Abstract. This research study investigates methods of brand loyalty through brand credibility and brand awareness. Simple random sampling method and ...
Arabian Journal of Business and Management Review (Nigerian Chapter) Vol. 2, No. 12, 2014
THE STUDY OF BRAND CREDIBILITY AND BRAND AWARENESS AS POSITIVE PREDICTORS FOR BRAND LOYALTY
1
1,2
Dr. Aqeel Ahmad,
2
Naveed Ahmad, 3Muhammad Nadeem
Department of Business Administration Lahore Leads University, Pakistan 3 Mari petroleum company Limited, Karachi
Abstract This research study investigates methods of brand loyalty through brand credibility and brand awareness. Simple random sampling method and Structure questionnaire were used for data collection. Data was analyzed through SPSS. The findings of this research study showed that brand loyalty has been observed to have positive association with brand credibility and also with brand awareness. This research study will help managers and policy makers in designing an efficient branding stratedy. Keywords: Brand credibility, Brand awareness, Brand Loyalty 1. INTRODUCTION: D. Aaker, (1996) discussed that in promotion Brand Loyalty is striking and engaging notion now a days. Brand loyalty is the behavioral intention of the customer toward some definite brand (Lin et al., 2000; Bang, Y. T., & Du, J. Q. (2010)). As there is positive impact of brand loyalty on sustainability of brand (Howell, 2004), people who are loyal with the products they are ready to pay more for the products because they believe that these products are more useful for them (Jacoby and Chestnut 1978; Pessemier 1959; Reichheld 1996). According to Fournier (1998) Brand Loyalty helps clients to get the valued products and builds a strong association of people with the products. Many factors have their effect on Brand loyalty such as brand credibility, customer satisfaction, brand switching and service quality. Brand credibility means the image of the brand for the customer; it is the mixture of multi characteristic term (sternthal and Craig, 1982; Erdem and Swait, 2004). Brand awareness means that people know about the product and have proper idea regarding the uses of the product. This research is according to the Pakistani culture and other researchers have just specified it according to the culture of their own countries. As every country has different culture; Pakistan is different according to norms, religion and values. According to Fournier, (1998) Brand Loyalty help clients to get the valued products and build a strong association of people with the products. Many factors effecting on Brand loyalty such as brand credibility, customer satisfaction, brand switching, service quality. Brand credibility means the image of the brand for the customer; it is the mixture of multi characteristic term (sternthal and Craig, 1982; Erdem and Swait, 2004). Brand awareness means people know about the 22
Arabian Journal of Business and Management Review (Nigerian Chapter) Vol. 2, No. 12, 2014 product and have proper idea regarding the uses of the products. Brand loyalty is the behavioral intention of the customer toward some definite brand (Lin et al., 2000). As there is positive impact of brand loyalty on sustainability of brand (Howell, 2004), people who are loyal with the products they are ready to pay more for the products because they believe that these products are more useful for them (Jacoby and Chestnut 1978; Pessemier 1959; Reichheld 1996). This research is according to the Pakistani culture and other researchers have just specified it according to the bank culture of their own countries culture. As every country has different culture Pakistan is different according to norms, religion and values. 1.1 Research Objectives: Objectives of this research are as under: a) To find out effect of Brand credibility on the brand loyalty. b) To find out effect of Brand awareness on the brand loyalty. 1.2 Research Questions: Questions to be investigated are as under: Q1. What is the connection between brand credibility and brand loyalty? Q2. What is the association between brand awareness and brand loyalty? Brand credibility and brand awareness both are essential for product loyalty, which is significant for people. Product loyalty not only differentiates the people who are loyal with the brand but also provides the perceived value to those people. Brand credibility and brand awareness increase the value of the product and also play a vital role in creating a positive image of the product. 2. LITERATURE REVIEW: 2.1 Brand Loyalty: Numerous studies have investigated the advantage of customer- focused brand loyalty and their potential to achieve super results (Oliver, 1999; Russell-Bennett et al., 2007). This study particularly focuses on the importance of customer satisfaction with determinants on brand loyalty because the core objective of strategic marketing is the resultant of customer satisfaction (Jaworski, B. J., & Kohli, A. K. (1991; Luo and Seyedian, 2003). Brand loyalty is the behavioral intention of the customer toward some definite brand (Luarn, P., & Lin, H. H. (2003). Brand loyalty can be measured with the help of these measurements. Another measurement technique is probability of repurchase and the technique used to measures the point when customer switched to another brand Tsao, H. Y., & Chen, L. W. (2005). The researchers used these techniques to investigate the factor of brand loyalty – brand knowledge being one of them (Dick et al., 1996; Feltham, T. S. (1998), ease and usage knowledge ( Rowley, J. 2005; Lin et al., 2000), perceived value and satisfaction (Baltas, 1997; Ness et al., 2002; Wood, L. (2004) and the other attributes to find the constructs of brand loyalty. 