They are not all same: variations in Asian consumers [604310]

They are not all same: variations in Asian consumers ’
value perceptions of luxury brands
Paurav Shukla &Jaywant Singh &
Madhumita Banerjee
Published online: 6 February 2015
#Springer Science+Business Media New York 2015
Abstract Asian markets are steadily becoming key growth regions for luxury brands.
However, despite the growth, many luxury brand firms are unable to obtain the desired
economic returns through their marketing strategies in Asia. Often these firms treatconsumers across Asian markets as homogenous groups, which could lead to inaccu-
rate luxury brand management strategy. Additionally, there is limited understanding of
consumer value perceptions toward luxury brands across the Asian markets.Employing impression management theory and the horizontal/vertical collectivisticcultural distinctions, this study examines differences and similarities in constituentluxury value perceptions across three prominent Asian markets, namely China, India,and Indonesia. The results of a quantitative survey conducted with 626 real luxuryconsumers in these three countries identify variations in perceptions of symbolic,experiential, and functional value of luxury brands. The study contributes to knowledge
on constituent luxury value perceptions, along with providing theoretical explanations
for the differences between consumers across Asian markets. With the emerging novelinsights on Asian consumers, luxury brand firms can align their marketing strategies torespective markets by leveraging the similarities and differences in consumer valueperceptions. This approach, informed by empirical evidence, will enhance luxurybrands ’competitiveness and profit opportunities in the high-growth Asian markets.
The study identifies a number of future research directions.Mark Lett (2015) 26:265 –278
DOI 10.1007/s11002-015-9358-x
P. Shukla (*)
Glasgow Caledonian University, 40 Fashion Street, Spitalfields, London E1 6PX, UK
e-mail: [anonimizat]
J. Singh
Kingston Business School, Kingston University, Kingston upon Thames, Surrey KT2 7LB, UKe-mail: [anonimizat]
M. Banerjee
School of Business Administration, American University of Sharjah, PO Box 26666, Sharjah, UnitedArab Emiratese-mail: [anonimizat]

Keywords Value perceptions .Luxury brands .Horizontal/vertical collectivistic
cultures .Asian consumers .China .India .Indonesia .Emerging markets
1 Introduction
The growth of Asian economies has meant increased income levels and a growing
number of affluent consumers (Price Waterhouse Coopers 2013). In the Asia-Pacific
region, the middle class is estimated to be two thirds of the global middle class and is atthe upper end of the income bracket with high spending power (Ernst and Young 2013).
With growing wealth, this consumer segment is increasing its discretionary spendingon travel, healthcare, and luxury goods (Price Waterhouse Coopers 2013). Many luxury
brands such as LVMH, Gucci, and Hermes have been highly successful in penetratingthe Asian markets. However, other brands such as Prada and Mulberry have struggled
to establish themselves in Asia (Butt and Roberts 2014;O s b o r n 2012). Analysts ascribe
the underperformance of some luxury brands in Asia to overexpectations from the
market and, crucially, to treating many Asian markets as homogenous (Financial Times2014 ). While business analysts and research scholars emphasize the diversity and
uniqueness of individual country markets in terms of geography, demography, culture,and consumption patterns (Ernst & Young 2013), market realities suggest that many
Western luxury businesses might have erred in considering Asia as a homogenousmarket. Markets in the Asian countries, therefore, pose strategic challenges, even as
they are critical to the future success of the luxury brands. How can a luxury brand,
therefore, profit from these rapidly growing, competitive, as well as diverse marketsrepresents an important question (Shukla 2012; Hennigs et al. 2012).
Researchers have established that the attempts to explain the social behavior of
consumers in one culture, based on another culture, would be inadequate due to thedifferences in the psychology of consumption and value associations (Belk 1999;S h e t h
et al. 1991). With regard to Asian consumers and status consumption, evidence on the
underlying value perception that drives lu xury consumption is largely anecdotal (e.g.,
Chadha and Husband 2006). As a consequence, insights into the changing effects of value
perceptions on consumers in the diverse Asian markets are inconclusive and have beenhighlighted as a substantial research gap by several authors, such as Hennigs et al. (2012),Shukla ( 2012), and Wiedmann et al. (2009). This study, therefore, examines the constit-
uent luxury value perceptions among the largest and rapidly-growing Asian markets,namely China, India, and Indonesia. The study p rovides explanations for the differences
in luxury value perceptions through the lens of impression management theory
(Goffmann 1959). The theory proposes that consumers are affected by their internal drive
to create a favorable social image, a behavior inherent to luxury consumption, andconsequently such motives can reflect consumer values and behaviors (Leary 1995).
The impression management theory is widely applied across cultures and domains (seeBolino et al. 2008; Shukla 2012), and offers an appropriate framework for this study.
The study makes the following theoretical contributions. First, it extends the three-
dimensional value perception framework developed by Berthon et al. ( 2009 ).
Employing the theory of impression management, the study separates the dimensionof symbolic value into two distinct aspects of self-directed symbolism and other-
directed symbolism. Impression management is grounded in the idea that people have266 Mark Lett (2015) 26:265 –278

