View of Why do People Buy Chinese Smart phones: The Role of Ethnocentrism, Value and Gender

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Why do People Buy Chinese Smart phones: The Role of Ethnocentrism, Value and Gender

Rocky Nagoya¹, Albert Surya Wanasida², Agus Purwanto³, Wahyu Rafdinal⁴

1,2,3

Pelita Harapan University, Indonesia

4Bandung State Polytechnic, Indonesia Corresponding email: [email protected]

ABSTRACT

This study objectives are to analyze the effect of consumer ethnocentrism and perceived value on Chinese smartphone purchase intentions in Indonesia, which are differentiated by gender. The analysis technique used is a partial least squares-structural equation modeling (PLS-SEM) multigroup analysis (MGA). Samples were taken from the Indonesian people.

Respondents in this study were 300 respondents. The results of the study prove that ethnocentrism and perceived value significantly influence the purchase intention of Chinese smartphone products. Based on gender, women prioritize hedonic values in buying smartphones, while men prioritize utilitarian values. This study also presents that gender differences will affect the effect of perceived value on purchase intention on smartphone products from certain countries such as China. This research provides insights to smartphone industry players to develop more effective strategies to get their target market and will increase knowledge about ethnocentrism and perceived value from the perspective of Chinese smartphones.

Keywords: Consumer Ethnocentrism, Perceived Value, Gender, Purchase intention

JEL Classification: Z130, M310, J160

INTRODUCTION

The number of smartphone users in Indonesia continues to increase in line with the dominance of the smartphone market in Indonesia from China. In 2018, seven of the ten most valuable companies in the world were the owners of digital platforms; five are Americans, and two are Chinese-owned. For smartphones and applications, China can enter earlier in the industrial life cycle, and this can explain why Chinese platform companies have had greater success in globalizing their offerings (Jia et al., 2018). The public's view of products originating from China or made in China is increasingly changing, the quality of Chinese products has increased in line with countries that have excellent product quality, such as Japan (Southworth, 2015). Indonesians have a large selection of smartphone products from various brands, with features that follow their preferences. It is essential to understand what

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consumers want in a product and the factors that influence consumers in buying a product (Lew, 2014).

Many Chinese smartphones can provide high value to consumers because they offer quality products at a price advantage. Perceived value theory shows that perceived value is a substantial factor in purchasing decisions, and consumers will choose the purchase option on products that provide the highest level of perceived value (Wang, 2016). Better product value leads to a higher evaluation, which ultimately creates purchasing decisions (Kim, 2017).

Perceived values such as utilitarian values and hedonic values are positively correlated with repurchase decisions (Hong, 2017; Hsu, 2016). Previous studies showed that perceived value plays an essential role in influencing purchase intention. However, understanding how perceived value affects the purchase intention of smartphones from certain countries such as China is still limited. Therefore, one of the objectives of this study is to propose and test a theoretical model of perceived value for the purchase intention of smartphones from certain countries such as China. In business practice, these results will present useful values and become the main assessment by consumers in analyzing smartphone purchase intentions.

The concept of consumer ethnocentrism (Shimp, 1987) is commonly used to understand customer trends toward foreign products, consumers do not have the same level of ethnocentric tendencies in different countries and within the same countries. Ethnocentrism is a cultural identity that influences the purchase of domestic products (He, 2015).

Ethnocentrism can influence purchase intentions directly (Parts, 2013; Banna, 2018; Wel, 2015) or influenced by other variables (Narang, 2016). Someone who has ethnocentrism and high national cultural identity would prefer to buy domestic products than imported products (He, 2015). High ethnocentrism tends to refuse purchase electronic products made in foreign countries, especially Chinese smartphones whose products are readily available at low prices and of good quality.

Previous studies showed the importance of gender roles in purchasing intentions (Wolin, 2003; Sreen, 2018). Socio-demographic factors were the substantial parameters used to explain consumer preferences (Straughan, 1999). Female consumers are comparatively more emotionally action than male consumers (Dubé, 1998). Previous research has analyzed gender roles in influencing intention in the context of social media (Krasnova et al., 2017), eWOM (Mishra et al., 2018), online games (Liu, 2016) which suggest continuing gender role

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analysis in a different context (Krasnova et al., 2017; Liu, 2016; Mishra et al., 2018). Thus, further investigation is needed to analyze the role of gender in purchase intentions that is influenced by perceived value and ethnocentrism, because men and women analyze different values of a product.

