A case for customer based brand equity conceptualization within motivational perspective.
Ponnam, Abhilash
INTRODUCTION
Strategic importance of branding is duly recognized in marketing
literature. A strong brand is described as a platform for new products,
an entry barrier, bulwark against shifts in consumer behavior (Farquhar,
1990), source of (sustainable) competitive advantage (Aaker, 1991), a
precursor of success of future marketing activities (Keller, 1993) a
source of future profits (Crimmins, 2000), a key organizational asset,
the primary capital (Guzman et al, 2006) and as an instrument of
competitive superiority (Kepferer, 2000). Value added by a brand to the
product is termed as brand equity (Farquhar, 1990). A strong brand is
one which possesses high brand equity (Kepferer, 2000, Aaker, 1996). To
this extent, it has been empirically proved that high brand equity could
result in increase in consumer preferences, purchase intentions (Cobb-
Walgreen et al, 1995), brand loyalty intentions (Johnson et al, 2006)
and stock returns (Aaker & Jacobson, 1994). Hence brand equity
formation, measurement and management deserves key focus both at
theoretical and managerial domains.
Brand equity has been the subject of academic inquiry since past
decade (Atilgan et al., 2005). Brand equity was initially conceptualized
as "added value" which the brand endows the product
(Leuthesser, 1988). This "added value" could be discussed from
the perspective of the firm or consumer (Farquhar, 1990). From
firm's perspective, value added by the brand is discussed under
brand valuation (Wood, 2000); whereas from consumers' perspective,
value added is discussed under customer based brand equity construct
(CBBE) (Keller, 1993). It is suggested that financial perspective of
brand equity is only an outcome of consumer perspective of brand equity
since customer based brand equity is the driving force for incremental
financial gains to the firm (Lassar et al., 1995) which in turn
determines brand value. In spite of diverse research on CBBE there
exists no consensus with respect to conceptualization and
operationalization of this construct (Winter, 1991; Punj & Hillyer,
2004). Given the importance attributed to CBBE, it is necessary to
conceptualize and operationalize this construct in manner which is
worthy of pragmatic managerial applicability.
CONCEPTUALIZATION OF CBBE
Aaker (1991, p.15) defined customer based brand equity as "a
set of brand assets and brand liabilities linked to a brand, its name
and symbol, that add or subtract the value provided by a product or
service to a firm and/or to that firm's customers". This
conceptualization is based on both cognitive and behavioral
underpinnings. This definition is regarded as most comprehensive
definition of customer based brand equity (Motameni & Shahrokhi,
1998). Aaker (1996) conceptualized brand equity as consisting of four
dimensions namely brand awareness, brand associations, perceived
quality, and brand loyalty. Aaker's (1996) operationalization of
brand equity has been widely used in universal customer based brand
equity scale developments (Yo & Donthu, 2001; Washburn & Plank,
2002; Pappu et al, 2005). No theoretical rationale is offered as to how
brand associations are formed and elicited in this framework.
Keller's (1993) framework offers more insight in this regard.
Keller's (1993, p.2) conceptualization of customer based brand
equity is based upon cognitive psychological underpinnings. Accordingly,
CBBE is defined as "differential effect of brand knowledge on
consumer response to marketing of a brand" and differential
response is measured as "consumer's reactions to an element of
marketing mix, in comparison with reaction to the same marketing mix
element attributed to the fictitiously named or unnamed version of
product or service". Brand knowledge is conceptualized as brand
node in human memory to which variety of associations are linked. Term
"node" is consistent with associative network theory (ANT)
while referring to a packet of information (Anderson, 1983). According
to this theory, human memory consists of nodes and links connecting
these nodes. Upon encountering an internal or external cue, a node gets
activated and the activation spreads to connecting node and so on as
long as sufficient threshold level for a node to become activated is
maintained. As each node becomes activated, information contained in the
node is recalled by the subject.
