Journal of Hospitality and Tourism Management 40 (2019) 114–124

Contents lists available at ScienceDirect

Journal of Hospitality and Tourism Management

journal homepage: www.elsevier.com/locate/jhtm

Brand awareness, image, physical quality and employee behavior as T

building blocks of customer-based brand equity: Consequences in the hotel
context
Özlem Sürücüa, Yüksel Öztürkb, Fevzi Okumusc, Anil Bilgihand,∗
a
The Head of Department of Tourism and Hotel Management, Sinop University, Sinop, Turkey
b
Faculty of Tourism, Gazi University, Gölbaşı-Ankara, Turkey
c
Rosen College of Hospitality Management, The University of Central Florida, Orlando, Florida, 32819, USA
d
College of Business Florida, Atlantic University, Boca Raton, FL, 33431, USA

A R T I C LE I N FO A B S T R A C T

Keywords: This study investigates the effect of Customer-Based Brand Equity (CBBE) on customer loyalty and further ex-
Branding amines the mediatory roles of customer satisfaction and trust in the hotel industry. To accomplish this goal, a
Customer-based brand equity questionnaire was developed and data was collected from 918 hotel guests of 39 five-star hotels in 10 cities in
Customer satisfaction Turkey. Results reveal that CBBE consists of brand awareness, physical quality, staff behavior, and brand image.
Trust
Study results indicate that CBBE improves customer satisfaction and trust. Findings also reveal that to build
Customer loyalty
Hotel establishment
customer loyalty, hotels should increase customer satisfaction, build trust, and develop CBBE. Theoretical and
practical implications are discussed.

1. Introduction
Customer loyalty is a key concept in the services marketing field
(Toufaily, Ricard, & Perrien, 2013). It is among the most important
assets earned by a hotel company (Kandampully, Zhang, & Bilgihan,
2015). Understanding how customer loyalty develops is an important
task for both academics and practitioners (Kandampully et al., 2015).
Branding managers are trying to develop a better understanding of the
appropriate relationships between constructs such as brand equity and
customer loyalty (Taylor, Celuch, & Goodwin, 2004). Specifically, they
struggle to come to terms with issues associated with the role of a brand
and how it effectively strengthens customer loyalty (Grewal, Levy, &
Lehmann, 2004).
Branding is significant for the hotel industry mostly because of
customer desires for a predictable product and service experience (Dev,
2009). Overall, the intangible nature of services makes branding an
important phenomenon in hotel marketing. Brands form a set of ex-
pectations in the minds of consumers. Some brands are associated with
high touch and high quality whereas some brands form reasonable
price, low level of service expectations. When a guest is choosing a
hotel, the brands in the evoked set builds certain expectations. The
hotel industry is using branding strategies to gain a competitive
advantage, and consumers are relying on hotel brands to make pur-
chasing decisions that reduce risks. With this situation in mind, mea-
suring the value of a brand from the customer's point of view becomes
an essential task for hotel marketers (Huang & Cai, 2015).
Consistent and strategic branding leads to strong brand equity.
Lodging marketers have turned their attention to brand equity because
well-known brand names usually reflect the quality of the hotel
(Brucks, Zeithaml, & Naylor, 2000). Brand equity is one of the key
concepts in brand management research (Kim, Jin-Sun, & Kim, 2008)
that refers to the value that a company generates from a product with a
recognizable name as opposed to a generic equivalent. In other words,
brand equity is formed when the product is memorable, easily re-
cognizable, trustworthy, and superior in quality and reliability. It is
simply the association with a brand name, design, and/or symbol that
enhances the value of a product beyond its functional purpose and
differentiates well-known from less-known brands (e.g., Keller, 2003).
For example, within the hotel industry, the Ritz-Carlton differentiates
itself in the luxury segment by having a strong brand equity. Strong
brand equity offers various benefits to firms. These benefits include
positive brand associations, higher cash flow, future profits, product
variety, lower operation risks, and loyalty (e.g. Aaker, 1991; Ailawadi,
Lehmann, & Neslin, 2003; Ambler, 1997; Keller, 1993; Kim & Kim,

∗
Corresponding author.
E-mail addresses: ozlemaltunoz@hotmail.com (Ö. Sürücü), oyuksel@gazi.edu.tr (Y. Öztürk), fevzi.okumus@ucf.edu (F. Okumus),
abilgihan@fau.edu (A. Bilgihan).

