Brand concept

R E S E A R C HP

A P E R S

in

Retailing

Not for quotation or ISSN 0265 9778citation without the expresspermission of the author.

Steve Burt is Professor of Retail Marketing at the University of Stirling, STIRLING FK94LA and Jos Carralero-Encinas is a postgraduate student at the University of Stirling.

Research Paper 9901

THE ROLE OF STOREIMAGE IN RETAIL

INTERNATIONALISATION

Steve Burt & Jos Carralero-Encinas

Disclaimer

The opinions expressed in this research paper are the responsibility of the authors alone.

Institute for Retail Studies. All rights reserved.


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The Role of Store Image in Retail Internationalisation

Abstract

Recent work on the internationalisation of retailing has focused on a number of themes such

as the motives for internationalisation, the geographical flows of investment, the impact of

internationalisation upon host environments, and methods and typologies of investment. Less

attention has been paid to the process of internationalisation per se. This paper argues that for

many retailers, competitive advantage in the home market has been based upon the

development of strong store and corporate images as retailers strive to develop themselves as

brands in their own right. The construction of store image, comprising both tangible and

intangible dimensions, compounds problems of moving into international markets - as

consumers in the host environment are less familiar with the intangible dimensions of image,

which have been built up over time with exposure to the retail company. Retail companies

therefore need to fully understand the importance of image in competitive positioning and the

components of store image before attempting to replicate this image and positioning overseas.

This paper explores these issues with reference to Marks and Spencer and the companys entry

into the Spanish market. A survey of customer perceptions of a range of store image

attributes in the UK and Spain, reveals differences and similarities in perceptions, which must

be managed if a standardised position is to be sought in the host market.


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The Role of Store Image in Retail Internationalisation

Introduction

This paper seeks to explore the role of store image in the retail internationalisation process.

As retailers in domestic markets are developing their brand image as the key source of

competitive advantage, an appreciation of the transferability of this image is crucial when

moving into non-domestic markets. This is particularly pertinent for those retailers who

choose to internationalise by standardising and replicating the domestic marketing effort and

brand identity. This paper seeks to explore this issue by reporting exploratory research which

examines how a set of pre-determined dimensions and attributes of store image are perceived

by customers in two different markets.

The paper starts with a review of retail internationalisation and the processes involved,

followed by an explanation of store image to establish the functional and symbolic attributes

which are commonly believed to contribute to store identity. The research approach and

method is then explained, the results drawn from a convenience sample of 150 respondents in

each country are reported, and potential issues for retail organisations moving abroad are

considered.

Retail Internationalisation

Whilst Hollanders (1970) book Multinational Retailing, is widely regarded as the seminalwork on retail internationalisation, the increased visibility of international moves by retailers

has stimulated a vast array of academic work in Europe since the mid 1980s. Akehurst and

Alexander (1995a) refer to the torrent of the late 1980s and the flood of the 1990s. Fromthis literature a number of common themes emerge, namely the motives for retail

internationalisation (eg Treadgold and Davies 1988, Wrigley 1989, Alexander 1990, Williams1992, Myers 1995); the geographical flows of investment - including studies of specific flows(eg Kacker 1985, Mitton 1987, Hamill and Crosbie 1990, Burt 1993, Davies and Fergusson1993, McGoldrick and Holden 1993, Alexander 1995, Sternquist 1997a), the temporal


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dimensions of investment (eg Treadgold 1990/91, Burt 1991, 1995 and various OXIRMnewsletters) and case histories of individual firms (eg Kaynak 1980, Martenson 1981, 1988,Truitt 1984, Laulajainen 1991, Treadgold 1991, Johnson and Allen 1994, Takahashi 1994,Wrigley 1997); the impact of internationalisation, particularly of new retail concepts on lessdeveloped retail environments (eg Goldman 1974,1981, Kaynak 1985, Alawi 1986, Ho andSin 1987, Loker, Good and Huddleston 1994); and methods and typologies of investment (egKacker 1988, Treadgold 1988, Dawson 1994, Bailey, Clarke-Hill and Robinson 1995,

Simpson and Thorpe 1995). These studies have taken various perspectives ranging fromstudies of whole retail sectors, to specific store formats and, in particular, the activities of

individual retail firms.