CRITIQUE OF 'ANT' BASED CBBE CONCEPTUALIZATION
It is lately suggested that the links between brand nodes are
asymmetric in strength (Romaniuk and Sharp, 2004). For example, given
the cue "HP", a consumer might recall a "printer",
but given the cue "printer", consumer might not immediately
recall "HP". It is also realized that cues that activate brand
nodes engender from both internal and external sources and many of them
might not necessarily suggest a brand but could increase the probability
of a particular brand / set of brands being considered for choice
(Romaniuk and Sharp, 2004). For example, being in film theater might
engender the consumer to eat/ drink something "refreshing" and
the consumer might consider a cola drink, popcorn bag and chocolate bar
to be equally refreshing. The cue here is activated from external
environment and doesn't suggest a brand or industry defined product
category. Thus, it may be conceived that different cues could result in
different "sets" of options (product categories, brands) which
the consumer might consider (Holden and Lutz, 1992). Hence, it can be
postulated that as brand node and subsequent brand association(s)
elicitation (brand knowledge) is variable with reference to chosen
cognitive path of activation (because of asymmetric links between brand
nodes) and the cue(s) encountered by the customer. This qualifies
(brand) associative network to be a fuzzy structure (Barsalou, 1983).
Extending this argument within the Keller's (1993) framework, it
may be inferred that consumer's evaluation of brand equity might
significantly differ for the same brand in two contrasting contexts if
the same brand node is evoked by two different cues leading to different
cognitive paths of activations. Hence, a statistical point estimate of
CBBE might not be derivable based upon this foundation.
Keller (1993) conceptualized brand knowledge as consisting of brand
node, to which variety of associations are linked. Above theoretical
evidences suggest that brand knowledge is a dynamic construct as
retrieval and processing of associations is cue specific. In such case,
CBBE, which is the differential effect of brand knowledge should also
vary according to the "context" in which brand is retrieved
from the memory. This paper attempts to prove this hypothesis using an
experimental design approach.
RESEARCH METHODOLOGY
Data Collection
MBA students of a reputed business school in south- central India
were considered for the study. Study spans across three product
categories. Each product category comprises of two brands. Each brand
has to be evaluated in two different contexts. One questionnaire dealt
only with one product category, thus three independent questionnaires
were framed to capture responses on three product categories. No two
product categories were evaluated by a single respondent. Hence, each
respondent evaluated two brands pertaining to same product category in
two hypothetical contexts. A total of one hundred and fifty
questionnaires were distributed equally among three product categories.
One hundred and five valid responses were obtained.
For product category pens, contexts were: intending to purchase pen
for class room use, intending to purchase a pen as a gift to a friend.
For product category courier services, contexts were: intending to avail
courier service for delivering vacation photographs, intending to avail
a courier service to post an application for job with deadline nearing.
For product category laptops, contexts were: intending to purchase a
laptop predominantly to use MS Office based applications, intending to
purchase a laptop essentially for sophisticated gaming and movie
watching.
Questionnaire Design
Respondents' familiarity of the brands was assessed on a seven
point semantic differential scale anchored at ends as highly unfamiliar
and highly familiar. To assess customer based brand equity, overall
brand equity scale proposed by Yo and Donthu (2001) was used in the
study. Respondent had to evaluate the scale for each brand in two
different contexts.
RESULTS
To assess familiarity of the respondents with respect to brands
used in the study, a single tail t-test with null hypothesis as
familiarity score for brand considered is less than the scale mean.
Significance at one percent for all the brands was achieved. This
suggests that respondents were quite familiar with brands used in the
study.
A paired t-test was performed to test for difference in CBBE
measure across contexts for each brand. Significance at one percent was
achieved for all the brands considered in the study.
These results clearly suggest a significant difference in the
evaluation of same brand in two different contexts. Therefore, building
upon the definition of Farquhar (1990), it is proposed that though brand
equity can be favorably conceptualized as value added by a brand to
product; in a consumer context, it can be demonstrated that, amount of
value added by the brand might vary according to purchase situation. In
such a case, two pertinent questions of marketing interest emerge:
* Generally in which situations, brand adds more value?
* Does the manner in which brand adds value differ amongst
different consumers?
These concerns were put forth earlier too. Schreuer (2000, p.5)
opines ".. .marketing must be in a position to create branding that
is based on delivering critical elements of value, and must design
marketing communications and customer experiences to reinforce that
value." It is assumed that answers to above questions can be
partially sought by shifting the frame of reference from cognitive
psychology perspective to motivational perspective.