To address this research gap, this study examines the formation of purchase intention for Chinese smartphone products. More specifically, this study tries to: (1) assess the antecedents of the purchase intention of Chinese smartphones including ethnocentrism and perceived value; (2) evaluate gender roles on these influences. This study chooses the Indonesian context because Chinese smartphones have market dominance in the smartphone industry in Indonesia. Furthermore, the rapid development of cellular phone users in Indonesia has occurred in this decade. In 2019, the percentage of Indonesia's population who owned cell phones was recorded at around 63.53%. This value is much higher when compared to 2010 which only reached 38.05% (BPS-Statistics Indonesia, 2019). This market potential can be utilized in building purchase intention of smartphones which can be an important path to the success of smartphone companies in the future.

LITERATURE REVIEW

Purchase Intention of Smartphone

Purchase intention shows the possibility that consumers will plan or want to buy a product in the future (Wu et al., 2011). Purchase intention is a plan to purchase certain goods or services in the future, but not necessarily purchasing because it depends on the ability of individuals to make purchases (Warshaw, 1985). According to Blackwell, Miniard, & Engel (2001), what comes to the customer's mind signifies their intention to buy. Regarding the context of smartphones, purchase intentions as consumers desire to make purchases (Chen et al., 2010).

Previous studies have analyzed purchase intention in several contexts such as the purchase of smartphones (Alrwashdeh et al., 2019; Lee et al., 2017; Martins et al., 2019) and foreign- made products and ethnocentrism (El Banna et al., 2018; Lew & Sulaiman, 2014; Narang, 2016). These previous studies have demonstrated that an increase in purchase intention reflects an increase in purchasing opportunities. In the context of smartphones, purchase intention as a consumer's desire to purchase a smartphone (Alrwashdeh et al., 2019; Lee et al., 2017; Martins et al., 2019). If consumers have positive intention to buy a smartphone, it

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will encourage these purchases.

Smartphones, different from standard cell phones in terms of operating systems, have attracted many users and have become a necessity in personal and work life. People use a smartphone for many purposes, such as social networking, reading e-books, answering e- mails, sending messages, and playing games (Martins et al., 2019). Smartphone technology has received little attention in academic research in terms of understanding the mindset of the user on the adoption of smartphones (Joo, 2013; Martins et al., 2019). Expectation- confirmation theory (ECT) is widely used in the consumer behavior literature to analyze consumer IT use decisions and repeat purchasing decisions (Bhattacherjee, 2001). This effect is mediated through positive or negative disconfirmation between expectations and performance (Oliver, 1980). The process starts before buying when the consumer makes the main expectations for the product. After the product is used, they form perceptions about the product's performance and compare it to their initial expectations (Yasami et al., 2020). In the context of purchasing a smartphone, they will analyze various aspects before buying a smartphone that raises expectations. This study analyzes the purchase intention of Chinese smartphones which shows the desire to use and buy Chinese smartphones by analyzing the expectation factor (perceived value). Despite the rapid growth of smartphone technology, there is still little research on the effect of ethnocentrism and value on the purchase intention of smartphones, and there is still room for new studies to help practitioners and researchers understand the factors that influence it. Each determinant is discussed in the following sub- sections, as well as their impact on the development of purchase intention for smartphones.

Ethnocentrism

The idea of consumer ethnocentrism was first described by Shimp (1987) as a belief held by American consumers about conformity, indeed morality, and purchasing foreign-made products. Consumers are very ethnocentric thinking purchase imported products as wrong because it harms the domestic economy and unpatriotic (Narang, 2016). Highly ethnocentric consumers might have a good attitude toward products from countries that have similar cultures (Sharma, 2015). Consumers do not have the same level of ethnocentrism; they have varying ethnocentrism due to various demographic and socio-psychological differences (Thelen, 2006). The level of ethnocentrism will influence behavior, especially in the intention

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to buy a product.

Consumer ethnocentrism influences consumer buying behavior (Parts, 2013). Ethnocentrism is a cultural identity influencing the purchase of domestic products (He, 2015). Ethnocentrism can influence purchase intentions directly (Banna, 2018; Wel, 2015) or influenced by other variables (Narang, 2016). Someone who has ethnocentrism and high national cultural identity would prefer to buy domestic products rather than imported products (He, 2015). This proves that consumer ethnocentrism can influence purchase intentions of Chinese smartphone. This influence will make a negative effect, the higher ethnocentrism will reduce the purchase intention of Chinese smartphones.

H1. Ethnocentrism negatively influence purchase intention of Chinese smartphone.

