr www. mypetstop.com/ge www.celebrations.co.uk
Pedigree, Whiskas Pedigree, Whiskas Celebrations
Pet food Pet food Confectionery
Procter & Gamble
www.olay.com www.uk.pantene.com
Olay Pantene Pro V
Personal care Hair care
Reckitt Benckiser
www.finish.co.uk
Finish
Dishwashing products
www.de.nl www.senseocrema.nl www.geschenkenwinkel.nl www.zwitsal.nl
Douwe Egberts Senseocrema Douwe Egberts, Pickwick, Senseo Zwitsal
Coffee Coffee pads Coffee, tea, tableware, textiles, coffee makers Baby care
SCA Hygiene
www.bodyform.co.uk
Bodyform
Sanitary napkins
Unilever
www.knorr-gastro.ch www.conimex.nl
Knorr Conimex
Food products Foreign food products
www.lifeandcooking.nl
Multiple brands (e.g., Becel, Bertolli) Via Direkt Axe
Food products
Barilla Beiersdorf
Heineken
Lindt & Sprungli Mars
Sara Lee
www.viadirekt.nu www.axe.be
Laundry detergents Deodorizer
Notes: The content of these sites has changed since we carried out our consumer survey.
all languages involved (Dutch, French, German, Italian, Spanish, Swedish), and linked to the respective country Web sites. To satisfy Web site managers' concerns, the number of items per construct was limited. This is not uncommon in Intemet research conducted in collaboration with companies (cf. Shankar, Smith, and Rangaswamy 2003). The Appendix provides detailed information on the measures.
Individual-level constructs. We measured perceived value with five items, which collectively capture the perceptions and behavioral intentions that have been associated with perceived value in the literature (Parasuraman, Zeithaml, and Malhotra 2005; Sirdeshmukh, Singh, and Sabol 2002; see also Holbrook 1999; Chen and Wells 1999). Seven facets of utilitarian experience are distinguished: (1) information provision, (2) easier decision making, (3) con-
Country Ciiaracteristics and the Perceived Vaiue of Web Sites /141
sumer education, (4) decision confidence, (5) convenience, (6) cross-channel integration, and (7) timeliness. These seven facets constitute a formative scale because there is no a priori reason to assume that they are correlated (Diamantopoulos and Winklhofer 2001). The higher a site scores on any of these facets in the mind of a visitor, the higher is his or her utilitarian experience. We measured both pleasure and arousal with two items taken from the work of Mehrabian and Russell (1974). We measured perceived privacy/ security protection with two items, which we adapted from the work of Wolfinbarger and Gilly (2003) and Zeithaml, Parasuraman, and Malhotra (2002). We measured customization with three items based on the work of Srinivasan, Anderson, and Ponnavolu (2002) and Wolfinbarger and Gilly (2003). Finally, we operationalized the congruity between the consumer and the site as a dummy variable (1 = site is adapted to the respondent's culture; 0 = otherwise). Adapted sites have three characteristics: (1) They are displayed in local country-specific language (e.g., American versus British English); (2) they offer local content (e.g., the site lists local activities versus the site is a mere translation); and (3) they exhibit some level of localization in the form of country-specific dates, zip codes, currency, and/or number formats (cf. Singh, Furrer, and Ostinelli 2004). Two coders independently coded whether each of the 30 sites was adapted to each of the 23 countries; there was a 96% interrater agreement, and disagreements were resolved by discussion. Country-level constructs. Rule of law measures the respect of citizens and the state for the institutions that govern their interactions. It includes several indicators that measure the extent to which people have confidence in and abide by the rules of society. Together, these indicators measure the success of a society in developing an environment in which fair, predictable, impartial, and enforceable rules form the basis for economic and social interactions (Kaufmann, Kraay, and Zoido-Lobaton 1999). The rule-oflaw measure reflects the statistical compilation of information obtained from surveys, nongovernmental organizations, commercial risk-rating agencies, and think tanks. We based the national identity measure on the ISSP (1998) on national identity. Respondents in various countries were asked to rate their opinion on six topics pertaining to national identity, such as how close they felt to their respective countries, national pride, preference to their own country's films and programs, and willingness to move outside their country. The ISSP reports the country-averaged score for each item. We constructed a national identity scale by averaging the countries' scores on the six national identity items. I We obtained the national-cultural individualism rating for each country by averaging the ratings of two leading experts in the field: Hofstede and Triandis, after converting 'For five countries, national identity ratings were unavailable from ISSP (1998). Instead, we used the national identity scores from a neighboring country. We conducted a robustness check by estimating the model after deleting those countries. The results remained substantively the same.