an internal drive to create a favorable social image through their possessions (Goffmann
1959; Tsai 2005). There are two notable aspects to the phenomenon, namely instru-
mental and expressive self-presentation. The instrumental aspect focuses on consump-tion geared toward influencing others (i.e. other-directed symbolic value) and gainingrewards, and the expressive aspect focuses on building an image, which reflects one ’s
own personality (self-directed symbolic value). The findings of this study confirm the
advantage of such a distinction of symbolic value perception. Second, the findings
enhance the understanding of differences in value perceptions of Asian consumers byintegrating the horizontal and vertical collectivistic cultural distinction (e.g., Triandis1989; Shavitt et al. 2006). The findings show that while both India and Indonesia are
conventionally categorized as collectivistic cultures, other-directed symbolism is sig-nificantly influential on luxury value perceptions for Indian consumers reflecting thehierarchical nature of the society (vertical collectivism). Self-directed symbolism, onthe other hand, emerges as highly influential for Indonesian consumers demonstrating
equality orientation (horizontal collectivism). This study thus identifies the underlying
reasons for the heterogeneity of Asian markets regarding luxury value perceptions. Interms of managerial implications, the findings offer insights on how a luxury brandmanufacturer can benefit from customizing the constituent value perceptions as adifferentiator in their marketing strategy. In addition, the results suggest standardizingfeatures of marketing campaigns, as functional value is observed to be significantacross all markets.
2 Theoretical background and hypotheses development
2.1 Constituent luxury value perceptionsValue creation has been widely discussed in the consumer behavior literature, and there
is consensus among researchers and practitioners that creating value can be a key tolong-term success. Zeithaml ( 1988, p 14) defines perceived value as Bac o n s u m e r ’s
overall assessment of the utility of a product (or service) based on perceptions of whatis received and what is given. ^The centrality of the Bgive ^and Bget^components
highlighted in Zeithaml ’s(1988) definition becomes even more pronounced in the field
of luxury, given that luxury goods, by definition, are expensive and enable consumersto satisfy their material and socio-psychological needs much more than regularlyconsumed goods (Shukla and Purani 2012; Wiedmann et al. 2009).
Researchers have attempted to conceptualize constituent luxury value perceptions
through various lenses, including brand luxury index (Vigneron and Johnson 2004),
consumption values (Hennigs et al. 2012; Wiedmann et al. 2009), and co-creation
(Shukla and Purani 2012). Berthon et al. ( 2009) suggest that in order to understand
luxury values, it is essential to capture the full dimensionality of the relationshipsamong people, products, and brands. Following Karl Popper ’sBthree worlds ^hypoth-
esis, Berthon et al. ( 2009) conceptualize luxury brands with three distinct value-based
dimensions: symbolic, experiential, and functional. The symbolic dimension getsreflected in the social signals which are constructed through the narrative associatedwith the brand ’s meaning, myth, stories, and consumer ’s own wealth, prestige, and
social status. Incorporating the instrumental and expressive aspects of impressionMark Lett (2015) 26:265 –278 267

management, this study extends Berthon et al. ’s(2009) three-component model by including
two specific sub-dimensions for symbolic valu e: other-directed sym bolism and self-directed
symbolism. The study posits that symbolic va lue is reflected not only through social signals
(i.e., instrumental aspect —other-directed symbolism) but a lso through possessions that help
build a unique image for the desired personality (i.e., expressive aspect —self-directed
symbolism). Moreover, in his seminal work, Triandis ( 1989) argues that the social and
self-directed behavior would vary, based on different cultures. More recently, Berger and
Ward ( 2010) further argue that cultural capital wi ll be a significant driver of symbolism
through possessions (also see Bourdieu 1984). The functional dimension relates to the
material embodiment which reflects in physical manifestations, such as quality of materialand craftsmanship (Berthon et al. 2009). The experiential dimension is associated with
subjectivity and is idiosyncratic, as it differs from person to person. It gets reflected through
sensations, feelings, cognitions, and behavioral intentions aroused by brand-related stimulisuch as logo, packaging, advertisements, and store environment.
Extant research is silent on the variations in luxury consumption practices across the
Asian markets. This study posits that due to the cultural variations, based on hierarchi-cal or equality-based nature of collectivist societies (Shavitt et al. 2006)u n d e r p i n n i n g
the different motives of impression management, consumers in Asia will differ in theirvalue perceptions toward luxury brands. Thus, this study takes a first step towardunderstanding the constituent luxury value perceptions across the three countries bydeveloping directional hypotheses. The conceptual framework of the study is presentedin Fig. 1, followed by the research hypothesis development.
2.2 Symbolic value
The symbolic association driving a brand choice can send significantly meaningful
signals to other consumers about the type of person using that brand (Kapferer andBastien 2009 ; Han et al. 2010; Berger and Ward 2010). It is widely accepted that people
make inferences about others, based on their choices of consumption objects (Belk1988). Symbolic value refers to the extent to which people attach or associate psycho-
logical meaning to a product (Smith and Colgate 2007). Prior research shows that
symbolic value has two specific aspects, namely self-directed symbolism and other-directed symbolism (Shukla and Purani 2012).
Luxury Value
Perceptions
Self-directed
symbolismFunctional Value
Symbolic ValueExperiential Value
Other-directed
symbolism
Fig. 1 Conceptual framework268 Mark Lett (2015) 26:265 –278