Perceived Value

Customer perceived value has recently become an interesting study for many researchers.

Several studies have treated the perceived value as two essential dimensions of consumer behavior: benefits received and sacrifices made by customers (Cronin, 1997; Oh, 2003).

Sheth (1991) use experience value theory to explain why consumers continue to buy products and classify experiential values into functional, conditional, social, emotional, and epistemic values. Some scholars argue that the hedonic and utilitarian constructs are two different dimensions of consumer attitudes toward purchase intentions (Babin, 1994; Voss, 2003).

According to Dhar (2000), utilitarian value refers to goal-oriented, rational, and functional goals when using a product, while hedonic values imply enjoyment as the main benefit of customer participation in a service or product.

Perceived value can affect purchase intention. A better product leads to a higher evaluation, which in turn creates purchase intentions (Kim, 2017). Perceived value is the determinant that influences the purchase decision (Lien, 2015). Perception of perceived value is important to achieve customer retention (Eid, 2015). Perceived values such as utilitarian values and hedonic values are positively correlated with repurchase intentions (Hong, 2017; Hsu, 2016).

Perceived value significantly influences purchase intention, where utilitarian value has the most significant influence on purchase intention (Gan, 2017). Perceived value and perceived risk have a significant influence on attitude and indirectly affect purchase intention (Mao, 2017; Wang, 2016). Based on previous studies, this study uses the utilitarian value and

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hedonic values of using Chinese smartphones to play an important role in customers' purchase intentions. Previous studies have shown the effect of utilitarian value and hedonic value on purchase intention (Ho et al., 2020; Kim, 2015). Kim (2015) has analyzed the effect of utilitarian value and hedonic value on purchase intention on Low-Cost Carriers (LCCs) and Full-Service Carriers (FSCs). Meanwhile, Ho et al. (2020) proved the influence of hedonic value and utilitarian value as a mediator of men's intention to purchase cosmetics.

Therefore, these results led to the following hypotheses regarding the relationship between utilitarian value and hedonic value on purchase intention.

H2. Utilitarian value positively influences purchase intention of Chinese smartphone.

H3. Hedonic value positively influences purchase intention of Chinese smartphone.

Gender differences in ethnocentrism

There is a large amount of literature on the antecedents of consumer ethnocentrism. This publication is based on empirical studies that have been carried out in many countries and have considered many variables. In reviewing the literature, certain biases towards the most frequently analyzed socio-demographic variables should be considered, such as age, gender, education level, and income level (Acikdilli et al., 2018; Fernández-Ferrín et al., 2017;

García-Gallego, 2016) because socio-demographic variables influence the ethnocentric tendency of consumers (Acikdilli et al., 2018; Stere, 2015). Thus, Socio-demographic variable such as gender becomes important because it allows predictions of consumer behavior.

This study highlights the role of ethnocentrism in purchase intentions, because only exposure to external stimuli (i.e., foreign or domestic products) can influence ethnocentrism (MacDonald, 2006; Narang, 2016). However, further analysis is needed when assessing the impact of demographic variables (gender) and ethnocentrism on purchase intention.

Consistent with previous studies analyzing the role of demography and ethnocentrism in influencing buying foreign products (Balabanis, 2017; Siamagka, 2015). In testing the effect of consumer ethnocentrism and demographic variables on reluctance to buy foreign products, Gender associated with consumer ethnocentrism affects purchase preferences for foreign products (Balabanis, 2017; Siamagka, 2015). This study complements the literature of previous studies, this is because no previous study has been identified to analyze gender

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differences on the effect of ethnocentrism on purchase intention. Thus, the following hypotheses are proposed:

H4. Ethnocentrism in female negatively influences purchase intention of Chinese smartphone.

H5. Ethnocentrism in male negatively influences purchase intention of Chinese smartphone.

Gender differences in perceived value

Gender has been considered as an important research topic, such as marketing, psychology, and behavioral studies (Meyers-Levy, 1991; Putrevu, 2004; Richard, 2010). Social role theory shows that gender differences in social behavior from shared expectations about what behavior is appropriate for men and women (Karakowsky, 2001). It has been found that female consumers are relatively more emotionally reactive than male consumers (Dubé, 1998). Women process information more comprehensively than men (Acikdilli et al., 2018;

Meyers-Levy, 1991). In the context of consumer behavior, previous research has shown that men and women have psychological pre-dispositions that are different from web-based purchases (Wolin, 2003). Based on the results of research by Sreen et al., (2018), there are differences based on gender in green product purchasing decisions. These studies have shown the role of gender in influencing consumer behavior to buy a product. Males and females have different perceptions of analyzing the products and values obtained.