142 / Joumal of Marketing, July 2006
Hofstede's ratings to a ten-point scale used by Triandis (e.g., Suh et al. 1998). Hofstede's scores have the strength of being based on a massive empirical data set, and Triandis's ratings include more recent information and include qualitative insights as well. Covariates. We included two sociodemographic variables (gender, age), another site characteristic variable (accessibility), and 29 site dummy variables to control for unobserved site-specific effects (Greene 2000). We measured accessibility with two items pertaining to being able to access the site quickly and being able to maneuver through the site (Novak, Hoffman, and Yung 2000). These covariates are not the focus of our study, but controlling for their effects provides a stronger test of our hypotheses (Greene 2000).
Measure Vaiidation To allow for a stringent test of convergent and discriminant validity, we included all reflective individual-level constructs in a single confirmatory factor model. Although the chi-square was highly significant (not unexpected, given the large sample size), other indicators suggested a good fit (Byme 1998): xK67) = 2070.77, p < .001; comparative fit index = .95; Tucker-Lewis index = .93; and root mean square error of approximation = .06. All the indicators loaded significantly (p < .001) and substantively (all factor loadings exceeded .50) on their hypothesized factors, providing evidence of convergent validity of the measures (Steenkamp and Van Trijp 1991). To test for discriminant validity, we ran a series of nested confirmatory factor analyses in which we constrained the correlation between each pair of reflective constructs to one. For all pairs, when we compared the constrained model with a free model, the difference was significant, which supports discriminant validity (Anderson and Gerbing 1988). Composite reliabilities were .65 or greater, exceeding the benchmarks that are suggested as acceptable (Bagozzi and Yi 1988). We further tested the validity of the measures of the Web site characteristics perceived privacy/security protection and perceived customization by relating them to objective site characteristics. Drawing on the definition of privacy/security protection, along with consumer pretesting and discussions with the advisory committee of Intemet experts of the participating CPG companies, we specified the following four objective privacy/security indicators: (1) whether the site tells how it will use the visitor's personal information, (2) whether the site explicitly indicates that it will not share personal data with third parties, (3) whether the site explicitly indicates that it will not send follow-up emails or other communications unless the visitor requests this, and (4) whether the visitor can delete the information the site has about him or her in its database. In a similar vein, we developed five objective indicators for customization: (1) whether the visitor can personalize the content of the site, (2) whether the visitor can personalize the "look and feel" of the site, (3) whether the visitor can personalize fun activities and games on the site, (4) whether the visitor can consult an expert through the site, and (5) whether the visitor is addressed by name when vis-
iting the site (after having registered). Two coders scored each Web site on each of these objective characteristics (1 = yes; 0 = no); there was a 97% interrater agreement, and disagreements were resolved by discussion. The correlation between the summated score on the objective privacy/ security indicators and the mean perceived privacy/security score per site was .53 {p < .001), whereas this correlation was .50 for customization (p < .001). These correlations support the validity of the perceived Web site characteristics measures. t\/lodei Specification Our conceptual model of the antecedents of perceived value involves variables at two hierarchical levels of aggregation: the individual and the country level. The Level 1 (individual-level) and Level 2 (country-level) models are as follows:^ Level 1: (1)
= Poj + PijUTILy +
specific Web site that was evaluated to control for unobserved site effects. We assume the individual-level error term ry to be normally distributed with zero mean and variance a^. The random effects Uqj (q = 0,..., 10) are multivariate normally distributed over countries, each with an expected value of zero, var(Uqj) = Tqq, a n d COV(Uqj, Uq'j) = Tqq' (q, q' = 0, ..., 10).