Most people use luxury brands for th eir symbolic meanings, and it is well-
established in the Western consumer-based literature that luxury goods make people
feel good about themselves (Shukla and Purani 2012;W i e d m a n ne ta l . 2009).
Additionally, it has been observed that consumers in the developed Western marketsuse their symbolic possessions such as luxury brands to extend, expand, and strengthentheir sense of self (Belk 1988 ; Kapferer and Bastien 2009 ). Using the context of
privately consumed inconspicuous food products, Zhou and Hui ( 2003 ) find the
increasing importance of self-directed symbolism among Chinese consumers.However, Shukla and Purani ( 2012 ) observe a non-significant influence of self-
directed symbolism among Indian consumers with regard to luxury brands. With therapidly growing consumption of luxury brands among Asian consumers, researchersargue that the influence of self-directed symbolism among Asian consumers is on therise (Tsai 2005 ; Hennigs et al. 2012 ). Based on the above logic, and given the
inconsistent findings from prior research, this study posits that:
H1a: Asian consumers ’luxury value perceptions will be significantly influenced by
self-directed symbolism.
Luxury goods are often acquired according to what they mean to the members of
social reference group (Kapferer and Bastien 2009 ; Shukla 2011). Moreover, prior
studies observe that luxury brands are not only used for fitting in with reference groups
but are also used for standing out (Han et al. 2010;B e r g e ra n dW a r d 2010). Such Bother-
directed ^associations have been observed to be highly relevant in collectivist societies
including East Asia (Monkhouse et al. 2012) and South Asia (Hennigs et al. 2012;
Shukla and Purani 2012). Furthermore, comparing the effect of interpersonal influences
among British and Indian consumers, Shukla ( 2011) finds that due to the collectivist
nature of the society, Indian consumers demonstrate high orientation toward conformingto the expectations of others. Similar findings have been observed with regard to socialsymbolic values in other Asian collectivist cultures like China (Xiao and Kim 2009)a n d
Indonesia (Rao 2005). Thus, the construct of other-directed symbolism is likely to be a
significant predictor of luxury value perceptions among Asian consumers. Therefore,
H1b: Asian consumers ’luxury value perceptions will be significantly influenced by
other-directed symbolism.
2.3 Experiential valueExperiential value is concerned with the extent to which a product creates appropriate
experiences, feelings, and emotions for the customer (Smith and Colgate 2007 ).
Experiential value is highly subjective and gets reflected through the hedonic dimen-
sions of a brand (Berthon et al. 2009 ). McCracken ( 1986 ) opines that there is a
significant relationship between individual prosperity and the desire for products withsymbolic aspects. Understanding the differing patterns of consumption among Asianconsumers is not only important because of the market size and growth of Asianeconomies but also because the growth is fuelling the aspirations of an emergentconsumer segment (the nouveau riche ). In order to target this important segment,
luxury brands attempt to create a unique store-level experience and consequently spendMark Lett (2015) 26:265 –278 269

a significant amount on building and maintaining the unique shopping experience for
their consumers (Kozinets et al. 2002). From a customer ’s perspective, historically,
buying luxury brands involved dressing up and going into a high-end boutique toconsult with a salesperson about what to buy (Adams 2013). These rituals are found to
be noticeable among Asian luxury buyers who, in many cases, travel especially toEurope and America to purchase luxury goods (Chadha and Husband 2006). Thus, the
shopping pleasure in itself offers a significant avenue in generating experiential value.Given the rising income levels and a growing appetite for luxury brands among Asianconsumers, this study posits that experiential value will play a significant role ininfluencing luxury value perceptions. Based on the above debate, it is proposed that:
H2: Asian consumers ’luxury value perceptions will be significantly influenced by
the experiential value.
2.4 Functional valueFunctional value represents the perceived utility of a product resulting from its inherent
attributes or characteristic-based ability to perform its functional, utilitarian, or physicalpurposes (Sheth et al. 1991; Smith and Colgate 2007). In other words, the meaning is
derived from perceived functionality of the product (Berthon et al. 2009), wherein
price-quality perceptions are a dominant aspect (Shukla and Purani 2012). Marketers
have long known that a common way to increase the appeal of an otherwise ordinaryproduct is to attach a high price to it (Han et al. 2010). Consumers will, therefore, pay a
higher price for a functionally equivalent good because they crave the status achievedby such material displays of wealth (Wiedmann et al. 2009). In some ways, higher
prices themselves offer a strong signal of quality to consumers, and they can feelsuperior as one of the few who can afford to buy the product. Often, consumersassociate prestige with a product through price and quality perceptions (Brucks et al.2000). For luxury brands, high price and excellent quality go together as inherent traits
(Shukla 2012). Prior studies have observed that functional value, especially price-
quality perceptions, play a significant role in value formation for inconspicuousproducts for the Chinese (Jin et al. 2010), and for luxury goods among Indian
(Shukla 2012) and Indonesian consumers (Rao 2005). Therefore,
H3: Asian consumers ’luxury value perceptions will be significantly influenced by
the functional value perceptions.
3M e t h o d
3.1 Sample and data collectionThis study focuses on the three fast growing Asian luxury markets, namely China,
India, and Indonesia. China has been identified as the fifth largest luxury goods market
in the world and it is projected as a key region of growth by 2020 (Deloitte 2013).270 Mark Lett (2015) 26:265 –278