https://doi.org/10.1016/j.jhtm.2019.07.002
Received 10 November 2018; Received in revised form 10 July 2019; Accepted 12 July 2019
Available online 16 July 2019
1447-6770/ © 2019 Published by Elsevier Ltd on behalf of CAUTHE - COUNCIL FOR AUSTRALASIAN TOURISM AND HOSPITALITY EDUCATION
Ö. Sürücü, et al.
2005; Wong & Teoh, 2015; Yoo, Donthu, & Lee, 2000; Šeric, Gil-Saura,
& Ruiz-Molina, 2014).
In marketing literature, trust has also received special attention due
to the notable influence it has on the attainment of long-lasting and
profitable relationships (Andaleeb, 1996; Flavián, Guinalíu, & Gurrea,
2006; Morgan & Hunt, 1994; Sirdeshmukh, Singh, & Sabol, 2002). Trust
is a set of beliefs derived from a person's perceptions about certain at-
tributes. In hospitality marketing, the brand itself, and its products and
services form a perception of trust in the minds of customers. Therefore,
it is important to investigate the relationship between branding ele-
ments and trust. Similarly, satisfaction reflects a consumer's favorable
attitude and is strongly correlated with trust and loyalty. Concepts such
as brand equity, customer satisfaction, and trust are developing in-
creased relevance in generating customer loyalty. Despite the im-
portance of these concepts in hotel marketing, to our best knowledge,
no research study has analyzed the relationships among them in a
Turkish hospitality context. Hotels in Turkey fall behind in marketing
mostly due to relying on third-party partners such as tour operators and
travel agents for reservations (Baloglu & Pekcan, 2006). On one hand,
Turkey has shown a notable growth in tourism, both attracting visitors
and providing necessary facilities (Avcikurt, Altay, & Oguzhan Ilban,
2011). The lodging industry in Turkey is growing at a rapid pace
(Kuruüzüm, IpekçiÇetin, & Irmak, 2009). On the other hand, high
turnover rate of the tourism industry in Turkey causes higher costs and
lower service quality which in turn negatively effects customer loyalty.
Further limitations of Turkish lodging indusry include insufficient
technology application, inadequate demand management, misleading
and confusing advertising campaigns, weak sales capabilities, high
competitive intensity, and low levels of customer satisfaction
(Köseoglu, Parnell, & Doyle, 2015), which grants further investigations.
Moreover, emerging economies such as Turkey merit specific inquireis
as they might be different from developed Western and other in-
dustrialized economies on important social, economic, and managerial
fronts (Köseoglu et al., 2015). Having identified these gaps, the current
study focuses on developing and testing a comprehensive theoretical
model of brand equity, which explains how customers develop loyalty
to a hotel brand and how customer-based brand equity (CBBE) is built
in the Turkish hospitality context.
Given the importance of customer loyalty and brand equity, our
research further aims to identify the impact that the brand equity of
hotel enterprises has on customer loyalty. We aim to propose and va-
lidate a theoretical model of hotel marketing that enhances brand
equity with foundations in brand awareness, physical quality, staff
behavior, and brand image. We chose CBBE as the exogenous variable
because brand equity is one of the most important marketing concepts
in both research and practice (Srinivasan, Park, & Chang, 2005). CBBE
is one of the top issues in the tourism industry (Im, Kim, Elliot, & Han,
2012) and hotel context (Kim et al., 2008; Šeric et al.,2017). Never-
theless, the development of a theory of hotel brand equity is still at its
initial phase (Bailey & Ball, 2006).
The paper is organized into four main sections. First, it discusses the
CBBE theory and introduces the research constructs. Later, it develops
the conceptual framework and research hypotheses based on the asso-
ciations among proposed constructs. This section is followed by a de-
scription of the study design and data collection. Study results are then
presented and discussed. Finally, it concludes with both theoretical and
practical implications and proposes future research directions and
limitations.
2. Literature review and hypotheses development
2.1. Customer-based brand equity
Aaker (1996a) defines brand equity as a set of brand assets and li-
abilities linked to a brand, its name, and symbol that add to or subtract
from the value provided by a product or service to a firm and/or to that
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firm's customers. It is the commercial value that derives from consumer
perception of the brand name of a particular product or service, rather
than from the product or service itself. Aaker (1991) also notes that
brand equity has five dimensions: brand loyalty, brand awareness,
perceived quality, brand associations, and other proprietary brand as-
sets. Keller (1993) offers a cognitive psychology perspective and defines
CBBE as the differential effect of brand knowledge on consumer re-
sponse to the marketing efforts of the brand. Keller (1993) further
claims that brand knowledge is the key to building CBBE, which con-
sists of brand awareness and brand image. Lassar, Mittal, and Sharma
(1995) define CBBE as the development in perceived value and at-
tractiveness of a brand name; they developed the CBBE scale based on
five dimensions: performance, value, social image, trustworthiness, and
commitment.
Branding plays an important role in services since the stronger the
brand, the higher the customer's trust in the invisible purchase (Berry,
2000). Moreover, Berry (2000) argues the product is the primary brand
for goods, whereas, in services, the firm is the primary brand. His ser-
vice branding model suggests that brand equity involves brand
awareness and brand meaning (similar to the brand image in Keller’s
(1993) model). The basic antecedent of brand awareness is shaped and
controlled by the company itself via advertising or promotions. External
brand communication is the other key component of Berry’s (2000)
model and refers to how consumers gather information from un-
controlled sources such as word of mouth, electronic word of mouth,
and publicity. Additionally, Berry (2000) implies that a customer's ex-
perience with the product is another key variable in building brand
equity.
Similar studies on CBBE have been undertaken in the hospitality
field. For example, Cobb-Walgren, Ruble, and Donthu (1995) con-
ducted a study examining CBBE concept in the hotel context. The au-
thors used the perceptual constituents of Aaker’s (1991) con-
ceptualization of brand equity as adopted by Keller (1993), namely
awareness, brand association, and perceived quality. Their results show
that customer perception is influenced by the psychological and phy-
sical features of the product. In return, this perception affects the brand
equity and, finally, brand equity leads to purchase intention. Brand
association, brand awareness, and perceived quality are significantly
correlated with purchase intention; furthermore, they positively influ-
ence customer preference and purchase intention. Prasad and Dev
(2000) developed a customer-centric brand equity index for hotels
based on brand awareness and brand performance. They highlight that
building brand equity is a key driver of a hotel's success. Muller (1998)
examined high-quality products/services, service delivery, and sym-
bolic and evocative images as three key factors of building CBBE in the
restaurant industry. His results underline that the successful combina-
tion of these three fundamental elements provides an opportunity for
restaurateurs to gain customer loyalty. Konecnik and Gartner (2007)
incorporated Cai's (2002) branding model and Gartner's (1994) image
model into the CBBE dimensions of a destination. Hsu et al. (2012)
added the construct of trust in the CBBE model for luxury hotel brands
