destination branding case study: tracking brand equity ...

DESTINATION BRANDING CASE STUDY: TRACKING BRAND EQUITY FOR AN EMERGING DESTINATION BETWEEN 2003 AND 2007 Steven Pike Queensland University of Technology, Brisbane, Australia Place branding has become a major focus of operations for destination marketing organizations (DMOs) striving for differentiation in cluttered markets. The topic of destination branding has only received attention in the tourism literature since the late 1990s, and there has been relatively little research reported in relation to analyzing destination brand effectiveness over time. This article reports an attempt to operationalize the concept of consumer-based brand equity (CBBE) for an emerging destination over two points in time. The purpose of the project was to track the effectiveness of the brand in 2007 against benchmarks that were established in a 2003 study at the commencement of a new destination brand campaign. The key finding was there was no change in perceived performance for the destination across the brand’s performance indicators and CBBE dimensions. Because of the common challenges faced by DMOs worldwide, it is suggested the CBBE hierarchy provides destination marketers with a practical tool for evaluating brand performance over time. KEYWORDS: destination branding; consumer-based brand equity; destination image

The topic of branding first appeared in the marketing literature more than 50 years ago (see Banks, 1950; Gardner & Levy, 1955). However, published research relating to destination branding did not emerge until the late 1990s. Ritchie and Ritchie (1998) bemoaned this dearth of research in their conceptual paper around the same time as the first destination branding journal articles by Pritchard and Morgan (1998) and Dosen, Vranesevic, and Prebezac (1998). In the decade since these first papers appeared, the field has attracted increasing interest. The first book on the topic appeared in 2002 (see Morgan, Pritchard, & Pride, 2002), case studies of destination brand development have appeared (see, e.g., Crockett & Wood, 1999; Curtis, 2001; Hall, 1999; Morgan, Pritchard, & Pride, 2002; Pride, 2002; Slater, 2002), and the first academic conference dedicated to the topic, held at Macau’s Instituto De Formacao Turistica (IFT), took place in 2005 (see Dioko & So, 2005). Despite recent attention, there is at least one area in which the destination branding literature remains significantly underreported. Although the published Journal of Hospitality & Tourism Research, Vol. 34, No. 1, February 2010, 124-139 DOI: 10.1177/1096348009349820 © 2010 International Council on Hotel, Restaurant and Institutional Education

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case studies now provide a destination brand development resource for destination marketing organizations (DMOs) and academics, there has been little reported on the performance of destination brands over time. However, it should be noted that the topic of brand metrics is also rare in the services marketing literature (Kim, Kim, & An, 2003). Given the resources now being invested in destination brand initiatives globally there is a need for more research related to destination brand performance. Brand equity is the most common term used to represent brand performance, and is measured in terms of a financial value on the corporate balance sheet. However, such intangible asset values are of little practical value to DMOs, albeit with the exception of potential licensing revenue. One alternative worthy of investigation by DMOs in brand effectiveness measurement is consumerbased brand equity (CBBE) promoted by Aaker (1991, 1996) and Keller (1993, 2003). CBBE measurement is based on the premise of developing an understanding of how marketing initiatives are impacting on consumer learning and recall of brand information. During 2003, research was undertaken to measure CBBE for an emerging Queensland destination at the time of a new brand launch. Aspects of this research have been reported previously (reference withheld). The aim of the 2003 study was to provide benchmarks, against which the effectiveness of the brand could be monitored over time. The purpose of this article is to report the results of a repeat study undertaken in 2007, to enable a comparison of CBBE at two points in time over 4 years of the brand’s life. In Queensland, 13 tourism regions are officially recognized and supported by the state tourism organization (STO), Tourism Queensland (see http://www .queenslandholidays.com.au/destinations/index.cfm). The STO provides substantial financial and human resources to the regional tourism organizations (RTOs), much of which has been invested in the development of destination brands. In the past few years, most RTOs have developed new brand positioning themes for use in Brisbane, the state capital. Brisbane is the most important market in terms of visitor arrivals for most destinations in Queensland and northern New South Wales. The destination of interest in this study is Bundaberg, Coral Coast and Country, which has been categorized by Tourism Queensland as an “emerging destination.” The foundation of a brand is its name (Keller, 2003), and the destination brand name introduced in 2003 by Bundaberg Region Ltd, the RTO, was “Bundaberg, Coral Isles and Country,” which recognized the geographic diversity of a region covering 26,000 square kilometers and 11 shire councils. The name was later changed to Bundaberg, Coral Coast and Country. Located 350 kilometers north of Brisbane, the region encompasses a large rural hinterland, for which Bundaberg (population 45,000) is the largest city, and a lengthy coastline that boasts the southern starting point of the Great Barrier Reef. The travel situation of interest in the study is short break holidays by car. Following White (2000) a short break is defined as a nonbusiness trip of between one and four nights away from home. Although short breaks have emerged as one of the fastest growing travel segments in many parts of the world (see, e.g., Downloaded from jht.sagepub.com at Universiti Teknologi MARA (UiTM) on March 29, 2016