2.2 Brand Credibility: In the same way, reliability of the product increases the belief of the people on the value of the product (Erdem & Swait, 1998). The notion of reliability of the product also increases the value of the product ( Erdem & Swait, 1998). Brand credibility means the image of the brand in the mind of the customer; it is the mixture of multi characteristic term (sternthal and Craig, 1982; Erdem and Swait, 2004). Signaling theory of brand also builds up the importance of brand credibility construct into brand equity (Erdem and Swait, 1998). The manufacturers are looking 23
Arabian Journal of Business and Management Review (Nigerian Chapter) Vol. 2, No. 12, 2014 for the motivators that can gradually increase the brand credibility. Brand credibility also supports the manufacturer-customer relationship and makes them strong and long. 2.3 Brand Awareness: A number of empirical studies show that contentment of the customers increases their willingness to purchase the product and also creates a positive image of the product among the people (Oliver, 1980; Pritchard et al., 1999; Russell- Bennett et al., 2007). According to Macdonald, E. K., & Sharp, B. M. (2000), Knowledge of the product is also very significant for the people because if they do not know usefulness of the product they will not demand the product. Knowledge about the product creates a positive or negative image of the product in the mind of the customer so its very significant to know about the product. According to Gustafson & Chabot (2007), if people know about the features of the product, it shows the good will of the product among people. Chaudhuri, A., & Holbrook, M. B. (2001) discussed that product image among people shows its popularity in their surroundings. Lassar, W., Mittal, B., & Sharma, A. (1995) described that perception of the products among customers is not depending upon any single factor. Keller (1993) found that some people buy only those products which are popular among them. Theory related to our research is signaling theory. Signaling theory of brand also builds up the importance of brand credibility construct into brand equity (Erdemand Swait, 1998). 2.4 Hypotheses: Hypotheses of the study are as follows, Hypothesis 1: Brand credibility is positively associated with brand loyalty Hypothesis 2: Brand awareness and brand loyalty relate each others positively 3. METHODOLOGY: Population of the Study: The population is students from Bahauddin Zakariya University Dera Ghazi Khan Sub Campus, Pakistan. Sample Size: Sample size is one hundred and twenty from Bahauddin Zakariya University Sub Campus D.G. Khan. Research Instrument: A questionnaire was used for data collection on likert scale ( five point). The questionnaire along with the groupings indicating questions measuring brand loyalty, brand credibility and brand awareness is given at Annexure 4. Findings: The findings of this research are explained according to the results obtained through analysis with help of the IBM SPSS Statistics software: Hypotheses1: The results of regression analysis are discussed in appendix Table 3 and according to these results a positive association between brand credibility and brand loyalty is observed (sig=0.000 r=0.809**). Similarly the value of t =12.896 that is above the normal level 2 and thus it indicates significant positive relative importance between predictor and criterion variables ( brand credibility and brand loyalty). Hypotheses2: The results of regression analysis for second hypothesis are presented in appendix table 4. According to these results there is positive and significant relation between predictor variable ( 24
Arabian Journal of Business and Management Review (Nigerian Chapter) Vol. 2, No. 12, 2014 brand awareness) and criterion variable brand loyalty (sig=0.000 r=0.814*). The P value for this hypothesis is 0.000** that is less than 0.05 level of significance and hence provides sufficient grounds for researcher to accept alternate hypothesis H2. Furthermore the value of beta is positive and shows positive association between these two variables. T value is also describing the positive related importance between regressor ( brand awareness) and regressand ( brand loyalty). So null hypothesis for H2 is rejected and alternate is accepted. 5. CONCLUSION: This research shows the effect of brand credibility and brand awareness on brand loyalty. The result shows that both – brand credibility and brand awareness – are useful for creating brand loyalty. Brand credibility and brand awareness both are the key elements in building brand loyalty, which is equally important for marketers and consumers. Brand loyalty acts a potent brand differentiator and offer sustainable competitive advantage. Brand credibility and brand awareness creating or reinforcing a brand’s personality enhances brand value or equity, which in turn can be leveraged through brand extension. Brand loyalty also helps brands to gain market share, command price premium and insulates from discounting brands. Brand credibility also supports the manufacturers and customers relationship and makes them strong and long .