in China as a result of focus-group interviews and surveys with luxury
hotel managers and customers in China. CBBE requires more research in
the context of growing international activities of tourists and hospitality
businesses (Pappu & Quester, 2006). Huang and Cai (2015) developed
and tested a CBBE model for multinational hotel brands, which ex-
amined the effects of brand knowledge on consumer response to brands.
2.2. Brand awareness
Brand awareness is a fundamental component of brand equity
(Aaker, 1991; Berry, 2000; Cobb-Walgren et al., 1995; Keller, 1993;
Shen, Yuan, Zhang, & Zhao, 2014; Yoo & Donthu, 2001; Yoo et al.,
2000). It reflects the salience of a brand in the customer's mind (Aaker,
1996b). It has a significant effect on consumer choices (Hoyer & Brown,
1990; Lin, 2013) and, therefore, is an important concept both in
Ö. Sürücü, et al.
marketing and consumer behavior (Barreda, Bilgihan, Nusair, &
Okumus, 2015). Brand awareness includes “consumer recognition, re-
calls, top-of-mind awareness, knowledge dominance, and recalls per-
formance of brands, as well as brand attitude” (Kim et al., 2008).
Valkenburg and Buijzen (2005) point out that brand awareness is an
individual's knowledge of a particular brand and is not limited to cus-
tomer knowledge of the brand name and previous exposure to the
brand; rather, it involves linking the brand – brand name, logo, symbol,
and so forth – to certain memory associations (Hoeffler & Keller, 2003).
Keller (1993) argues that brand awareness consists of two main com-
ponents, “brand recognition” and “brand recall.” Brand recognition is a
customer's ability to confirm prior exposure to the brand, while brand
recall signifies the unassisted retrieval of the brand from memory.
Additionally, a high level of brand awareness has several advantages in
the customer purchase decision-making process such as learning ad-
vantage, consideration advantage, and choice advantage. Seetharaman,
Nadzir, and Gunalan (2001) indicate that the demand for a certain
brand increases when more awareness and acceptance of the brand is
created among customers.
In accordance with the literature review, the following key points
can be stated regarding brand awareness. First, brand-related logos,
names, colors, designs, and all images influence brand awareness
without even purchasing the brand. Second, successful brand awareness
provides differentiation of the product from other similar products and
competitors. Finally, strong brand awareness, as one of the components
of CBBE, leads to a higher brand preference and purchase intention. In
short, brand awareness is the first step to creating brand equity (Buil,
Martínez, & de Chernatony, 2013). Further, awareness is a first and
necessary step to loyalty (Konecnik, 2006). The higher the level of
awareness the more dominant is the brand (San Martín, Herrero, &
García de los Salmones, 2018). Once the consumer identifies a brand,
he/she will assign a meaning to the brand and build associations. Brand
awareness stimuluses the formation of such associations, and therefore,
it is to be expected that a greater awareness of a hotel will enhance the
perception of its brand equity. Brand awareness may increase brand
equity over time (Harrington, Ottenbacher, & Fauser, 2017). Based on
previous research, we consider brand awareness as a key component of
CBBE and the following research hypothesis is posited:
H1. : Hotel brand awareness has a positive relationship with CBBE.
2.3. Perceived quality
Perceived quality refers to the customer's evaluation of a product or
service as superior compared to other alternatives (Aaker, 1991;
Zeithaml, 1988). The perception of quality is sometimes gathered
through prior use or consumption of a given product or service. How-
ever, previous experiences are not the only determinants of quality
perceptions. When customers do not have any previous experience with
a product or service, they obtain an opinion on the quality of a product
or service through clues like brand name, price, and brand advertise-
ments (Dodds, 2002). Furthermore, in recent years, e-WOM has proved
to be effective on brand perceptions (Yan, Zhou, & Wu, 2018). In to-
day's hotel business, social media and online platforms, such as Tri-
pAdvisor, play a critical role in quality and service perception as well as
forming customers' expectations. e-WOM impacts the decision-making
process, perceived trustworthiness/credibility, risk reduction, product
acceptance, loyalty, hotel/brand awareness, hotel comparison and
booking intention (Cantallops & Salvi, 2014). Zeithaml (1988) states
that perceived quality differs from objective quality and affects the
customer's preferences.
Aaker and McLoughlin (2010) state that perceived quality may be
two-fold as “product quality” and “service quality.” They claim that the
perceived quality of a product has six components including perfor-
mance, convenience, specifications of the product, customer support,
the quality of purchasing and use processes, and aesthetical design of
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the product. On the other hand, service quality is mostly characterized
by perceived efficiency, the ability to respond to demand, and empathy.
Although it is hard to analyze and identify customer perceptions about
the quality of service, there are various models for service quality
measurements. These models include: the Technical and Functional
Quality Model (Grönroos, 1984), Vacancy Model SERVQUAL
(Parasuraman, Zeithaml, & Berry, 1985), Conceptual Model of Service
Quality (Haywood-Farmer, 1988), Synthesized Service Quality Model
(Brogowicz, Delene, & Lyth, 1990), SERVPERF Service Quality Model
(Cronin & Taylor, 1992), Ideal Value Service Quality Model (Mattsson,
1992), Evaluated Performance and Normed Quality Model (Teas,
1993), Quality and General Impact Model (Dabholkar, Thorpe, & Rentz,
1996), Customer Value and Customer Satisfaction Model (Oh, 1999),
Internal Service Quality Model (Frost & Kumar, 2000) and Internal
Service Quality VZA Model (Soteriou & Stavrinides, 2000).
This study builds upon the broadly used SERVQUAL model
(Parasuraman et al., 1985). The SERVQUAL model suggests that the
perceived service quality is the difference between the individual's ex-
pectations about the provision of the product and service and the firm's
performance. It is comprised of five characteristics: “Tangibles”, “Re-
liability”, “Responsiveness”, “Assurance”, and “Empathy”. Kayaman
and Araslı (2007) analyzed the mutual relationship between compo-
nents of CBBE in the hotel context. They analyzed the perceived service
quality of hotel enterprises under five dimensions of the SERVQUAL
scale and found that physical specifications and keenness are the basic
components characterizing perceived service quality and customer
loyalty. Nam, Ekinci, and Whyatt (2011) found physical quality and
personnel behaviors as important components of CBBE. The interaction
between personnel of a hotel and its customers affects brand equity
(Biedenbach, Bengtsson, & Wincent, 2011). In service-based organiza-
tions, personnel are the face of the organization as they interact with
the customer in service encounter (Davies, Chun, & Kamins, 2010). The
interaction between the personnel and the customers involves both
experiences of how the professional employees engage in their workrole
to meet customers' expectations and the emotional reactions of the
employees during the interaction with the customers (Biedenbach et al.,
2011). Consequently, brand equity can be enhanced or diminished after
a service encounter depending to the extent the personnel act upon
their role expectations and develop affective relationships with the
customers. Drawing on Nam et al. (2011), Çiftçi et al. (2016) and Lin
(2015), which dealt with service quality within the scope of “physical
quality” and “personnel behavior” and concluded that these aspects
