THE BRAND EQUITY OF PETRONAS PETROLEUM PRODUCTS:

THE PERSPECTIVE OF MALAYSIAN CONSUMERS

NUR SUHAILI RAMLI

Master’s Project Submitted in Partial Fulfillment of the Requirement for the

Degree of Master of Business Administration

Faculty of Business and Management

Open University Malaysia

2009

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 DECLARATION

Name : NUR SUHAILI RAMLI

Matric. Number : CGS 00177801

I hereby declare that this Master’s Project is the result of my own work, except for

quotations and summaries which have been duly acknowledged.

Student Signature: _________________________ Date: _________________

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 TABLE OF CONTENTS

TITLE PAGE i
DECLARATION PAGE ii
ABSTRACT v
ACKNOWLEDGEMENTS vii
LIST OF TABLES viii
LIST OF FIGURES ix
LIST OF ABBREVIATIONS/ NOTATIONS/ GLOSSARY x
LIST OF TERMS xi
CHAPTER 1: INTRODUCTION 1
1.1 Background of The Company 2
1.2 Background of The Study 4
1.3 Problem Statement 7
1.4 Research Questions 9
1.5 Research Objectives 9
1.6 Significance of The Study 10
1.7 Limitations of The Study 11
CHAPTER 2: LITERATURE REVIEW 14
2.1 The Importance of Brand Equity 14
2.2 Brand Equity Theory 16
2.3 Brand Loyalty 18
2.4 Brands Trust 19
2.5 Brand Reliability 20
2.6 Theoretical Model Framework 22
2.7 Hypotheses 23
CHAPTER 3: RESEARCH METHODOLOGY 24
3.1 Research Design
24
3.2 Research Planning 25

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 3.3 Data Sampling 28
3.4 Approaches to Respondents 28
3.4.1 Face-to-Face Meeting 28
3.4.2 Distributing Through Emails 29
3.4.3 Interviewing some colleagues 29
3.5 Sampling Method 30
3.6 Methods to be Used 30
3.7 Data Measures 31
3.8 Measures of Variability 32
3.9 Data Collections 33
3.9.1 Data Collection Procedure 34
CHAPTER 4: DATA ANALYSIS AND RESULTS 36
4.1 Descriptive Analysis 36
4.1.1 Demographic of The Study 36
4.1.2 Frequencies to PETRONAS Petrol Station Weekly 39
4.1.3 Behavioral on Buying Petroleum 40
4.1.4 Overall Satisfaction of PETRONAS brand 41
4.2 Factors of Consumers Overall Satisfaction 42
4.2.1 Brand Equity 42
4.2.2 Brand Trust 43
4.2.3 Brand Reliability 44
4.2.2 Brand Loyalty 44
4.3 Inferential Statistics 45
4.3.1 The t-Test for Correlation Coefficients 46
CHAPTER 5: DISCUSSION 48
5.1 Discussion 51
5.2 Limitation of the Research 54
5.3 Recommendation of the Research 57
CHAPTER 6: SUMMARY AND CONCLUSION 59
LIST OF REFERENCES 61
APPENDICES