Less prevalent amongst this literature are studies which explore the process of retail

internationalisation per se. The need to develop a clearer understanding of the processes

involved has been commented upon to varying degrees by Brown and Burt 1992, Dawson

1993, 1994, Pellegrini 1994 and Akehurst and Alexander 1995b. These authors have cited the

lack of a clear definition of retail internationalisation (see Helfferich, Hinfelaar and Kasper,1997), and confusion as to the applicability of theories developed in other sectors, asimpediments to developing this understanding. Whilst some attempts (Whitehead 1992,Sternquist 1997a) have been made to apply theory derived from observations of themanufacturing sector - most notably the eclectic paradigm of Dunning (1981) and the stagesapproach championed by the Uppsala school - the inherent characteristics of retailing and the

retail sector question the viability of directly applying such models to the explanation of the

retail internationalisation process. The basic role of retailing in moving goods (and services)to the final consumer and the position of retail institutions as the final link in the distribution

channel, suggest that theory based on the traditionally viewed productive sectors of the

economy has limited value.

The major source of competitive advantage for retailers is found in the value added deliveredto customers, through the performance of functions or activities. This value added must be

firmly based upon customer needs and values, and may comprise both tangible or functional

and intangible or symbolic elements. The importance of fully understanding the source of


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competitive advantage (and in particular the role of intangible added value) in the domesticmarket before moving into foreign environments is recognised in a number of studies. For

example, Simpson and Thorpe (1995) in devising their PLIN model for global expansion ofspeciality retailing suggest that retailers need to fully understand the role of Product, Lifestyle,

Image and Niche in creating a differential advantage in the domestic market, before attempting

to move overseas. The ability to offer host market consumers a source of differentiation in the

delivery of added value is a key factor in international success. Burt (1991) suggested that theinternational activities of European grocery retailers appeared to be more successful if the

internationalisation process involved the importation of a new concept - such as the

hypermarket or limited line discount store - to the host market. Once the source of this

competitive and differential advantage is recognised, a key issue then becomes whether to

replicate or modify the operation on entering a foreign market.

Dupuis and Prime (1996) introduce the idea of business distance, as the gap between host andhome environments in four areas : consumer behaviour; outlet or store format; networks; and

environment. They argue that any retail format has a grounded history, built up over years of

operation in the home environment, and thus the fit within the host environment needs to be

fully understood. Without this understanding, the decision to export a retail format to

another cultural environment may drastically modify its initial competitive advantage.

Illustrations of the problems of fit are provided by authors such as Tordjman (1988),Shackleton (1996), and OGrady and Lane (1997) who discuss how French, British andCanadian retailers have found cultural and business behaviour differences when operating in

the American market.

One study which attempts to tackle the question as to how retail companies might

internationalise is that of Salmon and Tordjman (1989). The two main approaches to theinternationalisation of retail operations identified by these authors - the global and the

multinational approach - focus attention upon attitudes towards a number of management

functions within the retail business. As the nomenclature suggests, the global approach

requires a high degree of standardisation of management functions, whilst the multinational

approach allows for a greater degree of response to host market conditions. While endless


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debate can take place as to the exact degree of standardisation or adaptation within

management functions, and which retail companies conform to which model, there appears

to be a tacit acknowledgement in much of the literature that some form of adaptation in

management practices and approach is required in most non-domestic markets (eg Brown andBurt 1992, Dawson 1993, McGoldrick and Blair 1995).

One of the management functions discussed in the Salmon and Tordjman schema is marketing.In the domestic market, marketing and a customer focus have become crucial to the success of

a retail business. Retailers place great emphasis upon developing, maintaining and managing

store and corporate image (Pessemier 1980). Often this image, including the associatedpositioning of the firm and branding of the retailer, is the source of competitive advantage -

particularly as many other functional aspects of a retail operation can be imitated. It is

therefore surprising, as McGoldrick and Blair (1995) comment, that apart from their ownwork and that of McGoldrick and Ho (1992), so little research attention has been given to theimage and positioning of retailers operating outside their home markets. Given the

importance of customers to retailing, it would appear that an understanding of the perceptions

of customers in the host market to the retail image or identity being brought to that market is

of fundamental importance to the success of the international venture. An understanding of

retail image, what comprises this image, and how transferable this image or identify is, is

crucial to developing retail operations in foreign markets, especially if the retail image,

typically manifest in a brand, is itself the real source of consumer recognised value added and

competitive advantage.

