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Promotional Mix as the Strategic Tool for Improving Brand Equity (A Case in
Franchise Fast Food Restaurants in Sri Lanka)

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www.ijemr.net ISSN (ONLINE): 2250-0758, ISSN (PRINT): 2394-6962

Volume-7, Issue-6, November-December 2017

International Journal of Engineering and Management Research
Page Number: 6-11

Promotional Mix as the Strategic Tool for Improving Brand Equity

(A Case in Franchise Fast Food Restaurants in Sri Lanka)
S.F.Fasana1, A.G. Haseena2
1,2
Uva Wellassa University, Badulla, SRI LANKA

ABSTRACT center of success. In order to be successful, every

Brand equity is an important concept for
associating a brand and influencing customers in making
purchase decisions for particular brand products. In
developing the concept of brand equity, a number of
factors are playing key roles and marketers are using
promotional tools with the expectation of positioning their
brands by creating value for the brand and increasing the
ability to recall or recognize it. This study sought to analyze
brand equity with perceived promotional mix strategies in
franchise fast food restaurants in Sri Lanka. The present
study empirically evaluated five promotional mix
dimensions (advertising, sales promotion, personal selling,
direct marketing, public relation) and their impact on
brand equity in franchise fast food restaurants in Sri
Lanka. The sample consisted of 90 customers of 9
franchise fast food restaurants. Primary data were
gathered through a structured questionnaire among the
respondents in sample. The research findings revealed that
there is a strong positive relationship between perceived
promotional mix strategies and brand equity of the
franchise fast food restaurants. However, advertising and
direct marketing are the key factors that influence mostly
on brand equity in franchise fast food restaurants.
Further, almost all the consumers show their acceptance
towards the prevailing promotional mix strategies adopted
by fast food restaurants. In the light of the results, possible
managerial implications are discussed and future research
subjects are recommended. This research contributes to
the growing literature on the promotional mix strategies
and brand equity of the fast food business chains.
Keywords-- Perceived Promotional Mix Strategies,
Brand equity, Franchise Fast Food Restaurants
I. INTRODUCTION
Today’s business atmosphere is a dynamic and
competitive due to the continuous and rapidly changing
elements in the market and dramatic innovation in the
information technology. Also business enterprises have
to adopt many different types of strategic tools to survive
in the changing market. Organizations are trying to
achieve its goals through applying effective marketing
practices. In every business customers are the assets or
organization has to follow some promotional strategies
and business strategies such as franchising and
contracting. Franchisee-owned locations accounted for
56.3%, of fast food industry’s total locations in 2001.
McDonald's (MCD) operates as one of the world's
largest fast food chains, and earns 82% of annual
revenue from franchising businesses approximately
31,230 restaurant locations and only 16% of the revenue
from its company operated locations in 2016 (Annual
Report of McDonalds, 2016).
Promotional mix is a term used to describe the
set of tools that a business can use to communicate
effectively to the benefit of its product and services to its
customers. It consists of five elements called advertising,
sales promotion, personal selling, direct marketing and
public relation (Principles of marketing /Frances
Brassington, Stephen pettitt.-4th ed, 2006). Aaker (1991)
approaches brand equity as a set of fundamental
dimensions grouped into a complex system comprising
mainly brand awareness, brand perceived quality, brand
loyalty and brand associations.
Further, Udurawana (2013) mentioned, fast
food means simple, fast and convenience food. Fast food
consumption is rapidly growing with the people’s hard-
working professional living, and busy life styles in all
over the world. Fast food restaurants are playing a major
role among the people .According to that there are huge
numbers of meals eaten outside home and expenditure
on these is increasing in many countries. Hence,
nowadays fast food restaurants are growing rapidly with
a higher demand. For an example, Subway has opened
its 40,000th outpost worldwide. The extensive chain has
already added 1,761 outlets since the start of 2013 and
plans to add another 10,000 new locations by 2017
(www.businessweek.com Aug 26, 2013). McDonald’s
the world’s second biggest fast-food chain and there are
nearly 36, 899 restaurants have opened in 2016 (Annual
Report of McDonalds, 2016).
Today the fast food market is more fully
developed and they now compete against each other.
Basically, each fast food restaurant offers the same
products; a cheap snack, cleanliness and fast efficient