make up a significant part of CBBE, we argue that both physical quality
and personnel behavior will impact CBBE.
The consumption of services is a process consumption rather than
outcome consumption, and the inseparability of production and con-
sumption of most services involves co-production and consumption
(Grönroos, 2004; Zeithaml, Parasuraman, & Berry, 1985). Therefore,
quality perception related to a hotel is not only affected by physical
elements and ambiance of the hotel but also by the behavior, compe-
tence, and knowledge level of its employees. Hence, the current study
deals with perceived quality as a key determinant of CBBE in two di-
mensions: physical quality and employee behaviors.
H2. Physical quality of hotels has a positive relationship with CBBE.
H3. Hotel personnel behaviors have a positive relationship with CBBE.
2.4. Brand image
Kotler (2002) defines image as the set of beliefs, ideas, and im-
pressions that a person develops for an object and states that attitudes
and actions toward an object, such as a product or service, are highly
conditioned by that object's image. Keller (1993) describes the brand
image as the perceptions about a brand as reflected by the brand as-
sociations held in consumer memory. Brand associations are
Ö. Sürücü, et al.
informational nodes linked to the brand node in a person's memory.
They contain the meaning of the brand for consumers and take different
forms. These types of brand associations form the brand image, which
includes product-related or non-product-related attributes; functional,
experiential, or symbolic benefits; and overall brand attitudes.
Most consumers have stereotypic images of brands such as tradi-
tional versus modern, economic versus luxury, formal versus informal,
and so forth (Sirgy, 1985). Price, quality, and satisfaction are the ele-
ments correlated with the perceptions of brand image. A key part in
tourists’ valuations of hospitality establishments is hotel brand image
(Lee, Oh, & Hsu, 2017). Brand image is so important that it can even
lead customers to differentiate hotels with the same star category from
each other (Manhas & Tukamushaba, 2015).The brand image is char-
acterized through marketing activities such as advertisements and
promotions before the customer uses the product. Brand image is
considered an important component of CBBE in previous studies (Hyun
& Kim, 2011; Jara & Cliquet, 2012; Kayaman & Araslı, 2007; Keller,
1993; Muller, 1998). This study considers the brand image as a key
component of CBBE, so we propose the following research hypothesis:
H4. Hotel brand image has a positive relationship with CBBE.
2.5. The effect of CBBE on hotel customer satisfaction, customer loyalty,
and trust
All commercial businesses share an ultimate goal of being profitable
and maintaining their existence. Simultaneously, consumers in the
marketplace are seeking to obtain maximum benefits with minimum
costs. Consumers expect that a product or service they purchase or
prefer meets their requirements in a desirable way. Customer satisfac-
tion could be defined as meeting or exceeding customer expectations of
a product or service. When expectations are met, satisfaction will de-
velop (Oliver, 1980). In hotel businesses, guest satisfaction has much to
do with a hotel brand's performance (Assaf, Josiassen, Cvelbar, & Woo,
2015). Bloemer and Ruyter (1998) looked at the correlation between
image, customer satisfaction, and loyalty and found no direct correla-
tion between image and customer loyalty. Instead, they reconfirmed
that customer loyalty is linked to customer satisfaction.
Iglesias and Guillen (2004) analyzed the impact of quality and
pricing on customer satisfaction and found that a customer's quality
perception has an important impact on customer satisfaction in res-
taurants. Keith, Lee, and Lee (2004) found that when services are
consumed at the place of production, the producer and consumer in-
teract and quality perception during the process of production and
consumption will likely satisfy the customer. As a result, the customer
will likely repeat his/her purchase behavior with the enterprise (Keith
et al., 2004). Although brand awareness does not have a direct effect on
customer satisfaction, it can encourage the consumers to purchase the
brand. It nurtures the strength of a brand's presence in the consumer's
mind (Aaker, 1996a). It also increases the capacity of the decision-
makers to distinguish or recall a brand. Seetharaman et al. (2001)
identify that when brand awareness is high, the demand for that spe-
cific brand will also increase.
In light of these studies, it is proposed that the high rate of CBBE
originating from brand awareness, perceived quality, and brand image
will promote customer satisfaction. Thus, we propose the following
research hypothesis:
H5. There is a positive relationship between hotel CBBE and customer
satisfaction.
Early customer loyalty research treated loyalty simply as the ten-
dency to make repeat purchases and measurements originated from this
premise. However, later studies noted that this tendency was not suf-
ficient to define the concept of loyalty (Reinartz & Kumar, 2000). The
“behavioral loyalty” characterized by repeat purchases can be classified
as “artificial loyalty” (Dick & Basu, 1994). In other words, the
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Journal of Hospitality and Tourism Management 40 (2019) 114–124
behavioral loyalty of customers may not suffice or may not even be
observed in the face of better alternatives to products or services. In
contrast, attitudinally loyal customers feel an emotional intimacy and
adherence to the brand; hence they are not easily affected by alter-
natives (Shankar, Smith, & Rangaswamy, 2003). Customer loyalty is
defined based on behavioral and physical dimensions (Kumar & Shah,
2004; Schoenbachler, Gordon, & Aurand, 2004). This study treats
customer loyalty as a function of behavior and attitude. Lin, Huang, and
Lin (2015) investigated the effect of CBBE dimensions on customer
repurchase intention and concluded that brand equity is a key ante-
cedent of repurchase intention. A brand with positive CBEE may cause
consumers to return, spread favorable word-of-mouth, and be less
sensitive to price increases (Aaker, 1991; Biel, 1992; Keller, 1993).
Hence, the following alternative research hypothesis is proposed:
H6. There is a positive relationship between hotel CBBE and customer
loyalty.
It would be appropriate to assume that the tourism industry is very
different from other industries in terms of both customer purchasing
behaviors and structural characteristics of the services. First, as noted
by Berry (2000), risks in the tourism industry are usually difficult to
evaluate before buying services. Second, risk refers to a subjectively-
determined expectation of loss; the greater the probability of loss, the
greater the perceived risk by an individual (Mitchell, 1999). If tourists
are dissatisfied with products and services, loss of non-recoverable time
and money can come into question. Third, an increase in perceived risk
may lead to decrease in purchase intention (Wu, Yeh, & Hsiao, 2011)
and a customer's willingness to pay for the product (Tsiros & Heilmen,
2005). Due to these reasons, building trust becomes a critical success
factor for hotel brands.
Hotel businesses can organize various activities such as price
guarantees to diminish the perception of risk and establish trust.
However, they cannot assume that customer trust will be formed prior
to or without buying and using a product or service. Keller (1993)
suggests that customer trust is affected by the use of a product/service
and customer satisfaction. In both cases, experience is at play in the
aftermath of consumption. In this sense, we can state that CBBE and
customer satisfaction have an impact on brand trust. Hence, the fol-
lowing hypotheses are proposed:
