What’s in a Name? Asymmetry of Foreign Branding Effects in Hedonic versus Utilitarian Product Categories

Foreign branding (spelling a brand name in a foreign language) is one way to create desirable product associations. In three empirical studies, we apply justification theory to demonstrate that foreign branding increases purchase likelihood if it is compatible with the product category (e.g., a French brand name for hedonic and a German name for utilitarian products). However, incongruence between the country of origin (CoO) implied by the foreign brand name and the actual CoO, indicating a different origin, backfires for products in hedonic categories. However, by implicitly helping consumers to justify their purchase decision, this negative effect can be reduced.