Owing to the terminology used, Salmon and Tordjmans (1989) treatment of marketingactivities engenders links with the long established standardisation or differentiation debate in

international marketing (eg Buzzell 1968, Sorenson and Wiechmann 1975, Levitt 1983,Quelch and Hoff 1986). However, this association may have been a distraction to theunderstanding of the retail internationalisation process as researchers are diverted into

proving or disproving the extent of globalisation or standardisation of retailer X and

retailer Y. It is not the intention in this paper to expand on this particular debate, but merely

to try and gain some understanding of the dimensions of retail image in an international


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context and to explore the relative importance of these dimensions when moving into non-

domestic markets.

Store Image

Defining store image is far from easy (eg Sewell 1974). The mixture of tangible and intangibledimensions, and the complexity of meanings and relationships attributed to retailers by

customers have long been recognised (eg Myers 1960, Arons 1961, Weale 1961, Rich andPortis 1964, Kunkel and Berry 1968, Perry and Norton 1970, May 1974, Marks 1976).Martineau (1958) is attributed with being one of the first to discuss store personality,Lindquist (1974) develops the distinction between functional qualities and psychologicalattributes, and Oxenfeld (1974) argues that store image is a concept which is more than thesum of its parts , it represents interaction among characteristics and includes extraneous

elements, it has some emotional content a combination of factual and emotional

material. Although originating from an attempt to explain retail identity in an advertising

context, Kapferers (1986) identity prism, comprising physical, personality, cultural, relational,reflection, and customer self interest facets, similarly combines functional and symbolic

elements and stresses the importance of the customers de-coding of these facets. The

interplay of these tangible and intangible elements and the customers overall interpretation of

them, based upon previous knowledge and experiences, are widely accepted to determine

store image (Hirschman 1981, Marzursky and Jacoby 1986).

Lists of attributes which comprise store image have been devised and in turn criticised by

several authors (eg Zimmer and Golden, 1988). Martineaus (1958) paper identified four coreattributes : layout and architecture; symbols and colour; advertising; and sales personnel.

However, one of the most enduring sources is the nine attributes derived by Lindquist (1974)from a review of nineteen previous studies. These attributes are: merchandise, including

factors such as quality, assortment, styling or fashion, guarantees and price; service,

encompassing staff service, ease of return, credit and delivery service; clientele, consisting of

social class appeal, self image congruency and store personnel; physical facilities, such aslayout and architecture; convenience, primarily location related; promotion, including sales

promotions, product displays, advertising programmes, symbols and colours; store


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atmosphere, defined as atmosphere congeniality which represents a customers feeling of

warmth, acceptance or ease; institutional factors, such as the conservative or modernprojection of store, reputation and reliability; and post-transaction satisfaction, seen as returnsand adjustments.

Although regarded as not being totally comprehensive, these attributes encompass both

functional and symbolic elements of store image, and in one form or another have formed the

basis for many studies of store image. Combinations of these attributes have been used in the

plethora of retail image studies originating from the USA, for example, in addition to those

already cited, Kunkel and Berry (1968), Lessig (1973), Doyle and Fenwick (1974), Hansenand Deutscher (1977), Schiffman, Dash and Dillon (1977), Hirschman, Greenberg and Roberts(1978), Jacoby and Mazursky (1984), Hildebrandt (1988), and Steenkamp and Wedel (1991),Joyce and Lambert (1996). Although essentially all based on some form of attributemeasurement, methods vary and substantial debate centres around the measurement

techniques themselves (McDougall and Fry 1974, Swan and Futrell 1980, and Wu andPetroshius 1987). Amirani and Gates (1993) provide an overview of the different approachesbefore introducing their own preferred option, conjoint analysis. These approaches includevariations of semantic differentials (eg Kelly and Stephenson 1967, Hirschman, Greenberg andRoberts 1978, Menezes and Elbert 1979, Golden, Albaum and Zimmer 1987); multi-dimensional scaling techniques (eg Jain and Etgar 1976, Palmer 1985); multi-attribute models(eg James, Durand and Dreves 1976); and content analysis (eg Zimmer and Golden 1988)

The majority of these studies explore image, taken as the consumer perception of the overallstore image, relative to specific purchase behaviour contexts or specific store and service

attributes. A number of studies however point to the issues associated with implementing

image and the dissonance which may exist between management and consumer perceptions of

store image. Marcus (1972) examined image variation across stores within a chain, andOppewal and Timmermans (1997) explored management perceptions of store image in acompetitive context. Others, have compared management or corporate views of image with

customer views, highlighting the gap in perceptions which often exists (McClure and Ryan1968, Pathak, Crissy and Sweitzer 1974, Samli and Lincoln 1989, Keaveny and Hunt 1992).


