Central European Business Review 2014, 3(1):7-12 | DOI: 10.18267/j.cebr.69

Home-Bias-in-Consumption Based on Different Brand Preferences in the East and the West of Germany

Michael Bahles

Diplom-Kaufmann Michael Bahles, Assistant Professor, Department of International Trade, Faculty of International Relations, University of Economics, Prague, Nám. W. Churchilla 4, 130 67 Prague 3, Czech Republic, michaelbahles@hotmail.com

In international macroeconomics, there is a specific concept explaining deviations in international trade relations showing that countries have a bias and a strong preference for the consumption of their home-country goods. This article presents an application of the concept on brand preferences in West and East Germany, where a home-bias-in-consumption has been observed for the East of Germany. It is the first application of the concept on the territory of brand preference that explains the strong rootedness of the Eastern German consumers to their regionally known and familiar brands. The goal of the article is to elaborate more deeply the differences in attitudes towards brands between Eastern and Western German consumers. The main research method is secondary analysis of the data collected in two large research studies: (1) "West-East brand study", and (2) "Consumer Analysis". The results of the presented study have interesting managerial implications in brand management, showing that brands should utilize their local rootedness.

Keywords: Home-bias-in-consumption; local brand preference; brand heritage and nostalgia

JEL classification: M31

Received: December 3, 2013; Revised: March 1, 2014; Published: March 31, 2014  Show citation