Customer value theory explains the use of products and services by customers in terms of the value they provide to customers (Zeithaml, 1988). Analysis of consumer choice (Alonso- Almeida, 2019; Prieto et al., 2017) found that socio-demographic variables play an important role in perceived value. One of the key variables is gender. Age and gender can influence online repurchase intentions by moderating the relationship between relational benefits (i.e.

product quality and electronic service quality) and perceived value (Jiaming Fang et al., 2016). One of the socio-demographic variables is gender which moderates the effect of perceived value on purchase intention (Calza et al., 2020). When consumers decided to purchase products, males evaluated design value and social value, whereas females evaluated monetary value and guarantee value (Huang et al., 2019). The effect of perceived value on purchase intention differs based on consumer gender. This study complements the previous literature, because no study has been identified to show the effect of utilitarian value and

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hedonic value on different purchase intentions based on gender. Thus, the proposed hypotheses are:

H6. Utilitarian value in female positively influences purchase intention of Chinese smartphone.

H7. Utilitarian value in male positively influences purchase intention of Chinese smartphone.

H8. Hedonic value in female positively influences purchase intention of Chinese smartphone.

H9. Hedonic value in male positively influences and positively purchase intention of Chinese smartphone.

Ethnocentrism

Utilitarian Value

Hedonic Value

Purchase Intention

Male Group

Ethnocentrism

Utilitarian Value

Hedonic Value

Purchase Intention

Female Group

Figure 1. Research Model

METHODS

Data Collection

In this study, we distributed questionnaires through online surveys to Chinese smartphone users spread across various regions in Indonesia. The questionnaire consisted of two parts.

The first part contains questions to collect respondents' demographic information. The second part is the main component of the questionnaire that is statements related to the research variables. Samples were taken from the Indonesian people with the number of respondents was 300 respondents of 350 responses were obtained. However, due to incompleteness and inconsistency of responses, some of survey responses were excluded, resulting of 300 usable responses - a response rate of 85.7%. To improve data quality, we eliminated non-serious

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responses through data filtering on two verification questions. Data collection takes place from August to October 2019. Although participation in this study is voluntary, prizes encourage participants not only to answer but also to provide their personal and professional contacts.

Sample

An online survey yielded data for empirical analysis. Descriptive statistical analysis was used to analyze respondents’ demographic characteristics. Based on the results of the distribution questionnaires to respondents, a total of 300 questionnaires can be used for data analysis.

Forty-nine percent of respondents (n = 147) were male respondents while fifty-one percent of respondents were female (n = 153). Then, based on age, there was five percent of respondents (n = 15) aged 17-20 years old. Thirteen percent of respondents (n = 39) were 20-25 years old.

Seventy-one percent of respondents (n = 212) were 26-35 years old, ten percent of respondents (n = 29) were 36-45 years old. Two percent of respondents (n = 5) were more than 40 years old. This shows that respondents are evenly distributed based on gender. Based on age, it is dominated by respondents aged 26 years old to 35 years old. Details are shown in Table 1.

Table 1. Demographics of respondents.

Characteristics Frequency %

Gender

Male 147 49

Female 153 51

Age

17-20 15 5

20-25 39 13

26-35 212 71

36-45 29 10

>40 5 2

Income

<IDR 2,000,000 123 41

> IDR 2,000,000 - IDR 5,000,000 109 36

> IDR 5,000,000 68 23

Occupation

Students 114 38

civil servants 44 15

private employees 29 10

self-employed 67 22

employees of state companies 14 5

outside the group 32 11

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Measures

The purchase intention of the Chinese smartphone is measured by four items adapted from Gan (2017). All items are measured on a 5-point liker scale, ranging from strongly disagree (1) to strongly agree (5). Ethnocentrism is measured on six items adapted from Narang (2016) using a 5-point Likert scale, strongly disagree (1) to strongly agree (5) for each statement item. Utilitarian value and hedonic value are adapted from Gan (2017) with each of the four statement items using a scale of strongly disagree (1) to a scale of strongly agree (5).

Then, the Indicators for each variable can be explained as follows:

Table 2. Research Instruments

Variables Indicators Source

Ethnocentrism 1. Only those products that are unavailable in Indonesia should be imported.