ENGENDERING A MOTIVATIONAL PERSPECTIVE OF CBBE
Jenkins (1966) explicated motives as reasons behind an agent's
action. Kagan (1972) defined motive as individual's cognitive
representation of future goal with no necessary relation to either
action or affect and goal as a (future) state which enables the
individual (read as consumer) to feel better. In the context of consumer
behavior, motives can be operationalized as reasons behind
consumer's purchase (Assael, 1984). Motive when activated leads to
motivation (Kagan, 1972). It is suggested that greater the alignment of
consumer's perceptions of the brand with his/her motives, the
greater is the likelihood that the consumer will prefer that brand over
others (Mahatoo, 1989). A similar view has been espoused in "the
theory of buyer behavior" by Howard and Sheth (1969). According to
this theory, a consumer consumes brand to fulfill his (product related)
motives and motives when fulfilled by the brand leads to customer
satisfaction. The same view is again endorsed by Bagozzi and Dholakia
(1999) as they state consumers purchase those products / brands which
enable them to achieve their end state goals. Based on theory of goal
systems (Kruglanski et al, 2002), it can be proposed that in a choice
task consumer prefers that brand which has greatest ability to maximize
the subjective utility of a motive or set of (competing) motives. In
other words consumers will prefer that brand which closely fulfills
those motives which they consider important and it is supposed that this
preference is also reflected in CBBE measurement.
AN ALTERNATIVE EXPLANATION FOR RESEARCH PHENOMENON USING
MOTIVATIONAL PERSPECTIVE
Given the operational definition of motive as reason behind
purchase, the contexts which were discussed earlier can now be rephrased
as motives. This research has then attempted to understand whether
consumers' evaluation of brand differs according to motives.
Significance in t-test (table 3) proved that consumers evaluate brands
differently in different motivated conditions. Hence existing scales of
CBBE might not be generalizable as evaluation of CBBE varies according
to salience of motive.
In the current study, in each context, one motive is primed as
prominent driver of choice or "made salient", and consumers
evaluation of brand, as supposed, differed across different these
contexts. As observed from table 4, an attempt has been made to analyze
CBBE across different brands for same motive and in three out of six
cases, consumers perceived one brand to significantly out performs other
with respect to given motive. Results therefore prove the underlying
importance of motive in consumers' assessment and evaluation of
brand.
DISCUSSION
In this experimental setup, only one motive is made salient in each
situation to demonstrate the effect of each motive upon CBBE. However,
in a real purchase situations, consumer is confronted with multiple
competing motives while evaluating a brand where few motives are made
salient by external conditions (extrinsically salient motives) and few
motives are made salient habitually without any external cue
(intrinsically salient motives). Intrinsically salient product related
motives can be thought of as enduring goals which are immediately bought
into mind with respect to product category. For example a consumer who
is inherently weight conscious may be generally motivated to purchase
only those processed foods which are low in calories. "Calorie
consciousness", hence, can be termed as intrinsically salient
motive related to product category processed food. In a particular case
of celebration, the same consumer might consume tasty food which is high
in calories. This behavior is not enduring but apparent only because of
imposition of external situation of celebration. In this case, consumer
is motivated by taste. "Taste", here is extrinsically salient
processed food related motive be as it can be related to cue from
external surroundings which has modified the behavior. Based upon this
discussion, it can proposed that consumer preference can modeled as a
function of extrinsically and intrinsically salient product related
motives.
Preference has to be demarcated from CBBE. Preference can be bound
within a context and hence can vary across contexts but CBBE is
theoretically expected be stable over time because goal of the
management is to sustain and improve brand equity long term (Aaker,
1991, Keller 1993). This goal cannot be monitored/ accomplished if CBBE
is deemed unstable. An attempt has been made in this paper to prove that
existing CBBE measures vary across contexts/ motives and are therefore
deemed inappropriate for managerial use. In preceding section, it is
proposed that motives direct evaluation / choice of brand and consumers
pursue only those brands which fulfill their salient motives.
Accordingly, it is proposed that CBBE is "a measure of degree of
correspondence between consumer's intrinsically salient product
related motives and perceived potential performance of the brand upon
those motives." Intrinsically salient product related motives are
emphasized because these motives are enduring over time and in absence
of external constraints, consumer's choice is based upon them
(Ratneshwar et al, 2001).