6 Copyright © 2017. Vandana Publications. All Rights Reserved.

www.ijemr.net ISSN (ONLINE): 2250-0758, ISSN (PRINT): 2394-6962
service. Thus, it becomes difficult for any restaurant to
achieve a competitive advantage over another; therefore
they adopt the promotional tools to obtain more market
segment (Bryant and Dundes, 2008). Brand equity is
expensive to build; it is the difficult to differentiate one
fast food restaurant from another. Most of the fast food
restaurants make serious effort to build recognizable
brand names. (Aseambankers, 2007) explained that
Global brands, such as McDonald’s, KFC, and Pizza Hut
are excellent in managing brand; this is because of the
investment had made in branding and marketing
research. Fast food brand equity has a multidimensional
model. It is made of perceived quality, brand awareness,
brand familiarity, brand image, and brand loyalty (Tan et
al., 2011) Fast food restaurants are highly liable to
building strong brand names because of highly similar
services and foods are provided.
Promotional mix
Cole (1996) defines promotion mix as “the way
to bring customers from a state of relative unawareness
to a state of actively adopting the product” it elaborates
communicating with individuals, groups, or
organizations to directly or indirectly informing and
educating one or more target audience. It is the direct
way in which an organization tries to communicate with
various target audiences. It consists of five main
elements; advertising represents non-personal, mass
communication; personal selling deals with covering
face-to-face, personally customized messages; sales
promotion involves short term encouragements to
motivate customers; public relation is about maintaining
relations with external parties; direct marketing involves
creating one-to-one relationship with customers
(Principles of marketing /Frances Brassington, Stephen
pettitt-4thed, 2006).
Berkowitz et al (1997) defined promotion as a
means of communication between the trading parties
who are seller and buyer. A company can use one or
more of the promotional alternatives that is personal
7 Copyright © 2017. Vandana Publications. All Rights Reserved.
selling, advertising, sales promotion and public relation
to communicate with the customers. Further, Fische
(1996) noted and argued that three of the promotional
mix elements, which include advertising, sales
promotion and public relation, are often used in mass
selling because they are used with groups of potential
buyers. Promotional mix is the important tool between
the service providers and the customers in building up a
good relationship among them. It is the stimuli factor to
the service consumers (S.Sivesan 2013).
Brand Equity
(Aaker, 1991) has defined brand equity is a set
of assets and liabilities align with the brand, which add
value to a product in relationship with customers.
Further the researcher believed that the value of brand
equity came from five brand equity assets; brand loyalty,
brand awareness, perceived quality, brand association,
brand image). (Neal, 2000) explained brand equity is the
major weapon. It means building sustainable competitive
advantage and creating a differential advantage. Fast
food service chain restaurants are willing to build strong
brand names because they are providing similar services
and foods. Brand equity contributes to possibility of
brand extension to other product categories. Successful
brand extensions contribute to higher brand equity of the
original brand and unsuccessful brand extensions reduce
the brand equity of the parent brand (Aaker and Keller,
1990). (Keller, 1993) defined that brand equity is the
differential effect of brand recognition and identification
on consumer response to the marketing of that brand.
(Farrquhar, 1989) suggested brand equity is a power that
a brand have achieved it in a market because of its name,
sign and logo.
Figure one shows the conceptual model of this
study. The study has selected five elements that effect
brand equity of fast food restaurants: advertising, sales
promotion, personal selling, direct marketing and public
relation to identify the impact towards brand equity.
www.ijemr.net ISSN (ONLINE): 2250-0758, ISSN (PRINT): 2394-6962

II. METHODOLOGY analysis, correlation and regression analysis to achieve

This study has utilized convenience
sampling method and sample consisted of 90
customers of 9 franchise fast food restaurants in
capital city of Sri Lanka. The data for the study were
collected through structured questionnaires.
Questionnaire consists three parts. First part is acquiring
demographic information about consumers of Franchise
fast food restaurants such as gender, age, income, etc.
This part was used to get overall view about consumers.
Other part questions were organized regarding
promotional mix and brand equity. Questions have
created based on five point Likert Scale in order to
identify the impacts of promotional mix on brand equity.
The scale is ranging from strongly agree (SA) to strongly
disagree (SD). Further, study has adopted descriptive
the objectives.
III. DATA ANALYSIS AND
INTERPRETATION
In any research reliability of questions must be
checked before finishing the data collection. In order to
achieve it alpha test has been done. It explains the
reliability of questions which were made to measure the
variables. Further it explains the consistency between
the questions and can identify the weaker consistence
question. Accordingly all the promotional mix elements
scored alpha value more than 0.7
3.1 Descriptive Analysis