126 JOURNAL OF HOSPITALITY & TOURISM RESEARCH

Vanhove, 2005), there has been little research reported in Australia. This is despite Mackay’s (1988) analysis of Australians’ attitudes toward travel, which identified “mini breaks” as one of seven major opportunities for tourism marketers. Domestic short break drive tourism is an important aspect of Australian travel patterns. The Bureau of Travel Research (BTR, 2002) estimated 76% of domestic travel is undertaken by car, 70% of which is travel within the state of residence. The mean length of stay for these trips was estimated at three nights. BTR estimated short breaks of one to three nights represented 68% of the Queensland drive market, whereas short tours of four to seven nights represented a further 19%. Australian domestic travel growth has stagnated in recent years, which has been attributed to a trend toward longer working hours and increasing competition for leisure time (Tourism Forecasting Council, 2000, 2001). Tourism Forecasting Council forecast total domestic visitor nights to increase by 0.3% annually until 2012. However, the past and forecast growth rate of short breaks is less clear within published aggregated data associated with domestic tourism in Queensland. During 2002, Tourism Queensland undertook a series of focus groups with Brisbane consumers to investigate perceptions of Bundaberg, Coral Coast and Country. The study found that although the name Bundaberg had strong name recognition in the Brisbane market as the home of Bundaberg Rum and Bundaberg Ginger Ale, the region lacked a clear identity as a tourism destination. While there were positive perceptions held by older people and families who had recently visited the region, the results highlighted three possible barriers to increased visitation from Brisbane residents. These were (a) the perception there was “nothing to do,” (b) the driving distance, and (c) a lack of nightlife, restaurants, cafes, and shopping. To address these issues, a new destination brand, at a cost of $20,000 was developed by the RTO and STO over 12 months (Still, 2002). The new brand was launched by the RTO in early 2003 with the objectives being (a) to raise awareness of the destination; (b) to stimulate increased interest in, and visitation to the region; and (c) educate the market about things to do. The new brand positioning theme was “Take time to Discover Bundaberg, Coral Isles and Country.” The brand was launched to industry stakeholders in a series of meetings, where local businesses were enticed with financial incentives, in the form of discounted advertising rates, to use the new brand theme. Subregional variations of the brand theme were developed to encourage participation by towns and communities within the region. The brand promise was that visitors’ expectations would be exceeded. The brand identity attributes were laid-back, friendly and warm, relaxed, natural, coastal and country sense of freedom, choice, and flexibility. At the time of the brand launch in 2003, research was undertaken to provide structured data that the RTO could use to monitor the effectiveness of the brand campaign over time, relative to the objectives (Pike, 2006). It was felt that CBBE could be adapted to suit this aim. In terms of benchmarking the destination’s position as a short break destination in the Brisbane market, the study concluded the Bundaberg region had a low level of brand equity in its most Downloaded from jht.sagepub.com at Universiti Teknologi MARA (UiTM) on March 29, 2016