H7. There is a positive relationship between hotel CBBE and trust.
H8. There is a positive relationship between hotel customer satisfaction and
trust.
2.6. The effect of customer satisfaction on customer loyalty
Previous research demonstrates that customer satisfaction and trust
have significant effects on building customer loyalty (e.g., Beloucif,
Donaldson, & Kazancı, 2004; Flint, Blocker, & Boutin, 2011; Chen,
2012; Ranjbarian, Dabestani, Khajeh, & Noktehdan, 2011; Mohammad,
2012; Thakur & Singh, 2012). Although many previous studies posit
that brand equity has a direct influence on brand loyalty, few studies
have examined the effect that customer satisfaction has on the re-
lationship between CBBE and brand loyalty. Our research investigates
the relationship between CBBE and brand loyalty based on these
mediators: customer satisfaction and trust.
Many studies have investigated the benefits of customer satisfaction
and explored ways to establish customer satisfaction. Ravald and
Grönroos (1996) state that customer satisfaction is one of the most
important criteria in forming customer loyalty, so a satisfied customer
may have prolonged loyalty to the enterprise compared to a dissatisfied
customer. A review of previous studies shows it is possible that cus-
tomer satisfaction will have a positive impact on customer loyalty, re-
peat purchases (e.g., Beloucif et al., 2004; Chen, 2012; Flint et al., 2011;
Qiu, Ye, Bai, & Wang, 2015; Russell-Bennett et al., 2007; Thakur &
Ö. Sürücü, et al.
Singh, 2012), and positive WOM increases in financial performance of
enterprises (Anderson, Fornell, & Lehmann, 1994; Kandampully &
Suhartanto, 2000; Noyan & Şimsek, 2011). WOM has a sound influence
on consumer behavior and recently e-WOM has been similarly shaping
consumers’ perceptions towards brands (Gupta & Harris, 2010). e-WOM
may improve quality control, provide opportunities for new procedures,
customer interactions, specific marketing strategies, online reputation
comparison and building loyalty (Cantallops & Salvi, 2014). From the
perspective of hospitality enterprises, maximizing customer satisfaction
is a critical factor in ensuring customer loyalty. Therefore, we propose
the following research hypothesis:
H9. There is a positive relationship between hotel customer satisfaction and
customer loyalty.
2.7. The effect of trust on hotel customer loyalty
Building trust with guests is an important requirement for hospi-
tality organizations. Laroche, McDougall, Bergeron, and Yang (2004)
express that the intangibility of services increases customer risk per-
ceptions. Rees and Gardner (2003) state that trust is critical as it re-
duces risks in services and is not limited to its impact on risk reduction
and the purchase decision-making process. Pritchard, Havitz, and
Howard (1999) analyze trust involved in airport and hotel enterprises
and find that trust has direct and positive impacts on establishing
customer loyalty. There are various other studies that have analyzed the
impact of customer trust on obtaining customer loyalty (e.g., Berry,
1995; Chaudhuri & Holbrook, 2001; Gounaris, 2005; Martin,
Guttierrez, & Camarero, 2004; Mohammad, 2012; Ranjbarian et al.,
2011). In this context, we propose the following hypothesis:
H10. There is a positive relationship between trust and hotel customer
loyalty.
3. Research methodology
3.1. Research model
This study aims to identify the impact of hotel enterprises’ CBBE on
customer satisfaction, trust, and loyalty. Further, it studies the med-
iating role of customer satisfaction and trust on customer loyalty. The
research model is indicated in Fig. 1. The exogenous variable in the
research model is CBBE and the endogenous variable is customer loy-
alty.
3.2. Data collection and sample
Data was collected from 39 five-star hotels throughout Turkey in the
cities of Ankara, Antalya, Aydın, Balıkesir, Bolu, Bursa, İstanbul, İzmir,
Mersin, and Muğla. Of the 2,340 questionnaires distributed to hotel
guests, 1,007 responses came back. The front office managers of the
hotels had been contacted before and the questionnaires were given to
the managers who agreed to deliver them to the customers during
Fig. 1. Research model.
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Journal of Hospitality and Tourism Management 40 (2019) 114–124
check-out. Of those responses, 89 were not complete enough to be used
for further analysis, resulting in a 39% net response rate (n = 918
questionnaires).
3.3. Measurement
Study constructs were measured using statements from previous
research. All items were measured using 7-point Likert-type scale that
anchored from (1) strongly disagree to (7) strongly agree. The awareness
construct consists of five statements adapted from Yoo et al. (2000),
Yoo and Donthu (2001), and Washburn and Plank (2002). The service
quality construct consists of six physical qualities and six personnel
behavior statements taken from Parasuraman et al. (1985), Gabbie,
Martin, and O’Neil (1996), Ekinci (2001) and Madanoğlu (2005). The
brand image construct consists of eight statements adapted from Kim
and Kim (2005), Kayaman and Araslı (2007), and Lee and Lockshin
(2011). The customer satisfaction construct consists of two statements
adapted from Oliver (1980) and Brady, Cronin, Fox, and Roehm (2008).
The trust construct consists of five statements adapted from Morgan and
Hunt (1994), Hsieh and Hiang (2004), Matzler, Grabner-Krauter, and
Bidmon (2008). Finally, the loyalty construct consists of eight state-
ments adapted from Dick and Basu (1994), Yoo and Donthu (2001),
Chaudhuri and Holbrook (2001), and Sudhahar, Israel, Britto, and
Selvam (2006). The questionnaires were translated into the German,
English and Persian by sworn-in translators.
3.4. Data analysis
Structural Equation Modeling (SEM) was employed to test the re-
search hypotheses using LISREL 8.80. SEM has become one of the most
commonly used methods in marketing research (Baumgartner &
Homburg, 1996; Martínez-López, Gázquez-Abad, & Sousa, 2013), par-
ticularly for estimating causal models with latent variables and pro-
posed hypotheses. SEM can simultaneously test a set of interrelated
hypotheses by estimating the relationships between multiple in-
dependent and dependent variables in a structural model (Gefen &
Straub, 2000).
4. Results of research
4.1. Descriptive results
Table 1 shows the respondents' demographic characteristics. Almost
half of the respondents were males (51.7%) with an associate/under-
graduate degree (47.3%). While the nearly half of the respondents are
Turkish (43.2%), the rest are English, German and Persian with 39.5%,
16.9% and 0.3%, respectively. The hotels in Ankara, Balıkesir, Bolu,
Bursa and Istanbul are urban hotels, 29.5% in total, the ones in other
cities make up the holiday/beach hotels (70.5%).
4.2. Model &hypothesis testing
To check the validity of measurements, a confirmatory factor ana-
lysis was deployed. Study results for the initial measurement model
demonstrated a poor model fit. Consequently, large standardized re-
siduals (i.e., residuals that are greater than 3.0) have been identified
subsequent to the examination of the LISREL results. Problematic items
were deleted and the measurement model was re-evaluated. In parti-
cular, two of brand awareness items, two of physical quality items, two
of personnel behavior items, two brand image items, two trust items
and five customer loyalty items were taken out from the analysis. In
total, 24 items remained in the measurements. As illustrated in Fig. 2, a
revised measurement of each item has a loading between 0.80 (item SB
16) and 0.95 (CS 2) on the seven factors and each loading was statis-
tically significant. Study results are presented in Fig. 2.
Table 2 shows the mean, standard deviation, standardized loading,
Ö. Sürücü, et al. Journal of Hospitality and Tourism Management 40 (2019) 114–124