2. Indonesian products, first, last, and foremost.

3. A real Indonesian should always buy Indonesia-made products.

4. Indonesian should not buy foreign products, because this hurts the Indonesian business and causes unemployment.

5. It may cost me in the long run, but I prefer to support Indonesian products.

6. Indonesian consumers who purchase products made in other.

countries are responsible for putting their fellow Indonesian out of work.

Narang (2016)

Utilitarian Value 1. The quality of Chinese smartphones is reliable.

2. Chinese smartphones offer good value for money.

3. Chinese smartphones can meet my needs.

4. Chinese smartphones can provide many benefits.

Gan (2017)

Hedonic Value 1. Help me to feel acceptable if I use a china smartphone.

2. Make a good impression on others if I use a china smartphone.

3. Improve the way I am perceived if I use a china smartphone.

4. Get social approval if I use a Chinese smartphone.

Gan (2017)

Purchase Intention 1. It is always best if I buy a Chinese smartphone.

2. Whenever possible, I will buy Chinese smartphones.

3. Whenever available, I will buy Chinese smartphones.

4. I intend to recommend others if I have bought a Chinese smartphone.

Gan (2017)

RESULTS

Data were analyzed using partial least squares-structural equation modeling (PLS-SEM) and multigroup analysis (MGA) (Hair et al., 2014). Partial least squares were employed to analyze measurement models and test structural models. This technique was chosen because

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it presents sufficient advantages for the research to be carried out (Hair et al., 2014). PLS- SEM provides many advantages for researchers working with structural equation models.

Given the popularity of CB-SEM, the use of PLS-SEM often requires additional discussion to explain the reasons behind the decision (Chin, 2010). The most prominent justification for using PLS-SEM is associated with non-normal data, small sample sizes, and constructs measured formatively (Hair et al., 2014). The effects of different gender roles were examined using multigroup analysis (MGA).

Measurement Model

In evaluating the measurement model, it is necessary to estimate the accuracy of the measurement instrument in providing numbers free from random errors and the extent to which the numbers obtained on a scale reflecting the actual differences between objects and measured features (convergent validity and discriminant validity). According to Chin (1998), to assess convergent validity, the values of composite reliability and Cronbach’α for each construct should be higher than 0.7. Besides, the values of the average variance extracted (AVE) should be higher than the recommended threshold of 0.5 (Hair et al., 2014). Table 2 shows the results of a valid loading factor that is above 0.5; the indicators can be used in the research model (Hair et al., 2017). Therefore, convergent validity is considered adequate in this measurement model.

Table 3. Reliability and Validity of the Variables Item Loading Factor Cronbach’s

α

CR AVE

Ethnocentrism ETH1 0.715 0,850 0,889 0,577

ETH2 0.827

ETH3 0.797

ETH4 0.566

ETH5 0.773

ETH6 0.843

Utilitarian Value UV1 0.868 0,885 0,914 0,727

UV2 0.855

UV3 0.858

UV4 0.829

Hedonic Value HV1 0.879 0,841 0,895 0,682

HV2 0.872

HV3 0.844

HV4 0.694

Purchase intention PI1 0.826 0,846 0,897 0,686

PI2 0.871

PI3 0.844

PI4 0.767

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Notes. ETH = Ethnocentrism; UV = Utilitarian value; HV = Hedonic value; PI = Purchase intention

Discriminant validity is checked by a Fornell (1981) method. In this method, comparing the square root of Average Variance Explained (AVE) of each construct with the variance between constructs and if the square root of AVE is greater than the variance between constructs, then the researcher can state discriminant validity between constructs. Table 4 shows that discriminant validity in the model, the square root of AVE of each construct is greater than the shared variance between the constructs. In addition, cross-loadings of all the items were tested, and the results show each within-construct item loading is higher on the measured construct than the cross-loadings on the other items (see Table 5), this indicates the discriminant validity of the measurement model is accepted (Chin, 1998).

Table 4. Discriminant Validity (Fornell-Larcker Criterion)

Ethnocentrism Utilitarian Value Hedonic Value Purchase Intention Ethnocentrism 0.759

