Why is where a product is made important?


Countries are also brands. They each stand for something. When you tell someone you are from a certain country, it evokes a mental image of what you must be like because you come from there The same thing with brands. When you tell people that your product is made in such-and-such country, it will evoke a mental image of what that product must be like since it comes from that country. And that can aid your brand-building process.

Like we said earlier, once your brand is well-established in the minds of your customers, it matters less where your product is made. But to get to that point, you might need to keep hammering home the message that your product is from a particular country so that the good qualities associated with that country will be associated with your brand. It is The Halo Effect again.


What is Japan known for? Quality. Whatever you may think of Japanese products such as consumer electronics and cars, you cannot deny that they are of a high-quality. It is common knowledge, so much so that people just take it for granted that a product made in Japan must be a high quality product. Yes, it would cost a lot more to manufacture your product in Japan but the pay-off would be a solid gold reputation for your brand.

Take a look at Lexus, the luxury car division of the world’s No. 1 car maker Toyota. While Toyota makes its cars at factories all over the world, Lexus cars are all made in Japan Every single one. Why? Because although Lexus is the best-selling luxury car in its key market, which is the United States (we read somewhere that Lexus is actually a contraction of Luxury Export USA), it is still not that well-established around the world — unlike Mercedes-Benz, BMW and Audi.

Therefore, the German triumvirate can make their cars outside Germany and still rack up sales of over one million units each annually. For diehard Mercedes- Benz fans, you can probably use a sledgehammer to drive home the fact that his Mercedes-Benz E240 is made in South Africa and it would not change his mind about the brand one bit. His next car would probably still be a Mercedes-Benz whether it is made in Africa or in Stuttgart.

Lexus does not have that option. It needs to be as closely identified to Japan as possible. Lexus built its reputation based on its refinement and superb fit-and-finish. And to propagate that image, it must continue to make its cars in Japan because people still perceive Japanese cars that are not made in Japan as inferior in quality. Would you buy a Toyota that is made in Thailand? Probably. Many of the Toyotas sold in Singapore — such as the Vios, the Corolla, the Camry and the Fortuner — are now made in Thailand but people still buy them because Toyota’s reliability and manufacturing prowess are so well-known that people are willing to accept a Thai-made Toyota. On top of that, the Toyotas that are sourced from Thailand are much cheaper. Would Lexus buyers stay loyal to the brand if Lexus starts to make its cars in Thailand? Doubtful.

So, all Lexus cars are made in Japan, and being made in Japan also helps to differentiate Lexus from its German rivals. Lexus can say, “These days, German luxury cars are not that German after all. But Lexus is still 100 per cent pure Japanese” Being made in Japan makes Lexus’ slogan of “The Relentless Pursuit Of Perfection” more credible. After all, if Lexus is not made in Japan, how could it be anywhere near perfect? Nobody beats Japan when it comes to getting the build quality right However, we have not seen Lexus play up its Made In Japan status.


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