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Given the even greater potential for misinterpretation of image arising from cultural and

behavioural differences in international markets, one might expect these potential problems of

dissonance to be amplified when entering a foreign market.

Research Purpose and Method

This research seeks to explore how retail companies might manage the internationalisation

process if the source of competitive advantage that they possess is based upon image rather

than any unique trading format or management process. The starting point for this research is

the assumption that having invested heavily in developing a (presumably) successful image inthe domestic market, an internationalising retailer will seek to develop a broadly similar image

in the foreign market. Often, given the historical debate on globalisation in international

marketing, and the interpretation of Salmon and Tordjmans paper, replication andstandardisation is taken as the means of achieving this position. Some recognition is,

however, given to the importance of time in establishing a clear retail image in a non-domestic

market (McGoldrick and Blair 1995). As consumer perceptions of a store image aredetermined by exposure to and experience of a store, one should expect image to evolve over

time.

If it is accepted that, at least in the short term, total transfer of a standardised image into a

host market is difficult, one may surmise that it is the less tangible, more experience-related

dimensions of store image which are the most difficult to establish immediately in a new

foreign market. The meaning which domestic consumers attach to these dimensions has been

built up over a number of years of continued experience, but in the case of consumers in the

host market, there is no such history of exposure to the store or retailer. Conversely the more

tangible or functional components of image, with their greater dependency on physical clues,

can be more easily managed in the short run to establish a coherent image, once consumer

perceptions of these components are understood. It therefore becomes important for the

internationalising firm to understand which dimensions of image might transfer immediately

and which might take longer to develop. If a retailers main source of competitive advantage

in the domestic market is based upon the intangible dimensions of image, and these take time


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to develop, there is the danger of assuming that the customer values and perceptions

experienced in the domestic market have transferred automatically to the new market. This in

turn may then lead to complacency and mistakes in positioning and other marketing related

activities.

Based on this premise the objective of this exploratory research was to examine how, for asingle retail company, a set of pre-determined dimensions and associated attributes of store

image chosen to represent tangible and intangible elements of image, were perceived by

customers in two different national markets. Following the discussion above, it was expected

that the intangible dimensions and attributes would be the source of a wider gap in

perceptions in the two markets than the tangible elements of image.

Given this objective a retail company was sought which had considerable internationalexperience, a strong domestic image founded upon intangible attributes, and which essentially

sought to position itself in the same way in international markets. The retailer selected was

Marks and Spencer, with the comparison made between the domestic (UK) and Spanishmarket. Marks and Spencer has made no secret of its international ambitions in recent press

coverage. The company, has a long, but chequered history of retail internationalisation. The

1997 annual report shows that 87 of the 373 company owned Marks & Spencer stores are

non-UK stores, with a further 85 international stores in 20 countries operated as franchises

(Table 1).


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Table 1 : Marks & Spencer Stores Worldwide

Country Stores Franchises Stores

United Kingdom 286 Austria 3Belgium 3 Bahamas 5France 20 Bermuda 1

Germany 1 Canary Islands 3

Netherlands 2 Channel Islands 4

Republic of Ireland 3 Cyprus 8

Spain 6 Czech Republic 1Hong Kong 8 Finland 5Canada 44 Gibralter 1

Greece 9Hungary 2

Indonesia 5Israel 7

Malaysia 2

Malta 2

Philippines 6Portugal 6Singapore 7

Thailand 6Turkey 2

TOTAL 373 TOTAL 85

* excludes Brooks Brothers and Kings SupermarketsSource : Marks & Spencer Annual Report and Financial Statements 1997

These figures exclude the 173 Brooks Brothers stores in the USA and Japan and 20 Kings

Supermarkets in the USA acquired in 1988. In Europe company owned store openings in

France and Belgium in 1975, and the Republic of Ireland in 1979 were followed by the

Netherlands in 1991 and Germany in 1996. The company entered the Spanish market in

1989. In 1996/97 non UK operations (including Brooks Brothers) generated 1276.3m or16.3% of turnover and 91.4m or 8.8% of operating profit. The European operations -


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including franchises - accounted for 551.5 million (7%) of turnover and generated 37.7m(3.6%) of operating profit. Twenty years ago in 1976/77, the 3 European stores contributed1.3% of turnover but traded at a loss of 0.786m.

