Wave of home culture and MNC performance: The Korean Wave (Hallyu)

Multinational corporations (MNCs) are converging world cultures by creating common consumer lifestyles across countries through standardized products. However, little is known about how consumers’ exposure to foreign cultures affects their purchase experience from the country. This study explores this gap in the literature by investigating how consumers’ exposure to foreign cultural source (e.g., entertainment) shapes their attitude toward its country. This attitude is conceptualized to influence the perceived product quality and corporate ability of the country’s MNCs, which are further hypothesized to influence consumers’ purchase experience with products offered by the MNCs. Furthermore, the impact of product quality and corporate ability on consumer purchase experience is expected to be moderated by consumer ethnocentrism. The study framework is tested in the context of the Korean Wave (or “Hallyu”) using data consisting of 533 Indonesian consumers. The results support most of the study hypotheses. Theoretical and managerial implications of these findings are discussed.