Examining Examining Factors of Purchase Intention for Local Products in Comparison to Imported Products: A Study on Automobile Industry in Pakistan

Examining Factors of Purchase Intention for Local Products in Comparison to Imported Products: A Study on Automobile Industry in Pakistan

Abstract

Based on social identity theory, the study focuses to investigate the many factors that influence the purchase intention of customers in purchasing a locally assembled and/or imported used car in Pakistan including consumer ethnocentrism, self-congruity, product characteristics, perceived relative price and service quality. The study has been undertaken while identifying the research gap in automotive sector studies in Pakistan, as no study has investigated determinants of customer’s purchase intention towards locally assembled and imported used car segments separately. Additionally, earlier researches have generated varying results regarding purchase intentions towards automobiles in different regions of the world. The study has been carried out by surveying 216 customers prospective of purchasing an automobile. The findings of the study have revealed that purchase intention of customers of Pakistan is shaped by both emotional and rational factors including consumer ethnocentrism, self-congruity and product characteristics where the important predictor for purchase intention of locally assembled cars is consumer ethnocentrism followed by product characteristics and for imported used cars, product characteristics followed by self-congruity. The findings of the study have confirmed that opposing to the relatively developed individualistic societies, purchase decisions of customers towards automobiles in a collectivist country like Pakistan are not only rational but are also emotionally and socially bound. The study has also generated practical implications and has paved way for further studies by identifying the limitations of the study.