Figure 1 Brand Identity, Brand Position, and Brand Image

Brand identity Desired brand image Vision Values Personality

Brand positioning

Name Symbol

Brand image Actual image held by consumers

Slogan

Source: Pike (2004, p. 112).

important geographic market. The 2003 results can be used to track the performance of the brand, in relation to the original objectives, over time. To this end, the purpose of this article is to report a 2007 study to use the CBBE hierarchy to analyze the extent to which the objectives had been achieved in the 4 years since the brand launch. LITERATURE REVIEW

Most definitions of a brand have been based on that proposed by Aaker (1991) A distinguishing name and/or symbol (such as a logo, trademark, or package design) intended to identify the goods or services of either one seller or a group of sellers, and to differentiate those goods from those of competitors. (p. 7)

A brand is, however, more than the presentation of such symbols in consumer promotions. Aaker proposed a brand be viewed from both the supply and demand perspectives. One way to do this is through understanding of the distinction between the concepts of brand identity and brand image. The former is the self-image desired by the marketers, whereas the latter is the actual image held by consumers. As shown in Figure 1, brand positioning elements, such as the name, symbol, and slogan, are used by the marketer to cut through the noise of competing and substitute products to stimulate an induced destination image that matches the brand identity (see Pike, 2004, p. 112). Brand performance measurement with the analysis of the level of congruence of brand image and brand identity. This in effect provides a measure of brand equity. Aaker (1991) defined brand equity as assets and liabilities that add or detract value to a firm and/or its companies. High levels of brand equity can result in Downloaded from jht.sagepub.com at Universiti Teknologi MARA (UiTM) on March 29, 2016


Figure 2 Consumer-Based Brand Equity (CBBE) for a Destination

Hierarchy of effects

- Purchase - Preference

- Knowledge - Liking

- Awareness

RTO objectives

RTO Objective 2: to stimulate increased interest in, and visitation to the destination

RTO Objective 3: to education the market about things to do

RTO Objective 1: to raise awareness of the destination

CBBE components

Measures

Brand loyalty

• Repeat visitation • Word of mouth recommendation

Brand resonance

• Previous visitation • Intent to visit

Brand associations

• Cognition • Affect

Brand salience

• ToMA • Decision set

Source: Adapted from Pike (2007).

increased sales, price premiums, customer loyalty, (Aaker, 1991), lower costs (Keller, 1993), and purchase intent (Cobb-Walgren, Beal, & Donthu, 1995). Commonly, measurement of brand equity is by way of an intangible balance sheet asset net-present-value, with key dependent variables, including future financial performance (see Kim et al., 2003) and market share (see Mackay, 2001). Underpinning CBBE is the proposition that indicators of market attitudes and behavior toward a brand underpin any financial valuation of brand equity. In this way CBBE can be viewed as both a measurement of the effectiveness of past marketing communication, and a predictor of future performance. The CBBE hierarchy appears relevant to DMO stakeholders, for which the financial measure of a destination brand would be of little practical value to DMOs. Following the work of Aaker (1991, 1996) and Keller (1993, 2003), as well as Lavidge and Steiner’s (1961) hierarchy of effects, CBBE for a destination is conceptualized as a hierarchy of brand salience, brand associations, brand resonance, and brand loyalty. Figure 2 illustrates these concepts in relation to the RTO’s three 2003 brand objectives. Brand salience is the foundation of the hierarchy and represents the strength of the destination’s presence in the mind of the target for a given travel situation. It is suggested salience is best operationalized though unaided top of mind awareness (ToMA), rather than through recall by prompting. The proposition that ToMA is an indicator of purchase preference (see Axelrod, 1968; Wilson, 1981; Woodside & Wilson, 1985), was supported in the 2003 study (Pike, 2006). Of particular interest to destination marketers is in understanding how travelers select a holiday destination from so many places offering the same Downloaded from jht.sagepub.com at Universiti Teknologi MARA (UiTM) on March 29, 2016