Table 1 support that brand image has a positive impact on CBBE, as shown in
Demographic characteristics of sample (n = 918). H4. The measured standardized loading is 0.96 with a t-value of 31.03.
Demographic Characteristics f % The measured coefficient is 0.93 (R2), significant at the p < 0.001
level.
Gender Male 443 48.3 The results of the path analysis indicate that CBBE and customer
satisfaction are related and H5 is supported (SL: 0.90, t-value: 31.57,
Female 475 51.7
p < 0.01). H6 which states that CBBE has a positive effect on customer
Age Less than 20 67 7.3 loyalty (SL: 0.27, t-value: 4.57, p < 0.05) was supported. In addition,
21–30 279 30.4 one of the main findings of this study is related to trust. A combination
31–40 262 28.5 of CBBE and customer satisfaction explains 90% of customer loyalty
41–50 185 20.2
51–60 72 7.8
(R2: 0.90). Finally, the proposed model (CBBE + customer satisfac-
More than 61 53 5.8 tion + trust) explains 87% of customer loyalty (R2: 0.87).
Education Middle School 59 6.4 CBBE and customer satisfaction are found to influence trust posi-
High School 319 34.7 tively. Customer trust related to a brand is shown by a CBBE 0.53 unit
Associate/Undergraduate Degree 434 47.3
and a customer satisfaction 0.44 unit. Thus, H7 and H8 are supported
Postgraduate Degree 106 11.5
Language Turkish 397 43.2 (H7; SL: 0.53, t-value: 11.45, p < 0.05. H8; SL: 0.44, t-value: 9.93,
English 363 39.5 p < 0.01). It posited that customer satisfaction has a significantly
German 155 16.9 positive impact on customer loyalty. This hypothesis (H9) is also sup-
Persian 3 0.3 ported by findings (SL: 0.14, t-value: 2.58, p < 0.05). A one-unit in-
City Ankara 86 9.4
Antalya 230 25.1
crease/decrease in the customer satisfaction will cause a 0.14-unit in-
Aydın 187 20.4 crease/decrease in customer loyalty. Finally, H10, which states that
Balıkesir 20 2.2 trust has a positive effect on customer loyalty, was supported (SL: 0.55,
Bolu 54 5.9 t-value: 8.09, p < 0.01).
Bursa 21 2.3
İstanbul 89 9.7
İzmir 52 5.7 4.3. Discussion and conclusions of results
Mersin 52 5.7
Muğla 127 13.8 This study aims to measure the direct and indirect effect of CBBE on
customer loyalty in the hotel industry in Turkey. This study particularly
investigates (i) the effect of CBBE on customer satisfaction, trust, and
and reliability of our study. Calculated t-values related to the standar- customer loyalty, (ii) the effect of customer satisfaction on trust and
dized loadings of all items are greater than 1.96. These results indicate loyalty, (iii) the effect of trust on customer loyalty, and (iv) the indirect
that all the standardized item loadings are statistically significant and effect of CBBE on customer loyalty through the mediating role of cus-
related to the nominated constructs. Cronbach's Alpha values for brand tomer satisfaction and trust. It proposes and tests an integrative theory-
awareness is 0.897; physical quality is 0.892; personnel behavior is driven model. The enhancement of CBBE is an inevitable part of the
0.916; brand image 0.934; trust is 0.950; customer satisfaction is 0.944; process of hotel brand management. The path-analytic results regarding
and finally, customer loyalty is 0.938. the effect of CBBE on customer satisfaction, trust, and customer loyalty
The means of items related to CBBE dimensions (i.e., brand received empirical support from previous and recent studies (e.g.,
awareness, physical quality, personnel behavior, and brand image) Iglesias & Guillen, 2004; Keller, 1993; Lin et al., 2015). Our results
range from 5.02 to 5.64. The means for items related to trust range from reveal that customer satisfaction exerts a significantly positive effect on
5.25 to 5.36; those for customer satisfaction range from 5.41 to 5.48; trust and loyalty. This finding is consistent with results reported in
those for customer loyalty range from 5.28 to 5.36. Several goodness of other studies (e.g., Chen, 2012; Wu et al., 2011). Satisfied guests are
fit indices were used in assessing the research models. The most com- more likely to stay loyal to the hotel brand. Customer satisfaction and
monly used indices are the likelihood ratio chi-square test (χ2), {χ2/ trust were tested as the mediators in the relationship between CBBE and
sd.}, Root-mean-square error approximation (RMSEA), and Goodness- customer loyalty. The path-analysis results demonstrate that CBBE is
of-fit index (GFI). A ratio of χ2 to degrees of freedom (χ2/df) value less more successful in creating customer loyalty through customer sa-
than 5 indicates an acceptable fit between a hypothesized model and tisfaction and trust. Our results offer specific theoretical and practical
sample data. RMSEA values less than 0.05 indicate close fit while values implications, which are discussed below.
ranging from 0.05 to 0.08 indicate a reasonable fit and values greater
than 0.09 indicate a poor fit (MacCallum, Browne, & Sugarwara, 1996). 4.4. Theoretical implications
As shown in the revised study in Table 3, the value of the ratio between
χ2 and the degrees of freedom (χ2/df) was 2.86, indicating an accep- Our research provides several important theoretical contributions.
table fit for the data. The other indices, RMSEA = 0.048, NFI = 0.99, Brand equity is important for companies’ performance. The CBBE
NNFI = 0.99, CFI = 1, GFI = 0.94, and AGFI = 0.92, show a good fit. concept and its dimensions were re-evaluated in a hotel branding
H1 predicts that brand awareness has a significantly positive impact context. When a hotel company wants to understand what makes up its
on CBBE and was statistically supported. There is a significant positive brand, they need to go deeper than looking at its logo and tangible
relationship between brand awareness and CBBE. The measured stan- factors. CBBE calls for a broader sense of branding. The surroundings,
dardized loading is 0.80 with a t-value of 24.10. This value demon- lobbies, guest rooms, amenities all form the physical quality of the
strates that a one-unit increase in the brand awareness will cause 0.80- brands and is a vital component of CBBE. Furthermore, employee be-
unit increase in the CBBE. In addition, the measured coefficient is 0.65 havior (e.g., phrases used in conversation with customers), courtesy,
(R2), significant at the p < 0.001 level. H2 and H3 are also supported attentiveness, authenticity, social interactions, and respect form helping
by the findings. Physical quality and personnel behavior have a sig- a stronger CBBE. Current research reviewed the definitions, theories,
nificantly positive impact on CBBE. The measured standardized loading and findings related to the CBBE concept. Contrary to some studies
is 0.95 for physical quality with a t-value of 27.63 and 0.90 for per- (e.g., Aaker, 1991; Nel, North Ernest, Myburg, & Hern, 2009; Yoo &
sonnel behavior with a t-value of 28.90. The measured coefficient is Donthu, 2001), customer loyalty is a possible outcome of CBBE in a
0.90 (R2) for physical quality and 0.80 (R2) for personnel behavior, hotel context.
significant at the p < 0.001 level. Similarly, the research findings We suggest that brand awareness, physical quality, personnel