The success of Marks and Spencer in the domestic market is widely attributed to the

development of a strong store image, with a major emphasis upon the intangible added valueaspects of this image. In the eyes of most UK customers (and competing retailers) thecompany possesses an image and reputation second to none. The annual reports are now

embellished with the phrase Quality, Value and Service Worldwide which implies a visioninvolving the transfer of a similar image into non-domestic markets. Although the company

operates a range of formats overseas, a standardised image is sought particularly in those

markets where the company trades through full range variety stores, such as France, Spain,

and Germany. This research sought to establish how customers in the UK and Spanish

markets perceived the companys retail offer via a range of tangible and intangible dimensions

of image, and from this draw observations as to how these aspects of store image might be

managed as part of the internationalisation process.

Data was collected via an interviewer administered questionnaire which required respondents

to indicate their level of agreement/disagreement on a seven point likert scale (ranging fromstrongly agree (7) to strongly disagree (1) to a series of statements. All of the statements werepositive, therefore high scores/levels of agreement could also be taken to represent some

degree of satisfaction with the attribute concerned. Six broad categories were constructed to

provide a core group of dimensions ranging from the tangible/functional to the

intangible/psychological aspects of store image. Each of these dimensions was represented by

four statements which related to various aspects of store image commonly identified in the

literature. The chosen dimensions and associated statements are shown in appendix 1.


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Whilst all dimensions of store image inevitably contain both tangible and intangible elements,

as any attitude statement is judged by customers on the basis of their own experiences, valuesand priorities, the statements and dimensions were chosen to represent different degrees of

tangibility. Physical Characteristics, Pricing Policy and Product Range were felt to be

the more tangible dimensions, presenting customers with a higher proportion of primarily

physical, immediate, clues upon which to base their perceptions - such as store cleanliness,

decor, range, product quality and price. From a management perspective, it was felt that this

higher degree of tangibility, would enable more rapid adaptation of these dimensions to host

market conditions if need arose. The dimensions termed Customer Service, Character

and Store Reputation were felt to represent less tangible dimensions of image, more reliant

on customers experience-based perceptions of staff helpfulness, kindness, trust, store appeal

and position. As such any adaptation or change necessary in response to the host market

would require a longer term view.

The stores chosen exhibited similar basic characteristics in that both carried all seven

departments - ladieswear, menswear, lingerie, childrenswear, gifts, home furnishings and food

- although physically the stores differed. The UK store was on two floors covering 47,000

square feet compared to the Spanish store with 30,000 square feet over four floors. The

stores were both in main shopping street locations and traded for 60 and 66 hours per week

respectively.

As neither store could (would?) provide a demographic breakdown of customers, aconvenience sample of 150 respondents in each country was generated from customers leaving

the store. This was felt an appropriate sample given the exploratory nature of the study.

Basic characteristics of the sample are shown in appendix 2. The Spanish sample was

younger, with fewer respondents living in smaller households and with lower household

incomes.


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Results

From the data it was possible to assess how Marks and Spencer was viewed in a domestic and

non-domestic setting with respect to overall image, and to identify differences in absolute and

relative perceptions of attributes and dimensions of store image. In terms of the overall

impression of store image, measured by the degree of agreement with the statements, the

British respondents, as one would expect, had an extremely positive impression of the Marks

and Spencer store image (Figure 1 and table 2) Twelve of the attribute statements scored amean of over 6.0 and twenty-three of a mean of over 5.0. Only four attribute statements

achieved a mean of less than 5.5. There is also some evidence of the strength of views held on

the intangible elements of image, with eight of the twelve statements relating to intangibles

scoring over 6.0 in the UK, compared to four of the twelve tangible statements. Although the

Spanish respondents were less favourably disposed towards the attribute statements, seventeen

statements still scored a mean of over 5.0, although only three achieved a mean score of over

6.0.