Table 1 – Mean and Standard Deviation of promotional mix dimensions

Dimension Mean Standard Deviation

Advertising 4.1756 0.94754

Sales Promotion 4.3222 0.83988

Personal Selling 3.5815 0.54409
Direct Marketing 4.0889 0.94610
Public Relation 3.9667 0.43415
Overall promotional Mix 4.0270 0.55096

According to the Table 1, “mean” of all the
variables fall under the range of 3.5<=X<5. This
illustrates that almost all the participants agree with the
existing situation of advertising, sales promotion,
personal selling, direct marketing and public relation in
franchise fast food restaurants. Mean value and standard
variation of Advertising is 4.1756 and 0.94754
respectively. This mean value implies that customers are
agreeing with the existing situation of Advertising in
franchise fast food restaurants. Customers agree with the
current situation of publicity, television advertisement
and printed advertisement in franchise fast food
restaurants. When consider sales promotion dimension,
its mean is 4.3222 and standard deviation is 0.83988. It
also implies that customers are agreeing with the
existing situation of sales promotion of franchise fast
food restaurants. Product based sales promotion,
coupons; door to door sales promotions are available for
customers of franchise fast food restaurants For the
personal selling, mean and standard deviation are 3.5815
and 0.54409 respectively. It emphasizes customers agree
with the existing situation of personal selling in
franchise fast food restaurants. Customers agree with the
situation of sales staff, representative sales man, personal
communication. According to mean value of direct
marketing, it is 4.0889 and which implies that customers
are moderately agreeing with the current situation of
direct marketing. Customers agree with the existing
direct marketing communication methods, direct
response arrangements and face to face marketing. Mean
and standard deviation of public relation dimension is
3.9667 and 0.43415 respectively. It is obvious that
customers are agreeing with the existing situation of
franchise fast food restaurants’ public relation like
organized social events and websites of franchise fast
food restaurants create better public relation. For an
example McDonald’s introduced its own sauce bottle for
the customers and the money collected through it funded
to the people who are affected by cancer disease.

3.2 Correlation coefficient analysis

Table 2 - Correlation between Promotional Mix Dimensions and Overall

Brand Equity
Dimension Pearson correlation P-value
Advertising 0.848 0.000

Sales Promotion 0.494 0.000

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www.ijemr.net ISSN (ONLINE): 2250-0758, ISSN (PRINT): 2394-6962

Personal Selling 0.551 0.000

Direct Marketing 0.837 0.000
Public Relation 0.199 0.061

Above Table 2 illustrates the correlation
between Promotional mix dimensions and Brand equity.
For the Advertising, it denotes an amount of 0.848
correlations with brand equity which is suggested that
there is strong positive relationship between independent
variable advertising and dependent variable brand
equity. Further, there is a significant association between
these two variables.
Correlation coefficient of sales promotion and
brand equity is 0.494 and which implies that there is a
weak relationship between sales promotion and brand
equity. Personal selling and brand equity is 0.551 and
which implies that there is a strong positive relationship
between personal selling and brand equity. Correlation
coefficient of direct marketing is 0.837 to the brand
equity. This indicates that there is a strong positive
relationship between these two variables. For the public
relation there is a 0.199 correlation coefficient value
with brand equity, indicating that there is a weak
positive relationship between public relation and brand
equity. In addition, p-value of 0.061 indicates that there
is no any significant association between these two
variables at 0.05 level of significant. It can be concluded
that advertising, personal selling and direct marketing
have strong positive significant association with brand
equity. Further, sales promotion has weak positive
significant association with brand equity. While public
relation has weak positive insignificant association with
brand equity.
3.3 Regression Analysis
3.3.1 Multiple Linear Regression
Model summary of multiple linear regressions
was presented in the following Table 3 and it was
included value of R value, R Square value and adjusted
R square value and value of standard error of estimate.