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Fig. 2. Results of the confirmatory factor Analysis

Note. CBBE: Customer-based brand Equity, BA: Brand Awareness, PQ: Physical quality,
SB: Personnel behavior, BI: Brand Image, T: Trust, CS: Customer Satisfaction,
CL: Customer loyalty.

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Fig. 3. LISREL analysis of the hypothetical model.

Table 2 Table 3
Mean, standard deviation, standardized loading, and reliability. Models fit measurement statistics.
Factor/Items Mean Standard Standardized t-value Cronbach's Fit Indices Model Measure Result
Deviation Loading Alpha
χ 2 / df 2.86 χ2 Acceptable Fit
2≤ df ≤3
Brand Awareness 0.897
RMSEA 0.048 0 ≤ RMSEA ≤ 0.05 Good Fit
BA1 5.04 1.650 0.85 -
BA2 5.08 1.619 0.87 32.88 NFI 0.99 0,95 ≤ NFI ≤ 1,00 Good Fit
BA3 5.02 1.656 0,86 32.53 NNFI 0.99 0,97 ≤ NNFI ≤ 1,00 Good Fit
CFI 1 0,95 ≤ CFI ≤ 1,00 Good Fit
Physical Quality 0.892 GFI 0.94 0,95 ≤ GFI ≤ 1,00 Good Fit
PQ6 5.41 1.458 0.81 - AGFI 0.92 0,90 ≤ AGFI ≤ 1,00 Good Fit
PQ8 5.33 1.496 0.85 30.14
PQ9 5.33 1.511 0.81 28.10 The proposed hypotheses were tested by examining the path coefficients of the
PQ11 5.38 1.547 0.82 29.79 SEM. Table 4 shows the results and the LISREL analysis of the hypothetic model
is illustrated in Fig. 3. All the hypotheses presented in the study are found to be
Personnel 0.916 statistically significant and supported at the level 0.05 and/or 0.01.
Behavior
SB12 5.44 1,450 0.88 -
SB13 5.42 1.464 0.89 38.09
Table 4
SB14 5.42 1.481 0.86 36.19 Linear structural relations and mathematical forms.
SB16 5.42 1.522 0.80 31.39
Hypotheses Standardized Loading t-value Results