Similarly, India has been the fastest growing market for luxury goods in the world since
2011, and the sales of luxury goods in Indonesia have doubled since 2008(Euromonitor 2014).
A survey of actual luxury consumers was used to test the hypotheses. First, a
questionnaire was developed based on existing scales. The conceptual and functionalequivalence was assessed subjectively by the multinational research team. The scales
were evaluated by a panel of expert judges, consisting of three luxury marketing
executives in China and India, for content and face validity. Thereafter, two experi-enced academics assessed the questionnaire for representativeness of each scale item. Apilot test was carried out ( n=20 for each market) to identify any invalid responses. The
questionnaire was distributed in Shan ghai and Beijing in China, Mumbai and
Bangalore in India, and Jakarta in Indonesia, as each of these cities are major hubs ofluxury stores in the respective countries.
Respondents were contacted on major shopping streets and/or malls where luxury
brand stores are located. Non-nationals of the particular countries were not included inthe study. To avoid respondent and response bias, data were collected over five weekswith the survey team rotating the location of interviews, the times of the day, and thedays of the week. In order to capture the views of real luxury consumers, therespondents were asked if they had purchased any luxury products in the past sixmonths, following Han et al. ( 2010)a n dS h u k l a( 2012). In total, 626 valid question-
naires were used. The composition of respondents for each nationality was the follow-ing: China ( n=231; response rate, 41.03 %; M
age=27.3 years; female=51.5 %), India
(n=190; response rate, 41.44 %; Mage=24.37 years; female=62.1 %), and Indonesia
(n=205; response rate, 43.94 %; Mage=32.8 years; female=65.1 %).
In India, the questionnaire was in English, a commonly spoken language across
major cities. In order to avoid response bias in China and Indonesia, native speakers ofthe languages translated the questionn aire in Mandarin and Bahasa Indonesia,
respectively. The questionnaire was then back translated by another native speaker toobserve meaning equivalence. A comparison of two translations indicated nosubstantial differences in scale meanings. To avoid interviewer bias, each interviewer
was trained with a similar brief, and debriefing sessions were held at the end of each
day to standardize the process. To minimize and estimate the effect of common methodvariance, several procedural and statistical remedies recommended by Podsakoff et al.(2003) were employed. Order bias was controlled by counterbalancing the order of
measurement of the variables. To avoid response format bias, the participants complet-ed filler tasks on the questionnaire, unrelated to the study. To reduce method bias, therespondents were guaranteed anonymity with assurance that there were no wrong orright answers.
3.2 Measures
The initial sets of items were derived from established existing measurement scales:
functional value scale items were derived from Shukla ( 2012), other-directed symbolic
value measures from O ’Cass and McEwen ( 2004), self-directed symbolism using the
items by Tsai ( 2005), and experiential value was measured with the items from Babin
et al. ( 1994). All measures used a five-point Likert-type response format, anchored at
Bstrongly disagree ^and Bstrongly agree. ^Table 1provides details of standardizedMark Lett (2015) 26:265 –278 271

loadings, average variance extracted (A VE), composite reliability (CR), and Cronbach ’s
alpha for each country.
The AVE for the measures was 0.50 and above for all constructs (Table 1),
which is greater than the level recommended by Dillon and Goldstein 1984.
Cronbach ’s alpha value was above the threshold. Discriminant validity was
assessed following Fornell and Larcker ( 1981). This criterion was met by all
variables in the study, as no correlation exceeded the square root of the average variance
extracted (Table 2).
Table 1 Measurement model
China India Indonesia
Std. Est. Std. Est. Std. Est.
Symbolic value
Other-directed symbolism
Owning this accessory indicates social status 0.67 0.74 0.55Owning this luxury accessory indicates a symbol of achievement 0.88 0.66 0.56
Owning this luxury accessory indicates a symbol of wealth 0.80 0.65 0.73
Owning this luxury accessory indicates a symbol of prestige 0.80 0.84 0.66Composite reliability (CR) 0.87 0.82 0.72
Average variance extracted (A VE) 0.81 0.70 0.51
Cronbach ’sa l p h a 0.87 0.84 0.75
Self-directed symbolism
I am very attracted to unique luxury accessories 0.87 0.72 0.75I like to own new luxury accessories before others do 0.71 0.80 0.82I am more likely to buy luxury accessories that are unique 0.50 0.66 0.77
Composite reliability (CR) 0.74 0.77 0.82
Average variance extracted (A VE) 0.61 0.64 0.74
Cronbach ’sa l p h a 0.71 0.70 0.81
Experiential value
While purchasing luxury accessories, I felt the excitement of the hunt 0.65 0.66 0.83
When purchasing luxury accessories, I am able to forget my problems 0.63 0.72 0.82
When buying luxury accessories, I enjoy a shopping trip, no matter
what I purchase0.74 0.60 0.67
Composite reliability (CR) 0.71 0.70 0.82
Average variance extracted (A VE) 0.53 0.51 0.73
Cronbach ’sa l p h a 0.73 0.77 0.82
Functional value
In my mind higher price equals higher quality 0.65 0.73 0.64An item being higher in price makes it more desirable to me 0.66 0.86 0.79
Higher priced luxury brand accessories mean more to me 0.69 0.90 0.57Composite reliability (CR) 0.71 0.87 0.71
Average variance extracted (A VE) 0.52 0.83 0.53
Cronbach ’sa l p h a 0.71 0.87 0.70272 Mark Lett (2015) 26:265 –278