6. REFERENCES: 1. Aaker, D., (1996). Building strong brands. New York: The Free Press. 2. Baltas, G. (1997). Determinants of store brand choice: a behavioral analysis.Journal of product & brand management, 6(5), 315-324. 3. Bang, Y. T., & Du, J. Q. (2010). Identification of factors affecting Chinese wine consumers’ loyalty. International Review of Business Research Papers, 6(5), 320-333. 4. Boulding,W., & Kirmani, A. (1993). A consumer-side experimental examination of signaling theory: Do consumers perceive warranties as signals of quality? Journal of Consumer Research, 20, 111– 123. 5. Chaudhuri, A., & Holbrook, M. B. (2001). The chain of effects from brand trust and brand affect to brand performance: the role of brand loyalty. Journal of marketing, 65(2), 81-93.. 6. Chu, W., & Chu, W. (1994). Price, brand reputation and store reputation as signals of quality: A game-theoretic approach. Paper presented at the Marketing Science Conference, Tucson. AZ. 7. Dick,A.,Jain,A. and Richardson,P.(1996),“How consumers evaluate store brands?”, Journal of Product &Brand Management, Vol. 5 No. 2, pp. 19-28. 8. Erdem, T. and Swait, J. (1998), “Brand equity as a signaling phenomenon”, Journal of Consumer Psychology, Vol. 7 No. 2, pp. 131-57. 9. Erdem, T. and Swait, J. (2004), “Brand credibility, brand consideration and choice”, Journal of Consumer Research, Vol. 31 No. 1, pp. 191-9. 10. Erdem, T., & Swait, J. (1998). Brand equity as a signaling phenomenon. Journal of Consumer Psychology, 7 (2), 131– 157. 25
Arabian Journal of Business and Management Review (Nigerian Chapter) Vol. 2, No. 12, 2014 11. Feltham, T. S. (1998). Leaving home: brand purchase influences on young adults. Journal of Consumer Marketing, 15(4), 372-385. 12. Fournier, S. (1998). Consumers and their brands: Developing relationship theory in consumer research. Journal of Consumer Research, 24 (1), 343-73. 13. Gustafson, T., & Chabot, B. (2007). Brand Awareness. Cornell Maple Bulletin , 105. 14. Helgesen, Ø., & Nesset, E. (2007). What accounts for students' loyalty? Some field study evidence. International Journal of Educational Management, 21(2), 126-143. 15. Howell, D. (2004), “Today’s consumers more open to try new brands”, DSN Retailing Today. 16. Jacoby, Jacob and Robert Chestnut (1978), Brand Loyalty Mea-surement and Management. New York: John Wiley & Sons. - and D.B. Kyner (1973), "Brand Loyalty Versus Repeat Pur-chasing," Journal of Marketing Research, 10 (February), 1-9. 17. Jaworski, B. J., & Kohli, A. K. (1991). Supervisory feedback: alternative types and their impact on salespeople's performance and satisfaction. Journal of Marketing Research, 190-201. 18. Keller, K. (1993). Conceptualizing, measuring, and managing customer-based brand equity. Journal of Marketing, , 57, 1-22. 19. Kotler, Philip (1991), Marketing Management-Analysis, Planning, Implementation and Control, 7th Ed., Englewood Cliffs, NJ: Prentice-Hall, Inc. 20. Lassar, W., Mittal, B., & Sharma, A. (1995). Measuring customer-based brand equity. Journal of consumer marketing, 12(4), 11-19. 21. Luarn, P., & Lin, H. H. (2003). A Customer Loyalty Model for E-Service Context. J. Electron. Commerce Res., 4(4), 156-167. 