THE EFFECT OF ETHNOCENTRISM AND ANIMOSITY ON CONSUMER PURCHASE INTENTIONS IN THE FOOD PRODUCT SECTOR IN LITHUANIA A Thesis Presented to the Faculty of ISM University of Management and Economics in Partial Fulfillment of the Requirements for the Degree of Master in International Marketing by Vaiva Ungulaitytė May 2015 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 2 Abstract This study examined the country of origin (COO) effect in terms of the impact that its antecedents of ethnocentrism and animosity have on consumer intentions to purchase. The relationship between ethnocentrism and animosity was also examined. The research design of the study consisted of an online survey, where individual levels of ethnocentrism and animosity against Russia of Lithuanian consumers were measured, along with their intentions to purchase imported Russian dairy and meat products. After analyzing the results, it was found that both ethnocentrism and animosity had a significant negative effect on consumer intentions to purchase Russian products. Moreover, there was also an evident positive impact of animosity on the level of ethnocentrism demonstrated by the respondents. It was also found that the levels of ethnocentrism and animosity differed significantly between groups of respondents when divided by demographic variables of age, income and education. The findings of the study suggest that the COO effect is still an important factor, which should be considered by both local and foreign companies when developing their marketing strategies, as it directly affects consumer intentions to purchase domestic versus imported production. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS Table of Contents List of Tables and Figures .................................................................................. 4 Introduction ........................................................................................................ 6 Literature Review ............................................................................................... 11 The Evolution of Research on Country-of-origin .................................. 11 The Complexity of the COO Construct ................................................. 16 Ethnocentrism ........................................................................................ 19 Animosity ............................................................................................... 24 COO Effect in Lithuania ........................................................................ 29 Problem Definition ................................................................................. 30 Research Methodology ...................................................................................... 34 Theoretical Framework .......................................................................... 34 Independent and Dependent Variables .................................................. 38 Context of the Study .............................................................................. 39 Research Design ..................................................................................... 40 Questionnaire Structure.......................................................................... 42 Sample Description and Methods of Data Collection ............................ 45 Empirical Research Results ............................................................................... 48 Validity and Reliability of the Data ....................................................... 48 Profile of the Participants ....................................................................... 49 Descriptive Statistics .............................................................................. 51 3 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS Testing the Hypotheses .......................................................................... 52 Discussion and Conclusions............................................................................... 62 Summary of the Findings ....................................................................... 62 Implications of the Findings .................................................................. 67 Limitations of the Study......................................................................... 69 Suggestions for Future Research............................................................ 70 Conclusions ............................................................................................ 72 References .......................................................................................................... 74 Appendix ............................................................................................................ 82 4 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS List of Tables and Figures Table 1: Authors Examining the Static versus Dynamic Nature of COO Effect ........... 15 Table 2: The Complexity of the COO Construct ........................................................... 16 Table 3: The Classification of Animosity ...................................................................... 26 Figure 1: The Conceptual Model of the Study. .............................................................. 35 Table 4: The Questionnaire Structure ............................................................................ 44 Table 5: The Demographic Profile of Participants ........................................................ 50 Table 6: The Descriptive Statistics of the Variables ...................................................... 52 Figure 2: The correlation between ethnocentrism and intention to purchase (ITP)....... 53 Figure 3: The correlation between animosity and intention to purchase (ITP) ............. 54 Figure 4: The correlation between animosity and ethnocentrism. ................................. 55 Table 7: The Summary of the Empirical Testing of Hypotheses. .................................. 60 5 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 6 Introduction Research Problem Definition Country of origin (COO) effect in relation to consumer behavior has been extensively researched for more than several decades now. One of the most widely researched topics in relation to COO has been its effect on consumer purchase intentions towards imported products from foreign countries. Prior research has revealed that the two main endogenous antecedents of COO affecting consumer intention to purchase are their individual levels of ethnocentrism (Balabanis & Diamantopolous, 2004) and animosity (Nijssen & Douglas, 2004) towards the foreign country. Multiple studies over the years have demonstrated that higher levels of ethnocentrism and animosity can negatively impact consumer intentions to purchase goods imported from foreign countries (Klein & Ettenson, 1999; Papadopoulos, 1993). Demographic variables such as age, education and income have also been found to have a significant impact on the level of country of origin effects demonstrated by individual consumers (Sharma et al., 1995). Even though multiple studies have already examined the COO effect in diverse contexts, there are several limitations and gaps in the research that still need to be addressed further. First of all, there is a disagreement between various authors on whether COO still remains an important factor affecting consumer intentions to purchase in today's markets of globalization and internationalization. It is suggested that more detailed investigations into the concept of COO and its antecedents are necessary in order to determine its relevance today (Pharr, 2005). Moreover, mixed results have been demonstrated by prior research in terms of the relationship between the concepts of ethnocentrism and animosity. Some authors have found animosity to be positively related to ethnocentrism (Klein & Ettenson, 1999), while others claim them to be two distinct concepts (Nakos & Hajidimitriou, 2007). ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 7 According to Balabanis et al. (2001), ethnocentrism and animosity are also especially subject to change in various cultural contexts. Therefore, there is still a need for further research to be conducted in the field, where the impact of consumer ethnocentrism and animosity on intention to purchase would be measured in novel and different contexts. This study aims to examine the topic of COO effect and its antecedents of ethnocentrism and animosity further in the context of the food product sector in Lithuania. This particular context has not yet been widely investigated in relation to COO. The research study is also looking to examine the effects that the occurring animosity between Lithuania and Russia might have on consumer intentions to purchase products originating from the other country. Based on prior research, it could be hypothesized that Lithuanian consumers with higher levels of ethnocentrism and animosity should have lower purchase intentions of Russian products. However, up to this day there have not been any scientific attempts to examine the relationship any further in this specific context. Consequently, the aim of the study is to measure whether the level of ethnocentrism and animosity has a significant impact on Lithuanian consumers' intentions to purchase food products originating from Russia. The results of such study would have significant practical implications for the foreign firms looking to enter the Lithuanian market, by revealing the importance of COO when marketing their products. Moreover, the possible correlation between ethnocentrism and animosity is examined in more detail, which could potentially lead to new insights into the concept of COO as a whole. Thesis Goal The thesis goal is to identify whether ethnocentrism and animosity have an effect on Lithuanian consumers' intentions to purchase food products originating from Russia. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 8 Thesis Objectives The main objectives of the following research study are: 1. To analyze and describe previous research in relation to COO and its antecedents of ethnocentrism and animosity, the relationship between them and the effect that they have on consumer intentions to purchase, as well as to identify the relevant gaps in existing literature. 2. To conduct the empirical research in order to find out if ethnocentrism and animosity against Russia have a significant effect on consumer intentions to purchase in the food product sector in Lithuania. 3. To compare the literature analysis and the empirical testing results, and to discuss whether the found effects of ethnocentrism and animosity on intentions to purchase in Lithuania are consistent with prior research in other contexts, along with the practical implications of the findings and suggestions for future research. Research Design The study uses the quantitative research method in order to investigate the effect of ethnocentrism and animosity on consumer intentions to purchase. The food product sector in Lithuania has been chosen to be used as the context in this study. Firstly, the individual levels of ethnocentrism and animosity of each participant are measured. To measure consumer ethnocentrism, a 10-item CETSCALE is used (Shimp & Sharma, 1987). For measuring consumer animosity towards the foreign country, a scale developed by Nijssen and Douglas (2004) is applied. The participants are then asked to indicate their intentions to purchase food products that are imported from Russian manufacturers ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 9 (specific companies or brands are not named in the survey). In order to measure purchase intentions a version of the scale developed by Klein et al. (1998) is used. Finally, demographic information about the participants' age, gender, education and income is collected. The described research method allows to determine the effect that ethnocentrism and animosity have on consumer intentions to purchase in a novel context of food products in Lithuania, and also to see how the two concepts are related to each other. In addition, to gain a deeper understanding of the concepts, the differences in levels of ethnocentrism and animosity are examined and compared between distinct demographic groups of participants. Methods of Data Collection and Analysis In order to collect the data, convenience sampling technique is used and participants are selected because of their convenient accessibility and proximity to the researcher. The questionnaire is carried out in electronic format via the internet. Several statistical tests are employed to analyze the data and answer the research questions, such as analysis of variance, independent t-test, correlation and regression analysis. Thesis Sequence The first step of the thesis sequence is the literature review, where the current state of knowledge about COO is presented and the concepts of ethnocentrism and animosity are clearly defined based on prior research. The central research question and problem definition are also presented. Secondly, the empirical research is carried out. It consists of measuring participants' levels of ethnocentrism and animosity, as well as their intentions to purchase food products imported from ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 10 Russia. Subsequently, the next step is to process the data collected and perform the statistical data analysis. In the following stage, the results of the study are presented. The final stage of the research sequence entails the comparison of the reviewed literature and the empirical testing results. Scientific and managerial significance of the study are described here, along with recommendations and implications for further research. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 11 Literature Review This section of the research paper is dedicated to describing the evolution of research on the country of origin (COO) effect and consequently, defining its psychosocial antecedents of ethnocentrism and animosity, which are two of the main concepts used in the empirical study. The following literature review is thus divided into three main sections. In the first section the evolution of research on the COO construct is described along with its definition. Then the antecedents of ethnocentrism and animosity are presented and analyzed in more detail with regard to prior research. The final part of the chapter aims to summarize the findings, identify the existing gaps in the literature and define the main research problem. The Evolution of Research on Country-of-origin Researchers and marketing practitioners have been examining the topic of how consumer intentions and behavior are affected by the country a product is made in for more than several decades now. Multiple authors in the literature define the country of origin as “the country of manufacture or assembly of a product” (Bilkey & Nes, 1982; Lee & Schaninger, 1996; Papadopoulos, 1993). However, some other definitions are prevalent as well, for example, Johansson et al. (1985) describe country of origin as the location of the corporate headquarters of the company. These definitions take on significantly different views towards COO, as in many cases the location of the company's headquarters differs from the place of manufacture or assembly of the product. Such differences become especially important during this age of internationalization and globalization of trade and businesses, when many products are often assembled and produced in several distinct countries. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 12 However, despite their differences most researchers in the literature agree that COO becomes an essential factor for companies when entering new markets. This is due to the fact that it can create intangible barriers because of the negative bias that consumers may hold towards the products coming from a particular foreign country (Wang & Lamb, 1983). The constant dynamic changes in the world of business are affecting the way researchers look at the country of origin effect with a growing need to examine it further, especially in relation to a number of different attributes and in a variety of new contexts. The following part of the literature review will thus be focused on the evolution of research on country of origin up to this day, in order to more clearly define and describe the constructs that were chosen to be used in this particular study. Static Nature of the COO Effect. The first approach taken by scholars to examine the COO effect occurred during the seventh decade and can be seen as rather simplistic in the eyes of today's research. This is due to the fact that the studies, which were conducted in this primary period of research, employed methods that did not reveal the true complexity of the construct (Bilkey & Nes, 1982). The COO effect was examined only at a single point in time, thus assuming its static nature and not taking into account any changes that might occur over time. The method used was often a singlecue approach, which looked at COO as the only product cue that was affecting consumer behavior in empirical manipulations and was also the only characteristic presented for consumers to base their decision about the product on. Therefore, the results of such studies tended to underestimate the complexity of COO and at the same time to overestimate the effect that it had on consumers' purchaserelated behavior (Pharr, 2005). The country of origin based research first began with the work of Schooler in 1965, who was the first author to define and scientifically examine the COO effect. Schooler carried out his study on a student sample in South America and asked them to rate products that were indicated to supposedly be ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 13 originating from four different countries. The results revealed that products from less developed countries were evaluated less positively by the respondents and thus it could be concluded that the country of origin effect did in fact exist and that it had an impact on consumer perceptions of products. In the following years, many similar studies followed the work of Schooler and continuously attempted to analyze the country of origin topic in more depth. The next major author who took the COO research a step further was Reierson in 1967. He examined the topic in the context of American students and several different product categories, with products originating from the USA and multiple foreign countries. Reierson found that the country of origin and the national stereotypes associated with it had a significant impact on the American respondents’ opinions as well. Another important advance in the primary COO research was the identification of regional versus national labeling of products (Schooler & Sunoo, 1969). Regional labeling meant that instead of naming a particular country of origin, a region of origin was mentioned (“made in Europe”, “made in North America”, etc.). The authors noticed that while consumers often had negative bias towards products labeled nationally (as coming from a particular country), regional labeling did not seem to have any noticeable impact on consumer behavior. Such findings brought an important revelation for manufacturers coming from developing countries, which often had to face the negative perceptions consumers from other parts of the world held towards their products. In the years to follow other authors consistently found similar results that the country of origin effect had a major significant impact on consumers’ evaluations of products in a variety of different contexts (Schooler, 1971). However, as it has been mentioned before, the first studies often underestimated the complexity of the topic, by using simplistic research methods where the COO was seen as a static construct and was also the only characteristic of the product provided for the consumer to evaluate. Such manipulations did not reflect the real-life environment in which consumers actually made purchase- ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 14 related decisions and therefore, the results of such studies now could not be deemed as entirely accurate (Bilkey & Nes, 1982). Dynamic Nature of the COO Effect. The researchers that followed the work of pioneers in the field of COO effect began to realize the drawbacks and disadvantages that this simplistic approach had. During the period of 1970-1990, a multiple cue approach to examining COO emerged, based on the idea that in the natural environment the consumer is faced with and affected by many more cues than just the location where the product is made in (Bilkey & Nes, 1982). This led to the consequent development of numerous mufti-faceted design studies, which examined the COO effect in context with other product attributes, such as price, quality, reliability and others. The results of such studies revealed that when COO was investigated together with other cues, it had a less significant effect on consumer behavior than it had been believed before (Darling & Puetz, 2002; Papadopoulos et al., 1987). Moreover, the findings of multiple cue studies suggested that the country of origin effect was more of a dynamic construct rather than a static one as it had been seen by single cue research (Nagashima, 1970; Nagashima, 1977). The dynamic nature of the construct meant that it was subject to change over time due to the constantly shifting beliefs and attitudes that people had in general. Nagashima's research during the period of 1970-1977 entailed the comparison of Japanese and American consumers' perceptions of national and foreign products over a period of time. The research revealed that the attitudes of Japanese and American consumers towards the same products differed based on the different national stereotypes that they possessed. For instance, while the Japanese rated German originating products the most positively, the American consumers had the most positive attitudes towards their own domestic production. Nagashima replicated the study seven years later and found that the country of origin image had in fact changed over time. The results showed that the image of USA had deteriorated in the minds of consumers during that time, whereas the images of other ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 15 countries used in the research (Japan, Germany, France and UK) had improved. Other authors continued to follow the work of Nagashima and their research consistently confirmed the dynamic nature of the country of origin construct (Darling & Puetz, 2002; Lampert & Jaffe, 1998; Papadopoulos et al., 1987). The table below presents the main authors in the literature who examined the static versus dynamic nature of country of origin effect. Table 1 Authors Examining the Static versus Dynamic Nature of COO Effect Authors Examining the Static Nature Authors Examining the Dynamic Nature Schooler (1965); Reierson (1967); Nagashima (1970); Nagashima (1977); Bilkey & Schooler & Sunoo (1969); Schooler (1971). Nes (1982); Papadopoulos et al. (1987); Lampert & Jaffe (1998); Darling & Puetz 2002. In the years to follow, the multiple-cue approach for measuring COO was further developed and widely used. Along with country of origin, researchers used multiple other attributes (price, reliability, durability, workmanship, etc.) that consumers were asked to consider and rate when making their judgments about the presented products. The results of such research consistently showed that the country of origin effect on consumer behavior was less significant than it had been believed before. It was demonstrated that price and other quality-related attributes were rated as more important than COO to most consumers when making a product evaluation (Ettenson et al., 1988; Johansson et al., 1985). Another important study in the history of COO research is one that was performed by Han in 1989. He conducted interviews with consumers from three countries (USA, Japan and South Korea) in order to examine the role that country of origin had on their perceptions of certain products. After analyzing the results, Han came to the now widely cited conclusion that COO can be used as either a ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 16 halo or a summary construct by consumers in their product evaluations. According to the author, the halo effect occurs when consumers are not familiar with the product category or have limited knowledge about it. In such conditions, the country of origin serves as a source of information and consumers attribute the characteristics of country image to their evaluation of the product. On the other hand, if the consumers are familiar with the product category and also the country of origin itself, then COO can be used as a summary construct, which summarizes their attitudes towards the product characteristics (Han, 1989). The Complexity of the COO Construct With the advancement of research that has been described previously (from static to dynamic image; from single to multiple cue approach), the understanding of what the overall construct of COO is has been shifting as well. It is important to note that the COO construct is perceived differently by various authors in their work as it is demonstrated in Table 2 below. Table 2 The Complexity of the COO Construct Definition of the COO Construct Authors The country where the product was assembled. Papadopoulos (1993) The country where the majority of components of the Insch & McBride (2004); product were made. Lee & Schaninger (1996) The country where the product was manufactured. Bilkey & Nes (1982); Lee & Schaninger (1996) The country where the company owning the product is based. Johansson et al. (1985) ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 17 As this particular study is carried out in the food product sector, in most cases the goods are produced in a single country. Therefore, in this case it would not be logical to look at COO as the “country of assembly of the product“ or the “country of components of the product“. Moreover, when it comes to food products, consumers are usually more concerned with the country where the product was actually made in rather than the country where the brand is established. Consequently, the following study takes on the views of the authors, who claim that country of origin can best be defined as the country of manufacture of a product (Bilkey & Nes, 1982; Lee & Schaninger, 1996). However, in order to understand the construct of COO that exists today deeper, it is also important to look at the main antecedents and precursors, which determine the variations in the COO effect. It has been suggested by prior research that the antecedents of COO can be divided into two main parts – exogenous and endogenous (Pharr, 2005), both of which are described in more detail in the following part of the chapter. First of all, the exogenous antecedents investigate the COO effect in relation to external factors that occur outside of the consumers. They seek to explain the differences in individual COO effects by looking at the structural and cultural dimensions of the particular country in question. One of such most commonly used exogenous variables is the level of economic development of the country. However, as demonstrated by prior research, the exogenous antecedents have produced rather mixed results in terms of their impact on consumer intentions to purchase and have not been found to be as influential as the endogenous variables (Pharr, 2005). While exogenous antecedents have received extensive attention from scholars over the years, the endogenous traits have been examined much less and are still relatively new concepts in the literature of COO. These factors focus on the traits that are found within consumers and impact the individual level of COO effect in each consumer, for instance such as demographic and psychosocial ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 18 variables (Balabanis & Diamantopoulos, 2004). Country image is one of the main factors that falls under the psychosocial category of antecedents. Previous research has demonstrated that if consumers have a more positive image of a country, consequently they will have higher purchasing intentions of the products originating from that country (Roth & Romeo, 1992). As indicated by Pharr (2005), country stereotypes are also considered as another antecedent of the endogenous type. Stereotypes as such can be either of a favorable or unfavorable nature and that can determine the positive or negative bias that consumers will hold towards that country and its products. Consumer ethnocentrism and country-specific animosity are two other examples of the psychosocial antecedents that have been examined less in the context of country of origin research. It has been demonstrated that the concepts of ethnocentrism and animosity are especially subject to change in different cultural contexts and the findings are not consistent across various countries (Balabanis et al., 2001). The research on post-Soviet bloc countries in terms of ethnocentrism and animosity is particularly scarce, despite of their interesting and unique historical context. In addition, although several authors have already investigated the existence of a correlation between ethnocentrism and animosity, they have found mixed and inconsistent results (Klein & Ettenson, 1999; Nakos & Hajidimitriou, 2007). A clear and more comprehensive approach to an empirically confirmed relationship between the two concepts is still missing (Pharr, 2005). As a result, there is still a lack of studies in the literature of COO that focus both on consumer ethnocentrism and animosity and examine the correlation between them in novel contexts, which is essential because of the mentioned cultural sensitivity of the concepts. It is important to identify a more precise nature of the relationship between these antecedents and the overall effect that they have on consumer purchase intentions, in order to gather a deeper insight into the concept of COO. Due to such gaps in the current literature, ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 19 ethnocentrism and animosity have been chosen as the main concepts in the study and are described in more detail in the following part of the chapter. Ethnocentrism Ethnocentrism (CET) as a concept in the field of marketing was first applied and defined by Shimp and Sharma in 1987 as “the home country bias portion of the country-of-origin effect”. Another well-known and widely accepted definition was proposed by Papadopoulos (1993) who states that it is “the phenomenon of a preference of one’s ‘kind’ and concomitant dislike of others”. Essentially both of these definitions indicate that it is a belief that is held in the minds of consumers concerning the morality and suitability of purchasing products that are produced in foreign countries. Consumers that are more ethnocentric may hold the belief that purchasing imported products is unpatriotic in the sense that it hurts the domestic economy. Therefore, the construct of ethnocentrism can have a negative effect on consumers' intentions to purchase foreign products and in turn have them biased in favor of domestic production (Balabanis & Diamantopoulos, 2004). The idea of ethnocentrism is also supported by social identity theory, which says that people tend to categorize themselves as belonging to some social groups (in-groups) and others as belonging to different social groups (out-groups) (Tajfel & Turner, 1979). According to the authors, members of a certain in-group are likely to have negative perceptions of the out-group, in order to enhance their own self-perception. With regards to consumer ethnocentrism in marketing, the in-group becomes the domestic country of consumers, whereas the out-group is the foreign country. Consequently, consumers perceive their in-group as superior and hold prejudiced negative views against the outgroup, leading them to believe that their domestic goods are the best and thus increase their willingness to purchase such products. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 20 Shimp and Sharma (1987) can be given credit for not only defining the concept of ethnocentrism but also for developing an important tool, which is used by researchers to measure the level of consumer ethnocentrism up to this day – the CETSCALE (Consumer Ethnocentric Tendencies Scale). The scale was first developed with 225 questions, however, during periods of multiple testing it was reduced to a final version of 17 items. The scale measures the tendency of consumers to consistently behave towards domestic and foreign productions. Respondents, whose scores are distributed in the upper half of the scale are then categorized as highly ethnocentric, meanwhile those who have scores on the lower half of the scale are said to be less ethnocentric. The scale was originally validated in the US by Shimp and Sharma but during the years and research that followed, it has been validated in multiple other countries as well. For example, the UK (Balabanis & Diamantopoulos, 2004), Netherlands (Douglas & Nijssen, 2003), Poland (Supphellen & Rittenburg, 2001), China (Pereira et al., 2002) and others. Moreover, shorter versions of the original 17-item scale have also been used and validated by other researchers. One of the most popular of such shortened versions is the 10item CETSCALE, with its main advantage being the smaller amount of questions that the respondents have to answer (Balabanis et al., 2001). Another even shorter version that consisted of 4-items was also introduced to the research literature and was demonstrated to have high (0.96) correlation with the 10item scale (Klein, 2002). Demographic variables. The following study is also looking to compare how the levels of ethnocentrism may differ within various demographic groups of consumers. This category of variables was chosen because of its expected significant impact on ethnocentric tendencies. It is interesting to examine the demographic variables in the context of post-Soviet countries mainly because of the predictable significant variations between the different generations of consumers. The older generation was born and grew up under the Soviet regime, meanwhile, the younger one has already spent the ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 21 biggest part of its conscious life in independence and has not directly experienced the Russian occupation. Therefore, such differences between the two demographic groups should also result in important implications in terms of their effects on ethnocentric tendencies. In addition, there is also the existence of mixed findings by different authors when it comes to the demographic variables of education and gender (Bailey & Pineres, 1997; Insch & McBride, 2004; Ruyter et al., 1998; Sharma et al., 1995). As a result, it would be interesting to see the effect that these variables have in the particular context of this study. In the further part of this chapter, the existing findings on each of the demographic variables are going to be described in more detail in order to provide a clearer picture of how each of them may influence the level of consumer ethnocentrism in individuals. It has been demonstrated by prior research that demographic variables such as age and education can have an impact on the individual levels of ethnocentrism exhibited by consumers (Shimp & Sharma, 1987). When it comes to the age factor of consumers, researchers have demonstrated that as people get older, they become more ethnocentric and as a result, more biased against purchasing foreign production (Wetzels et al., 1996). On the other hand, younger people in general hold more cosmopolitan views and possess lower levels of patriotism. Consequently, such consumers are usually more open-minded and in favor of purchasing foreign products than the elder part of the population (Sharma et al., 1995). Furthermore, education has also been demonstrated to be one of the most influential demographic variables in terms of affecting the individual levels of consumer ethnocentrism. Most authors have found that the higher the level of education is, the less ethnocentric tendencies the person possesses and so is more in favor of foreign production (Bailey & Pineres, 1997; Festervand et al., 1985). The rationale behind this is that education broadens the minds of people, in turn making them more open and less prejudiced towards the ideas and values of other cultural groups. However, there ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 22 have also been some inconsistent findings provided by other authors. Among others, Insch and McBride (2004) found that education did not have a significant impact in the context of some product categories and also in particular country contexts (for instance, with American consumers). Gender was another demographic variable that has been widely examined in relation to consumer ethnocentrism and has demonstrated some mixed results. A portion of the researchers who investigated this relationship found women to show more ethnocentric tendencies than men (Bruning, 1997; Sharma et al., 1995). This was explained by the authors to be due to the fact that women in general are more empathetic, conservative and care about maintaining harmony and well-being within their social groups. However, as demonstrated by some other researchers, gender was found to be a relatively unimportant factor when it comes to the effect on consumer ethnocentrism (Ruyter et al., 1998). Finally, in terms of demographic variables, income has also been found to have a significant impact on levels of ethnocentrism by multiple researchers. Most studies have demonstrated that there is a negative correlation between the level of income and ethnocentrism of an individual (Bruning, 1997). Such a relationship can be explained as due to the fact that higher levels of income allow for more opportunities of foreign travel and interactions with other cultures. Consequently, people that earn higher income levels are usually better traveled and more cosmopolitan, which causes them to be less ethnocentric and hence have more positive attitudes towards buying imported goods (Sharma et al., 1995). The effect of ethnocentrism on consumer behavior. As it has been mentioned, the topic of ethnocentrism and the use of the CETSCALE in different contexts had become a popular area and tool of investigation for many researchers in the years to follow. One of such examples where the relation between ethnocentrism and consumer intentions to purchase was empirically examined by using the ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 23 CETSCALE was that of Lantz and Loeb (1996). They investigated it in the context of American and Canadian consumers’ preferences of computer mouse-pads. The authors motivated that such a product was chosen for the study because it was a low-involvement, generic product for which country of origin effects would not generally occur. The results of the survey-based research revealed that consumers with higher levels of ethnocentrism were not only more willing to purchase domestically made mouse-pads but also to pay larger sums of money for them. Such findings support the theory of ethnocentrism acting as an important factor with regard to consumer decisions of purchasing domestic versus foreign production. However, it is argued by some researchers that the implications of the Lantz and Loeb study are limited because of their use of the sample of undergraduate students as respondents (Watson & Wright, 1999). Another major study that examined ethnocentrism in relation to consumer intentions to purchase was performed by Baker and Michie (1995). They used five different automobile manufacturers in the research in order to examine the effect of British drivers' ethnocentrism on product perceptions and intentions to purchase. The automobiles used in the study were of four foreign producers and one domestic producer. The results revealed that ethnocentrism had a significant effect on the preferences of consumers: 18% of the respondents demonstrated a strong preference, whereas 48% showed a general preference towards their domestic brand. According to Baker and Michie, such results indicate that consumer ethnocentrism can act as an important source of competitive advantage for a domestic brand, especially when other product attributes (such as price and quality) are of similar level between the foreign and domestic competitors. Balabanis and Diamantopolous are two other major authors in the literature on ethnocentrism, especially well-known for their study in 2004, where they found that consumer perceptions and preferences for foreign and domestic products depend not only on the country of origin, but on the ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 24 product category as well. They examined the preferences of British consumers towards domestic products and foreign ones from five well-developed countries (USA, Japan, Italy, Germany, and France). The authors motivate their exclusion of less-developed countries from the research by claiming that products from such countries are usually perceived of lower quality in general and thus this could lead to biased results of the study. Eight different product categories were also chosen by the researchers to be part of the study, they included: cars, food products, toiletries, TV sets, toys, fashion wear, furniture and do-it-yourself tools. The respondents of the study were then asked to rank the countries of origin for each product category indicating their preferences. The individual level of ethnocentrism of each participant was also measured by use of the CETSCALE. Results of the study revealed that consumers did not consistently favor their home country in their preferences. However, there was a strong positive relationship between ethnocentrism and participant preference for domestic products; and a negative one between ethnocentrism and the negative bias against foreign goods. Animosity The second concept examined in this study is that of animosity. In the recent years, it has gained a lot of interest in the field of marketing research, particularly due to the growth of international trade and product alternatives from many different countries now being available for consumers to choose from. Animosity is defined as consumers' antipathy towards a foreign country, caused by the past or present economic, political, military or diplomatic activities (Klein et al., 1998). In today's context of international markets, this construct becomes of special importance because it can have a significant negative effect on consumers' purchase intentions of foreign products. In most cases animosity is event-triggered, meaning that it can arise from historical, national or even personal events that are negatively associated with a particular country (Jung et al., 2002). Consumer animosity ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 25 towards a foreign country can also be of dual dimensions – cognitive and affective. The cognitive perspective is caused by rational underlying reasons, such as historical events and is more of a stable nature. Meanwhile, the affective dimension is more situational and unstable, however, it has also been found to have a more significant influence on consumer purchase intentions (Leong et al., 2008). Consumer animosity has been found to be positively related to ethnocentrism by some authors, as both concepts can have significant effect on consumer intentions to purchase products from foreign countries. However, it is also claimed to be a rather distinct construct from consumer ethnocentrism by others (Nakos & Hajidimitriou, 2007). The rationale behind this is that while ethnocentric consumers may be less willing to purchase goods that are imported from foreign countries in general, consumers with high levels of animosity usually tend to have negative purchase intentions towards products coming from one country in particular (Klein & Ettenson, 1999). Animosity is a relatively new concept in the marketing literature as it was first empirically investigated with regards to consumer behavior only in 1998 by Klein et al. They examined the perceptions of Chinese consumers towards Japanese products, by using the Nanking massacre of 1937 (when Japanese troops murdered thousands of Chinese civilians) as underlying rationale for animosity. The authors revealed that even though many years had passed since the cruel event, the Chinese consumers still held negative feelings of animosity towards the Japanese, which had negative effects on their intentions to purchase products imported from Japan. As it has been mentioned previously, animosity can be classified into several different types, with two of the main types being – economic and war animosity (Klein et al., 1998). Economic animosity relates more to the fear of economic domination of a foreign country over the consumers' home country. It can also be associated with unjustified power in the market gained by one country, unfair trade or even losing one's job to due to a negative economic situation that has been influenced by another country. On the other hand, war ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 26 animosity is related to military disagreements between countries, which can result in the physical harm of citizens of one country or even occupation. Furthermore, Klein et al. (1998) developed a scale, which has been used to measure animosity by many of their subsequent authors. The original scale consisted of three different parts: general animosity revealing total hatred towards a country and measured by a single variable, military animosity measured by three variables and economic animosity measured by five variables. However, over the years modified and shortened versions of the scale have also been validated and used by researchers. Later studies also tended to exclude the general animosity part and focused solely on the war and economic animosity (Witkowski, 2000; Wood & Darling, 1993). Most authors in their research studies have investigated the animosity of the consumers of one country towards the products originating from another country and have aimed to duplicate the findings of Klein et al. (1998) in different contexts. Based on the research that has been carried out in the field, animosity can be classified as being of several different types depending on its origin, an overview of which is presented in the table below. Table 3 The Classification of Animosity Authors Type of animosity Countries examined Klein & Ettenson (1999) Situational – Economic USA's animosity against Japan Ettenson & Klein (2005) Situational – Economic Australia's animosity against France Cici et al. (2005) Situational – War Animosity between Bosnia, Serbia, Croatia Shoham et al. (2006) Situational – War Israel's animosity against Palestine Witkowski (2000) Stable – Economic USA's animosity against China Russel (2004) Stable – Economic Animosity between USA and France Wood & Darling (1993) Stable – War Central and Eastern European countries Klein et al. (1998) Stable – War China's animosity against Japan Nijssen & Douglas (2004) Stable – War Netherlands' animosity against Germany ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 27 Sources of animosity. As it is demonstrated in Table 3, animosity for a particular country can be of multiple types and thus it can be triggered by multiple different sources. Most authors in the literature on animosity divide the sources into few general groups such as war-based, economic-based, social-cultural based or personal-based (Klein & Ettenson, 1999). In terms of the war-based animosity, in most cases it has been found to be of a more cognitive and stable nature when military conflicts are involved. This has been demonstrated by authors such as Nijssen and Douglas, who in their paper of 2004 found that animosity had a significant influence on Dutch consumers' intentions to purchase as they were more reluctant to purchase cars that were produced in Germany. This behavior was positively correlated to the animosity levels felt towards Germany, which as explained by the authors, was probably due to the German aggression during World War II. However, it is important to note here that war-related animosity can also be of a situational and unstable nature, especially when it comes to feelings of extreme nationalism between several ethnic subcultures. Cicic et al. (2005) demonstrated such types of situational animosity between the Bosnians, Serbs and Croats, who all felt high levels of animosity towards each other during the time of military conflict between the groups. After some time had passed and when the physical conflicts had ceased, the animosity levels were seen to go down as well. Similar types of situational animosity can also be seen evident between other ethnic groups around the world as well (Shoham et al., 2006). When it comes to the economic-based precursors of animosity, it is usually caused by the perceived economic threat or dominance of one nation towards another (Klein et al., 1998). For instance, Witkowski (2000) found that American consumers' purchase intentions of Chinese products were negatively impacted by their animosity towards China. Such animosity was most likely caused by China's rapidly growing economy, which could be perceived as a threat to the domestic economic and well-being of the American consumers. Similar results were demonstrated by Ettenson and Klein ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 28 (2005), in the context of Australians' animosity towards France, during the time that France was performing nuclear research in the South Pacific close to the shores of Australia. The results of the study indicated that at the time of the nuclear research Australian consumers' animosity towards France had significantly risen and consequently, negatively affected their willingness to purchase imported production from France. However, it is important to note here that the authors performed their study once again in a year, when the nuclear research had already been finished. This time they found that the animosity towards France in Australia had decreased as compared to the results of the first study. Such findings provide evidence for the suggestion of Leong et al. (2008) that animosity can also be of a more affective situational nature and unstable over time. Animosity of one nation towards another or between nations can also be caused by socialcultural factors, as for example, differences in culture, religion and mentality (Klein & Ettenson, 1999). One of the most prominent examples of such animosity in the world is the one felt between the American and the French nations. Moreover, such animosity can be of a stable nature and occur even without the two sides ever being involved in any military conflicts. Russel (2004) demonstrated the existence of this type of animosity in the context of the film industry by comparing each country's consumers' preferences of American and French films. He found that there was a positive correlation between the level of animosity felt towards the foreign country and the preference for locally produced films rather than imported ones, which by most consumers was perceived as “cultural invasion”. This was explained by the author as due to the clear mentality differences between the two nations, with the French being extremely proud of their culture and being derogatory towards the American culture and values. Finally, the origins of animosity can also be of a more personal nature based on the specific traits and experiences of a particular individual (Klein & Ettenson, 1999). For example, animosity ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 29 towards another country can be brought on and impacted by factors such as age, nationalism, patriotism and collectivism (Shoham et al., 2006). The personal type of animosity can also be generated by a simple factor like a negative individual experience with a particular country. It can either be caused by a single experience in time or during multiple similar experiences, which lead to a more stable nature of animosity (Jung et al., 2002). Personal-based sources of animosity can also include the environment and demographic characteristics of the individual consumer. For instance, in terms of the relationship between age and animosity, it has been demonstrated by previous research studies that age has a significant effect on the level of animosity. As a result, consumers who are older tend to hold significantly higher levels of animosity towards a particular foreign country (Klein & Morris 1996; Klein & Ettenson 1999). With regards to other demographic variables such as gender, no significant influence in relation to animosity has been demonstrated by researchers up to this day (Klein & Morris 1996; Klein & Ettenson 1999). The findings on the effect of education on animosity have been similar, with no significant correlation found between the two concepts (Klein & Ettenson, 1999). Meanwhile, in the same study, income was found to have a marginally significant impact on the level of animosity. Consumers who earned higher levels of income were less likely to show high levels of animosity towards a foreign country (Klein & Ettenson, 1999). COO Effect in Lithuania During the later years, one of the most prevalent topics in COO research