4 Findings
Since this study used data collected across three countries, the cross-cultural measure-
ment invariance for all the scales was assessed following the process recommended bySteenkamp and Baumgartner 1998. A maximum likelihood estimation procedure with
LISREL 8.8 was used for this purpose.
Table 3provides the results of the stepwise process used for testing the difference in
measurement for invariance levels. After achieving configural invariance (M1 —χ2
(238)=414.94; Root Mean Square Error of Approximation (RMSEA)=0.059; Non-Normed Fit Index (NNFI)=0.96; Comparative Fit Index (CFI)=0.97), the next stepinvolved testing the data for full metric invariance (M2). The procedure was carried outby constraining the factor loadings to be equal across the three national groups andcomparing the fit statistics with the unconstrained model. The difference between M2and M1 was non-significant ( Δχ2 (14)=28.46; p<0.01). Furthermore, the other fit
indices were better than the recommended benchmarks (RMSEA=0.061, χ2/df=1.76,
NNFI=0.96, and CFI=0.97). Thus, support for full metric invariance was observed.
Full scalar invariance was not achieved, consistent with Steenkamp and Baumgartner
(1998 ) who suggest that full scalar invariance is extremely rare in cross-national
studies. Next, a partial scalar invariance model was tested by freeing the invarianceconstraints on intercepts. Two chi-square difference tests were conducted to access thefit of the partial scalar invariance model (M4). The first test compared M4 to M2 andthe second compared M4 to M1 which suggested that the partial scalar invariancemodel was not significantly worse than the full metric or configural invariance model.Moreover, the other fit indices showed significant improvement from the full scalarTable 2 Correlations matrix
ODS SDS EXV FNV
China
Other-directed symbolism (ODS) 0.90
Self-directed symbolism (SDS) 0.46 0.78
Experiential value (EXV) 0.52 0.61 0.73
Functional value (FNV) 0.45 0.48 0.45 0.72
India
Other-directed symbolism (ODS) 0.84
Self-directed symbolism (SDS) 0.42 0.80
Experiential value (EXV) 0.38 0.60 0.71
Functional value (FNV) 0.36 0.46 0.41 0.91
Indonesia
Other-directed symbolism (ODS) 0.71
Self-directed symbolism (SDS) −0.16 0.86
Experiential value (EXV) 0.22 0.08 0.86
Functional value (FNV) 0.37 −0.10 0.50 0.73
Values in diagonal italics represent square root of A VEMark Lett (2015) 26:265 –278 273

invariance model (RMSEA=0.062, χ2/df=1.75, NNFI=0.95, CFI=0.96). Therefore,
partial scalar variance was achieved across the samples.
Table 4provides the structural model with respective path coefficients and tvalues
for each country. H1a is partially supported as self-directed symbolism and was
significant among Indonesian consumers ( β=0.24, p<0.01), but it was non-
significant among Indian and Chinese consumers. Other-directed symbolism wassignificant for Indian consumers ( β=0.64, p<0.001). However, it was non-significant
among Chinese and Indonesian consumers, thus offering partial support for H1b.Experiential value was significant among Indonesian consumers ( β=0.84, p<0.001)
but not among Indian and Chinese consumers. Hypothesis 3 is fully supported as
functional value was found to be significant across China ( β=0.31, p<0.05), India
(β=0.51, p<0.001), and Indonesia ( β=0.28, p<0.01).
5 Discussion and conclusions
This study aimed to understand consumer value perceptions toward luxury products
across three major Asian markets. Although the markets are similar in that they are
characterized by high growth and are located on the same continent, the results show
that they differ significantly in terms of value perceptions for luxury goods. Thesimilarities and differences in value perceptions find explanation in the impressionmanagement theory and the horizontal/vertical cultural distinctions among collectivistsocieties.Table 3 Invariance Measurement
Model comparison χ2df χ2/dfΔχ2Δdf RMSEA NNFI CFI
Full configural invariance (M1) 414.94 238 1.74 0.059 0.96 0.97
Full metric invariance (M2) 443.40 252 1.76 28.46 14 0.061 0.96 0.97
Full scalar invariance (M3) 507.91 264 1.92 92.97 26 0.067 0.95 0.96
Partial scalar invariance (M4) 456.42 261 1.75 41.48 23 0.062 0.95 0.96
Table 4 Structural model
China India Indonesia
Std. Est. tvalue Std. Est. tvalue Std. Est. tvalue
Symbolic value
Other-directed symbolism 0.04 0.34 0.64 5.11*** -0.01 -0.06
Self-directed symbolism 0.05 0.23 0.14 0.82 0.24 2.34**
Experiential value 0.05 0.25 0.08 0.50 0.84 5.81***
Functional value 0.31 1.82* 0.51 4.20*** 0.28 2.04**
***p<0.001; ** p<0.01; * p<0.05274 Mark Lett (2015) 26:265 –278