An operationalization based upon this definition has clear
advantages over existing measurement schemes. It is stable over time and
hence CBBE can be monitored over time without attributing increment or
decrement of CBBE to contextual situations. All those related and
unrelated product categories which address similar (set of)
intrinsically salient motives could be considered as competition for
existing product category. For example, even though milk shake and cool
drink seem as if they belong to unrelated product categories, if it is
observed that target customers substitute either of them when they are
thirsty (motive 1) or exhausted (motive 2), and these motives being
identified as intrinsically salient in determining choice for both the
product categories, then cool drink brands should start considering milk
shake brands as relevant competition and vice-verse. Further, by
ascertaining how consumers weigh different motives in determining brand
choice, it becomes possible to heuristically segment consumers with
respect to given product category.
REFERENCES
Aaker, D. A. (1991). Managing Brand Equity, New York, NY: The Free
Press.
Aaker, D. A. (1996). Measuring brand equity across products and
markets. California Management Review, 38(3), 102-121.
Aaker, D.A. & R. Jacobson (1994). Study shows brand building
pays off for stockholders. Advertising Age, 65(30), 18.
Anderson, J. R. (1983). A Spreading Theory of Activation of Memory.
Journal of Verbal Learning and Verbal Behavior, 22(3), 261-295.
Assael, H. (1984). Consumer Behavior and Marketing Action (Second
Edition). Boston, Mass.: Kent Publishing.
Atilgan, E., S. Aksoy, & S. Akinci (2005). Determinants of the
brand equity: A verification approach in the beverage industry in
Turkey. Market Intelligence and Planning, 23 (30), 237-248.
Barsalou, L.W. (1983). Ad hoc categories. Memory and Cognition, 11,
211-227.
Cobb-Walgren, C.J., C. Beal & N. Donthu (1995). Brand Equity,
Brand Preferences, and Purchase Intent. Journal of Advertising, 24(3),
25-40.
Crimmins, J. C. (2000). Better Measurement and Management of Brand
Value. Journal of Advertising Research, 40(6), 136-144.
Farquhar, P. H. (1990). Managing Brand Equity. Journal of
Advertising Research. 30(4), 7-12.
Guzman, F., J. Montana et al (2006). Brand building by associating
to public services: A reference group influence model. Journal of Brand
Management. 13(4/5), 353 -362.
Holden, S. J. S. & R. J Lutz (1992) Ask Not What the Brand Can
Evoke; Ask What Can Evoke the Brand?, in J. Sherry and B. Sternthal
(eds) Advances in Consumer Research, pp.101-7. Provo, UT: Association
for Consumer Research.
Howard, J. A & J. N. Sheth (1969). The Theory of Buyer
Behavior. New York: John Wiley & Sons.
Jenkins J.J. (1966). Dr. Peters' Motives, Mind, 75(298),
248-54.
Johnson, M. D., Andreas, H. & Frank, H (2006). The Evolution of
Loyalty Intentions, Journal of Marketing, 70(2), 122-132.
Kagan, J. (1972), Motives and development. Journal of Personality
and Social Psychology, 22 (1), 51-66.
Keller, K. L. (1993). Conceptualizing, Measuring, and Managing
Customer-Based Brand Equity, Journal of Marketing, 57 (January), 1-22.
Kepferer, J. N. (2000), Strategic Brand Management--Creating and
Sustaining Brand Equity Long Term (First Edition), Kogan Page
Publishers.
Kruglanski, A. W., J. Y. Shah, A. Fishbach, R. Friedman, W. Y.
Chun, & D. Sleeth-Keppler. (2002). A theory of goal-systems. In M.
Zanna (Ed.), Advances in experimental social psychology (Vol. 34, p.
331-376). New York: Academic Press.
Lassar, W., B. Mittal, & A. Sharma, (1995). Measuring Customer
Based Brand Equity. Journal of Consumer Marketing, 12 (4), 11-19.
Leuthesser, L. (1988). Defining, measuring and managing brand
equity. A Conference Summary, Marketing Science Institute, Cambridge MA.
Mahatoo W. H. (1989). Motives must be differentiated from needs,
drives, wants: strategy implications. European Journal of Marketing.
