Consumer Attitude towards Gray Market in Indonesia

Abstract

Despite the fast growth of luxury industries in both mature and emerging markets in the world, problems are also arising concurrently. The problem is the growth of gray market which utilize this opportunity to take over the luxury industries’ consumers into their hand and their activities have become global. Gray market has now grown faster not only in offline channel but also by going viral by using online media such as Facebook, Instagram, or Website as their main channel. Although there’re many studies about gray market problems which have been discussed in the literature, relevant studies from consumers’ perspective are still limited. This study aims to learn about consumer attitude toward online gray market in Indonesia, where the result of this study can be used effectively by trademark holders or international brand managers in determining the right marketing strategy in facing the gray market from consumer point of view. The main focus in this research is about gray market which sold genuine branded bags at lower prices. This study also investigates the relationships between consumer attitude toward gray market goods and their antecedents which are consumers’ personal value, social recognition values, and luxury brand perception. This research takes period of 8 months where Multiple Linear Regression and Path Analysis method is used for this research data analysis. The implications and further research are discussed.