Figure 1 : Perceptions of Store Image Attributes

1

2

3

4

5

6

7 Cleanliness

Attractive Decor

Easy Layout

Excellent Atmosphere

Wide Selection

Good Quality

Fashion

Reliable Brand

Fair Prices

Low prices

Value for money

Price/qualityKind/Helpful

Product Knowledge

Easy Returns

Services

Conservative

British Appeal

Middle-class

World-class

Reliability

Confidence

Trustworthiness

Credibility

UK

Spain


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When comparing the difference in means (Table 2), potential differences and similarities inperceptions of the same statement between the two countries can be seen. A T-test showed

that all the attribute statements, except for the eight statements showing the least difference in

means, were found to show significant differences between the means at both the 0.05 and

0.01 level. Three of the statements showing the greatest difference in means (the storecarries a wide selection of different products (1.51), St Michael is a reliable brand (1.12),and the products stocked are of good quality(0.98)) are associated with the broad ProductRange dimension. Whilst some divergence of opinion may surround attributes within the

Product Range dimension, the basic tangibility of these attributes means that they should, in

theory, be more easily or immediately assessed by consumers, and if negative opinions are

formed the retailer may need to take remedial action. The other statements with a difference

in means of 1.00 or more were the Reputation related attributes of Marks and Spencer will

never let you down (1.05) and you have total confidence in Marks and Spencer (1.00). Athird Reputation statement, Marks and Spencer is a world class retailer also had a

relatively large difference between means of 0.73.

At the other end of the scale one can observe that both of the national groups had identical

perceptions of the statement prices are low compared to similar stores(0.01), and that therewas a very high degree of uniformity in opinion on three statements associated with the

Character dimension, namely Marks and Spencer has a British appeal(0.02) serves the middle class(0.02) projects a conservative image(-0.03). The closeness ofsome of these views was unexpected given the intangible nature of this dimension. As with

the Reputation statements it was believed that these intangible Character statements,

based upon experience or exposure to the Marks and Spencer store image, would have shown

a greater degree of divergence in opinion between the UK and Spanish respondents.


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If one considers the relative ranking of statements in the two countries based upon mean

scores (Table 3), some similarities of relative perception within countries arose. The top twostatements (the store operates an easy return policy, the store is clean and tidy) in both theUK and Spain were the same, although in a reverse order, and six of the top ten statements in

the UK could be found on the top ten list for Spain. Similarly the two statements least

favourably received in both countries were the same (prices are low compared to similarstores, and the merchandise is fashionable). Even at this very crude level this suggests thatwithin countries some similarity in perception of store image is presented, albeit at the

extremes.


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Table 2 : Attribute Statements: Differences in Means

Attribute StatementUK

mean

Spainmean

Diff inmeans

T-test 2-tailsignif

(0.001)The store is clean and tidy 6.63 6.53 0.10 1.59 0.113 nsThe store decor is attractive 5.71 4.73 0.99 7.08 0.000 sThe store layout makes shopping easy 5.35 5.25 0.11 0.68 0.498 nsThe store atmosphere is excellent 5.83 5.37 0.46 3.42 0.001 sThe store carries a wide selection ofdifferent kinds of products

6.16 4.65 1.51 10.51 0.000 s

The products stocked are of good quality 6.57 5.59 0.98 8.76 0.000 sThe merchandise is fashionable 5.29 4.58 0.71 4.48 0.000 sSt Michael is a reliable brand 6.49 5.37 1.12 7.73 0.000 sThe prices charged are fair 5.56 4.71 0.85 5.37 0.000 sPrices are low compared to similar stores 3.91 3.91 0.01 -0.04 0.971 nsYou get good value for your money 5.77 4.89 0.87 6.08 0.000 sThe relationship between price and qualityis good

5.87 5.15 0.72 5.18 0.000 s

Store personnel are kind and helpful 6.04 5.93 0.11 0.87 0.386 nsSales people have a good knowledge ofthe products

5.86 5.77 0.10 0.74 0.458 ns

The store operates an easy return policy 6.72 6.07 0.65 4.37 0.000 sThe store offers a high level of customerservice

6.31 5.77 0.53 4.14 0.000 s

Marks and Spencer transmits a reliableimage

6.49 5.79 0.70 6.0 0.000 s

Marks and Spencer projects aconservative image

5.89 5.92 -0.03 -0.22 0.827 ns

Marks and Spencer has a clear Britishappeal

6.04 6.02 0.02 0.16 0.874 ns

Marks and Spencer serves the middleclass

5.29 5.27 0.02 0.12 0.901 ns

You have total confidence in Marks andSpencer

6.16 5.16 1.00 7.52 0.000 s

You find Marks and Spencer totallytrustworthy

6.20 5.66 0.54 4.88 0.000 s

Marks and Spencer will never let youdown

5.68 4.64 1.05 5.87 0.000 s

Marks and Spencer is a world classretailer

6.14 5.41 0.73 5.25 0.000 s

Note: 7 = Strongly Agree; 1 = Strongly Disagree


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Table 3 : Ranking of Attribute Statements Based on Means