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 ABSTRACT

This study examines the perspective of Malaysian consumers on buying

petroleum products. This study uses PETRONAS as a case study to examine the
relationship of potential variables that could be factors of buying. The main objective of
this research is to investigate these factors that could be important to the formation brand
equity of PETRONAS petroleum product to its consumer overall satisfaction. The
identified variables in this research include brand loyalty, brand trust, perceived quality,
brand association, and other proprietary brand assets. This study focuses only within
Klang Valley because of its high populations in Malaysia. This is a quantitative study and
the research method of this study is using closed-ended questionnaires with 400 samples
from random consumers. Data collection gathers from potential consumers randomly
through face-to-face at various petrol stations and emails. This research uses primary data
from questionnaires, secondary data from newspapers and company reports, and
triangulations from other sources to cross check the information gathered. The data
collected analyses with the SPSS software and it helps to identify the relationship
between variables. The findings from this study summarizes that: First, brand equity and
brand loyalty relationship shows the extension to new consumers like creating awareness
and reassurance, which cause a reduction on marketing costs on promotion, and respond
to competitive advantage in the industry. Second, the relationship between brand equity
and brand trust suggests that PETRONAS brand is high in familiarity on brand image
among local community and it encourages the brand’s commitment to the society through
business strategies that involve consumers. Third, the brand equity and perceived quality
relationship clarifies the reasonable price offered by PETRONAS was due to consumer
buying behaviors and it suggests a potential in strategy for brand extension to other new
product line that associated to this brand. Fourth, brand equity and brand associations
relationship proposes that consumers retrieving information for PETRONAS brand was
easy, and it helps in their process of buying petroleum products. Fifth, the relationship
between brand equity and other proprietary brand assets illustrates that PETRONAS
brand has a high competitive advantage in the industry. This is because the brand
implemented product differentiation and the marketing strategy was specifically tailored
to the local cultural like packaging, promotional, and distribution approach. Finally, the
theoretical approach and conceptual framework propose in this research demonstrate that
brand equity of petroleum PETRONAS product has positive relationships with the
variables such as brand loyalty, brand trust, perceived quality, brand association and other
proprietary brand assets. The analysis result on confirmatory factor analysis and scale
reliability from questionnaires distributed summarizes the overall perception of
Malaysian consumers on this petroleum brand that these variables’ relationships provide
values to consumer by enhancing satisfactions, confidence in making decision, and
information processing and expectation of PETRONAS products. On the other hand, the
analysis result suggests some values to the company by enhancing their review of
efficiency and effectiveness of their marketing strategy, competitive advantage in the
industry, prices and margins competitions, consumer loyalty, and consideration to extent

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other petroleum products. This study has a small contribution to the managerial
implication and recommendations for future study are also discussed.

ABSTRAK

Petroleum adalah salah satu komoditi produk di Malaysia yang melibatkan

pengguna. Di Malaysia terdapat pelbagai jenis jenama produk petroleum di antaranya
PETRONAS, ESSO, SHELL, MOBIL dan BP. Walau bagaimanapun, focus utama kajian
subjek adalah jenama produk petroleum tempatan, PETRONAS. Objektif utama kajian
subjek ini ialah untuk mempelajari faktor-faktor yang telah menyumbang kepada
pembangunan ekuiti jenama produk petroleum PETRONAS kepada keseluruhan
kepuasan pengguna. Terdapat 2 jenis pembolehubah yang terlihat dalam kajian subjek
ini seperti pembolehubah tidak bersandar dan pembolehubah bersandar. Pembolehubah
tidak bersandar yang terdapat di dalam kajian subjek ini adalah kepercayaan pengguna
kepada jenama, jenama produk yang boleh dipercayai, dan kesetiaan pengguna kepada
jenama. Sementara itu, pembolehubah bersandar yang terdapat di dalam kajian ini
ialah ekuiti jenama produk. Kajian ini telah dijalankan di sekitar Lembah Klang kerana
kepadatan penduduknya. Pengguna telah dipilih sebanyak 400 orang di mana ia adalah
saiz sample kajian. Walau bagaimanapun, hanya 395 data daripada 400 kajian
pengguna tersebut dapat digunakan kerana kecuaian pengguna menjawab soalan. Set
soalan telah diagihkan kepada pengguna melalui perjumpaan bersemuka di petrol
stesen, emel, dan temuduga bersama rakan sekerja. Dalam kajian yang dijalankan,
jangkamasa pengagihan soalan dan mendapatkannya semula mengambil masa selama 2
minggu. Teknik pengumpulan data seperti data utama, data kedua dan pendekatan
komunikasi telah diadaptasi dan dirujuk melalui buku Basic Marketing Reseach
daripada Naresh K. Malhotra, 2005. Pembolehubah tidak bersandar seperti kepercayaan
pengguna kepada jenama, jenama produk yang boleh dipercayai, dan kesetiaan
pengguna kepada jenama yang terlibat telah dianalisis melalui aplikasi SPSS. Semua
hipotesis telah diterima berdasarkan analisis yang telah dibuat dalam kajian subjek ini.
Keputusan analisis data dan hipotesis yang didapati telah dibincangkan berdasarkan
kajian ini. Pendapat kajian seperti perbincangan, pembatasan kajian, dan cadangan
juga telah dibincangkan. Akhir skali, ringkasan kajian dan penutup kajian ini telah
diringkaskan.

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