Acceptance of Local Product

Malaysia, with a population of around 27 million, is one of the most developed nations in Southeast Asia. About 61% of its population falls into the middle to upper income group of consumers with Gross Domestic Product (GDP) per capita income of over US$6,000.

The introduction of economic reforms through New Economic Policy (NEP) has produced some notable achievements such as the emergence of several successful domestic products with international competitiveness. Local brands such as Air Asia, PETRONAS, MAS and Selangor Pewter have reflected some successful stories of local entrepreneurs competing in the global markets.

In the view of food product, the Malaysian food and beverage market is becoming more and more sophisticated and is supplied by both local and imported products. The strong economic growth in the late 80’s and early 90’s contributed to major changes in consumer purchases and consumption patterns. Malaysians living in urban areas are relatively brand conscious, and they prefer to shop in stores, which offer them convenience and good product selections. Malaysia has a large and growing food retail market that is supplied by local and imported products. Due to rising prosperity and higher education level, Malaysian consumers have become more difficult and demand higher quality for the goods that they purchased.

Supermarkets and hypermarkets are mainly located in the major urban centers and are continuing to grow in numbers. Foreign-owned retailers operating locally include Tesco and Carrefour, Makro, Dairy Farms International (owns Giant), and Jaya Jusco. These retail stores provide good venues for imported products and access to the middle and high-income sophisticated consumers. Pressure is mounting for local retailers such as The Store to maintain competitive prices and carry a good variety of products in order to keep up with the international players.

Malaysian government has tried to solve this problem that consumers should buy local product to stimulate the nation’s economy. Malaysian’s consumer have to change our attitude in believing that imported things are superior to local goods. We have locally-made goods which are of similar value and quality. Actually a significant number of goods sold overseas, items such as TV, radio, air-conditioner, VCR, shirt, shoe and automobile are made in Malaysia. We should build up a culture where we do not automatically think that imported goods are of superior goods over local goods. Many goods marketed under famous brand names such as Christian Dior, Piere Cardin, Levis, etc are actually made in Malaysia under OEM manufacturing.

(Norman Rajen Abdullah, 2009) Malaysian appears to be more confident of local products, judging from their rising sales at Mydin stores nationwide. Demand for these products, ranging from food to handicrafts and textiles made by small businesses, has grown steadily since 2006. Sales of products made by small and medium enterprises (SMEs) have more than tripled to RM55 million in 2009 from 2006 This is projected to grow by another 18 per cent to RM65 million this year and hit RM80 million in 2011. He said it was important for local entrepreneurs to build a strong foundation for their businesses in the local market before going international market.

LITERITURE RIVIEW

(Ghazali, Othman, Yahya & Ibrahim, 2008) This paper reports on a study of Malaysian consumers’ perception towards foreign products, and in particular looks at how the country of origin effect influences their behavior. Results at the table 1 showed that Malaysian consumers are inclined to attribute higher quality to products made in developed countries. The study also showed that the average Malaysian consumer does not consider the country of origin aspect to be their priority in deciding to purchase a product. Other product attributes take precedence, particularly its quality, technological prowess and price.

(Asiah M. Zain, 2005) Study a number of factors contribute to the present low acceptability of local fishery products the following are thought to be important are physical appearance, improper packaging, inadequate quality control, attitudes of the consumer and insufficient knowledge of local recipes.

(Raj, 2009) The government launched the Buy Malaysian campaign. Consumers should support this campaign to minimize the impact of the global economic crisis on workers and consumers. In this gloomy economic climate, external demand for our goods has been reduced tremendously, resulting in companies reducing production or closing down. More than 10,000 workers have reportedly lost their jobs. This situation is expected to get worse, globally and locally. With diminishing external demand, the focus on economic growth has to be on local consumption to minimize the impact of falling exports.

RECOMMENDATIONS AND CONCLUSIONS

Strategic brand management is one of the factors that contribute to the success of a particular product or brand. The scenario in Malaysia shows that product branding is going to be more important especially after realizing that globalization has an impact on the economy of Malaysia. The numbers of local brands that have succeeded in the international arena are still very low. Based on this factor, it shows that the awareness of the important of brand management among local manufacturer is not high enough. A local brand could only survive in the markets if it gets the trust and loyalty from local customers themselves. It seems that many campaigns were created to increase the patriotic spirit among Malaysian consumers toward local products such as “Cintai Barangan Malaysia”(Love Malaysian Goods) “, and “Belilah Barangan Buatan Malaysia (Buy Made in Malaysia Goods)” campaigns. These campaigns were organized aggressively; however, this promotion is still not enough persuade the customer to purchase. This problem caused by the brand itself which is failed to display image, value and confidence to local customers. Brands that already succeed in the domestic markets should be encouraged to enter outside markets that are larger by straighten up their branding strategy. Selecting suitable and good brand name is one of key success factors for a company to penetrate foreign markets. Without brand communication, buyer would not be aware the existence of a particular brand. This process is very important for a local company which wants to compete in the global markets. As in foreign markets, buyers will usually focus on country of origin. Therefore, it is necessary for local entrepreneurs to assess what type of image to carry by their products in order to attract consumers from various countries to buy their products

In general, it is important for marketers to emphasize more on product dimensions such as the product quality, its technological prowess and its price in marketing their products in the local Malaysian market than its country of origin factor. However, marketers should put more emphasis on the country of origin factor if the product is made in developed countries such as Japan, Germany or the USA. On the other hand, if a product is made in developing countries, or

lesser known under developing economies, the marketer should emphasize more on the product quality, its technological prowess and its price rather than the country of origin aspect since accentuating the country of origin dimension may be detrimental to the marketing efforts for such a product