Short answer

Designers and strategists must consider the socio-cultural and emotional impact of production decisions on consumer perception, moving beyond purely economic considerations to maintain brand loyalty and integrity.

Field: Innovation & Markets
Source: Journal of Marketing Management (2019)
Method: Naturalistic, contextualised research
Evidence: Strong effect

When companies offshore production, consumers can feel excluded and perceive the brand as losing its integrity, even if they are not socio-economically disadvantaged. This innovation & markets research insight is drawn from a 2019 study published in Journal of Marketing Management. Using Naturalistic, contextualised research, researchers explored how this design variable affects real-world outcomes. The key design takeaway: Designers and strategists must consider the socio-cultural and emotional impact of production decisions on consumer perception, moving beyond purely economic considerations to maintain brand loyalty and integrity.

Study

Innovation & MarketsHigh ImpactStrong effect

Offshoring Decisions Can Alienate Consumers, Leading to Perceived Brand Devaluation

When companies offshore production, consumers can feel excluded and perceive the brand as losing its integrity, even if they are not socio-economically disadvantaged.

Journal of Marketing Management · 2019

Key Findings

01Consumers can feel excluded by offshoring, even without traditional disadvantage markers.
02Perceived brand 'liquidification' (corporate greed, opportunistic consumers) and brand 'de-contagion' contribute to negative sentiment.
03Patriotism and nationalism play a role in consumer reactions to offshoring.
04Consumers desire a 're-solidification' of brand values.

Application

Design takeaway

How to apply

When evaluating offshoring, conduct qualitative research to understand potential consumer sentiment regarding brand values, national identity, and perceived corporate ethics.

Project actions

01When researching a product, consider where and how it's made and how that might affect people's feelings about it.
02Think about how a brand's decisions about production can influence its image and customer loyalty.

Method & Evidence

AimHow do consumers, particularly from working and middle-class segments, perceive the offshoring of durable goods production, and what are the implications for brand sentiment?

MethodNaturalistic, contextualised research

ProcedureThe study investigated consumer perceptions of production offshoring for durable goods within a broader macroeconomic and political context.

ContextConsumer perception of globalized manufacturing practices.

Variables

IVOffshoring of production

DVConsumer sentiment (exclusion, brand liquidification, patriotism/nationalism)

Strengths & Limitations

Strengths

+Provides a nuanced understanding of consumer sentiment beyond economic factors.
+Connects micro-level consumer perceptions to macro-level economic trends.

Limitations

The study's findings might be more pronounced in countries with strong nationalistic sentiments or during economic downturns.

Reliability & validity

The naturalistic approach enhances ecological validity, but the qualitative nature may limit generalizability and require further quantitative validation.

Think critically

To what extent does the perceived 'soul' of a brand, as tied to its production location, outweigh the benefits of lower costs and increased accessibility for consumers?

Design Principles

"Brand integrity is perceived not just through product quality but also through ethical and nationalistic considerations in production."

This research highlights a critical, often overlooked, emotional and psychological impact of offshoring on consumer perception. It suggests that purely economic motivations for offshoring can lead to unintended brand damage and a disconnect with a significant consumer base.

What This Means for Your Design

When companies move their factories to other countries to save money, people can feel like the company doesn't care about their country or their jobs, making them feel bad about the brand.

How to use in your project

1.Use this research to justify exploring consumer sentiment regarding the origin and production of a product in your design project.
2.Incorporate findings about brand perception and consumer exclusion when analyzing the market for your design solution.

Add to My Project

Quick Cite

Paragraph starter

This research indicates that offshoring production can lead to consumer alienation and a perceived devaluation of brand integrity, even among non-disadvantaged demographics. This suggests that design projects should consider the socio-cultural and emotional implications of manufacturing choices on brand perception and consumer loyalty, potentially exploring strategies for transparent communication or localized production where feasible.

Source

Journal of Marketing Management

Brands that ‘sell their soul’: offshoring, brand liquidification and the excluded consumer

journal · 2019

View source

Questions About This Research

What does the research say about offshoring decisions can alienate consumers, leading to perceived brand devaluation?: Designers and strategists must consider the socio-cultural and emotional impact of production decisions on consumer perception, moving beyond purely economic considerations to maintain brand loyalty and integrity. Evidence: Journal of Marketing Management (2019).
Why does "Offshoring Decisions Can Alienate Consumers, Leading to Perceived Brand Devaluation" matter for design?: This research highlights a critical, often overlooked, emotional and psychological impact of offshoring on consumer perception. It suggests that purely economic motivations for offshoring can lead to unintended brand damage and a disconnect with a significant consumer base.
How can designers apply this research?: Designers and strategists must consider the socio-cultural and emotional impact of production decisions on consumer perception, moving beyond purely economic considerations to maintain brand loyalty and integrity.
What were the main findings?: Consumers can feel excluded by offshoring, even without traditional disadvantage markers.. Perceived brand 'liquidification' (corporate greed, opportunistic consumers) and brand 'de-contagion' contribute to negative sentiment.. Patriotism and nationalism play a role in consumer reactions to offshoring.. Consumers desire a 're-solidification' of brand values.
What research method was used?: Naturalistic, contextualised research.
How strong is the evidence?: Evidence strength is rated Strong effect, based on a 2019 journal from Journal of Marketing Management.
What should I do differently in my next project?: When evaluating offshoring, conduct qualitative research to understand potential consumer sentiment regarding brand values, national identity, and perceived corporate ethics.
What are the limitations?: The research focuses on durable goods and may not generalize to all product categories. The specific 'working/middle-class' segment's characteristics were not exhaustively defined.