Ask most Americans if they prefer products made by American workers, and they readily say, “Of course!” But do they put their money where their mouth is? The common assumption is that, when given the choice of saving a few dollars by buying a toy, a pair of sneakers, or a cell phone made in China versus purchasing a more expensive product that says “Made in USA,” the vast majority of Americans go for the bargain.
It may be time to rethink that assumption. Our research suggests that a “Made in USA” label may be worth a lot more than many retailers and manufacturers think.
In September 2012, we surveyed 5,000 consumers in the U.S., China, Germany, and France about their buying behavior and the value of the “Made in USA” brand. More than 80 percent of U.S. consumers stated that they are willing to pay more for products labeled “Made in USA” than for those labeled “Made in China.” Concerns about quality and a desire to keep jobs in the U.S. were the key drivers.
That, in itself, may not be surprising; such sentiments have been expressed in other surveys. But we probed more deeply, using a survey method (named after its inventor, the Dutch economist Peter van Westendorp) that many consumer companies use to determine consumer price preferences in industries as diverse as packaged goods and media. We showed photos of four products—a gas range, a mobile phone, a pair of athletic shoes, and a wooden baby toy—to half of the U.S. consumers in our sample and told them that the products were manufactured in the U.S. We then asked the respondents a set of open-ended questions about how much they would be willing to pay for those items. We asked the same questions and showed the same photos to the other half of consumers in the sample, but this time the products were labeled “Made in China.”