Attribute Statement UKMean

UKRank

SpainMean

SpainRank

The store operates and easy return policy.The store is clean and tidy.The products stocked are of good quality.Marks and Spencer transmits a reliable image.St Michael is a reliable brand.The store offers a high level of customer service.You find Marks and Spencer totally trustworthy.The store carries a wide selection of different kinds ofproducts.You have total confidence in Marks and SpencerMarks and Spencer is a world class retailer.

6.726.636.576.496.496.316.206.16

6.166.14

1 2 3 4= 4= 6 7

8=

8=10

6.076.535.595.795.375.775.664.65

5.165.41

2 110 612= 7=

921

1611

Note : 7 = Strongly Agree; 1 = Strongly Disagree

If the attribute statements are aggregated into the broad image dimensions that they were

intended to represent (Table 4) then a comparison of means reflects the observations above,namely that perceptions of Character are very similar, whilst the greatest difference in

perceptions occur in respect of Product Range and Store Reputation. It may also be

noted that in both countries the dimension perceived most favourably was the same -

Customer Service - as was that which was perceived least favourably - Pricing Policy.

Within these extremes there was a reversal of the rankings of the remaining categories. Again

UK perceptions in general were more favourable, as the mean score attributed to the most

favoured dimension in Spain was bettered by all but one dimension in the case of the UK.


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Table 4 : Image Dimensions: Differences in Means - ranked by UK mean

Dimension UKMean

SpainMean

Diff inmeans

T-test 2-Tail signif(0.001)

Customer ServiceStore ReputationProduct RangePhysical CharacteristicsCharacterPricing Policy

6.246.136.135.885.845.27

5.815.295.085.475.704.67

0.430.841.050.410.140.60

4.333.138.906.321.424.62

0.0000.0000.0000.0000.1570.000

Note: 7 = Strongly Agree; 1 = Strongly Disagree

Finally, if one examines the differences between the mean scores attained by each of the

ranked dimensions within each country (Table 5), it is evident that the dimensions areperceived more closely in the UK than in Spain - in the case of the UK only 0.40 separates the

means of the top five ranked dimensions, whilst 0.52 separates the means of the top four

ranked dimensions in Spain. As the statements were all positive statements, this may suggest

as one would expect, that a more cohesive and coherent image is projected, or perceived bycustomers, in the UK.


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Table 5: Differences Between the Means of the Ranked Image Dimensions

UK SPAIN

Between DimensionsRanked

Difference CumulativeDifference

Difference CumulativeDifference

1-22-33-44-55-6

0.110.000.250.040.57

0.110.110.360.400.97

0.110.230.180.210.41

0.110.340.520.731.14

Concluding Remarks

Returning to the purpose of this paper, where does this leave us? At one level, the survey

results simply show - not surprisingly - that customer perceptions of store image, defined in

the terms specified in this study, are more positive and coherent in the domestic than host

market. Does this mean that there are real differences in customer perception between the two

markets which might require adaptation of store image? Or can this be explained simply by

the fact that the internationalising retailer has had less exposure in the foreign market and in

time one would expect this current image to change (hopefully so that customer perceptionsreached the higher levels found in the domestic market)? Assuming that the aim is to achieve asimilar image in the host market, from a managerial perspective a disaggregation of store

image and closer attention to the different dimensions contributing to image is important as it

highlights areas requiring attention and towards which valuable resources might be channelled.

Gaps in perceptions may reflect fundamental differences in opinions over the retail offer - if the

gap is greater with respect to tangible dimensions there may be a fundamental problem (iedislike) with the retail offer (store, merchandise, price). If the gap is greater betweenintangible dimensions, exposure to and experience of the retail offer over time may close this

gap. In short, the need for and type of remedial action may differ.

From the results of this survey, there is evidence that in relative terms within countries certain

aspects (whether dimensions or attributes) are already perceived in similar ways - the


22

Customer Service dimension, and in particular the returns policy and cleanliness attributes

are the most positively received aspects in both countries, whilst the Pricing Policy

dimension and the fashionability of merchandise attribute are the least positively received

aspects. This would suggest that some components of store image, whether defined as

tangible or intangible, transfer between international markets, either in absolute or relative

terms. The retail company may then need to determine which components this applies to and

how these components contribute to the future image required.

