CHAPTER I INTRODUCTION 1.1 Introduction In this era, everyone definitely needs food to fulfill their daily needs. Everyone need to survive in any way and one of them is eating for energy, almost everyone knows and has eaten noodles. Noodle is long thin dough that has been rolled, dried, and cooked in boiling water. Nowadays there are noodles that are made instantaneously, usually called instant noodle. As we know, instant noodle products have very many choices from various kinds of local and foreign brands. Instant noodles are very easy to find, they always available at any retailer. almost all retailers must provide or sell these instant noodles. retail business is a business that involves selling goods or services to consumers in units or retail (Untung, 2015). Consumers who buy products or services at retail are intended to consume or use them personally and not to resell them. Indonesia's retail sales growth was reported at -12.3% in July 2020. This record increased compared to the previous one, namely -17.1% for June 2020. Indonesia's Retail Sales Growth Data is updated monthly, with an average of 8.7% from 2011 January to July 2020, with 115 observations. This data reached 1 the highest figure of 28.2% in December 2013 and a record low of -20.6% in 2020 in May. Indonesia's Retail Sales Growth Data remains active status in CEIC and is reported by CEIC Data. As we can see in the graphic 1.1 that Indonesia's retail growth in 2020 has decreased significantly, it was concluded that due to this pandemic which has occurred throughout the world, the economy has become hampered. Likewise, Indonesia’s economy aslo hampered in various sectors, especially in the retail sector. (Manggala, 2020) Graphic 1.1 Indonesia Retail Sales Growth Source: (CEICDATA, 2020) In Indonesia, there are several companies that produce instant noodles and there are many kinds of instant noodle products that we can choose from. Examples are “indomie” from PT Indofood, “Mie Sedap” from Wings 2 company, “ABC noodles” from ABC company, etc. The market leader in instant noodle with its famous brands such as Indomie, Pop Mie, Supermie and others is Indofood with a percertage of 72% of market share, after that the wings company followed with a percentage of 14.9% of market share, and the rest by other instant noodle companies (Suhendra, 2016). In Indonesia, there are various imported instant noodle brands from several country like Korea, China, Japan, etc. There are also many types of Korean instant noodle products such as ottogi cheese ramen, ottogi yeul ramen, Nongshim Shin Ramyun Black, Samyang, Neoguri udon, etc. Among all types of Korean instant noodle products, there are several variants in each type of Korean instant noodle product. This Korean instant noodle product is popular too with existing local brands. Many people like the taste of these Korean instant noodle products. In addition to the good taste, it is also easy to find in supermarkets. The graphic 1.2 below shows Indonesia's import data on Pasta, whether or not cooked or otherwise prepared, such as spaghetti, macaroni, noodles, lasagne, gnocchi, ravioli, and etc. 3 Graphic 1.2 Indonesia’s import data (pasta, noodle, etc) Source: Trend Economy (2020) Top trading partners (import of Pasta, whether or not cooked or otherwise prepared, such as spaghetti, macaroni, noodles, lasagne, ravioli, and etc are listed as follow (Comtrade.com, 2020): • Korea with a share of 53% equal to 24 million US$ • China with a share of 26% equal to 11.9 million US$ • Australia with a share of 4.25% equal to 1.91 million US$ • Italy with a share of 3.65% equal to1.64 million US$ 4 • Thailand with a share of 3.3% equal to 1.48 million US$ • Japan with a share of 2.98% equal to 1.34 million US$ • Malaysia with a share of 1.59% equal to 719 thousand US$ • Other Asia, nes with a share of 1.29% equal to 583 thousand US$ • Turkey with a share of 1.03% equal to 464 thousand US$ • Vietnam - 207 thousand US$ The data shows that one of the countries that imports the most of (Pasta, whether or not cooked or otherwise prepared, such as spaghetti, macaroni, noodles, lasagne, gnocchi, ravioli, and etc) is Korea with 53% share (equal to about 24 Million US$) (Comtrade.com, 2020) This research is interesting to discuss because it involves consumer behavior, towards foreign instant noodle products, their halalness of these products, and worldmindedness and is moderated by domestic product judgement towards willingness to buy foreign products: Korean noodle. People are smarter in choosing products, for example, like there is a new product from Korea.