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Perceptual and behavioral dimensions: measuring brand equity

consumer based

Chapter: 01 Introduction

1-1 Overview

(An attempt to define the relationship between customers and brands produced the term ``brand

equity'' in the marketing literature. The concept of brand equity has been debated both in the

accounting and marketing literatures, and has highlighted the importance of having a long-term

focus within brand management. Although there have been significant moves by companies to be

strategic in the way that brands are managed, a lack of common terminology and philosophy

within and between disciplines persists and may hinder communication.

Brand equity, like the concepts of brand and added value (discussed in the section headed ``the

brand construct'') has proliferated into multiple meanings. Accountants tend to define brand

equity differently from marketers, with the concept being defined both in terms of the

relationship between customer and brand (consumer-oriented definitions), or as something that

accrues to the brand owner (company-oriented definitions). )

Management Decision
Brands and brand equity: definition and management
Lisa Wood

(Almost every marketing activity works, successfully or unsuccessfully, to build, manage,

and exploit brand equity (Aaker, 1991; Keller, 1993; Yoo and Donthu, 2001). Building brand
equity is considered an important part of brand building (Keller, 2008). Brand equity is regarded

as a very important concept in business practices as well as in academic research because

marketers can gain competitive advantages through strong brands (Keller, 1993; Aaker, 1996a;

Keller, 2008). For example, high brand equity levels are known to lead to higher consumer

preferences, brand purchase intentions and brand choice behavior (Cobb-Walgren et al., 1995;

Freling et al., 2011; Romaniuk and Nenycz-Thiel, 2013). Firms who have strong brands with

positive brand equity are also known to have better product-market outcomes such as brand

extensibility and price flexibility (Wang et al., 2008), and brand market performance outcomes

(Chaudhuri and Holbrook, 2001). )

Journal of Product & Brand Management

Brand personality and brand equity: evidence from the sportswear industry: Jin Su Xiao Tong

(The research on brand equity has been inserted in cognitive psychology and centred in the analysis

of cognitive processes of consumer. In this field, two principal issues are

considered for the analysis of brand equity (Irmscher, 1993, Barwise 1993, Chaudhuri

1995 and Feldwick 1996) - the first one is that brand equity is equivalent to the

multidimensional construction of the knowledge of the brand (Keller, 1993, 2003) and,

the second one, headed by the works of Aaker (1991, 1996), consider brand equity like
a multidimensional construction integrated into a series of assets and liabilities that add

value to the brand, for the company and for the consumer. The problem of validity of

content around brand equity, is not solved yet, given the diversity of operative

descriptions that we can found about it (Aaker (1991), Keller (1993), Farquhar, (1989),

Park and Srinivasan, (1994), Rangaswamy et al., (1993), Lassar et al., (1995), Kapferer

(1997), Motameni and Shahrokhi (1998), Dawar and Pilluta (2000), Yoo et al. (2000),

Faircloth et al. (2001), Vásquez et al. (2002), Stahl, et al. (2012), Buil et al., (2013)).

The subject of brand equity measurement has attracted the attention of academic and

business community due to the strategic importance of brand management in

companies. Keller and Lehman (2003) delineate three approaches for assessing brand

equity: customer mind-set (Aaker 1996; Keller 2008), product market (Park and

Srinivisan 1994), and financial market (Mahajan, et al. 1994). These approaches have

different strengths and weaknesses (Ailawadi, et al. 2003). In this paper, brand equity is

measured based on the consumer perspective and are analysed the constructs and scales

of its measurement. In this work, the brand equity is considered as a multidimensional

construction of the knowledge of the brand (Keller, 1993, 2003), according to a

construction approach in the consumer's mind (Keller, 2008) and in a holistic view of
brand management.

In this study, the main goal is to propose a measurement model in brand equity

consumers’ mind, which follows the perspective of considering the brand as an

intangible asset that has associated a certain capital, which is the result of perceptions

and attitudes, toward brands which give them a value. The measurement model of

brand equity based on consumers’ mind separates the perceptual component of the

behavior component of individuals in their preferences for brands. This is, as a result of

a set of perceptions, consumers create a brand equity that will be realized in loyal

behavior and willingness to pay a premium price for a brand. )

Journal of Fashion Marketing and Management: An International

Perceptual and behavioural dimensions: measuring brand equity consumer based
Paula Rodrigues Francisco Vitorino Martins
Literature Review

2.1 Brand awrness

Brand awareness refers to the capacity of the consumer to remind and recognise the brand

(Keller, 1993; Netemeyer et al., 2004; Yoo et al., 2000; Yoo and Donthu, 2001). Awareness

affects the perceptions the consumer has about the brand, contributing to the perceptual

evaluation that is expressed on brand equity. A brand with a large remembrance leads to an

increase of perceptual brand equity in consumers’ minds.