benefits. The theory of consumer decision sets offers, introduced by Howard (1963) and Howard and Sheth (1969), is helpful in this regard. Many tourism studies have supported the assertion that the number of destinations a traveler will actually consider in the purchase process is limited to four plus or minus two (see, e.g., Crompton, 1992; Thompson & Cooper, 1979). These destinations form the decision set, which provides a measure of brand salience relative to competitors. This CBBE dimension relates to the destination’s first brand objective: To increase awareness of the destination. Brand associations are anything linked in memory to the destination. Mayo and Jarvis (1981) suggested destination attractiveness is a function of the specific benefits sought by travelers and the ability of the destination to provide them. From this perspective it is important to gain an understanding of what decision criteria will be used by the consumer-traveler when making differentiating destinations under consideration. Reviews of the extensive destination image literature (see Chon, 1990; Echtner & Ritchie, 1991; Gallarza, Saura, & Garcia, 2002; Pike, 2002, 2007; Tasci, Gartner, & Cavusgil, 2007) indicate there is no commonly agreed conceptualization of the construct. Not surprisingly therefore, no accepted destination image scale has been developed. Kotler, Haider, and Rein (1993) highlighted the way in which minds simplify the process of destination image formation: “Images represent a simplification of a large number of associations and pieces of information connected with the place. They are the product of the mind trying to process and essentialize huge amounts of data about a place” (p. 141). Mayo and Jarvis proposed an individual would make a brand selection based on what is “important and relevant to them” (p. 68), and so associations need to be measured in terms of attributes deemed determinant for a given travel situation. That is, the researcher needs to elicit from the respondent, from a selection of salient attributes, those that determine destination selection for a given travel situation. Although most popular measurement approach is structured surveys using scales of cognitive attributes and affective benefits, the issue of travel situation salience and determinance has been neglected in the destination image literature. This CBBE dimension relates to the destination’s third objective: to educate the market about things to do. Brand resonance represents willingness to engage with the brand, or level of identification a consumer has with a brand. It is suggested that for destinations, resonance can be measured behaviorally, such as in previous visitation, and also attitudinally through stated intent to visit. This CBBE dimension is related to the destination’s second objective: To stimulate interest in, and visitation to, the destination. This objective is also related to the highest level of the hierarchy, brand loyalty, which has received little attention in the destination marketing literature. Loyalty can be measured by repeat visitation and word of mouth recommendations. In this way the CBBE hierarchy incorporates perceptual and behavioral measures. There has been criticism in the marketing literature of what has been failure in market research to link attitudinal data with measures of actual behavior (see Schultz & Schultz, 2004). Certainly, there has been a lack of longitudinal tourism studies investigating Downloaded from jht.sagepub.com at Universiti Teknologi MARA (UiTM) on March 29, 2016


the relationship between attitude and behavior (Pike, 2006), such as stated preferences and actual travel. METHOD