As stated earlier, if one was taking a standardised approach to the foreign market, one might

expect that the less tangible dimensions of store image - those where customer perceptions are

based upon exposure to and experience of the retailer - would generate the greatest difference

in perceptions between customer groups when retailers move into new international markets

and that managing this perceptual gap is one of the biggest challenges facing international

retailers. If one returns to the distinction made earlier between the more tangible dimensions -

defined here as Physical Characteristics, Product Range and Pricing Policy - and the less

tangible dimensions - Customer Service, Character and Reputation, one would expect

customer perceptions between the two countries of the latter three dimensions to be more

divergent than for the former three.


23

The results of this study however suggest that this tangible/intangible distinction may be too

simplistic, or at least there are important implications of different perceptions in these

categories. While one might argue that definitions and the grouping of attributes explain these

outcomes, or that the retailer chosen Marks and Spencer, is an exception, the results

surprisingly (?) suggest that one of the more intangible dimensions, Character, is that forwhich the perceptions of UK and Spanish respondents were most closely matched - it appears

to have transferred more easily. In contrast, the greatest divergence of opinion is found in

respect to the dimensions termed Product Range and Store Reputation which register the

greatest differences in perception. One defined as a tangible the other as an intangible

dimension. This may have different managerial implications. The gap in Reputation might

be expected and may close over time with exposure to the company, but the gap in Product

Range may hint at fundamental differences in perceptions over the tangible elements.

Just as important as the apparent absolute gap in perceptions of image by customers in

different markets, may also be the relative importance these national perceptions place on an

attribute or dimension. In the case of this study not only are Product Range and Store

Reputation perceived the most differently in the two markets but both of these dimensions

are ranked very highly in the UK market - where they were equally ranked as the second most

positively viewed dimensions, and with only 0.11 separating the mean scores achieved by the

top three dimensions. In short, not only is there an apparent difference in perception of these

dimensions between the two countries, but if the retailer wishes to achieve a similar image

perception as in the domestic market, these dimensions appear to be important in achieving

this. Similarly, whilst customer perceptions in the two markets are closest in respect of

Character, from a UK perspective this dimension is relatively less important than Product

Range and Store Reputation. It perhaps then becomes important not just to close thegap in perceptions between the Spanish and UK market but to ensure that this raises the

relative perception of these dimensions in Spain, and leads to a more standardised image in

both markets - in this case Quality, Value and Service Worldwide.


24

Appendix 1 : Store Image Dimensions and Attribute Statements

Physical CharacteristicsThe store is clean and tidy.The store decor is attractive.The store layout makes shopping easy.The store atmosphere is excellent.

Pricing PolicyThe prices charged are fair.Prices are low compared to similar stores.You get good value for your money.The relationship between price and quality is good.

Product RangeThe store carries a wide selection of different kinds of products.The products stocked are of a good quality.The merchandise is fashionable.St Michael is a reliable brand.

Customer ServiceStore personnel are kind and helpful.Salespeople have a good knowledge of the products.The store operates an easy return policy.The store offers a high level of customer service.

CharacterMarks & Spencer projects a conservative image.Marks & Spencer has a clear British appeal.Marks & Spencer serves the middle class.Marks & Spencer is a world class retailer.

Store ReputationMarks and Spencer transmits a reliable image.You have total confidence in Marks and Spencer.You find Marks and Spencer totally trustworthy.Marks and Spencer will never let you down.


25

Appendix 2 : Sample Characteristics

UK SpainGender n % n %- male 34 22.7 29 19.3- female 116 77.3 121 80.7Age- 25 or less 27 18.0 50 33.3- 26-35 42 28.0 65 43.3- 36-45 33 22.0 24 16.0- 45 and over 48 32.0 11 7.3Household Size-1 20 13.3 9 6.0-2 50 33.3 33 22.0-3-4 67 44.7 68 45.3-5+ 13 8.7 35 23.3Income- under 10,000 12 8.0 23 15.3- 10,001-20,000 36 24.0 58 38.7- 20,001-30,000 34 22.7 34 22.7- 30,000 plus 56 37.3 15 10.0not available 12 8.0 20 13.3


26

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