22. Luo X, Seyedian M (2003). Contextual marketing and customer-orientation strategy for e-commerce: An empirical analysis. Int. J. Electron. Commer., 8(2): 95-118. 23. Macdonald, E. K., & Sharp, B. M. (2000). Brand Awareness Effects on Consumer Decision Making for a Common, Repeat Purchase Product:: A Replication. Journal of business research, 48(1), 5-15. 24. Macdonald, E. K., ＆ Sharp, B. M. (2000). Brand awareness effects on consumer decision making for a common, repeat purchase product: A replication. Journal of Business Research, 48, 5-15. 25. Oliver RL (1980). A cognitive model of the antecedents and consequences of satisfaction decisions. J. Mar. Res., 17(4): 460-469. 26. Oliver, Richard L. (1980). "A Cognitive Model of the Antecedents and Consequences of Satisfaction Decisions." Journal of Marketing Research 1 7 (November), 460-469. 27. Pessemier, E.A. (1959), "A New Way to Determine Buying Deci-sions," Journal of Marketing, 24 (October), 41-46. 28. Pritchard MP, Havitz ME, Howard DR (1999). Analyzing commitment-loyalty link in service contexts. J. Acad. Mar. Sci., 27(3): 333-348. 29. Reichheld, Frederic F (1996), The Loyalty Effect: The Hidden Force Behind Growth, Profits and Lasting Value. Boston: Har-vard Business School Press 30. Rowley, J. (2005). The four Cs of customer loyalty. Marketing intelligence & planning, 23(6), 574-581. 31. Russell-Bennett R, McColl-Kennedy JR, Coote LV (2007). Involvement, satisfaction and brand loyalty in a small business services setting. J. Bus. Res., 60(12): 1253-1260. 26
Arabian Journal of Business and Management Review (Nigerian Chapter) Vol. 2, No. 12, 2014 32. Sternthal, B., & Craig, C. S. (1982). Consumer behavior: An information processing perspective. Englewood Cliffs, NJ: Prentice-Hall. 33. Tsao, H. Y., & Chen, L. W. (2005). Exploring Brand Loyalty from the Perspective of Brand Switching Costs. International Journal of Management,22(3). 34. Wood, L. (2004). Dimensions of brand purchasing behaviour: Consumers in the 18–24 age group. Journal of Consumer Behaviour, 4(1), 9-24.
7. APPENDIX : Table 1: Descriptive Statistics:
Descriptive Statistics Mean Std. Deviation Credibility Awareness Loyalty
4.6407 4.5963 4.7500
N
.39179 .36802 .32311
90 90 90
Table 2:
Correlations Credibility
Awareness
Loyalty
Pearson Correlation Sig. (2-tailed)
1
.883** .000
.809** .000
Awareness
N Pearson Correlation Sig. (2-tailed)
90 .883** .000
90 1
90 .814** .000
Loyalty
N Pearson Correlation Sig. (2-tailed)
90 .809** .000
90 .814** .000
90 1
N 90 **. Correlation is significant at the 0.01 level (2-tailed).
90
90
Credibility
Results of Regression: Hypotheses1: brand credibility is positively associated with brand loyalty
Table 3: Coefficientsa Unstandardized Coefficients
Model
B 1
(Constant)
1.655
Std. Error .241
Credibility
.667
.052
27
Standardized Coefficients Beta .809
t
Sig.
6.872
.000
12.896
.000
Arabian Journal of Business and Management Review (Nigerian Chapter) Vol. 2, No. 12, 2014 a. Dependent Variable: Loyalty
Results of Regression: Hypotheses2: brand credibility and brand loyalty relate each others positively Table 4: Coefficientsa Unstandardized Coefficients
Model
(Constant)
B 1.467
Std. Error .251
Awareness a. Dependent Variable: Loyalty
.714
.054
1
28
Standardized Coefficients Beta .814
t
Sig.
5.846
.000
13.129
.000