Utilitarian Value -0.851 0.852

Hedonic Value -0.598 0.580 0.826

Purchase Intention -0.838 0.818 0.647 0.828

Table 5. Cross Loading of Reflective Constructs

Ethnocentrism Utilitarian Value Hedonic Value Purchase Intention

ETH1 0,715 -0,703 -0,487 -0,644

ETH2 0,827 -0,671 -0,556 -0,655

ETH3 0,797 -0,587 -0,435 -0,663

ETH4 0,566 -0,576 -0,297 -0,425

ETH5 0,773 -0,652 -0,424 -0,705

ETH6 0,843 -0,696 -0,495 -0,677

UV1 -0,783 0,868 0,573 0,807

UV2 -0,690 0,855 0,401 0,584

UV3 -0,729 0,858 0,515 0,659

UV4 -0,687 0,829 0,465 0,703

HV1 -0,516 0,512 0,879 0,548

HV2 -0,480 0,493 0,872 0,551

HV3 -0,510 0,485 0,844 0,555

HV4 -0,468 0,421 0,694 0,479

PI1 -0,718 0,671 0,600 0,826

PI2 -0,679 0,664 0,540 0,871

PI3 -0,672 0,688 0,514 0,844

PI4 -0,701 0,684 0,485 0,767

Notes. ETH = Ethnocentrism; UV = Utilitarian value; HV = Hedonic value; PI = Purchase intention

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Structure Model

After testing the measurement model, the assessment of the model's quality is based on its ability to predict endogenous constructs. The following criteria facilitate this assessment:

coefficient of determination (R²), effect size (f²), cross-validated redundancy (Q²), and path coefficient (Hair et al., 2017). The main evaluation criterion for assessing the goodness of fit of a model is to test R² which represents the effect of the combined exogenous variables on endogenous variables (Hair et al., 2017). The R² value on the purchase intention variable is 0.765. This means that ethnocentrism, utilitarian value, and hedonic value explain 76.5% of purchase intention variance. Rule of thumb R² purchase intention value is above 0.75 which is a substantial criterion (Hair et al., 2017).

The next step is to measure f² (effect size). Effect sizes can be categorized into three levels:

large (0.35), moderate (0.15), and small (0.02) (Cohen, 1988). Based on the results of the f² test, there is a relationship that has a threshold value of more than 0.15 (medium effect size), ethnocentrism on purchase intention (f² = 0.216). Then, there are two relationships that have a value of 0.15 - 0.35 (small effect size): the utilitarian value on purchase intention (f² = 0.125) and the hedonic value on purchase intention (f² = 0.097). If the exogenous construct contributes strongly to explaining the endogenous construct, the difference between R² included and R² excluded will be high, leading to a high f² value (Hair et al., 2017).

Furthermore, for predictive relevance in measuring how good the conservation value is generated by the model and estimated purchase intention parameter. Q-square value > 0 indicates that the model has predictive relevance (Hair et al., 2017).

Table 6. Structural model evaluation

Relationships

Variance explained

(R²)

R² Adjusted Predictive relevance (Q²)

Effect Size (f²)

VIF

ETH -> PI 0.765 0.763 0.386 0.216 3.855

UV -> PI 0.449 0.097 1.603

HV -> PI 0.283 0.125 3.733

Note(s): n = 5,000 subsample; VIF: variance inflation factor; ETH: Ethnocentrism; UV: Utilitarian value; HV:

Hedonic value; PI: Purchase intention

The next step is to examine the direct effect between variables in table 7. The structural model test shows the relationship of latent variables with other latent variables. This study finds a significant direct effect between the three predictors (ethnocentrism, utilitarian value,

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and hedonic value) on purchase intention. The results showed that ethnocentrism, utilitarian value, and hedonic value significantly influence purchase intention.

Table 7. Direct effect on purchase intention

Variable

Path

Coefficient Mean

Std.

Deviation T Statistics Ethnocentrism -> Purchase intention -0.442 -0.440 0.054 8.210**

Utilitarian value -> Purchase intention 0.331 0.331 0.050 6.632**

Hedonic value -> Purchase intention 0.191 0.194 0.049 3.907**

Notes: **p < 0.01; * p < 0.05

Based on the results of testing the direct effect show that purchase intention significantly influenced by ethnocentrism (H1; β = -0.442, ρ < 0.01), utilitarian value (H2; β = 0.331, ρ <

0.01), dan hedonic value (H3; β = 0.191, ρ < 0.01), hypotheses 1, 2, and 3 are accepted. The results showed that ethnocentrism, utilitarian values, and hedonic values significantly influence purchase intention. The negative coefficient on ethnocentrism shows that the higher ethnocentrism of consumers can reduce the purchase intention of Chinese smartphones.

β = 0.331**

R2 = 0.765 Ethnocentrism

Utilitarian Value

Hedonic Value

Purchase Intention

Notes. **: ρ < 0.01; *: ρ < 0.05

Figure 2. PLS results of the proposed model

Gender Roles

To analyze gender roles, we conducted MGA using the SmartPLS software (See Figure 2).