Overall, this study makes two important theoretical contributions. First, the study
extends and empirically tests Berthon et al. ’s(2009) three-component model of luxury
value perceptions using impression management theory and thereby enhances under-
standing of the constituent luxury value perceptions. Prior literature treats symbolicvalue perceptions as a singular construct. By contrast, this study proposes a novelconceptualization of symbolic luxury value perception as a bi-dimensional concept,
consisting of other-directed and self-directed value perceptions. The two sub-
dimensions of symbolic value deepen understanding of how luxury value perceptionsare formed. Second, the study demonstrates constituent luxury value perceptions in theAsian consumer context. Previous studies have largely treated Asian consumers as ahomogenous entity, and this misconception has often spilled over to marketing practice,resulting in costly mistakes by several luxury brands. Using impression managementtheory and the horizontal/vertical collectivistic cultural distinction, the findings of thisstudy demonstrate that Asian consumers vary in their constituent value perceptions of
luxury goods. Thus, the study sheds new light on the behavior of Asian consumers. For
instance, in India, the construct of other-directed symbolism is found to be significantlyrelated to luxury value perceptions, conforming to the crucial role of the instrumentalaspect of impression management. Thus, the Indian luxury brand consumer seem to beinfluenced by what others think of them and therefore consumes in a way to influenceothers in order to achieve societal acceptance, reflecting the hierarchical nature of thesociety (vertical collectivist).
Luxury value perception of the Indonesian consumers, on the other hand, is influ-
enced by the self-directed symbolism of luxury brands. Self-directed symbolismresonates with expressive self-presentation, wherein the individual seeks to enhancethe self through consumption. This result, while counterintuitive to the general percep-tion of Indonesia as a collectivistic society, can be explained from the lens of equalityperspective (horizontal collectivist). While Indonesian consumers in general would seethemselves as similar to others, they will not submit to in-group authority if theconsumption choice is distasteful to them (Shavitt et al. 2006). The non-significant
result for self-directed symbolism among Chinese and Indian consumers can be
attributed to the hierarchical nature of the society as identified in earlier studies (Belk
1999; Monkhouse et al. 2012).
The Indonesian consumers also show significant impact of experiential value on
their luxury value perceptions, which is consistent with the earlier result relating to self-directed symbolism. Experiential value perceptions represent store-level and personalpleasure derived from the consumption of luxury brands. The differences in thesymbolic value perceptions of the Indian and Indonesian customers are also consistentwith Triandis ( 1989), who argues that social and self-directed behavior vary as per
cultural differences.
Functional value perception has a significant impact on luxury value perceptions
across all three countries in the study. This result shows that consumers evaluate thefunctional value of a luxury brand in terms of the status it brings and therefore arewilling to pay a premium price. The three countries have witnessed rapid economicgrowth over the last two decades and a consequential increase in aspirational con-sumers. These consumers associate prestige through the price and product qualityperceptions and therefore buy luxury brands, which are perceived to accord higher
status in the eyes of the society (Berthon et al. 2009).Mark Lett (2015) 26:265 –278 275

5.1 Managerial implications
This study offers rich insights into the differences in consumer value perceptions of
luxury goods across Asian consumers. The three countries included in this study are atdifferent levels of maturity in terms of economic development, a fact reflected in howthe consumers perceive the value of luxury products. Marketers can benefit from
knowledge about the differences (and similarities) in constituent luxury value percep-
tions and customize or standardize their marketing strategy accordingly. For instance, aluxury brand positioning strategy in Indonesia should emphasize how the brand couldenhance a consumer ’s self-image and could make them feel good about themselves, as
well as focus on the experiential aspects of buying and using the brand. On the otherhand, a luxury brand in India should focus more on how the brand could add tothe buyers ’social status. Thus, the luxury bra nd marketer should customize
their positioning and communication strategies for symbolic and experiential
value perceptions across the three countries. Given that functional value has a
significant impact on luxury value perceptions in all three countries, marketerscould achieve scale economies by standardizing their strategy for this dimension ofluxury value perception.
5.2 Limitations and future research directionsThe findings of this study are contingent upon some limitations, which also provide
avenues for further research. The study included three large and rapidly developing
Asian countries. Further studies can include samples from smaller countries whereluxury consumption is picking up at a slower rate and conduct a cross-countrycomparison. Given the absence of examples of comparative studies focusing onAsian consumers, this study employed directional hypotheses. A further study coulduse comparative hypotheses, in which the differences and similarities may emergeacross groups of countries. In addition, a future study could examine the impact of thetenure of customer-brand relationship on luxury value perceptions. Future studies could
also investigate the role of rarity of brands, new versus established luxury brands, brand
attachment, and commitment in shaping luxury value perceptions in the Asian coun-tries. In conclusion, this study sheds light on the constituent value perceptions ofconsumers, provides suggestions to develop this research topic further, and suggestsmanagerial responses in the light of enhanced understanding of value perceptionstoward luxury brands.
References
Adams A (2013). Luxury consumers value products, not buying experiences. Forbes. http://www.forbes.com/
sites/arieladams/2013/05/23/luxury-consumers-value-products-not-buying-experiences/ . Accessed April
22 2014.
Babin, B. J., Darden, W. R., & Griffin, M. (1994). Work and/or fun: measuring hedonic and utilitarian
shopping value. Journal of Consumer Research, 20 , 644 –656.
Belk, R. (1999). Leaping luxuries and transitional consumers. In R. Batra (Ed.), Marketing issues in
transitional economies (pp. 39 –54). USA: Springer. doi: 10.1007/978-1-4615-5009-9_2 .
Belk, R. W. (1988). Possessions and the extended self. Journal of Consumer Research, 15 ,1 3 9 –168.276 Mark Lett (2015) 26:265 –278

