Measuring brand equity a global brand and a national ...

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brand. Track: Brand equity issues. Key words: brand equity, marketing mix, .... mentioned authors, who have identified relationships between all variables of the.
Measuring brand equity: a comparison between a global brand and a national brand.

Track: Brand equity issues

Key words: brand equity, marketing mix, Brand comparisons, Partial least squares structural equations.

The present study undertakes a comparative analysis of the brand equity between a Portuguese brand (Salsa) and a global brand of jeans (Levi’s) by means of the application of the brand equity scale developed by Yoo et al., (2000), which explores the relationships between the composite of marketing-mix and the creation of brand equity.

Ever since the appearance of the designation of brand equity in the 1980s the interest in the subject has been increasing among the academia and marketing professionals (Walgren et al., 1995). Initially associated to the notion of brand image (Gardner & Levy, 1955) the term brand equity had been considered, until the 1980s, as a peripheral concept in the field of marketing and lacking the proper development that would allow its inclusion in the professional language and practices (Feldwick, 1996). According to Nunes & Haigh (2003), the alteration in the perception of the term is due to the major mergers and acquisitions that took place in the previous decades, which caused investors and companies to realize that intangible goods, such as brands, could represent sources of value to the businesses.

The interest in the study of brand equity has been particularly active in the beginning of the millennium (e.g., Yoo et al., 2000; Keller, 2001; Yoo and Donthu, 2001; Kapferer, 2004). Rust (2004) claims that the models of brand equity should be considered priority subjects in marketing research. Rajh (2005) also refers that, with the exception of Yoo et al., (2000), there was a dearth in research focussed on the form the individual elements of marketing-mix affect the creation of brand equity.

Nonetheless, the term brand equity still raises a degree of controversy, since Agarwal & Rao, (1996) and Erdem & Swait (1998) refer that the overall theoretical instruments have not yet been created that allow a totally unanimous definition of the concept of Brand Equity. The main contributions for this conceptualization come from Aaker (1991) and Keller (1993), who define brand equity from the viewpoint of the consumer, (it has to provide the same value for the company and for the consumer). However, there are some differences in the form these two authors define the concept. For Aaker (1991), brand equity is the set of actives or passives connected to a brand, its name and its symbol, which are added or subtracted, of the value perceived by a consumer as to a product or service. Aaker (1991) was the first author to propose an evaluation model based on the consumer, which was used as the basis of subsequent research (Atilgan, et al. 2005; Kim & Kim, 2004; Yoo et al., 2000). It is his conceptualization that allows the development of the scale by Yoo et al. (2000) and Yoo & Donthu (2001), which will be applied in the present analysis. Yoo & Donthu (2001) develop this scale because they consider that, despite the many studies carried out in the area of brand equity, the focus of the research was not centered on the effective development of an effective measurement instrument which could be used to render it operational. The study by Yoo et al. (2000) had the purpose of verifying the existence of relationships between the

elements of the marketing mix and the creation of brand equity, by means of a conceptual model of the brand value, which seeks to represent an extension of the conceptual model by Aaker (1991). Yoo et al. (2000) and Yoo & Donthu (2001) perfected their earlier study (Yoo & Donthu, 1996) equally based on the dimensions of Aaker (1991, 1996) and Keller (1993), where the scale appears in its more consolidated version. Since then, this scale has been applied in several studies (i.e., Atilgan, et al. 2005; Kim & Kim, 2004). However, its study is not consensual yet. Grinberg & Luce (2000), Schultz (2001), and Washburn & Plant (2002) point out that there does not exist a universal scale that can be accepted by all, nor adequate instruments have been established to measure brand equity. Therefore, it is still necessary to undertake further studies in different sectorial and cultural contexts on this subject, and which apply the scale developed by Yoo et al. (2000) and Yoo & Donthu (2001).

The main aim of this study is to investigate the relationships between the three dimensions of brand equity (perceived quality, brand loyalty and brand awareness/brand associations) in the formation of brand value; the relationships of the marketing mix (price, shop image, intensity of distribution, advertising and promotions) in the formation of brand value and, lastly, the study of the relationships between the three dimensions of brand equity. In this sense, the scale by Yoo et al., (2000) will be tested against the undertaking of a comparative study of the Salsa and Levi’s brands.

Hypotheses investigated in the present study:

H1: The level of brand equity is positively related with the quality of the brand displayed in the product.

H2: The level of brand equity is positively related with the brand loyalty displayed in the product. H3: The level of brand equity is positively related with the brand associations and awareness displayed in the product. H4: The perceived quality of the brand is positively related with the perception of high price. H5: The perceived quality of the brand is positively related with the distribution in stores with an upscale image. H6: The brand associations are positively related with the distribution in stores with an upscale image. H7: The perceived quality of the brand is positively related with the intensity of distribution in stores. H8: The brand loyalty is positively related with the intensity of the distribution in stores. H9: The brand associations are positively related with the intensity of distribution in stores.

Conceptual model of the research:

The present article is structured as follows: firstly, it undertakes a literature review, where the present understanding of the concept is discussed, as well as the different perspectives and mensuration models, its dimensions and connection between brand equity and the marketing elements. Afterwards, the methodology adopted is exposed, followed by the presentation and analysis of results. Lastly, the results are obtained are discussed and the implications of this study for the area of marketing are presented.

Table 1. Summary of the methodology employed Geographical coverage Data gathering method Date of data gathering Sample type and size Scale Used Constructs and dimensions measured Method and programmes of analysis

Portugal Quantitative on-line questionnaire Survey May 2010 – January 2011 Convenience sample 464 validated questionnaires Scale by Yoo et al., (2000) and Yoo & Donthu (2001) Dimensions of brand equity: perceived quality, brand loyalty and brand associations/awareness. Composite of marketing mix: price, store image intensity of distribution, advertising and promotions. OBE (overall brand equity). Descriptive and Paired Comparisons T test (IBM SPSS©) e Structural equation modelling (SmartPLS 2.0©, Ringle et al., 2005).

The results indicate that the Levi’s scale presents, in all its dimensions, higher averages than the Salsa scales. An analysis to the dimensions of brand equity allows us to conclude that both scales present the lowest average in the dimension brand loyalty. On the other hand, the dimensions of perceived quality and brand awareness/association present the highest values and reveal less distancing between themselves. The OBE construct presents, in both scales, values below the average value of the scale. We have also observed significant differences between the averages of both scales (p