H1: There is a positive relationship between awareness and brand equity from the point of

view of the consumer.

2.2 Perceived Quality

While the price-quality heuristic employed in the context of evaluation tasks predicts negative

effects of lower prices on perceived quality, when consumers are engaged in a choice task, an

alternative mechanism may be at work that could lead to lower prices having a positive effect on

perceived quality of the focal brand (Blattberg and Neslin, 1989; Pauwels et al.,2002).We call

this the attention-and-choice perspective.

H2: There is a positive relationship between perceived quality and brand equity from the point

of view of the consumer.

2.3 Brand personality

Aaker (1997, p. 347) defines brand personality as “the set of human characteristic associated

with brand”. Researchers have established in the marketing literature that brands can have
human traits that influence critical outcomes such as purchase likelihood and brand choice

(Ha and Janda, 2014; Gordon et al., 2016; Guèvremont and Grohmann, 2013; Swaminathan

et al., 2009). Although brand personality is considered as one of the prominent constructs in

predicting consumer preferences and choices (e.g. Eisend and Stokburger-Sauer, 2013;

Gordon, Zainuddin, and Magee, 2016; Guèvremont and Grohmann, 2013; Hultman, Skarmeas,

Oghazi, and Beheshti, 2015; Swaminathan, Stilley, and Ahluwalia, 2009), previous research

however note that the effects of brand personality on the brand success variables partly depend

on the specific dimension (Eisend and Stokburger-Sauer, 2013). For example, out of the brand

personality dimensions developed by Aaker (1997), many studies mainly focus on two, namely,

sincerity and excitement, respectively (e.g. Aaker, Benet- Martinez, and Garolera, 2001; Hosany,

Ekinci, and Uysal, 2006; Ivens and Valta, 2012; Rojas Mendez, Erenchun-Podlech, and Silva-

Olave, 2004; Sung, Choi, Ahn, and Song, 2015).

Previous studies consider these two dimensions to be the most important since these dimensions

appear to capture much of the variance in personality ratings of brands (Aaker, 1997).

H3: There is a positive relationship between brand personality and brand equity from the

point of view of the consumer.

2.4 Brand Loyalty

Besides analysing factors that contribute for the construction of brand equity from the part of the

consumer, this hypothesis claims that brad equity may lead to a certain consumer behaviour.

Therefore, it is considered if may allow the analysis of how far brand equity influence consumer

loyalty and his willingness to pay a higher price for a branded product. Brand loyalty in the
proposed model is a perceptual loyalty that is to say if, the result of the evaluation the consumer

does when is selecting the brand, it is the result of a positive perceptual evaluation strong enough

to lead him to a loyalty behaviour. A favourable evaluation of brand equity may lead to the

preference and purchase of the branded products along time (Odin et al., 2001; Oliver, 1997,

1999; Chaudhuri and Holbrook, 2001; Back, 2005; Kuikka and Laukkanen, 2012). Attitude

constituents and behaviours are both present in this construct.

H4: There is a positive relationship between brand equity and brand loyalty from the point of

view of the consumer.

2.5 Price Premium

A brand obtains a price premium when the sum that customers are willing to pay for products

from the brand is higher than the sum they are willing to pay for similar products from other

relevant brands (Aaker, 1996). Conceptually, several writers describe price premiums as the

most useful indicator of brand equity (Blackston, 1995; Aaker, 1996; Sethuraman, 2000).

Empirically, several studies (see Agarwal and Rao, 1996; Ailawadi et al., 2003) seem to support

their argument by showing, for example, that a price premium is relatively stable over time, yet

captures variation in the brand’s health, and is a powerful predictor of market shares. Some

writers, such as Doyle (2001), even argue that a price premium is the most important way in

which brands can create shareholder value, because it requires no direct investments to charge a

higher price.

H5: There is a positive relationship between brand equity and the willingness to pay a price

premium from the point of view of consumer.

2.6 Brand Equity (conclusion of DV)