Finally, Uqj is the unique effect of country j on the intercept (Poj) or slope (Py, ..., pioj), while controlling for the country-level predictor variables (when applicable). A preliminary analysis indicated that our specification of random effects was consistent with the data. In all cases, the variance of the error term was significantly different from zero (ps < .05). We do not hypothesize main effects for the countrylevel variables, because it is not obvious why the perceived value of a Web site is systematically influenced by, for example, the degree of national-cultural individualism of the country the visitor is from. However, we include these main effects as covariates for correct estimation of the interaction effects involving the country-level variables (Pedhazur 1982). iViodei Estimation
39
Level 2: (2)
Poj = Too + YoiLAWj + YOZNATIDJ
(3)
P,j =
(4)
P2j=
(5)
p3j =
(6)
h =
(7)
p6j =
(8)
P7j = Y70
(9)
Prj =
(10)
Psj = Y s 0 . f o r s = l l , . . . , 3 9 ;
YK)
In our model, respondents are nested within countries. Applying ordinary least squares regression to multilevel data is inappropriate because the resulting estimates will be biased and the estimated standard errors of the effects will be too small (Aitkin, Anderson, and Hinde 1981; Raudenbush 1988). Hierarchical linear modeling (HLM; Raudenbush and Bryk 2002) has been specifically developed to deal with multilevel data. It enables the simultaneous estimation of relationships of variables at two (or more) levels, using iterative maximum likelihood estimation. Hierarchical linear modeling borrows strength from all the data in each of the countries and makes it possible to estimate cross-level effects, thus enabling us to test H3-H8, specifying how country-level constructs affect relationships occurring at the individual level. We used HLM to test our research hypotheses. Following Raudenbush and Bryk's (2002) recommendations, we centered the Level 1 predictors within countries, and we grand-mean-centered the Level 2 predictors.
+ Urj. for r = 4, 8-10; and
Results where i and j represent individuals and countries, respectively; PV denotes perceived value; UTIL is utilitarian experience; PLEAS represents pleasure; AR is arousal; PRIVSEC measures perceived privacy/security protection; CUSTOM is perceived customization; CONGRUITY is cultural congruity; LAW is the rule of law; NATID is national identity; and INDIV is national-cultural individualism. The covariates GENDER and AGE are selfexplanatory, ACCESS is the Web site's perceived accessibility, and SITE is the dummy variables that denote the 2We estimated our model using SAS PROC MIXED (Singer 1998).
Table 3 presents descriptive statistics and correlations between the variables. The results for the HLM model appear in Table 4.3 Note that we report unstandardized coefficients. In HLM, standardized coefficients are problematic 3We use one-tailed tests because we have directional hypotheses. A 5% significance level might be considered too lenient, given the large sample size, but we believe that this is not the case. It is well known that moderator effects are extremely difficult to detect in nonexperimental research (McClelland and Judd 1993). In simulation studies, McClelland and Judd (1993, p. 379) show that "91% of the simulated field studies made Type II errors by failing to reject a false null hypothesis." They argue (p. 387) that "enormous samples are required to have the statistical power of optimally designed experiments for detecting interactions."