had become the comparison of consumer attitudes towards foreign and domestic products. Different researchers consistently demonstrated similar results – consumers from developing countries were more in favor of foreign goods coming from more developed countries, whereas consumers from developed countries rated their own domestic production more positively (Kaynak et al., 2000; Krishnakumar, 1974; ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 30 Sharma, 2011). After the fall of the Soviet Union and with the opening of new emerging markets, the post-Soviet countries became a new area of interest for country of origin researchers, who demonstrated that consumers from those markets consistently rated products from Western countries more positively (Cumberland et al., 2010; Ettenson, 1993). Lithuanian consumers were no exception to such findings as Mockaitis et al. successfully demonstrated in 2013. They found that Lithuanian consumers rated products from USA, Western Europe and Japan as those with the highest quality and most attractive for purchasing. Meanwhile, domestic products and those imported from closer neighbors (such as Latvia, Estonia, Poland, etc.) were rated far less positively by the respondents. However, slightly different results were found by similar research carried out on another product category – vitamins and dietary supplements (Smaiziene & Vaitkiene, 2013). Their study revealed that Lithuanian consumers’ perceptions of domestic products were of a similar level to those from Western developed countries. However. products from neighboring countries were rated significantly less positively than domestic goods. Therefore, it can be assumed that the results of such comparative studies in the Lithuanian market are strongly impacted by the choice of product category and the particular context under investigation. Further research into the field is still needed in order to gain a deeper understanding of the COO effect on Lithuanian consumers’ behavior and intentions to purchase. Problem Definition As the nature of business is getting more dynamic and complex, especially with the internationalization of products and services, some scholars have started to question if the COO impact is still a critical factor affecting consumer behavior these days. They argue that due to the larger amounts of information about products available for consumers, they are becoming less aware of COO ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 31 and it does not play an important part in the decision making process anymore (Samiee et al., 2005). However, it is agreed between most authors that further research is still needed into the construct of COO in order to be able to determine its relevance in today's markets. Pharr (2005) suggests that future researchers should focus more on the antecedents of COO and the correlation between them, so as to gain more comprehensive knowledge about the construct and its precursors. First of all, in terms of ethnocentrism and its effect on consumer intentions to purchase, a significant impact has been demonstrated by multiple prior researchers. It has been shown that higher levels of consumer ethnocentrism can be associated with higher intentions to purchase domestic production instead of foreign one (Baker & Michie, 1995; Balabanis & Diamantopolous, 2004; Lantz & Loeb, 1996). This is explained by the assumption that highly ethnocentric consumers are likely to hold the belief that buying foreign goods is unpatriotic and has a negative effect on the domestic economy. Thus they may believe that it is immoral and selfish to purchase imported products from other countries and consequently, refuse to do so (Balabanis & Diamantopolous, 2004). Even though ethnocentrism can be seen as a reliable predictor of consumers’ intentions to purchase local goods, it is not able to explain and predict the patterns of foreign production purchasing behavior. Consumer animosity on the other hand, measures one's antipathy towards a foreign country and hence can act as a predictor of intentions to purchase foreign products coming from particular countries. In most cases it is caused by the past or present economic, political, military or diplomatic activities of one country towards another (Klein et al., 1998). As a result, if an individual feels a high level of animosity towards a particular country, this can have a negative impact on the person's intentions to purchase products imported from that country (Klein et al., 1998; Leong et al., 2008; Nakos & Hajidimitriou, 2007). However, it is important to mention that both ethnocentrism and animosity are particularly culturally dependent concepts, which are unable to clarify the prevalent ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 32 overall patterns of consumer intentions to purchase across multiple countries and cultures. For that reason, it is necessary to carry out further research on ethnocentrism and animosity, especially in less examined cultural contexts, in order to deepen the understanding of the extent to which these concepts have a significant impact on consumer purchase intentions. In terms of the relationship between the constructs of consumer ethnocentrism and animosity, the findings of prior research have been rather mixed and controversial. As it has been mentioned previously, some authors have already attempted to determine that the individual level of animosity could be positively related to ethnocentrism (Klein & Ettenson, 1999). They have found that individuals with higher levels of animosity are likely to demonstrate respectively higher levels of ethnocentrism as well. Meanwhile, other authors argue that consumer ethnocentrism and animosity are two distinct concepts, which are determined by different conditions in the consumer's environment (Nakos & Hajidimitriou, 2007). It is important to examine this topic further and in a variety of contexts due to its cultural sensitivity and in order to define a more precise nature of the relationship between the two concepts (Balabanis et al., 2001). While many studies have examined ethnocentrism and animosity in the context of Western nations or even “third world” countries, little attention so far has been paid to the emerging and fast growing economies of the post-Soviet bloc countries. Such countries make for an especially interesting context for investigation in terms of ethnocentrism and animosity because of their historical background – having undergone both economic and war conflicts rather recently. Having defined the relevant gaps in the literature, this empirical study aims to examine the effect that consumer ethnocentrism and animosity may have on consumer purchase intentions in the context of food products imported from Russia in Lithuania. The research also aims to investigate the ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 33 effects of COO deeper, by examining the relationship between animosity and ethnocentrism and confirming the existence of any correlation between the two concepts. In addition, the study is going to provide a more detailed understanding of COO in a scarcely examined environment of post-Soviet bloc countries and Eastern Europe. The way that consumers evaluate and tend to purchase local production in comparison to foreign one is a critical factor for companies facing international expansion. It raises challenges such as choosing the correct entry mode into a particular country, as well as a suitable advertising and promotion approach for it. Therefore, the findings of this study will help foreign companies that are either considering entering Lithuania as a new market or are already established there, regarding the importance of COO when marketing their product offerings or developing positioning strategies. The findings of the study will have important practical implications for local companies as well, because it will determine the ethnocentric tendencies held by Lithuanian consumers, which in turn have an impact on their purchase intentions towards domestic products and services. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 34 Research Methodology The following chapter of the research paper covers the theoretical framework of the study and the chosen hypotheses for empirical testing. Moreover, each of the dependent and independent variables used in the study are indicated and discussed. Finally, the design of the research is described and justified, along with the sample of participants and the instruments for collecting data. Theoretical Framework As it has been mentioned, the research study aims to investigate whether consumer ethnocentrism and animosity have a significant effect on intentions to purchase in the context of food products in Lithuania. In order to do so, the ethnocentric tendencies demonstrated by Lithuanian consumers are examined along with their individual animosity levels felt against Russia. In addition, the study seeks to examine the relationship between the two variables of ethnocentrism and animosity in more detail and to determine if there is any correlation between them. Finally, the differences in levels of ethnocentrism and animosity between various demographic groups of respondents are analyzed to gain a better understanding of the extent to which demographic variables can have a determining impact on these constructs. The whole research study is based on the conceptual model presented below in Figure 1. It has been developed according to the author's investigation of existing literature sources and in particular the work of Shimp and Sharma (1987), Klein et al. (1998) and Nijssen and Douglas (2004). ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 35 Figure 1. The Conceptual Model of the Study. Based on the presented conceptual model and the indicated goals of the study, the following hypotheses have been identified for the empirical research and are described in the next part of the chapter. First of all, it has been demonstrated by previous research performed in different product and country contexts that consumers with high levels of ethnocentrism believe that purchasing imported products is unpatriotic and hurts the domestic economy. Therefore, ethnocentrism has a negative effect on their intentions to purchase foreign-made products (Balabanis & Diamantopoulos, 2004; Shimp & Sharma, 1987). Based on such findings, the first hypothesis (H1) has been developed for this empirical study: H1: Consumer ethnocentrism will have a significant effect on the intentions to purchase Russian products. The second hypothesis (H2) of the study is based on the relationship between consumer animosity towards a foreign country and their intentions to purchase products originating from there. Animosity is defined as the antipathy towards a particular country and as such can have a negative ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 36 impact on consumers' purchase intentions (Klein et al., 1998), hence the following hypothesis has been developed for this study: H2: Consumer animosity will have a significant effect on the intentions to purchase Russian products. Moreover, the research study further examines the relationship between consumer ethnocentrism and animosity. There have been inconsistent results provided by different authors in terms of the correlation between the two concepts. In this study, the positive correlation between animosity and ethnocentrism as proposed by Klein and Ettenson (1999) is tested. They claim that higher levels of consumer animosity have a positive impact on the level of ethnocentrism, consequently the following hypothesis (H3) is proposed: H3: Consumer animosity towards Russia will have a significant effect on consumer ethnocentrism. The next part of the study investigates how the levels of ethnocentrism and animosity vary between demographic groups of participants, based on differences in age, gender, education and income. First of all, the levels of ethnocentrism and animosity in participants of different ages are examined. The hypothesis (H4) has been developed based on the assumption that older people usually tend to show more ethnocentric tendencies in their purchasing behavior, whereas younger consumers are more open minded and thus should be less ethnocentric (Sharma et al., 1995; Wetzels et al., 1996). In terms of age and animosity, this relationship so far has been investigated far less as compared to the amount of research on ethnocentrism. Nonetheless, it has been demonstrated by some prior researchers that older consumers tend to show significantly higher levels of animosity towards the foreign country under investigation (Klein & Morris, 1996; Klein & Ettenson, 1999). ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 37 H4: Ethnocentrism (H4.1) and animosity (H4.2) levels will differ significantly between participants from various age groups. In terms of differences in gender and the effect on ethnocentrism and animosity, the findings of other authors have been mixed up to this day. Some researchers have found women to demonstrate higher levels of ethnocentrism (Bruning, 1997; Sharma et al., 1995). Meanwhile others have not found a significant effect of gender on consumer ethnocentrism (Ruyter et al., 1998). In relation to gender and its effect on consumer animosity, the research is rather scarce up to this day. However, the authors that have examined this relationship have not been able to find any significant effect of gender on the level of animosity (Klein & Morris, 1996; Klein & Ettenson, 1999). Therefore, it can be assumed that in the context of Lithuanian consumers' intentions to purchase Russian products the findings should be similar and so it is hypothesized that: H5: Ethnocentrism (H5.1) and animosity (H5.2) levels will not vary significantly between participants of different genders. The effect of education on consumer ethnocentrism and animosity has also been found to be inconsistent among different researchers. While most authors have demonstrated that higher levels of education lead to lower levels of ethnocentrism (Bailey & Pineres, 1997; Festervand et al., 1985), others found that education did not have a significant impact on ethnocentrism (Insch & McBride, 2004). Meanwhile, the impact of the level of education on consumer animosity can be assumed to have a similar negative effect as on ethnocentrism, due to the fact that more educated consumers should be more open-minded and hold favorable perceptions of foreign production (Sharma et al., 1995). On the other hand, after empirically testing such assumptions Klein and Ettenson (1999) could not validate any significant relationship between education and animosity. In this study it is assumed that higher levels ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 38 of education should broaden the minds of consumers, causing them to be more open-minded and less prejudiced, thus it is hypothesized as follows: H6: Ethnocentrism (H6.1) and animosity (H6.2) levels will vary significantly between participants with different levels of education. The final demographic variable to be examined in relation to consumer ethnocentrism and animosity is that of income. Previous research has suggested that higher level of income leads to lower levels of ethnocentrism demonstrated by consumers (Bruning, 1997; Sharma et al., 1995). Whereas the relationship between income and animosity has been examined rather scarcely up to this day. In one of the few studies it was found that the level of income had a significant effect on animosity and respondents with higher income demonstrated lower levels of animosity (Klein & Ettenson, 1999). Therefore it can be hypothesized that consumers who earn more tend to be more cosmopolitan and have more positive attitudes towards purchasing foreign products, hence the hypothesis (H7): H7: Ethnocentrism (H7.1) and animosity (H7.2) levels will vary significantly between respondents with different levels of income. Independent and Dependent Variables For the purpose of achieving the indicated research goals the following variables were used in the empirical study: ethnocentrism, animosity, intention to purchase, age, gender, education and income. It is important to note that the classification of independent and dependent variables depended on each particular hypothesis that was tested, as some of the variables were used interchangeably. Therefore, the variables for each of the seven hypotheses will now be identified in this next part of the chapter. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 39 The first two hypotheses (H1, H2) respectively tested the effect of ethnocentrism and animosity on the intention to purchase. Thus the independent variables in this case can be defined as ethnocentrism and animosity, and the dependent variable as intention to purchase. In the third hypothesis (H3), the relationship between ethnocentrism and animosity was tested to see if animosity had a positive effect on ethnocentrism. Consequently, the independent variable here is animosity with the dependent variable being ethnocentrism. The final four hypotheses of the study (H4, H5, H6 and H7) investigated demographic variables in relation to ethnocentrism and animosity. In turn it can be stated that the independent variables for these hypotheses respectively are age, gender, education and income, meanwhile, the dependent variables are ethnocentrism and animosity. Context of the Study This particular study focuses on the context of Lithuanian consumers’ ethnocentrism and animosity towards Russia. The relationship between the two countries has always been tense because of the multiple military and political conflicts which have occurred during the course of history. The most recent of which are the Soviet occupations during the last century and Lithuania becoming the first Soviet-bloc country to declare its independence. However, recently the tensions have risen even more mainly caused by Russia's military actions in neighboring Ukraine and the fear of the Lithuanian people that the Baltic countries might also become a target. Russia has also introduced trade sanctions and bans on the import of some Lithuanian products such as dairy, which struck local producers particularly hard as the Russian market accounts for about 85% of Lithuania's total dairy exports (Scrutton & Sytas, 2014). Despite that, according to the Lithuanian Department of Statistics, Russia still remains one of the most important economic partners for Lithuania with 16.6% of exports going to Russia and 32.8% of imports coming from Russia. There are clear signs of animosity and hostility ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 40 demonstrated towards Russia in Lithuania, with it being referred to as an aggressor in the media and even by the president of the country. Some initiatives in the social media have also been introduced encouraging consumers to stop purchasing products that are imported from Russia. However, it is not clear whether such political tensions have an evident effect on the actual consumer behavior and purchase intentions as the topic has not been empirically investigated yet. In addition, Lithuania is an attractive country for research on consumer ethnocentrism and animosity because of the high levels of trade it demonstrates and the increasing amount of imported goods from foreign countries, as stated by the Lithuanian Department of Statistics. Due to such tendencies, the Lithuanian consumers are exposed to many products being available from abroad and therefore, it is interesting to see whether ethnocentrism and animosity have an impact on their purchase intentions. The food industry in particular has been chosen for the study because it is relevant for all consumers and with a variety of products imported from Russia being available in local supermarkets. Moreover, it is interesting to examine food products in terms of COO because of the strict labeling laws that were introduced in the EU recently. From December 2014, mandatory country of origin labeling was introduced for some products such as for example, meat and unprocessed foods, possibly making COO one of the most important factors that consumers may base their purchase decisions upon. Research Design The design of the research study is carried out in the form of a quantitative questionnaire. This particular type of research method was chosen because it has already been validated by previous researchers in the field and the goal of the study was to test the concepts in a novel context and to be able to compare them with previous findings. The questionnaire design of the study allows for more ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 41 objective and measurable results as the responses of participants are gathered in a standardized way and thus reduce the potential of researcher bias, as identified by Creswell (2013). Consequently, after analyzing such quantitative data, it is then easier to compare and contrast it to the results of prior research. The ability to make such comparisons is especially important for the study at hand in order to see how the concepts used in the study are subject to change under a different cultural context. Moreover, by using the questionnaire method data can be collected rather quickly, cost-efficiently and from a large amount of respondents, which act as a representative of the general population. Finally, questionnaires are less intrusive than other means of data collection such as interviews or experiments, as they do not interrupt the respondent and allow completing the research at a time that is most convenient for them (Wright, 2006). On the other hand, the use of such design of the study may lead to several weaknesses of the research as well. Most importantly, with the use of questionnaires it is not clear whether the respondent is answering truthfully, and if the answers reflect the real-life behavior of the participant. In addition, such quantitative research design can be seen as superficial by some, as only a limited amount of information is gathered from the respondents without the possibility for any in-depth explanations into their answers (Creswell, 2013). The participants may also understand and interpret the questions provided differently leading to some inconsistencies occurring across the results. Finally, it is important to mention that the current tense state of the geo-political situation in the region may also have an impact on the results of the study. As it has been mentioned previously, these days Lithuania's relationship with Russia is particularly strained due to the import ban that has been placed on Lithuanian products and the crisis in Ukraine, which threatens the whole Baltic region. Due to such factors, the animosity levels demonstrated by participants might be higher than usual and this can be reflected in their answers provided for the research study causing some bias in the results. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 42 Questionnaire Structure The questionnaire that was used was conducted based on the conceptual model of the study and the hypotheses that were developed to be empirically tested. First of all, in line with the goals of the study, it was necessary to test the effect that ethnocentrism and animosity have on Lithuanian consumers' intentions to purchase products imported from Russia. Then the relationship between animosity and ethnocentrism had to be investigated in order to see if there is any correlation between the two variables. Finally, demographic information about the respondents had to be collected, with the aim of finding out whether the levels of ethnocentrism and animosity differed based on demographic variations between groups of participants. In order to achieve the indicated research goals, each respondent was asked to answer 31 specifically constructed questions, which are presented in the table at the end of this part of the chapter. The questionnaire was first formed in the English language and was based on already existing and validated scales by previous research. Then the questions were slightly modified to fit the context of the study and translated into the Lithuanian language by a native speaker. All of the questions were designed in a way so that the following variables used in the study would be measured: ethnocentrism, animosity, intention to purchase and demographics. Firstly, during the study, the individual level of ethnocentrism of each respondent had to be measured. The CETSCALE (Consumer Ethnocentric Tendencies Scale) developed by Shimp and Sharma (1987) was chosen as the mean of achieving that. The original version of the scale was validated in the US and consisted of 17 items, all of which measure the tendencies that consumers demonstrate towards domestic and foreign products. Respondents are categorized as highly ethnocentric if they score on the upper half of the scale. The CETSCALE has been validated in both developed and less developed countries and shortened versions of it have been used (Balabanis & ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 43 Diamantopoulos, 2004; Douglas & Nijssen, 2003). One of the most prevalent of the shortened versions is the 10-item scale, which has already been found to be reliable in different cultural contexts as well (Balabanis et al., 2001). The 10-item version of the scale was chosen to be used in this study because of the smaller amount of questions that respondents needed to answer and its established validity across multiple countries. In addition, the ten statements of the scale had to be modified to fit the context of the study. Lastly, the respondents of the questionnaire were asked to rate their opinions of each of the ten statements on a 5-item Likert scale. The following part of the questionnaire was dedicated to measuring the individual level of animosity towards Russia of each participant. For this purpose, a modified version of the original Klein et al. (1998) scale was used (Nijssen & Douglas, 2004). This specific version was also chosen due to the reduced number of questions and the maintained validity of the original version. In this version two items were used to measure war animosity and five items were used to measure economic animosity. Some researchers tend to exclude either war or economic animosity, however, in the particular context of the study it seemed appropriate to measure both types of animosity, as there can be seen both warrelated and economic threats coming from Russia towards Lithuania. The answers to each of the statements had to be rated on the same 5-item Likert scale. After collecting the data for both consumer ethnocentrism and animosity, the respondents were asked to indicate their purchase intentions of imported Russian products. In particular, two categories of food products were chosen as the objects for analysis – dairy and meat products. These two categories were chosen due to a couple of reasons. First of all, they represent two of the main food product categories that are purchased and used regularly by the majority of consumers. Secondly, as it has been previously mentioned, Russia has recently banned the import of some Lithuanian dairy and meat products. Therefore, it is interesting to see whether such opposing actions have caused Lithuanian ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 44 consumers to boycott the same types of Russian products in return. In order to measure the intentions to purchase of each of the product categories, a scale developed by Klein et al. (1998) was used. The scale consists of five statements that are constructed to measure a respondent's intentions to purchase products made in a particular foreign country. The statements had to be answered on a 5-item Likert scale and were also modified to represent Russian products as the object of interest. Each of the participants was asked to first answer the five questions in relation to Russian dairy products and then answer the same questions with regard to Russian meat products. In the final part of the questionnaire, the demographic information about each of the participants was collected. Four questions were constructed where the respondents were asked to provide the information about their age, gender, education and income for the research purposes. Table 4 The Questionnaire Structure Variable Questions Ethnocentrism 1) Only those products that are unavailable in Lithuania should be imported. 2) Lithuanian products, first, last, and foremost. 3) Purchasing foreign made products is unpatriotic. 4) It is not right to purchase foreign products because it puts fellow Lithuanians out of jobs. 5) A real Lithuanian should always buy only local-made products. 6) One should purchase products manufactured in Lithuania instead of letting other countries get rich off us. 7) Lithuanians should not buy foreign products because it hurts Lithuanian business and causes unemployment. 8) It may cost me more in the long run but I prefer to support Lithuanian products. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 45 9) Only those products should be obtained from other countries that cannot be obtained within Lithuania. 10) Lithuanian consumers, who purchase products made in other countries are responsible for putting their fellow Lithuanians out of work. Animosity 1) I feel anger because of Russia's past military actions in Lithuania. 2) I will never forgive Russia for Lithuania's occupation. 3) While doing business with Russians one should be careful. 4) Russian companies are unreliable trading partners 5) Russia wants to gain economic power over Lithuania. 6) Russia has too much influence on Lithuania and its economy. 7) Russian companies are doing business unfairly with Lithuanian companies. Intentions to purchase 1) I would feel guilty if I bought a dairy/meat product made in Russia. 2) I would never buy a dairy/meat product made in Russia. 3) I do not like the idea of purchasing a dairy/meat product made in Russia. 4) Whenever available, I would prefer to buy dairy/meat products made in Russia. 5) If two dairy/meat products were of equal quality, I would prefer to buy another product over the one made in Russia. Sample Description and Methods of Data Collection In order to investigate the effect that ethnocentrism and animosity have on the intentions to purchase of Lithuanian consumers, an appropriate sample and sample size of respondents had to be selected to participate in the research study. To begin with, it is important to mention that the questionnaire was conducted and data was collected via the means of an internet survey. This particular method of data collection was chosen ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 46 because of its accessibility and ease of data gathering. Internet questionnaires are fast and convenient for the respondent, as the questions can be completed at their own pace and schedule (Couper, 2000). In addition to that, the data that is collected is automatically stored in an electronic format, thus minimizing the potential for errors when having to enter the data into a computer manually. Moreover, it allows reaching the respondents in a wider variety of locations than would be possible when conducting face-to-face research (Wright, 2006). Convenience sampling was also chosen as the method for collecting respondents for the research study. By using this non-probability sampling technique, the respondents are selected due to their proximity to the researcher and because of their accessibility for recruitment as they are already willing to respond. In convenience sampling, there are no specific criteria that would be identified for the selection of the respondents, as all respondents who are available are invited to participate. Even though, it would be ideal to test the entire population, this is not possible due to the time and cost constraints and because the chosen population is too large to be able to test every person individually (Hultsch et al., 2002; Salkind, 2010). Convenience sampling is a technique, which allows for relatively fast and cheap data collection. This is important when the researcher is faced with a time limitation because it allows spending more time focusing on the essential aspects of the research rather than spending significant amounts of time on finding the most optimal way to calculate and obtain a sample of participants for the study (Farrokhi & Mahmoudi-Hamidabad, 2012). However, convenience sampling also introduces the possibility of negative bias because the respondents chosen for the study may not be representative of the general population. This can occur due to the inaccurate representation of the regional differences within the population, as the researcher often includes only the respondents that are located close by (Salkind, 2010). Furthermore, different ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 47 demographic groups of the population may not be represented equally, as in convenience sampling there is the tendency for one group to be over-represented because of the way the participants are chosen by the researcher (Hultsch et al., 2002). As a result of such factors, it can be difficult for researchers to draw concrete conclusions from their study results, as the data collected may not be truly representative of the opinions and behavior of the general population. Due to the context of the research and the method of data collection, the population of the study could be defined as all Lithuanian consumers with an internet connection. As it has been indicated, the context chosen for analysis in the study was that of dairy and meat products, which are purchased on a daily basis by the wide majority of consumers. Moreover, according to the research performed by The International Telecommunications Union, Lithuania ranks as the 50th in the world in terms of internet usage, with 68% of the population having access to internet in 2012. Because of such facts, it can be concluded that the population of the research is around 68% of the consumers in Lithuania. In addition, only respondents that are of ages 18 and over are included in this sample because they are the ones with real purchasing power. In order to determine the exact population sample that is necessary for the research study, Slovin’s formula as described by Krejcie and Morgan (1970) is used, where the calculation is based on the confidence interval and confidence level that the researcher wishes to achieve. In this particular case, for large populations of over 100 000 people, with a chosen confidence level of 95% and a chosen confidence interval of 6, it can be calculated that approximately 267 respondents are needed in order to objectively represent the general population in the study. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 48 Empirical Research Results In this chapter of the thesis, the empirical findings of the survey which was carried out by the researcher are presented. The collected raw data was first prepared in Excel format and then analyzed using SPSS software, with statistical operations such as correlation, one-way analysis of variance and independent-samples t-test carried out. First of all, in this chapter the methods for cleaning the data and testing its reliability are described, followed by the descriptive statistics and a detailed profile of the participants who took part in the research. Finally, the chapter is rounded up with the presentation of the findings for each of the tested hypotheses of the study. Validity and Reliability of the Data In order to check the validity of the answers to the survey provided by the respondents, reverse wording questions were included when constructing the questionnaire. This particular technique was used in order to avoid the possibility of response bias, when some participants do not read the questions carefully enough and tend to choose the same answer option regardless of the content of the question. For example, these are the two reverse wording questions that were used in the study when measuring purchase intention of Russian products: “I would never buy a product made in Russia”/ “Whenever available, I would prefer to buy products made in Russia”. After collecting the data from all the participants, it was checked for outliers who responded to the reverse wording questions in the same way, suggesting that those participants were not attentive enough when filling out the questionnaire and that their answers might not be valid and representative. When such analysis of the data was carried out, a total of 12 respondents were categorized as outliers and thus their answers were removed from further analysis in order to ensure the validity of the collected data. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 49 Internal consistency and reliability. Once the data was cleaned from outliers, the internal consistency and reliability of the scales that were used to construct the questionnaire were analyzed. The statistical procedure of Cronbach's Alpha in SPSS was used for this purpose. In the first analysis, the reliability of the CETSCALE, which was used to measure consumer ethnocentrism and consisted of a total of 10 items, was investigated. The Cronbach's Alpha coefficient was found to be at 0.902 for this scale, which indicates a high level of internal consistency and reliability (a coefficient of 0.70 or higher is usually considered as an indicator of good reliability in survey research). Moreover, by looking at the Cronbach's Alpha if a particular item was deleted from the survey, it can be seen that the coefficient would be lower in all cases except for questions 2 and 3, when it would be slightly higher (0.910 and 0.917 respectively). Therefore, for future uses of the scale the removal of these items should be considered. The Cronbach's Alpha coefficient of the 7-item scale that was included in the questionnaire to measure consumer animosity, also revealed a high reliability with the score of 0.857. When using this scale, future researchers might consider the exclusion of question 6 as its removal would result in an increase of Cronbach's Alpha to 0.871. Finally, the same statistical procedure was performed for the Klein et al. (1998) 5-item scale of intentions to purchase. A high reliability of this scale was also found with the Cronbach's Alpha coefficient equal to 0.876. Further analysis of the questions revealed that the removal of any item would in turn result in a lower coefficient, suggesting that all of the items were of importance to the reliability of the survey. Profile of the Participants A total of 271 respondents participated and completed the research survey. However, as it has been mentioned previously, 12 participants' answers had to be removed from the data due to response ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 50 bias that was found when analyzing the responses. Therefore, this resulted in the total number of 259 participants' answers that were deemed as valid and included in the final analysis. A detailed profile of the final participants can be found in table 5, which is presented below. Age – the majority of the participants were aged from 18 to 44 (89.57%), with 57.91% being between the ages of 25-34. Gender – the distribution of gender between the participants was close, with slightly more females (57.92%) than males (42.08%). Education – the majority of the participants had completed higher education (89.2%) with either a Bachelor's (52.12%) or a Master's (37.08%) degree. Income – the distribution of monthly income was rather similar between the three groups of 300-600, 601-900 and 901-1200 Euros (adding up to a total of 83.78%), meanwhile, 16.22% of the participants reported higher level of income of 1200 Euros and more. Table 5 The Demographic Profile of Participants Demographic variables Number of Participants (out of 259) Age 18-24 40 (15.44%) 25-34 150 (57.91%) 35-44 42 (16.22%) 45-54 14 (5.40%) 55+ 13 (5.03%) Gender Male 109 (42.08%) Female 150 (57.92%) ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS Education Incomplete secondary education 51 0 (0%) Secondary education 14 (5.40%) Vocational school 14 (5.40%) Bachelor's degree 135 (52.12%) Master's degree 96 (37.08%) Doctor's degree 0 (0%) Monthly Income (EUR) Less than 300 0 (0%) 300-600 82 (31.66%) 601-900 81 (31.27%) 901-1200 54 (20.85%) 1201-1500 28 (10.82%) More than 1500 14 (5.40%) Descriptive Statistics The questionnaire of the study was constructed to measure the following three main variables within the responses of each participant: ethnocentrism, animosity and intentions to purchase. It is important to report on the overall descriptive results for each of the variables in order to better understand the general average levels that are demonstrated by the Lithuanian consumers' population as a whole. The responses to the questions measuring every variable were recorded on a 5-item Likert scale. The mean values along with the standard deviations for each of the variables are presented in table 6. From the results it can be seen that the general level of ethnocentrism within the Lithuanian population is slightly higher than the average score of the items of 2.5 (M = 2.75, SD = 0.87) but it is also lower than the level of animosity against Russia (M = 3.58, SD = 0.68). Furthermore, the intentions to purchase Russian products in total are lower than the average score of 2.5 (M = 2.39, SD ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 52 = 0.75), with intentions to purchase dairy products (M = 2.37, SD = 0.86) in particular being slightly lower than meat products (M = 2.41, SD = 0.70). Table 6 The Descriptive Statistics of the Variables Variable Mean Standard Deviation Ethnocentrism 2.75 0.87 Animosity 3.58 0.68 ITP (Total) 2.39 0.75 ITP (Dairy) 2.37 0.86 ITP (Meat) 2.41 0.70 Testing the Hypotheses Ethnocentrism and intention to purchase. The first hypothesis that was tested in the research study (H1) suggested that consumer ethnocentrism would have a significant impact on the respondents' intentions to purchase Russian products. In order to examine this relationship statistically, a Pearson product-moment correlation coefficient was calculated to evaluate if the higher level of ethnocentrism of the respondent resulted in lower purchase intentions of imported products from Russia. After carrying out the analysis, a negative correlation between the two variables was found, r = -0.838, n = 259, p = 0.000 (the full output tables from SPSS can be found in the Appendix). When the Pearson's r is negative and close to 1 as in this case, it is an indicator that the correlation between the two variables is negative and strong. A negative correlation suggests that as the first variable increases in value, the second one decreases. Since the p value is less than 0.05, it can also be concluded that the correlation between the two variables is statistically significant and the increases in one variable are significantly related to the decreases in the other variable. The results of the correlation ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 53 between ethnocentrism and intention to purchase are summarized in the scatter-plot presented in figure 2. Figure 2. The correlation between ethnocentrism and intention to purchase (ITP). In order to test this relationship further and to determine if ethnocentrism has a significant effect on the intention to purchase, a linear regression analysis for the two variables was carried out. The results indicated that even 70.2% of the dependent variable (intention to purchase) could be explained by the independent variable (ethnocentrism), R2 = 0.702, p = 0.000. All in all, such findings confirm the hypothesis that consumer ethnocentrism has a significant effect on the intentions to purchase and when the level of ethnocentrism is higher, the intentions to purchase imported products are lower as a result. Animosity and intention to purchase. The second hypothesis (H2) that was tested in the study was focused on the impact that consumer animosity against Russia had on the respondents' intentions to purchase Russian products. The Pearson product-moment correlation coefficient was also calculated to ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 54 test if higher levels of consumer animosity resulted in lower intentions to purchase imported products from Russia. When the Pearson's r was computed, it revealed that there was in fact a negative correlation between animosity and intention to purchase, r = -0.872, n = 259, p = 0.000. Once again the p value is very small and well below the 0.05 cut-off point, thus it is evident that the negative correlation between the variables is statistically significant. Consequently, there is a strong negative correlation between animosity and intention to purchase and increases in animosity against Russia are correlated with the decreases in intentions to purchase Russian products. The negative correlation between the two variables is also demonstrated in the scatter-plot in figure 3. Figure 3. The correlation between animosity and intention to purchase (ITP). Since there was a significant correlation found between the two variables, a linear regression analysis had to be conducted so as to determine if animosity against Russia had a significant impact on Lithuanian consumers' intentions to purchase. The statistical analysis showed that animosity could be held as an accountable variable for 76.1% of the intentions to purchase Russian products, R2 = 0.761, ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 55 p = 0.000. Therefore, it can be claimed that the second hypothesis, which states that consumer animosity against Russia has a significant impact on the intentions to purchase Russian products, is confirmed by the empirical research results. Animosity and ethnocentrism. The third hypothesis (H3) which was raised when conducting the research, was aiming to examine the relationship between consumer animosity and ethnocentrism. It was hypothesized that the level of animosity against Russia would have a significant impact on the level of consumer ethnocentrism. In order to test this hypothesis, another variation of the Pearson product-moment correlation coefficient was computed, this time with animosity as the independent and ethnocentrism as the dependent variable. The statistical analysis demonstrated that a positive correlation between the two variables was existent, r = 0.715, n = 259, p = 0.000. Since the Pearson's r in this case is positive and close to 1, it can be stated that the changes in one variable are strongly correlated with the changes in the other variable. The p value here is also very small, indicating that the positive correlation that was measured is statistically significant. This positive correlation can also be seen by examining the scatter-plot which is shown in the following figure 4. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 56 Figure 4. The correlation between animosity and ethnocentrism. As demonstrated in the figure, there is a clear positive correlation between the variables of animosity and ethnocentrism. After conducting a linear regression analysis on the two variables, it was also found the effect of animosity on consumer ethnocentrism was statistically significant and that 51.1% of ethnocentrism could be explained by animosity, R2 = 0.511, p = 0.000. As a result, it can be concluded that the level of animosity does have a significant effect on the level of ethnocentrism and so the hypothesis H3 can be confirmed. Differences between products. Since there were two product categories included in the research study, it is important to investigate if there were any significant differences in the empirical results between them. The same kind of Pearson product-moment correlation coefficient analysis was carried out for each of the categories – dairy products and meat products. First of all, the relationship between ethnocentrism and the intention to purchase dairy versus meat products was analyzed. There were no significantly large differences found between the two product categories, with the correlation coefficient for dairy products equal to: r = -0.875, n = 259, p = 0.000, and for meat products equal to: r = -0.730, n = 259, p = 0.000. Such findings indicate that the negative correlation between ethnocentrism and dairy products is slightly stronger than for ethnocentrism and meat products, as it is a value closer to 1. However, both coefficients are significant and close to 1, therefore it is not possible to find any further implications of the intentions to purchase between the different product categories and their relationship with consumer ethnocentrism. The same type of statistical analysis was also performed in terms of the intentions to purchase dairy versus meat products and their relationship with animosity against Russia. The results of the analysis were similar to those that were received when consumer ethnocentrism was investigated. Intentions to purchase for both dairy and meat product categories had a significant negative relationship ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 57 with animosity: r = -0.859, n = 259, p = 0.000 for dairy products; r = -0.824, n = 259, p = 0.000 for meat products. As it can be seen, the coefficient scores between the two product categories are very close, and as such do not lead to any assumptions that the intention to purchase one product would have a significantly stronger relationship with animosity than the other. Differences between age groups. The next step of the statistical analysis was to investigate the variations in ethnocentrism and animosity levels that occurred between different age groups of the participants. It was hypothesized by the researcher that the levels of both ethnocentrism and animosity will vary significantly between the different age groups. To begin with, in order to test the first part of the hypothesis with regard to ethnocentrism and age, a one-way analysis of variance (ANOVA) was conducted. The findings of the analysis revealed that there was a statistically significant difference at the p < 0.05 level in the degree of ethnocentrism demonstrated by participants of different age groups [F(4,254) = 33.635, p = 0.000]. Because the differences found between the groups were significant, post-hoc comparisons using the Tukey HSD test were carried out to find out which groups had significant differences between them in particular. The results demonstrated that the mean ethnocentrism scores of age groups 35-44 (M = 3.33, SD = 1.24) and 55+ (M = 4.50, SD = 0.05) where significantly higher when compared to all of the other age groups. Meanwhile, there were no significant differences found between age groups 18-24, 25-34 and 45-55 (p = 0.803, p = 0.833, p = 0.337). Such findings indicate that the level of ethnocentric tendencies does differ between separate age groups of Lithuanian consumers, with ones between the ages of 35-44 and 55+ showing significantly more ethnocentrism than others. The second part of the hypothesis is focused on the differences in animosity levels that are demonstrated by participants of various age groups. In order to test whether the results between age groups in relation to animosity do in fact differ significantly, a one-way ANOVA was also conducted. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 58 After carrying out the analysis, it was found that there were significant differences in the levels of animosity exhibited by distinct age groups of respondents [F(4,254) = 5.334, p = 0.000]. The post-hoc Tukey HSD test revealed that the average level of animosity demonstrated by the age group of 35-44 (M = 3.95, SD = 0.72) was significantly higher when compared to the groups of 18-24 (M = 3.46, SD = 0.69), 25-34 (M = 3.55, SD = 0.68) and 45-55 (M = 3.14, SD = 0.15). There were no significant differences found between any other of the age groups as the p values exceeded the cut-off point of 0.05. Differences between gender groups. Based on the findings of prior research, it was hypothesized that the ethnocentric and animosity tendencies of participants should not vary significantly based on gender. For the purpose of statistically comparing the results between groups based on gender, an independent-samples t-test procedure was carried out. The findings from the statistical analysis indicated that in fact there were no significant differences in the levels of ethnocentrism demonstrated by male (M = 2.73, SD = 0.96) and female (M = 2.77, SD = 0.80) participants, t(257) = -0.377, p = 0.707. Another independent-samples t-test was conducted in order to test the hypothesis in relation to animosity. The results of the analysis revealed similar findings to those of ethnocentrism, as there were no significant differences recorded between the male (M = 3.57, SD = 0.96) and female (M = 3.59, SD = 0.66) respondents of the study, t(257) = -0.224, p = 0.823. As a result, it is evident that the hypothesis can be confirmed and there are no significant variations in the levels of ethnocentrism and animosity exhibited by males and females. Differences between education levels. Hypothesis 6 of the study is concentrated on the differences in ethnocentrism and animosity that can occur between participants with varying levels of education. First of all, it was hypothesized that the levels of ethnocentrism exhibited by participants ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 59 should be significantly different between groups with distinct education backgrounds. The hypothesis was statistically confirmed by performing a one-way ANOVA, which revealed that the results did differ significantly between the groups [F(3,255) = 20.286, p = 0.000]. As found when performing the Tukey HSD test, the mean scores of participants with a Master's degree (M = 3.14, SD = 1.01) were significantly higher than all other education groups. There were also significant differences found between the group with a Bachelor's degree (M = 2.64, SD = 0.67) and vocational education (M = 1.60, SD = 0.21). It can be summarized from the findings that participants with higher levels of education in the study demonstrated higher levels of ethnocentrism as well. Furthermore, the same type of one-way ANOVA was carried out in order to examine the differences in animosity against Russia that might occur between the selected education groups. The statistical analysis confirmed the hypothesis that there would be significant differences in animosity levels between the groups [F(3,255) = 16.915, p = 0.000]. To examine this relationship further, a Tukey HSD test was also carried out. The findings demonstrated that the mean scores on the animosity scale were significantly higher for participants with a Bachelor's (M = 3.80, SD = 0.61) and a Master's degree (M = 3.47, SD = 0.71) than any other educational backgrounds. Therefore, such results are similar to the ones when ethnocentrism was examined and participants with higher levels of education seem to exhibit higher levels of animosity towards Russia. Differences between income levels. The final hypothesis, which was raised for the research study, is focused on the ethnocentric and animosity tendencies between groups with different income levels. The hypothesis states that ethnocentrism and animosity levels should differ depending on the level of income of the participants. Once again a one-way ANOVA was used to first examine the relationship between ethnocentrism and income level. After performing the analysis, it was found that there were in fact significant differences in ethnocentrism between some of the groups based on income ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 60 [F(4,254) = 4.265, p = 0.002]. The results of the post-hoc Tukey HSD test indicated that the mean scores of ethnocentrism were significantly lower for income levels of 1201-1500 (M = 2.30, SD = 0.10) and more than 1500 Euros (M = 2.20, SD = 0.05) when compared to groups with levels of 300-601 (M = 2.83, SD = 0.86) and 601-900 Euros (M = 2.90, SD = 0.94). Consequently, it can be stated that the participants with higher income levels are likely to demonstrate lower levels of ethnocentric tendencies. Another one-way analysis of variance needed to be conducted so as to test the hypothesis from the perspective of animosity and how it differed between participants with various income levels. Similarly to ethnocentrism, it was found that the levels of animosity were significantly different between groups based on income [F(4,254) = 17.859, p = 0.000]. Moreover, the results of the Tukey HSD test revealed that the group with income level of 1201-1500 Euros (M = 2.79, SD = 0.36) was significantly less ethnocentric than the groups with lower income levels. In addition to that, the group that earned more than 1500 Euros (M = 3.14, SD = 0.10) also demonstrated significantly lower ethnocentric tendencies when compared to groups that earned 300-601 (M = 3.80, SD = 0.70) and 601900 Euros (M = 3.74, SD = 0.82). To sum up, it seems that the participants who earn higher amounts of income per month also tend to exhibit lower levels of animosity towards Russia. An overview of all of the hypotheses that were empirically tested and either supported or rejected by the research carried out are presented in the table below. Table 7 The Summary of the Empirical Testing of Hypotheses Hypotheses Results H1 (Consumer ethnocentrism will have a significant effect on the Supported intentions to purchase Russian products) ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 61 H2 (Consumer animosity will have a significant effect on the Supported intentions to purchase Russian products) H3 (The level of consumer animosity towards Russia will have a Supported significant effect on the level of ethnocentrism) H4 (Ethnocentrism (H4.1) and animosity (H4.2) levels will differ Supported significantly between participants from various age groups) H5 (Ethnocentrism (H5.1) and animosity (H5.2) levels will not vary Supported significantly between participants of different genders) H6 (Ethnocentrism (H6.1) and animosity (H6.2) levels will vary Supported significantly between participants with different levels of education) H7 (Ethnocentrism (H7.1) and animosity (H7.2) levels will vary significantly between respondents with different levels of income) Supported ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 62 Discussion and Conclusions In this final part of the thesis, the findings of the empirical study are summarized in relation to the main research questions and the relevant external literature sources. Furthermore, the theoretical and practical implications are then discussed along with the limitations of the research study. Finally, the author's ideas and suggestions for future research are provided and the chapter is ended with the general conclusions of the study. Summary of the Findings The COO construct has been a topic of extensive investigation during the recent years of research. However, some authors have now started to question the importance of COO and whether it can still be claimed that it has a significant impact on consumer intentions to purchase domestic and foreign production (Samiee et al., 2005). The aim of this study was to examine the COO construct in more detail in the rarely explored context of Lithuania, in order to determine its relevance for this particular market. As it has been suggested by Pharr (2005), more research in the field is needed, especially focusing on the antecedents of COO and the correlation between them. Therefore, the author has chosen to examine the COO concept from the perspective of its antecedents of ethnocentrism and animosity, and their effect on the consumer intentions to purchase. The effect of ethnocentrism. First of all, multiple authors in the past have found ethnocentrism to have a significant effect on consumer intentions to purchase foreign production (Baker & Michie, 1995; Balabanis & Diamantopolous, 2004; Lantz & Loeb, 1996; Shimp & Sharma, 1987). The findings consistently indicated that as the level of consumer ethnocentrism increased, the intentions to purchase foreign products decreased. The results of this research study have also demonstrated similar tendencies to those found by other authors (Douglas & Nijssen, 2003; Klein, 2002; Watson & Wright, ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 63 1999). After statistically analyzing the relationship between the two variables, a negative correlation was found and the regression analysis confirmed that there was a significant effect of ethnocentrism on the intentions to purchase. Consequently, it can be stated that ethnocentrism is an important factor affecting Lithuanian consumers' intentions to purchase domestic and foreign production. For instance, when the level of ethnocentrism is higher, the intentions to purchase imported products are lower as a result. Such behavioral tendencies can be explained by the reasoning that ethnocentric consumers hold the beliefs that by purchasing foreign production, one hurts the domestic economy and the well-being of the whole country and fellow citizens (Lantz & Loeb, 1996; Pereira et al., 2002; Supphellen & Rittenburg, 2001). As a result, such consumers refuse to act in what they perceive as a selfish way and thus their intentions to purchase imported goods are lower (Tajfel & Turner, 1979). As the findings of the study have demonstrated, Lithuanian consumers are no exception to these assumptions and their intentions to purchase are also significantly affected by the level of ethnocentrism. Overall, as measured by the survey, on average Lithuanian consumers tend to exhibit more ethnocentric tendencies in their purchasing behavior. The effect of animosity. In terms of the relationship between animosity and intentions to purchase foreign products, similar findings have been revealed by prior researchers as those in relation to ethnocentrism. Consumer animosity is described as antipathy that is felt towards a particular country and it has also been found to have a negative impact on the intentions to purchase products coming from that country (Klein et al., 1998; Leong et al., 2008; Nakos & Hajidimitriou, 2007). Animosity can be of different types and originating from various sources, such as economic, political, military or diplomatic activities of one country towards another (Jung et al., 2002; Klein et al., 1998; Klein & Ettenson, 1999). In this particular study, the goal was to examine the impact of Lithuanian consumers' ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 64 animosity against Russia on the intentions to purchase Russian products. The animosity against Russia can be assumed to originate from both military actions that have occurred in the past and hostile economic activities that are continuing up to this day. The findings of the empirical study that has been carried out are in-line with the results of prior research (Klein et al., 1998; Klein & Ettenson, 1999; Leong et al., 2008; Nakos & Hajidimitriou, 2007). It has been demonstrated that Lithuanian consumers' intentions to purchase Russian products are significantly negatively affected by the level of animosity they feel towards Russia. It is interesting to note that the level of animosity felt by Lithuanian consumers is noticeably higher than their level of ethnocentrism and the correlation between animosity and purchase intentions is stronger. The high level of animosity that has been revealed could be due to the especially rising tensions between the two countries at the moment. Because of the Russian ban on imports of the dairy and meat products from Lithuania, it seems that Lithuanian consumers are also refusing to purchase the same products that are being imported from Russia. It is evident that the political and economical conflicts do not go unnoticed by the consumers, and they do have an important negative effect on their decisions to purchase imported products from certain foreign countries. The relationship between animosity and ethnocentrism. During the empirical study which was carried out, it was found that in the context of Lithuanian consumers, the concepts of animosity and ethnocentrism are closely related. The findings indicated that the animosity against Russia felt by an individual consumer does have a significant effect on the level of ethnocentrism as well. Such results align with the tendencies noticed by Klein and Ettenson (1999) who have determined a positive relationship between the two concepts. They have found that as the level of animosity held by an individual increases, so does the level of ethnocentrism. However, such findings are also in conflict with what is stated by some other researchers. For instance, Nakos and Hajidimitriou (2007) claim that ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 65 consumer ethnocentrism and animosity are two distinct and unrelated concepts, which do not have any significant relationship between them. As stated by Balabanis et al. (2001) in their work on animosity and ethnocentrism, these concepts are highly culturally sensitive and thus the nature of their relationship might differ depending on the context of the research. Therefore, it seems that in the context of Lithuanian consumers, animosity against Russia does have a significant positive impact on the level of ethnocentrism that is felt. A possible explanation for the findings of such a positive relationship could be based on the social identity theory (Tajfel & Turner, 1979), which talks about the idea that individuals categorize themselves as parts of some social groups (in-groups) and others as parts of different groups (out-groups). Consumer ethnocentrism originates from the feeling of belonging to a particular in-group and the responsibility to do what is best for the group (hence purchase domestic rather than foreign production). Meanwhile, consumer animosity is related more to the out-groups and the fear that they may cause harm and threaten the well-being of the in-group. As a result, it could be stated that such animosity felt towards the out-group can reinforce the feeling of belonging to the in-group, and thus have a positive impact on the level of ethnocentrism (Tajfel & Turner, 1979). The effect of demographic variables. The final part of the research study examined how the levels of ethnocentrism and animosity vary between the demographic groups of participants, based on differences in age, gender, education and income. To begin with, as it had been predicted based on the findings of previous researchers, the demographic variable of age had a significant impact on both consumer ethnocentrism and animosity. In terms of ethnocentrism, it was found that the level of it increased with older participants. The level of ethnocentrism of participants who were older than 35 was significantly higher than the level of younger participants. Such findings are consistent with other literature sources that have found similar age-related effects between different demographic groups of ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 66 respondents (Sharma et al., 1995; Wetzels et al., 1996). The findings on animosity were not entirely consistent with previous research, as it was shown that the highest level of animosity against Russia overall was demonstrated by the group of participants who were aged from 35 to 44 years old. According to other relevant literature sources, as the age of consumers increases, they should show significantly higher levels of animosity towards the foreign country under investigation (Klein & Morris 1996; Klein & Ettenson 1999). However, in the case of Lithuanian consumers, it seems that the level of animosity peaks at around middle-age and then starts to decrease again. Such an unusual pattern could be related to the especially tense current situation between Lithuania and Russia, which is probably most felt by the working middle-age group of consumers. For instance, students and the elderly retired consumers might not feel such a big economic effect of the Russian import ban on some of the Lithuanian products. On the other hand, this would be more felt by people of the middle age group, who are working and aiming to provide not only for themselves but also for their families. The next demographic variable that was examined in relation to consumer ethnocentrism and animosity was gender. The findings indicated that there were no significant differences in the level of ethnocentrism and animosity in terms of Lithuanian male and female consumers. These results are inline with the work of some other authors, who have also not found a significant effect of gender on consumer ethnocentrism (Ruyter et al., 1998) or animosity (Klein & Morris, 1996; Klein & Ettenson, 1999). Therefore, it seems that for Lithuanian consumers gender does not play a determining role with regards to this topic. According to the literature, the relationship between education and consumer ethnocentrism and animosity has shown inconsistent results among different researchers. Most authors who examined the topic found that higher levels of education did determine lower levels of ethnocentrism (Bailey & Pineres, 1997; Festervand et al., 1985). Meanwhile, in terms of animosity, Klein and Ettenson (1999) ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 67 did not find any significant relationship with education. It is interesting to note that in this particular study, it was demonstrated that participants who were more educated showed higher levels of ethnocentrism as well. Similar tendencies have also been found in relation to animosity and education, as respondents with higher levels of education seemed to feel higher levels of animosity towards Russia as well. This contradicts the findings of previous authors, who claim that more educated consumers should be more open-minded and thus less biased when it comes to the purchasing of imported goods (Klein & Ettenson, 1999; Sharma et al., 1995). Such an opposite effect could once again be explained by the fact that the current political situation between Lithuania and Russia is especially tense, and this may cause Lithuanian consumers to feel higher levels of ethnocentrism and animosity than they would in other circumstances. Finally, the findings on the effect that the level of income has on ethnocentrism and animosity are in-line with what has been demonstrated by other authors. Prior research has shown that consumers who earn higher levels of income, show lower levels of ethnocentrism (Bruning, 1997; Sharma et al., 1995) and animosity (Klein & Ettenson, 1999). In the context of Lithuanian consumers, it was also found that the groups of participants, who earned more on average also demonstrated significantly lower ethnocentric and animosity tendencies when compared to the groups that earned less per month. Consequently, it could be assumed that consumers in Lithuania with higher income are also more cosmopolitan and open-minded than those who earn lower amounts. As a result, consumers that earn more are also more likely to hold less biased and more positive attitudes towards purchasing foreign products. Implications of the Findings As it has been mentioned, the COO effect has been examined for several decades now and multiple authors have