(Jin & Yoon, 2017) The Korean Hallyu Waves started in a several TV dramas that very popular in Indonesia include Asia, and the local cultural industries have developed several cultural forms, including popular K-pop music, Digital games, and animation, which have gradually penetrated global markets. Digital media of Korean and the 5 interest of Korean culture has triggered the growth of several point, such as tourism, Korean foods, and Korean language, etc. Due to the increasing role of the Korean Hallyu Wave for the economy and culture, the Korean government has changed its cultural policy, to make use of the Korean Wave as a means of power to improbe the national image. In some previous studies have found that the effect of country origin can play an important role in brand image of a product, and indirectly impact on consumers purchase intention (Yang, Ramsaran, and Wibowo, 2016). However, people very concern about buying foreign product, according to (Alsughayir, 2013) consumer ethnocentrism is the concept to represent their normative beliefs in the superiority of their own countries' products. Consumer ethnocentrism is one of the factors that can affect the consumer’s decision of whether to buy domestic or foreign products. it directly influences the consumer’s willingness to buy foreign products (Karoui & Khemakhem, 2019). Still related to willingness to buy foreign product, worldmindedness in buying a product, people not only see the economic aspect but also see values, culture, brand attitudes, etc. consuming behavior is also a subject of both economic, cultural and social capital (Topçu & Kaplan, 2015). According to (Khalid, 2020) worldmindedness called as global view in which considers oneself to be associated with the world network and feels awareness of other people. This is reflected in a person'sattitude, convictions and practices. 6 (Topçu & Kaplan, 2015) stated that there is an effective effect on the assessment of domestic products against the purchases of foreign products which tend to have a tendency for the values and cultural standards of each individual. According to (Guo & Zhou, 2017) product judgment is a consumer's judgment for the quality of product or an idea or comment from an individual or a group of people on a product. (Hefner, 2018;3) Indonesia, which is included in the category of the fourth most populous country in the world, has a majority Muslim population. This makes Indonesia one of the countries with the largest Muslim population. Fulfill the needs of a halal life is a basic right for every Muslim (Warto & Samsuri, 2020), Therefore it is necessary to have certification and product labeling in guaranteeing a halal product to the public, especially Muslim citizens (Warto & Samsuri, 2020). In addition, halal product purchase intention consists of Halal awareness and Halal Certificate (Sardiana, 2020). When we would like to buy foreign product, there are several factors that affect the willingness to buy the foreign product. According to (Guo & Zhou, 2017) willingness to buy means Consumer's behavioral intention to buy something. (Topçu & Kaplan, 2015) said that in a consumer driven world, lack of interest and purchases of foreign products by consumer, relates compliances to buy and having foreign products. Researchers have found and demonstrated a vast variety of factors, such as consumers 'nationalism, ethnocentrism, 7 animosity, and etc that will influence consumers' behaviors and purchase decisions regarding local and foreign products (Cheah, Phau, Kea, and Huang, 2016). 1.2 Research Background In 2017 there was controversial case related to several instant noodle brands from Korea which were accused as containing non-halal ingredients. Various reports were saying that based on the results of sampling and laboratory testing of BPOM, 4 types of instant noodles showed positive results containing specific pig DNA fragments. Responding to these results, BPOM has ordered importers to withdraw products from circulation. Even though Samyang noodles are quite popular among the public, especially millennials, it is necessary to know what noodles have been determined to contain pork by the BPOM. In accordance with the regulation of the Head of the POM Number 12 of 2016, it states that processed food containing certain ingredients derived from pigs must include a special sign in the form of writing containing and a picture of a red pig in a red box on a white basis. From checking the label, it is known that the product containing pork does not contain a warning about containing pork. Importers also do not inform BPOM during registration to obtain distribution permits that the registered products contain pork (www.idntimes.com, 2017). 8 For these products, the BPOM has ordered the importers concerned to withdraw the products from circulation in the market (www.liputan.com, 2017) The recalled instant noodle products are included: 1. Samyang, U-dong instant noodles with a distribution permit from BPOM RI ML 231509497014, imported by PT Koin Bumi 2. Nongshim, instant noodles (Shim Ramyun Black) with a distribution permit from BPOM RI ML 231509052014, imported by PT Koin Bumi 3.