The predictive power of the model proposed for the two groups of respondents was not significantly different, male (R² = 0.791) and female (R² = 0.788). Then, the results of direct influence based on gender (see Table 8) shows that ethnocentrism influences purchase intention in the female group (H4; β = -0.357, ρ < 0.01) and the male group (H5; β = -0.503,

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ρ < 0.01). While in the utilitarian value influences purchase intention in the female group (H6; β = 0.201, ρ < 0.05) and the male group (H7; β = 0.371, ρ < 0.01). Hedonic value influences purchase intention in the female group (H8; β = 0.413, ρ < 0.01) but did not significantly influence the male group (H9; β = 0.080, ρ > 0.05). Based on gender, the effect of ethnocentrism on purchase intention is more significant in the male group. On the effect of utilitarian value, the most significant effect is on the male group. For the effect of hedonic value on purchase intention, the female and male groups are different. Only the female group affected purchase intention. These results indicate that males are more concerned with utilitarian values than females. Whereas females are more concerned with hedonic value than males.

Table 8. Direct effect on purchase intention based on gender

Variable

Female Male Differences

Path

Coefficient P value

Path Coefficient

P value

Path Coefficient

P value Ethnocentrism -> Purchase intention -0.357 0.000 -0.503 0.000 -0.146 0.146^ns Utilitarian value -> Purchase intention 0.210 0.021 0.371 0.000 0.161 0.168^ns Hedonic value -> Purchase intention 0.413 0.000 0.080 0.158^ns -0.333 0.002 Notes: ns = non-significant

0.371** 0.210*

R² = 0.788 R² = 0.791

Ethnocentrism

Utilitarian Value

Hedonic Value

Purchase Intention

Male Group

Ethnocentrism

Utilitarian Value

Hedonic Value

Purchase Intention

Female Group Notes. **: ρ < 0.01; *: ρ < 0.05

Figure 3. The MGA PLS results for the proposed model compare male and female customers

DISCUSSION

Based on the results of the analysis, ethnocentrism has a significant negative effect on purchase intention. The higher ethnocentrism will

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reduce the purchase intention of Chinese smartphones. Ethnocentrism is a cultural identity influencing product purchases (He, 2015). Consumer ethnocentrism has a significant effect on purchase intention (Banna, 2018; Aniza, 2015; Parts, 2013). Someone who has high ethnocentrism in buying behavior, such as having more desire to purchase and use domestic products can reduce the purchase intention of foreign products, especially Chinese smartphones. Ethnocentrism and high national cultural identity would prefer to purchase domestic products rather than imported products (He, 2015). These results provide an important explanation that the smartphone market in Indonesia, the role of ethnocentrism and a sense of nationality affect one's intentions in buying smartphone products manufactured abroad such as Chinese smartphones. These findings complement the literature on the effect of ethnocentrism on purchase intention, especially in the context of foreign products, namely Chinese smartphones. From a practical point of view, marketers need to consider the ethnocentrism factor in their marketing strategies. A high sense of ethnocentrism will determine a person's perception of foreign products. For this reason, in marketing a product, especially smartphones, marketers need to determine a promotional strategy that includes local or domestic elements. This will create a positive perception of the product because it displays a domestic image.

The results also showed that purchase intention can be influenced by Utilitarian value. The better utilitarian value offered will increase consumer purchase intention. Reliable smartphone quality, value for money and many benefits can increase China's smartphone purchase intention. In addition, hedonic value also significantly influences Chinese smartphone purchase intention. The value that can make happy, comfortable, generate high interest in the product, and a great curiosity about the product has a significant influence on the purchase intention of Chinese smartphones. Indicators of perceived value, such as utilitarian value and hedonic value are positively correlated with repurchase intentions (Hong, 2017; Hsu, 2016). Utilitarian value and hedonic value significantly influence satisfaction and purchasing decisions, where utilitarian value has the most significant influence on purchasing decisions, and hedonic value is the most important factor affecting satisfaction (Gan, 2017).

These results complement the previous literature and provide evidence of the effect of utilitarian value and hedonic value on purchase intention of Chinese smartphones. Every smartphone company needs to make products that can increase value for consumers. In terms of utilitarian value, companies must make products that can provide more benefits to

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consumers by making smartphone products with specifications that match consumer desires.

In terms of hedonic value, companies need to make products that are good impressions and present a better image, not just cheap products.