The 2003 longitudinal study took place during the autumn months of April to June 2003 (Pike, 2006). Autumn in subtropical Brisbane provides ample opportunities for domestic short breaks by car, including school, university, and public holidays. April is the second most popular holiday month in Australia (BTR, 2002). The first questionnaire contained questions about recent and intended short break activity, ToMA/decision set preferences, and ratings of salient short break destination attributes. The second questionnaire, distributed three months later, contained questions about actual travel since the first questionnaire, and perceptions of performance for five destinations across the battery of salient attributes. For consistency, the 2007 study also took place during April, when questionnaires were mailed to a new systematic random sample of 3,000 households selected from the 2007 White Pages telephone directory. An incentive prize of a short break holiday at a mystery destination was offered. The questionnaire consisted of 173 items in three sections. The first section included filter questions about attitudes toward short breaks, two unaided questions to elicit ToMA destination and decision set composition, and a battery of 22 destination attribute-importance items using a 7-point scale (1 = not important, 7 = very important). A “don’t know” option was also provided for each scale item. These attributes were selected from the results of the 2003 study, supplemented by attributes from further exploratory research using group applications of Repertory Grid with Brisbane residents (Pike, 2007c). The second section asked participants to rate the perceived performance of the Coral Coast, along with four competing destinations selected from the decision set findings of the 2003 study, across the 22 cognitive scale items, and two affective scale items. Questions were also used to identify measures of previous visitation, intent to visit and word of mouth recommendations for each of the five destinations. The third section contained questions related to demographics. The back page of the questionnaire was left blank, apart from an open-ended question inviting participants to indicate thoughts on how Queensland destinations could improve to suit their needs. It is important to reiterate the purpose of the project was to trial the CBBE hierarchy dimensions as indicators of performance, particularly as they related to brand objectives, rather than structurally test the model. For example, in this study, brand salience was measured by tapping unaided top of mind awareness rather than by a series of prompted recall scale items required in confirmatory factor analysis. While researchers have started to undertake such tests of the suitability of the model for destination brand measurement using structural equation modeling (see Konečnik, 2006; Konečnick & Gartner, 2007), more Downloaded from jht.sagepub.com at Universiti Teknologi MARA (UiTM) on March 29, 2016


research is required to develop construct scale items that can be adapted across travel situations. RESULTS

A total of 447 completed questionnaires were received, which represented a useable response rate of 17%. A further 7 incomplete questionnaires were received, along with 337 returned because of incorrect mailing addresses, and 6 politely declining participation. The response was similar to the 19% obtained in 2003. As shown in Table 1, the characteristics of the 2007 participants were very similar to those who participated in 2003. These characteristics were generally similar to the 2001 Census population, albeit again with a higher level of females and a lower level of those aged 18-24 years. Participants indicated a strong familiarity with short break holidays, suggesting a mean of three such trips by car per year, which was consistent with the 2003 sample. The mean importance of taking at least one short break by car each year (1 = not important, 7 = very important) was 6.3, whereas the mean likelihood of taking a short break by car in the next 12 months (1 = definitely not, 7 = definitely) was 5.1. A total of 86% had taken a short break during the previous 12 months. The unaided awareness question elicited more than 100 ToMA destinations from participants. For reporting succinctness the list has been categorized in Table 2 by RTO geographic boundary. These results were also consistent with the 2003 study for each destination. The most popular destination region again the Sunshine Coast, which was listed by almost half of the sample (46%). Less than 2% of participants listed Coral Coast destinations as their ToMA destination. The mean number of destinations listed in decision sets was 3.1, in comparison with 3.8 in 2003. More than 90% of participants indicated a range of between two and four destinations. Including the ToMA destinations, more than 120 places were elicited unaided from participants. This clearly indicates the range of available destinations, and therefore competition, is extensive. Practically, the decision set size and composition has serious implications for those destinations not listed, such as the Coral Coast, given half of the sample indicated a likelihood of taking a short break within the next 3 months. These destinations are less likely to be considered in the selection process. Coral Coast destinations were listed 25 times in decision sets, in comparison with 58 in 2003. The ToMA and decision set findings highlight a lack of improvement in brand salience between 2003 and 2007. This is important given brand salience is the foundation of the CBBE hierarchy. Although the Coral Coast did not rate well in terms of unaided awareness, more favorable results emerged when participants were prompted to recall the destination. Table 3 shows the perceived performance of the Coral Coast across the cognitive attributes was generally favorable. With the exception of two attributes, “within a comfortable drive” and “trendy atmosphere,” the means were above the scale midpoint. Whereas the latter was not deemed Downloaded from jht.sagepub.com at Universiti Teknologi MARA (UiTM) on March 29, 2016


Table 1 Characteristics of Participants in 2003 and 2007 2003 (n)

Gender Male Female Total Missing Age (years) 18-24 25-44 45-64 65+ Total Missing Annual household income ($)