Cultural Values and Consumers’ Brand Preference

Consumers routinely need to choose between mass-market (e.g., Häagen-Dazs) and niche brands (e.g., Halo Top), yet little research has examined the factors that influence such choices (Dalgic and Leeuw 1994). Can consumers’ cultural background and orientation affect their choices? How and why? Are there any strategies firms may use to influence consumers’ choices? In the current research, we propose that power distance belief (henceforth, PDB) is associated with greater risk aversion and, hence, a greater preference for mass-market over niche brands. PDB is defined as the degree to which individuals accept and endorse hierarchy and inequalities in power (Hofstede 1984, 2001; Zhang, Winterich, and Mittal 2010). Research suggests that that people in high (vs. low) PDB societies are more likely to stay within their comfort zone and cling to the familiar (Hofstede 1984, 2001; Carl 2004). Therefore, we expected high (vs. low) PDB consumers to be more risk averse. Risk aversion refers to one’s tendency to avoid uncertainty rather than avoid loss, and a risk-averse person avoids a gamble in favor of a sure thing (Isen, Nygren, and Ashby 1988; Kahneman and Tversky 2013). Mass-market brands are seen as tried and tested by the market, and are accepted by a majority of consumers (Desarbo et al. 2002; Raj 1985; Kim and Chung 1997). We suggest that mass-market brands are perceived to be less risky because following the crowd appears less risky, compared to following a new path (Devenow and Welch 1996; Olsen 1996). Following the same logic for mass-market brands, niche brands that lack the endorsement of the majority may be perceived as risky (Munshi 2004; Huang and Chen 2006; Desarbo et al. 2002). Because risk-averse (vs. risk-taking) consumers have been found to take fewer risks associated with products (Grewal, Gotlieb, and Marmorstein 1994; Kahn and Sarin 1988; Mandel 2003), we propose that high (vs. low) PDB consumers would prefer mass-market brands to niche brands because they are more risk averse.