demonstrated its significant impact on consumer evaluations of products and ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 68 intentions to purchase (Han, 1989; Nagashima, 1970; Nagashima, 1977; Schooler, 1965). However, with the rise of globalization and large amounts of product-related information available for consumers, some researchers have begun to argue its relevance in today's markets (Pharr, 2005; Samiee et al., 2005). Moreover, as internationalization is increasing, more and more companies are seeking to import their products and services to foreign markets. Therefore, it is essential to determine if COO is still an essential factor impacting the effectiveness of their marketing strategies and international success. At the same time, the political and economic environment is constantly shifting as the tensions between some countries are increasing, due to financial or military reasons. Consequently, it is important for companies to know the extent to which these tensions can have an impact on consumer intentions to purchase products imported from particular countries. This study has aimed to answer the above questions by examining the COO effect deeper from the perspective of its antecedents of ethnocentrism and animosity and the effect that they have on consumer intentions to purchase. The results of the research have confirmed that both ethnocentrism and animosity still have significant effects on purchase intentions and thus they are important factors to consider for both companies seeking to enter new markets or those that are already established internationally. It also provides both researchers and practitioners with a basis for deeper insights into the concept of COO by revealing a more precise nature of the relationship between ethnocentrism and animosity. As shown in the study, higher levels of animosity cause higher levels of ethnocentrism, and so it can be claimed that the political tensions between countries can cause consumers to start favoring their domestic production significantly more than foreign one. The particular context of the study set in a post-Soviet Baltic state, also gathers a deeper understanding of these effects in a scarcely examined environment up to this day. It reveals that the current political animosity in the region towards Russia has an evident negative effect on consumer intentions to purchase imported Russian products. As a ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 69 result, such findings lead to a better understanding of consumers' purchasing behavior and their preference for domestic production versus foreign one. Consequently, for practitioners this knowledge can serve as a basis for developing and maintaining more effective promotional strategies of their products. In order to be internationally successful, it is critical for companies to understand the underlying reasons of why consumers may choose the products of one country over the products of another. Such understanding can help when choosing whether to enter a particular market and also the most suitable marketing strategy for it. In the case of this study, it has been revealed that Lithuanian consumers tend to show higher ethnocentric tendencies in their purchase intentions of domestic products. In addition, they are also significantly affected by the occurring political and economical actions, which cause a decrease in the intentions to purchase products imported from countries with which the relationships are tense. These findings are of special importance for local companies, which in this situation can take advantage of their domestic position in the market and thus put more emphasis on the home country of origin when communicating their offerings to consumers. Meanwhile, for foreign companies looking to enter Lithuania or already established there, the findings should signal to be more careful with the inclusion of COO in their marketing strategy, especially if there might be a basis for any consumer animosity towards the country of origin of the product. Limitations of the Study The main limitation of the research study that was carried out is the unequal distribution of participants in the groups split by demographic variables. The majority of the respondents that participated in the study were of a younger age (mostly from 25 to 34 years old) and over half of the participants had achieved a Bachelor's degree in education. Consequently, some demographic groups in ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 70 the study were over-represented, while others in turn were under-represented. As a result, this could lead to not entirely accurate comparisons that were performed between different demographic groups in order to determine the differences in the levels of ethnocentrism and animosity. The lack of participants from some of the demographic groups could deprive the research from more detailed insights and from gaining a deeper understanding of the COO effect in the Lithuanian market. Furthermore, it should also be noted that almost all of the respondents who took part in the study, were current residents of the capital city Vilnius. It could be assumed that consumers who live in different areas of the country, such as cities compared to rural locations, should have developed different attitudes and behavioral patterns as well. Therefore, the findings of the present study may not be applicable to the whole population of consumers in Lithuania, but only to those living in urban and more developed locations. In addition, during this empirical study the intentions to purchase goods from only two categories were examined – dairy and meat products. For this reason, the area of research was rather narrow and it is not clear if the consumer tendencies that were noticed in the study could be extended to other product categories as well. Lastly, as it has already been mentioned previously, the current political and economic relations between Lithuania and Russia are more tense than usual at the moment, due to the events in Ukraine and Russia's import ban on Lithuanian products. It is possible that the rising tensions could have made an impact on the respondents' answers to the questions of the survey, in a way that they indicated higher levels of ethnocentrism and animosity and lower intentions to purchase Russian production than they normally would. Because of this, the findings of the study might not accurately represent the general attitudes and purchase intentions of the Lithuanian consumers in the long-run. Suggestions for Future Research The present study focused only on two of the antecedents of COO – consumer ethnocentrism and animosity. However, in order to better understand the complexity of the COO construct, it would ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 71 be necessary to examine it in relation to other antecedents as well, together with ethnocentrism and animosity. For instance, concepts such as patriotism, collectivism and conservatism could also be found to have a significant influence on consumer intentions to purchase foreign products. It would also be interesting to examine the relationships between these antecedents, in order to see if there are any positive correlations between them, as it has been found with animosity and ethnocentrism in this study. Moreover, as it has been mentioned, the current study focused only on two product categories and so it is necessary to see if similar findings could be demonstrated in terms of other product categories as well. In addition to that, the services industry has been becoming a major part of the economy globally and its importance is only expected to grow in the upcoming years. Nonetheless, the research in terms of the COO effect on services remains rather scarce and in the context of Lithuania, it is practically non-existent. For this reason, future researchers examining this area should focus more on the services industry, in order to be able to determine if the findings from the product sector could be applied for services as well. Furthermore, experimental or qualitative design research in the field of COO is also rather rare to find, as most authors so far have relied on quantitative surveys and questionnaires. It is essential for future researchers to extend the methodologies that are used when investigating this particular field. Especially because the use of experimental or qualitative design may bring more in-depth and analytical insights into the concepts under investigation and thus help to better understand the importance of COO and the effect of its antecedents on purchase intentions. Finally, it can also be suggested for further research to expand the context of the study into other Eastern European countries, as not much investigation on the topic has been done so far in this particular region. For example, future authors could think about the inclusion of other Baltic states into the study as this might also generate some interesting comparisons in the findings between countries. ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 72 Conclusions All in all, it can be concluded that the goals of the study which were raised prior to the conduction have been successfully carried out and fulfilled. First of all, the literature review has been performed, which focused on the analysis of previous research in the field of country of origin and in particular - its antecedents of ethnocentrism and animosity. During the investigation on the work of other authors, the known effects of ethnocentrism and animosity on consumer intentions to purchase were revealed. Moreover, existing gaps and inconsistent results in the literature were found and identified, which became the basis for the empirical research that was conducted by the author. During the empirical testing, the respondents’ individual levels of ethnocentrism, animosity and intentions to purchase of Russian food products were measured. This allowed to answer the main research question of the study of whether ethnocentrism and animosity had a significant effect on consumer intentions to purchase in Lithuania. Lastly, after comparing the literature analysis and the empirical testing results, the findings were deemed to be consistent with the work of other authors, who have demonstrated that ethnocentrism and animosity have a significant effect on consumer intentions to purchase, and so the hypotheses which were raised by the researcher have been confirmed and the main research question answered. Moreover, it has been shown that there is a positive relationship between the concepts under investigation, with animosity against a particular country having a significant impact on the level of consumer ethnocentrism. The demographic variables which were investigated in relation to the levels of ethnocentrism and animosity have revealed that age and income had evident effects within different consumer groups as it had been expected. It was demonstrated that older consumers showed more ethnocentric and animosity tendencies in their behavior, while higher income levels had the opposite effect. In addition, surprisingly it was found that consumers with higher levels of education tended to show more ethnocentric and animosity tendencies, which contradicts the findings of prior ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 73 research. 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Predictors: (Constant), Ethnocentrism ANOVAb Model 1 Sum of Squares Regression Mean Square 102,976 1 102,976 43,635 257 ,170 146,611 258 Residual Total df a. Predictors: (Constant), Ethnocentrism b. Dependent Variable: ITP Model Summary Model 1 R ,872a R Square ,761 a. Predictors: (Constant), Animosity Adjusted R Std. Error of the Square Estimate ,760 ,36962 F 606,497 Sig. ,000a 82 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS ANOVAb Model 1 Sum of Squares Regression Mean Square 111,501 1 111,501 35,110 257 ,137 146,611 258 Residual Total df F Sig. ,000a 816,158 Multiple Comparisons a. Predictors: (Constant), Animosity b. Dependent Variable: ITP Model Summary Model R ,715a 1 R Square Adjusted R Std. Error of the Square Estimate ,511 ,509 ,60822 a. Predictors: (Constant), Animosity ANOVAb Model 1 Sum of Squares df Mean Square Regression 99,376 1 99,376 Residual 95,071 257 ,370 194,447 258 Total F Sig. ,000a 268,636 a. Predictors: (Constant), Animosity b. Dependent Variable: Ethnocentrism ANOVA Ethnocentrism Sum of Squares Between Groups df Mean Square 67.331 4 16.833 Within Groups 127.116 254 .500 Total 194.447 258 F Sig. 33.635 .000 83 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS Ethnocentrism Tukey HSD 95% Confidence Interval Mean (I) Age (J) Age 1.00 2.00 -.13933 .12589 .803 -.4852 .2065 3.00 -.90333* .15629 .000 -1.3327 -.4739 4.00 .23000 .21968 .833 -.3736 .8336 5.00 -2.07000* .22585 .000 -2.6905 -1.4495 1.00 .13933 .12589 .803 -.2065 .4852 3.00 -.76400* .12350 .000 -1.1033 -.4247 4.00 .36933 .19770 .337 -.1738 .9125 5.00 -1.93067* .20453 .000 -2.4926 -1.3687 1.00 .90333* .15629 .000 .4739 1.3327 2.00 .76400* .12350 .000 .4247 1.1033 4.00 1.13333* .21832 .000 .5335 1.7332 5.00 -1.16667* .22453 .000 -1.7835 -.5498 1.00 -.23000 .21968 .833 -.8336 .3736 2.00 -.36933 .19770 .337 -.9125 .1738 3.00 -1.13333* .21832 .000 -1.7332 -.5335 5.00 -2.30000* .27248 .000 -3.0486 -1.5514 1.00 2.07000* .22585 .000 1.4495 2.6905 2.00 1.93067* .20453 .000 1.3687 2.4926 3.00 1.16667* .22453 .000 .5498 1.7835 4.00 2.30000* .27248 .000 1.5514 3.0486 2.00 3.00 4.00 5.00 Difference (I-J) Std. Error Sig. Lower Bound Upper Bound *. The mean difference is significant at the 0.05 level. ANOVA Animosity Sum of Squares Between Groups df Mean Square 9.126 4 2.281 Within Groups 108.636 254 .428 Total 117.762 258 F Sig. 5.334 .000 84 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS Multiple Comparisons Animosity Tukey HSD 95% Confidence Interval Mean (I) Age (J) Age 1.00 2.00 -.09275 .11638 .931 -.4125 .2270 3.00 -.48875* .14448 .007 -.8857 -.0918 4.00 .32125 .20308 .510 -.2367 .8792 5.00 -.10875 .20879 .985 -.6824 .4649 1.00 .09275 .11638 .931 -.2270 .4125 3.00 -.39600* .11417 .006 -.7097 -.0823 4.00 .41400 .18276 .160 -.0881 .9161 5.00 -.01600 .18908 1.000 -.5355 .5035 1.00 .48875* .14448 .007 .0918 .8857 2.00 .39600* .11417 .006 .0823 .7097 4.00 .81000* .20183 .001 .2555 1.3645 5.00 .38000 .20757 .358 -.1903 .9503 1.00 -.32125 .20308 .510 -.8792 .2367 2.00 -.41400 .18276 .160 -.9161 .0881 3.00 -.81000* .20183 .001 -1.3645 -.2555 5.00 -.43000 .25189 .431 -1.1221 .2621 1.00 .10875 .20879 .985 -.4649 .6824 2.00 .01600 .18908 1.000 -.5035 .5355 3.00 -.38000 .20757 .358 -.9503 .1903 4.00 .43000 .25189 .431 -.2621 1.1221 2.00 3.00 4.00 5.00 Difference (I-J) Std. Error Sig. Lower Bound Upper Bound *. The mean difference is significant at the 0.05 level. ANOVA Ethnocentrism Sum of Squares Between Groups df Mean Square 37.465 3 12.488 Within Groups 156.982 255 .616 Total 194.447 258 F Sig. 20.286 .000 85 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 86 Multiple Comparisons Ethnocentrism Tukey HSD 95% Confidence Interval Mean (I) Education (J) Education 1.00 2.00 .70000 .29656 .088 -.0669 1.4669 3.00 -.33778 .22030 .419 -.9075 .2319 4.00 -.83750* .22447 .001 -1.4180 -.2570 1.00 -.70000 .29656 .088 -1.4669 .0669 3.00 -1.03778* .22030 .000 -1.6075 -.4681 4.00 -1.53750* .22447 .000 -2.1180 -.9570 1.00 .33778 .22030 .419 -.2319 .9075 2.00 1.03778* .22030 .000 .4681 1.6075 4.00 -.49972* .10475 .000 -.7706 -.2288 1.00 .83750* .22447 .001 .2570 1.4180 2.00 1.53750* .22447 .000 .9570 2.1180 3.00 .49972* .10475 .000 .2288 .7706 2.00 3.00 4.00 Difference (I-J) Std. Error Sig. Lower Bound Upper Bound *. The mean difference is significant at the 0.05 level. ANOVA Animosity Sum of Squares df Mean Square Between Groups 19.545 3 6.515 Within Groups 98.216 255 .385 117.762 258 Total F Sig. 16.915 .000 Multiple Comparisons Animosity Tukey HSD 95% Confidence Interval Mean (I) Education (J) Education Difference (I-J) Std. Error Sig. Lower Bound Upper Bound 1.00 2.00 -.14000 .23457 .933 -.7466 .4666 3.00 -.93785* .17425 .000 -1.3885 -.4872 4.00 -.60948* .17755 .004 -1.0686 -.1503 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 2.00 3.00 4.00 1.00 .14000 .23457 .933 -.4666 .7466 3.00 -.79785* .17425 .000 -1.2485 -.3472 4.00 -.46948* .17755 .043 -.9286 -.0103 1.00 .93785* .17425 .000 .4872 1.3885 2.00 .79785* .17425 .000 .3472 1.2485 4.00 .32837* .08286 .001 .1141 .5426 1.00 .60948* .17755 .004 .1503 1.0686 2.00 .46948* .17755 .043 .0103 .9286 3.00 -.32837* .08286 .001 -.5426 -.1141 *. The mean difference is significant at the 0.05 level. ANOVA Ethnocentrism Sum of Squares Between Groups df Mean Square 12.238 4 3.060 Within Groups 182.209 254 .717 Total 194.447 258 F Sig. 4.265 .002 Multiple Comparisons Ethnocentrism Tukey HSD 95% Confidence Interval Mean (I) Income (J) Income 1.00 2.00 -.07072 .13268 .984 -.4353 .2938 3.00 .05027 .14843 .997 -.3575 .4581 4.00 .52805* .18539 .038 .0187 1.0374 5.00 .62805 .24492 .080 -.0449 1.3010 1.00 .07072 .13268 .984 -.2938 .4353 3.00 .12099 .14880 .926 -.2878 .5298 4.00 .59877* .18568 .012 .0886 1.1089 5.00 .69877* .24514 .038 .0252 1.3723 1.00 -.05027 .14843 .997 -.4581 .3575 2.00 -.12099 .14880 .926 -.5298 .2878 4.00 .47778 .19724 .113 -.0641 1.0197 5.00 .57778 .25402 .157 -.1201 1.2757 2.00 3.00 Difference (I-J) Std. Error Sig. Lower Bound Upper Bound 87 ETHNOCENTRISM AND ANIMOSITY EFFECT ON PURCHASE INTENTIONS 4.00 5.00 1.00 -.52805* .18539 .038 -1.0374 -.0187 2.00 -.59877* .18568 .012 -1.1089 -.0886 3.00 -.47778 .19724 .113 -1.0197 .0641 5.00 .10000 .27724 .996 -.6617 .8617 1.00 -.62805 .24492 .080 -1.3010 .0449 2.00 -.69877* .24514 .038 -1.3723 -.0252 3.00 -.57778 .25402 .157 -1.2757 .1201 4.00 -.10000 .27724 .996 -.8617 .6617 *. The mean difference is significant at the 0.05 level. 88
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