Results from the analysis revealed gender differences from findings in the perceived value literature. Viewed by gender, males prioritize the utility factor over females in purchase intention. The influence of hedonic value on purchase intention, females have more influence than males. Accordingly, male's and female's self-concepts differ (Cross, 1997): males tend to separate the representation of others from the self (independent self), while females tend to include others as part of the self (interdependent self). Females are more sensitive to the opinions of others (Deaux, 1987), and rely on self-appearance to make a good impression on others (P. Z. Wang, 2006; Workman, 2011). These results provide evidence that there is a gender role in influencing purchase intentions for Chinese smartphones. For this reason, marketers need to make different smartphone products based on their target consumers, males who prioritize utility factors or females who prioritize hedonic factors. Thus, it provides instructions for marketers to provide different values to consumers based on their gender.

Finally, comparing the differences between different gender groups shows different results based on an assessment of the value received. Specifically, significant differences also appear in the hedonic value relationship for women, higher influence in terms of utilitarian value for male consumers.

CONCLUSION

Based on the research results described, it can be concluded that ethnocentrism has a significant negative effect on Chinese smartphone purchase intentions. The higher consumer ethnocentrism will reduce the purchase intention on Chinese smartphones in Indonesia. Then, the perceived value (utilitarian value and hedonic value) has a positive and significant effect on purchase intention on Chinese smartphones. The better-perceived value can increase purchase intention on Chinese smartphones in Indonesia. The results also proved the difference in the effect of perceived value on Chinese smartphone purchase intentions. In utilitarian value, the influence is more significant for male consumers. Whereas the hedonic value, a greater influence on female consumers.

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From the results of this study, the increasing ethnocentrism of Indonesian people will determine the purchase intention of Chinese smartphones. A sense of love for domestic products will further reduce the intention of purchasing Chinese smartphones. Purchase intention will also be stronger if the smartphones offered to Indonesian consumers provide a high value. Consumers also consider the perceived value obtained on smartphones that can affect purchase intention. The influence of gender also shows meaningful results because female consumers are more concerned with the hedonic value factor than male consumers, while male consumers are more concerned with utilitarian values than female consumers to buy smartphones.

THEORETICAL AND MANAGERIAL IMPLICATIONS

Theoretically, this research proves that social role theory states that gender differences in social behavior from shared expectations about what behavior is appropriate for males and females (Karakowsky, 2001). It has been found that female consumers are relatively more emotionally reactive than male consumers (Dubé, 1998). The results of this study indicate differences in consumer behavior in buying a product that is determined by gender. This research lays the foundation for the study of differences between female consumers and male consumers in assessing perceived value and ethnocentrism.

Practically, this research proves that the purchase intention of products from abroad, such as Chine smartphones can be influenced by consumer ethnocentrism. It provides implications for marketers to consider this ethnocentrism factor. For example, local smartphone marketers need to implement marketing strategies that bring up consumers' ethnocentrism feelings.

While overseas smartphone marketers such as China need to adjust their marketing strategies by incorporating local elements in their promotional activities. In addition, consumers also see the value obtained from the product before deciding to buy. Therefore, smartphone managers need to provide products with reliable quality, affordable prices, meet the needs and desires of consumers, and provide better features.

Gender differences can give different results to the value assessment of a product. Marketers need to focus on providing high values so that buying intentions for smartphones can be increased among these groups. Focus on utilitarian values for male consumers and focus on hedonic values for female consumers. From a managerial perspective, the findings of this

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study can help marketers redefine their strategies. Marketers must be aware that gender differences are important factors, they must focus on the factors that affect male and female buyers differently. Marketers must recognize that these factors also depend on the perceived value of the product and analyze these differences when designing marketing plans.

LIMITATION

Although research proves an important concept of the role of gender in assessing value, it still has limitations that can help researchers to extend this study. The possibility of future research can be classified into five main points. First, the focus of this research is ethnocentrism and perceived value on Chinese smartphones. Different types of Smartphones based on class categories may have different effects on purchase intention. Further research can focus on specific smartphone categories, and the impact of the variables studied in this study can be tested for the smartphone subclass.

Second, exogenous variables can be added to future research. This might give marketers complete information to implement the strategy. Third, this study only distinguishes consumers based on gender. Further research can include the impact of more moderate variables such as age, income, and education. Fourth, this research only focuses on Chinese smartphones. Different results may be obtained for the smartphone market from other countries. Finally, a longitudinal study can be conducted to analyze the impact of changes in consumer demographics on purchase intentions over time.

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