Brand Image 0.934 H1: Brand Awareness and CBBE 0.80 24.10** Supported
BI19 5.36 1.541 0.86 - H2: Physical Quality and CBBE 0.95 27.63** Supported
BI20 5.64 1.421 0.84 33.75 H3: Personnel Behavior and CBBE 0.90 28.90** Supported
BI21 5.39 1.607 0.86 35.40 H4: Brand Image and CBBE 0.96 31.03** Supported
BI22 5.54 1.484 0.87 36.02 H5: CBBE and Customer 0.90 31.57** Supported
BI23 5.52 1.497 0.87 36.05 Satisfaction
H6: CBBE and Loyalty 0.27 4.57* Supported
Trust H7: CBBE and Trust 0.53 11.45* Supported
T1 5.25 1.565 0.82 - 0.950 H8: Customer Satisfaction and 0.44 9.93** Supported
T2 5.25 1.590 0.92 46.70 Trust
T3 5.36 1.531 0.90 45.60 H9: Customer Satisfaction and 0.14 2.58* Supported
Loyalty
Customer 0.944 H10: Trust and Loyalty 0.55 8.09** Supported
Satisfaction Mathematical Forms of Structural Relations R2
CS1 5.41 1.574 0.94 - CBBE = 0.80 × BA 0.65
CS2 5.48 1.579 0.95 57.15 CBBE = 0.95 × PQ 0.90
CBBE = 0.90 × SB 0.80
Customer Loyalty 0.938 CBBE = 0.96 × BI 0.93
CL1 5.28 1.703 0.92 - TRUST = 0.44 × CS + 0.53 × CBBE 0.90
CL2 5.36 1.628 0.91 45.90
LOYALTY = 0.27 × CBBE + 0.14 × CS + 0.55 × TRUST 0.87
CL3 5.36 1.685 0.92 47.20
Statistically significant at the level*0.05; **0.01.
Note: CBBE: Customer-Based Brand Equity, BA: Brand Awareness, PQ: Physical
behavior, and brand image are key determinants of CBBE. Next, the Quality.
antecedents of customer loyalty in the hotel industry were examined. SB: Personnel Behavior, BI: Brand Image, T: Trust, CS: Customer Satisfaction.
Customer satisfaction and trust posited as mediator variables that im- CL: Customer Loyalty.
pact customer loyalty. The direct effect of CBBE on customer loyalty
exists, but it is rather limited. CBBE is more fruitful in creating customer customer experiences the product/service. If the brand meets or ex-
loyalty through customer satisfaction and trust. All three constructs ceeds customer expectations, the experience with the brand will result
(i.e., CBBE, customer satisfaction, and trust) are found to have a posi- in customer satisfaction. Our research findings indicate that CBBE and
tive impact on customer loyalty. Trust is found to be the most important customer satisfaction together have a significant effect on customer
variable amongst proposed variables in creating customer loyalty. trust. These findings parallel previous studies that suggest customer
CBBE may provide a sense of high quality, positive image, and satisfaction is a key determinant of customer loyalty (Beloucif et al.,
strong awareness. However, actual perceptions will occur after the 2004; Chen, 2012; Flint et al., 2011; Nam et al., 2011; Ravald &

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Grönroos, 1996; Russel-Bennett, McColl-Kennedy, & Coote, 2007;
Thakur & Singh, 2012) and trust (Berry, 1995; Chaudhuri & Holbrook,
2001; Gounaris, 2005; Martin et al., 2004; Mohammad, 2012; Morgan
& Hunt, 1994; Pritchard et al., 1999; Ranjbarian et al., 2011).
4.5. Managerial implications
This study also offers several managerial implications. Nowadays, a
highly competitive environment causes the product design to move
away from its functional qualities. Numerous substitutable and imitable
products are available in the marketplace. A hotels room interior de-
sign, furnishings, bedding and amentieis can be easily imitiated by
competitors. However, it is more difficult to replicate the intangible
components of a brand. Hence branding and creating loyalty have be-
come key factors in achieving business objectives. A successful brand
equity strategy should be implemented for gaining brand loyalty.
Marketing executives should be aware that positive brand image is the
most important determinant of CBBE. Enhancing the physical en-
vironment, brand awareness, and personnel behavior are other key
determinants of CBBE. Managers should invest in marketing activities
such as advertising and promotions to enhance these four dimensions.
Hotels should invest in improving their staff behavior. This could be
done with the proper recruitment of passionate team members, em-
ployee empowerment, motivation, proper orientation, and training. The
physical quality and atmosphere of a hotel also play an important role
in creating CBBE.
Next, creating a positive brand image is important for practitioners.
A brand is an identity and people want to be socially connected to the
brands they support. The brand image should mirror a customer's de-
sired image. Hence, it is crucial to have a brand identity. Images of a
hotel brand do not only include design, architecture, logo, and furniture
but other very important details that distinguish one hotel from an-
other. These details can include a wide spectrum of tangibles from
shampoo bottles to rental bikes or magazines to gift shop items. In
short, to create CBBE hotels need to create an image.
Marketers also need to create brand awareness. While advertising is
useful for creating awareness, hotel marketers should also consider the
fact that consumers rely on e-WOM. e-WOM is effective on brand per-
ceptions and it increases consumer's power over brands. It also in-
creases consumers' power over each other. In today's connected world,
choices are constrained by groupthink. Most factors we discussed in the
current research model could be influenced by the online reviews,
posts, and comments. They impact brand awareness directly and have
an influence on the brand image. Social media and online travel plat-
forms are forming customers' expectations. e-WOM is significant in the
decision-making process as it entices perceived trustworthiness and
credibility, awareness, product acceptance, loyalty and booking inten-
tion. Our findings reveal that brand awareness is a vital part of CBBE.
Finally, having CBBE is important but not enough to create customer
loyalty. Fulfilling the promises presented through marketing activities
is a key to creating brand-oriented customer satisfaction and trust.
Brand experiences that result from customer satisfaction and trust are
required for gaining customer loyalty.
4.6. Limitations and future research
There exist some limitations in the current research. First, data was
collected from tourists who visited Turkey and stayed at 5-star hotels.
This study did not consider the price of the hotel service. Future studies
could investigate the impact of different pricing points on branding
elements. Price conscious guests may a different viewpoint regarding
brand image. This research also ignored cultural differences between
tourists. Different cultures may have different perceptions toward
branding and some cultures may be more prone to loyalty. Future re-
search is advised to examine the intercultural differences about CBBE in
the tourism and hotel industry. In future research, the financial
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Journal of Hospitality and Tourism Management 40 (2019) 114–124
performance may be included in a model. We did not have access to the
financial reports of the hotels. Future studies may investigate whether
investing in CBBE results positively financially. Factors such as personal
characteristics, ranging from nationality to education and motivation
play a substantial role in forming loyalty habits (Neuts, Romao,
Leeuwen, & Nijkamp, 2013) along with the quality of the experience,
and price (Moon & Han, 2019). Future studies may incorporate per-
sonal characteristics. The scale used in the study is distributed in
English, German, Persian, and Turkish. Language differences may cause
a decrease in clarity of measurement. Additionally, this study is con-
ducted only in hotels. Finally, the proposed model for hotels provides
insights into the mediator role of customer satisfaction and trust on the
relationship between CBBE and customer loyalty. More research is
needed to improve this relationship and to provide further insight into
the model.
Appendix A. Supplementary data
Supplementary data to this article can be found online at https://
doi.org/10.1016/j.jhtm.2019.07.002.
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