Berthon, P., Pitt, L., Parent, M., & Berthon, J.-P. (2009). Aesthetics and ephemerality: observing and
preserving the luxury brand. California Management Review, 52 ,4 5–66.
Berger, J., & Ward, M. (2010). Subtle signals of inconspicuous consumption. Journal of Consumer Research,
37,5 5 5 –569. doi: 10.1086/655445 .
Bolino, M. C., Kacmar, K. M., Turnley, W. H., & Gilstrap, J. B. (2008). A multi-level review of impression
management motives and behaviors. Journal of Management, 34 ,1 0 8 0 –1109. doi: 10.1177/
0149206308324325.
Bourdieu, P. (1984). Distinction: a social critique of the judgment of taste . London: Routledge.
Brucks, M., Zeithaml, V . A., & Naylor, G. (2000). Price and brand name as indicators of quality dimensions
for consumer durables. Journal of the Academy of Marketing Science, 28 , 359 –374. doi:10.1177/
0092070300283005.
Butt R, Roberts A (2014). Prada falls most in 17 months as revenue growth slows in Asia. Bloomberg. http://
www.bloomberg.com/news/2014-02-12/prada-full-year-sales-climb-9-boosted-by-asia-america-demand.
html. Accessed June 28 2014.
Chadha, R., & Husband, P. (2006). The cult of the luxury brand: inside Asia ’s love affair with luxury . London:
Nicholas Brealey.
Deloitte. (2013). Global powers of luxury goods 2014 . UK: Deloitte Touche Tohmatsu Limited.
Dillon, W. R., & Goldstein, M. (1984). Multivariate analysis: methods and applications.N e wY o r k :W i l e y .
Ernst & Young (2013). Hitting the sweet spot: the growth of the middle class in emerging markets http://www.
ey.com/Publication/vwLUAssets/Hitting_the_sweet_spot/$FILE/Hitting_the_sweet_spot.pdf .A c c e s s e d
October 15 2014.
Euromonitor. (2014). Luxury goods in Indonesia . UK: Euromonitor.
Financial Times (2014). Prada: the shoe has dropped. Financial Times. http://www.ft.com/cms/s/3/cff32734-
ed8b-11e3-8a1e-00144feabdc0.html#axzz34HPB1iiP . Accessed June 25 2014.
Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and
measurement error. Journal of Marketing Research, 18 ,3 9–50.
Goffmann, E. (1959). The presentation of self in everyday life . New York: Double Day.
Han, Y . J., Nunes, J. C., & Drèze, X. (2010). Signaling status with luxury goods: the role of brand prominence.
Journal of Marketing, 74 ,1 5–30. doi: 10.1509/jmkg.74.4.15 .
Hennigs, N., Wiedmann, K.-P., Klarmann, C., Strehlau, S., Godey, B., Pederzoli, D., Neulinger, K., Dave, K.,
Aiello, G., & Donvito, R. (2012). What is the value of luxury? A cross-cultural consumer perspective.Psychology and Marketing, 29 , 1018 –1034. doi: 10.1002/mar.20583 .
Jin, B., Park, J. Y ., & Ryu, J. S. (2010). Comparison of Chinese and Indian consumers ’evaluative criteria
when selecting denim jeans: a conjoint analysis. Journal of Fashion Marketing and Management, 14 ,
180–194. doi: 10.1108/13612021011025492.
Kapferer, J. N., & Bastien, V . (2009). The specificity of luxury management: turning marketing upside down.
Journal of Brand Management, 16,3 1 1 –322. doi: 10
.1057/bm.2008.51 .
Kozinets, R. V ., Sherry, J. F., DeBerry-Spence, B., Duhachek, A., Nuttavuthisit, K., & Storm, D. (2002).
Themed flagship brand stores in the new millennium: theory, practice, prospects. Journal of Retailing, 78 ,
17–29. doi: 10.1016/S0022-4359(01)00063-X .
Leary MR (1995) Self presentation: impression management and interpersonal behavior. Social Psychology
Series. Madison, WI, US: Brown & Benchmark.
McCracken, G. (1986). Culture and consumption: a theoretical account of the structure and
movement of the cultural meaning of consumer goods. Journal of Consumer Research, 13 ,
71–84.
Monkhouse, L. L., Barnes, B. R., & Stephen, U. (2012). The influence of face and group orientation on the
perception of luxury goods: a four market study of East Asian consumers. International Marketing
Review, 29 ,6 4 7 –672. doi: 10.1108/02651331211277982.
O′Cass, A., & McEwen, H. (2004). Exploring consumer status and conspicuous consumption. Journal of
Consumer Behaviour , 4 ,2 5–39. doi: 10.1002/cb.155 .
Osborn T (2012). Trade of the week: Asia bores a hole in Mulberry. Efinancial news. http://www.
efinancialnews.com/story/2012-10-26/trade-of-the-week-asia-mulberry-share-price?ea9c8a2de0ee111045601ab04d673622 . Accessed April 21 2014.
Podsakoff, P. M., MacKenzie, S. B., Lee, J. Y ., & Podsakoff, N. P. (2003). Common method biases in
behavioral research: a critical review of the literature and recommended remedies. Journal of Applied
Psychology, 88 , 879 –903. doi: 10.1037/0021-9010.88.5.879 .
Price Waterhouse Coopers (2013). The rise of the affluent Asian shopper. http://www.pwc.com/en_US/us/
advisory/customer-impact/assets/retail-apparel-customer-insights-global-experience-radar-2013.pdf .
Accessed September 29 2014.Mark Lett (2015) 26:265 –278 277