Country Characteristics and the Perceived Vaiue of Web Sites /143
TABLE 3 Descriptive Statistics Correlation Matrix 1
2
3
4
5
1 Perceived value 2 Utilitarian experience 3 Pleasure 4 Arousal 5 Privacy/security 6 Customization 7 Cultural congruity 8 Gender 9 Age 10 Accessibility 11 Rule of law 12 National identity 13 Individualism
1.000 .563 1.000 .446 .338 1.000 .460 .264 .659 1.000 .271 .281 .309 .250 1.000 .540 .530 .471 .432 .402 .011 .016 -.030 -.019 .015 .067 .155 .156 .053 .096 -.009 -.032 -.042 .047 -.031 .459 .472 .222 .196 .148 -.187 -.076 .011 -.190 -.111 -.048 .035 -.056 -.230 .056 -.137 -.015 .007 -.236 -.083
M SD
3.961 .628
3.864 3.783 3.625 3.647 .438 .642 .693 .761
6
7
8
1.000 -.012 1.000 .134 .003 1.000 -.007 -.015 -.197 .311 .014 .078 -.108 .114 -.144 .022 -.103 .072 -.098 .045 -.032 3.742 .639
.951 .216
9
10
11
12
13
1.000
1.000 .001 -.058 -.141 -.099
1.000 -.061 1.000 -.058 -.033 -.059 .703
1.000 -.016
.746 32.163 .435 12.096
3.582 1.168 .690 .858
3.521 7.220 .280 1.448
Notes: N = 8886 for evaluating pairwise correiations between individuai-levei variables or between individual- and country-ievel variables and for means and standard deviations of individual-level variables; N = 23 for evaluating pairwise correlations between country-level variabies and for means and standard deviations of country-level variables.
because the variance is partitioned across different levels. We use t-values as a measure of relative effect size (Nijs et al. 2001). The more positive the utilitarian experience (YIQ = .421, p < .001) and the more pleasurable the experience (720 .106, p < .001), the higher is the perceived value. We also found an inverse U-shaped relationship between arousal and perceived value (730 - .\l9,p < .001; Y40 = -.028, p < .01). Thus, H] is supported. Contrary to our expectafions (H2a and H2c), we do not find support for the notion that perceived privacy/security protecfion (Y50 = .016, /? = .11) and cultural congruity (770 = .017, p = .30) enhance perceived value. However, as we expected (H2b), customization has a significant effect on perceived value (Y6O - -166, p < .001). The core of our conceptual model pertains to the crosslevel interactions between individual-difference and country-level variables. The positive effect of perceived privacy/security protection on perceived value is stronger in countries characterized by a weak rule of law than in countries characterized by a strong rule of law (Y51 = -.094, p < .01), in support of H3. The effect of perceived privacy/ security protection is also larger in individualistic cultures than in coUectivistic cultures (752 = .040, p < .01). This is consistent with H7. H4 proposes that the effect of cultural congruity on perceived value is reinforced when national identity is higher. This hypothesis is supported (j-jy - .\9S, p < .05). H5 proposes that the effect of utilitarian experience is smaller in individualistic cultures than in coUectivistic cultures. This hypothesis is not supported (711 - -.012, p - .32). Hg, which proposes that the effect of emotional experience is larger in individualistic cultures than in coUectivistic cultures, is supported for pleasure (721 = .024, p < .05) but not 144 / Journal of Marketing, July 2006
for arousal (731 = -.001, p = .49). Finally, as we expected, the effect of customization is larger when national-cultural individualism is higher (751 = .035, p < .05), in support of H8.4
The main effects of gender and age were not significant. However, given the practical importance of these easily identifiable consumer characteristics, we reestimated our model including all two-way interactions with consumption experience and Web site characteristics. Three interactions were significant. We found an interaction between gender and (arousal)2 (7 = -.033, p < .05), indicating that males have a higher optimum level of arousal than females. This is consistent with the literature (Zuckerman 1994). Furthermore, we found that older people attach less importance to pleasure (7 - -.003, p < .001) and more importance to customization (7 = .003, p < .001).
Discussion In this article, we examined whether the antecedents of the perceived value that consumers derive from visiting a brand
'•As a robustness check, we reestimated the model for an alternative specification of perceived value, after eliminating Perceived Value Items 4 and 5, while adding Utilitarian Experience Item 3. The results remained substantively the same. The direction of all significant coefficients remained the same, butp values were often somewhat weaker. This is also because the alternative perceived value instrument had substantially lower reliability (.65 versus .75 for our operationalization). Nevertheless, nine of the ten hypothesized effects that were significant remained significant in the altemative model (the other coefficient attained a p value of .13).
TABLE 4 Resuits Unstandardized Coefficient
t-Value
Intercept
4.033
80.2