Table 3- Model Summery of Multiple Linear Regression Analysis

Figure Value
R Square 0.821

Adjusted R Square 0.810

Standard Error of Estimate 0.42580

According to Table 4, the R Square or
Coefficient of determination for the model is obtained as
0.821. It suggested that 82.1 per cent of variation in
dependent variable promotional mix is explained by
independent variables advertising, sales promotion,
personal selling, direct marketing and public relation.
Therefore it can be identified that there is 17.9 per cent
of unexplained variation in this model. Furthermore,
0.821 is substantially high and therefore it is significant.
Adjusted R square is represented the modification of R
square that adjusted for the number of explanatory in a
model.
Analysis of variance was presented in the
following Table 4 and it included sum of squares, degree
of freedom, F value and P value.

Table 4 - Analysis of Variance for Multiple Linear Regressions

Model Sum of Squares Degrees of F Significant
Freedom
Regression 69.740 5 76.930 0.000
Residual 15.230 84
Total 84.969 89

It is revealed that out of 84.969 of total sum of brand equity is explained by residual. Thus, it can be
square, 69.740 of variation can be explained by concluded that model was fitted well because large
regression and 15.230 of variation of dependent variable proportion is contributed by regression.

Table 5 - Multiple Linear Regression Analysis of Promotional Mix dimensions versus Brand Equity
Predictor ß Coefficients Standard Error T-value P-Value