23(3), 29 -36
Motameni, R. & M. Shahrokhi (1998). Brand equity valuation: a
global perspective. Journal of Product and Brand Management, 10(7),
275-91.
Pappu, R., P.G. Quester, & R.W. Cooksey. (2005). Consumer based
brand equity: improving the measurement empirical evidence, Journal of
Product and Brand Management, 14(3), 143-154.
Punj, G. N. & C. L Hillyer (2004). A Cognitive Model of
Customer-Based Brand Equity for Frequently Purchased Products:
Conceptual Framework and Empirical Results. Journal of Consumer
Psychology, 14 (1&2), 124-131.
Ratneshwar, S., L. W. Barsalou, C. Pechmann, & M. Moore (2001).
Goal-Derived Categories: The Role of Personal and Situational Goals in
Category Representations. Journal of Consumer Psychology. 10(3),
147-157.
Romaniuk, J. & B. Sharp (2004) Conceptualizing and Measuring
Brand Salience. Journal of Marketing Theory, 4(4), 327-342
Schreuer R. (2000). To build brand equity, marketing alone is not
enough. Strategy & Leadership, 28(4), 16 -20.
Washburn, J.H. & R. E. Plank (2002) Measuring brand equity: an
evaluation of customer based brand equity scale. Journal of Marketing
Theory and Practice, 10(1), 46-62.
Winters, L.C. (1991), Brand equity measures: some recent advances,
Marketing Research, 3(4), 70-73
Wood, L. (2000). Brands and brand equity: definition and
management. Management Decision, 38(9), 622-9.
Yoo, B. & N. Donthu (2001). Developing and validating a
multi-dimensional consumer-based brand equity scale. Journal of Business
Research, 52(1), 1-14.
Abhilash Ponnam, ICFAI University
Table 1: Research Design
Product Category Brand Context
Pens Reynolds Class use Gifting
Parker
Courier services India Post Standard Delivery Expedite Delivery
Blue Dart
Laptops Acer Data Analysis and Multimedia
Viao Reporting
(D A & R)
Table 2: Respondent's mean familiarity with brands used in the study
Mean Std. Error t df Sig.
Familiarity (1-tailed)
Reynolds 6.54 0.185 13.752 34 0
Parker 6.4 0.197 12.154 34 0
India Post 6.13 0.201 10.605 30 0
Blue Dart 5.52 0.304 4.993 30 0
Acer 5.15 0.299 3.837 33 0
Viao 5.71 0.237 7.196 33 0
Table 3: Paired t-statistic for CBBE measure across contexts
Product Brand Context n Statistic
Category [Mean CBBE [paired
(st dev)] t (sig)]
Pens Class use Gifting
Reynolds 2.96 (.91) 1.97 (.87) 35 5.39 (0)
Parker 2.52 (1.0) 4.40 (.74) -10.575 (0)
Courier Standard Expedite
Services delivery delivery
India Post 3.79 (.843) 3.05 (1.44) 31 3.13 (.004)
Blue Dart 2.91 (.95) 3.64 (1.159) -3.47 (.002)
Laptops DA & R Multimedia
Acer 2.98 (.73) 2.32 (.72) 34 4.76 (0)
Viao 3.32 (1.05) 3.95 (.84) -3.46 (.002)
Table 4: Paired t-statistic for CBBE measure across brands
Product Motive Brand n Statistic
Category (Context) [Mean CBBE [Paired
(st dev)] t (sig)]
Pens Reynolds Parker
Regular use
(Class use) 2.96 (.91) 2.52 (1.0) 35 2.01 (.052)
Gifting 1.97 (.87) 4.40 (.74) -14.223 (0.00)
Courier India Post Blue Dart
Services
General
delivery
(Standard
delivery) 3.79 (.843) 2.91 (.95) 31 3.42 (.002)
Speed &
safe
delivery
(Expedite
delivery) 3.05 (1.44) 3.64(1.16) -1.375 (.179)
Laptops Acer Viao
Productivity
(DA & R) 2.98 (.73) 3.32 (1.05) 34 -1.469 (.151)
Entertainment
(Multimedia) 2.32 (.72) 3.95 (.84) -7.648 (.000)