Rao V (2005). Symbolic public goods and the coordination of collective action: a comparison of local
development in India and Indonesia, World Bank Report. http://elibrary.worldbank.org/doi/book/ 10.
1596/1813-9450-3685 . Accessed October 9 2014.
Shavitt, S., Lalwani, A. K., Zhang, J., & Torelli, C. J. (2006). The horizontal/vertical distinction in cross-
cultural consumer research. Journal of Consumer Psychology, 16 ,3 2 5 –356.
Sheth, J. N., Newman, B. I., & Gross, B. L. (1991). Consumption values and market choices: theory and
applications . Cincinnati: South-Western Pub.
Shukla, P. (2011). Impact of interpersonal influences, brand origin and brand image on luxury purchase
intentions: measuring interfunctional interactions and a cross-national comparison. J o u r n a lo fW o r l d
Business, 46 ,2 4 2 –252. doi: 10.1016/j.jwb.2010.11.002 .
Shukla, P. (2012). The influence of value perceptions on luxury purchase intentions in developed and
emerging markets. International Marketing Review, 29 ,5 7 4 –596. doi: 10.1108/02651331211277955.
Shukla, P., & Purani, K. (2012). Comparing the importance of luxury value perceptions in cross-national
contexts. Journal of Business Research, 65 , 1417 –1424. doi: 10.1016/j.jbusres.2011.10.007 .
Smith, J. B., & Colgate, M. (2007). Customer value creation: a practical framework. Journal of Marketing
Theory and Practice, 15 ,7–23. doi: 10.2753/MTP1069-6679150101 .
Steenkamp, J.-B. E. M., & Baumgartner, H. (1998). Assessing measurement invariance in cross-national
consumer research. Journal of Consumer Research, 25 ,7 8–107. doi: 10.1086/209528 .
Triandis, H. C. (1989). The self and social behavior in differing cultural contexts. Psychological Review, 96 ,
506–520.
Tsai, S.-P. (2005). Impact of personal orientation on luxury-brand purchase value. International Journal of
Market Research, 47 ,1 7 7 –206.
Vigneron, F., & Johnson, L. W. (2004). Measuring perceptions of brand luxury. Journal of Brand
Management, 11 ,4 8 4 –508. doi: 10.1057/palgrave.bm.2540194 .
Wiedmann, K.-P., Hennigs, N., & Siebels, A. (2009). Value-based segmentation of luxury consumption
behavior. Psychology and Marketing, 26 ,6 2 5 –651. doi: 10.1002/mar.20292 .
Xiao, G., & Kim, J. O. (2009). The investigation of Chinese consumer values, consumption
values, life satisfaction, and consumption behaviors. Psychology and Marketing, 26 ,6 1 0 –624.
doi:10.1002/mar.20291 .
Zeithaml, V . A. (1988). Consumer perceptions of price, quality, and value: a means-end model and synthesis
of evidence. Journal of Marketing, 52 ,2–22. doi: 10.2307/1251446 .
Zh
ou, L., & Hui, M. K. (2003). Symbolic value of foreign products in the People ’s Republic of China. Journal
of International Marketing, 11 ,3 6–58. doi: 10.1509/jimk.11.2.36.20163 .278 Mark Lett (2015) 26:265 –278

Copyright
of
Marketing
Letters
is
the
property
of
Springer
Science
&
Business
Media
B.V.
and
its
content
may
not
be
copied
or
emailed
to
multiple
sites
or
posted
to
a
listserv
without
the
copyright
holder's
express
written
permission.
However,
users
may
print,
download,
or
email
articles
for
individual
use.