Constant 0.177 0.523 0.338 0.736

Advertising 0.418 0.095 4.400 0.000

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www.ijemr.net ISSN (ONLINE): 2250-0758, ISSN (PRINT): 2394-6962
Sales Promotion 0.212
Personal Selling 0.188
Direct Marketing 0.434
Public Relation -0.258
According to table 5, constant (ß0) was 0.177
which implies that while all promotional mix dimensions
remain zero, customer satisfaction is 0.177. It means
without promotional mix, brand equity is lower. P-
Value of constant term was 0.736 and which stated it
was statistically insignificant at 0.05 level of significant.
In addition, most of the beta coefficient values
represented positive values and thereby it is obvious that
there is a positive relationship between promotional mix
and brand equity.
When consider advertising, the ß coefficient of
0.418 indicates that when advertising increased by one
unit while other variables remain constant, brand equity
increased by 0.418 units. It can be seen that advertising
contributed significantly to the model since p-value of
0.000 is less than 0.05 level of significant. Therefore null
hypothesis H0 was rejected and alternative hypothesis H2
was accepted. Hence, there is a significant relationship
between advertising and brand equity.
According to coefficient of sales promotion,
one unit of increase in sales promotion while other
variables remain constant, brand equity was increased by
0.212. Further, this was significantly contributed to the
model as p-value of 0.000 is less than the 0.05 level of
significant. Therefore null hypothesis H0 was rejected
and alternative hypothesis H3 was accepted. Hence, there
is a significant relationship between sales promotion and
brand equity.
When looking at personal selling, it can be
identified when personal selling increased by one unit
while other variables remain constant, it result in
increase of brand equity by 0.188 unit. This is significant
BE = 0.177 + 0.418 AD + 0.212 SP + 0.188 PS + 0.434 DM – 0.258
IV. CONCLUSION AND
IMPLICATIONS
Major objectives of this research were to
identify the existing situation of promotional mix and
brand equity, to identify relationship between
promotional mix and brand equity, and to identify the
impact of promotional mix and brand equity in franchise
fast food restaurants.
The results of multiple regression analysis show
that the all elements of promotional mix impact on brand
equity in franchise fast food restaurants. Advertising,
sales promotion, personal selling, direct marketing and
public relation are significantly impact on brand equity
in franchise fast food restaurants.
10 Copyright © 2017. Vandana Publications. All Rights Reserved.
0.058 3.641 0.000
0.099 1.908 0.040
0.094 4.606 0.000
0.113 -2.285 0.025
at 0.05 level of significant since its p-value of 0.040 is
less than 0.05. Therefore null hypothesis H0 was rejected
and alternative hypothesis H4 was accepted. Hence, there
is a significant relationship between personal selling and
brand equity.
When consider coefficient of direct marketing,
one unit of increase in direct marketing while other
variables remain constant, brand equity was increased by
0.434. Further direct marketing significantly contributed
to the model as its p-value of 0.000 is less than 0.05
level of significant. Therefore null hypothesis H0 was
rejected and alternative hypothesis H5 was accepted.
Hence, there is a significant relationship between direct
marketing and brand equity
It was indicated that coefficient of public
relation was -0.258, which meant when one unit of
increase in public relation while other variables remain
constant. Further, p-value of 0.025 stated that public
relation was significantly contributed to the model.
Therefore null hypothesis H0 was rejected and alternative
hypothesis H6 was accepted. Hence, there is a significant
relationship between public relation and brand equity.
According to above information, advertising,
sales promotion, personal selling, direct marketing,
public relation were highly significant for the model as
its p-values were less than 0.05. Among these variables
brand equity was highly impacted by direct marketing
(0.434) and advertising (0.418) respectively. However,
public relation was not impacted highly on brand equity
(-0.258).
By using above information, multiple
regressions model can be articulated as follows.
It was identified that brand equity through
customer satisfaction is highly influenced by direct
marketing in franchise fast food restaurants. As for
direct marketing, a possible explanation could be that the
components investigated in this dimension, which is face
to face selling; direct response marketing and catalog are
widely recognized as the key success factors in franchise
fast food restaurants. Second highest promotional mix
dimension, which is influence on brand equity is
advertising. This is understandable in franchise fast food
restaurants, because non personal components like
television, printed media and billboard are creating
customer awareness and brand equity well. Further,
sales promotion is also a key factor which influence on
brand equity in franchise fast food restaurants. By
www.ijemr.net ISSN (ONLINE): 2250-0758, ISSN (PRINT): 2394-6962
providing sales promotion a restaurant can build a long-
term relationship with customers. Over a period of
lifetime, the restaurants should offer customer seasonal
benefits in celebrations. Therefore it can maintain a
successful relationship with customers. Moreover,
personal selling is also significantly influence on brand
equity in franchise fast food restaurants. It means that
customers are satisfied with the sale persons’ activities,
order making system of sales representatives and direct
communication of employees. Moreover personal selling
is improved continuously by the franchise fast food
restaurants. The last factor which influence on brand
equity in franchise fast food restaurants in Sri Lanka is
public relation. Also it is negatively impact on brand
equity, it has a significant relationship. Therefore
restaurants keep considerations on social and welfare
campaign for society.
This research is conducted to identify the
impact of promotional mix on brand equity in franchise
fast food restaurants in Sri Lanka. This study further
shows that five promotional mix dimensions
(Advertising, Sales promotion, Personal selling, Direct
marketing, Public relation) have an impact on brand
equity. Because this study shows that there is a positive
relationship between promotional mix dimension and
brand equity with special reference to franchise fast food
restaurants. In practical terms, this means that improving
promotional mix will increase brand equity in franchise
fast food restaurants.
The impact of promotional mix dimension on
brand equity is considered as most influential dimension
and lead to have higher response from customers. Direct
marketing is the most influential dimension and
advertising is the second dimension. And public relation
is less influential dimension on brand equity in franchise
fast food restaurants. However, the results and
recommendation of this study can be used for
promotional mix improvements, innovation strategies
and consequently improving brand equity in franchise
fast food restaurants.
Our research findings suggest fertile directions
for future research. First, further investigation might be
directed toward other service sector while evaluating the
impact of promotional mix elements on brand equity.
The limitation is that geographically the area concerned
only Capital city of Sri Lanka. It can be done in other
parts of the country or for the whole country. And the
questionnaires were given to 90 respondents in 9
franchise fast food restaurants. It also can be widen to a
large number of respondents. Further this study has been
done by using main branches of whole population but
fewer amounts of respondents due to the time
constraints. Therefore future researchers can be move
towards a considerable population including branches of
franchise fast food restaurants and wide area by
expanding sampling frame.
Furthermore, future studies could focus on
other direct marketing factors and could examine the
dimensions that drive the brand equity of customer.
Another future research might be innovation aspect of
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the fast food industry as well as further empirical
research should be done on the service quality,
marketing mix and brand equity.
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