UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------ Luu Kien Quoc ANTECEDENTS AND CONSEQUENCE OF CONSUMER-BRAND IDENTIFICATION MASTER OF BUSINESS (Honours) Ho Chi Minh City – Year 2014 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------ Luu Kien Quoc ANTECEDENTS AND CONSEQUENCE OF CONSUMER-BRAND IDENTIFICATION ID: 22120105 MASTER OF BUSINESS (Honours) SUPERVISOR: Dr. Nguyen Thi Mai Trang Ho Chi Minh City – Year 2014 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com ACKNOWLEDGEMENT This thesis could not be accomplished without the valuable support of many people whose contributions will never be forgotten. Therefore I would like to express my gratitude to them. The first sincere thank I would like to give to my supervisor, Prof.
Nguyen Thi Mai Trang, for giving me the position in a very interesting and challenging project. I had anticipated the difficulties in dealing with too much strange economy theories and new academic definition before I started master thesis, but I had not expected so many tough problems to be encountered. Luckily we could manage to overcome and to reach the target in the end. Thank you so much for giving me chances to correct my mistakes during the project and teaching me many new things.
I really appreciate your quick action whenever I need your advices and instructions, your direction in writing our articles and also your day and night correction for my thesis. So thanks you again, Madame! I would like to express my gratitude to Professor Nguyen Dong Phong, Professor Nguyen Dinh Tho, Dr. Tran Ha Minh Quan for their valuable time as the members of the proposal examination committee. Their comments and meaningful suggestion were contributed significantly for my completion of this research.
My sincere thanks are given to all of my teachers at International Business School – University of Economics Ho Chi Minh City for their teaching and guidance during my Master course. Best regard, LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com ABSTRACT The purpose of this research is to extend consumer-brand identification into social identity literature in Vietnam smartphone market. We do this by developing a conceptual model showing how predictors effect on consumer-brand identification and influence of consumer-brand identification on brand loyalty. The model was tested using cross-sectional data; 166 respondents were students of university of Science.
Results from study show that brand-self similarity has no influences on consumer-brand identification; brand social benefit and brand prestige-distinctiveness have positive relationship with consumer-brand identification. The positive influence of consumer-brand identification with brand loyalty was also confirmed. Keywords: Social identity theory, consumer-brand identification, brand loyalty, brand-self similarity, brand prestige, brand distinctiveness, brand social-benefit. LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Abbreviation CBI Consumer-brand identification BS Brand-self similarity BSB Brand social benefit BP Brand prestige BD Brand distinctiveness BPD Brand prestige-distinctiveness BL Brand loyalty VIF Variance Inflation Factor LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Table of Contents ACKNOWLEDGEMENT.
3 LIST OF FIGURES. 6 LIST OF TABLES .5 SIGNIFICANCE OF THE STUDY .6 THE STRUCTURE OF THE STUDY. LITERATURE REVIEW AND HYPOTHESES .1 SOCIAL IDENTITY THEORY.2 CONSUMER – BRAND IDENTIFICATION .4 ANTECEDENTS OF CBI .1 Brand-self similarity .4 Brand social benefit .4 THE RESEARCH MODEL .2 MEASURES OF THE CONSTRUCTS .23 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.4 DATA ANALYSIS METHOD .2 Exploratory Factor Analysis (EFA) .3 EXPLORATORY FACTOR ANALYSIS (EFA) .1 EFA for all variables .2 Correlation analysis of all variables.1 Multiple regression analysis .2 Simple linear regression .3 LIMITATIONS AND FUTURE RESEARCH. 60 Appendix A: Guidelines for In-depth Interview Respondents’ information.
PLOT AND DIAGRAM. 73 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com LIST OF FIGURES FIGURE 2. 1 Proposed research model……………………………………………………. 1 Research procedure………………………………………………………… 27 FIGURE 4.
1 Refined research model…………………………………………………….355 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com LIST OF TABLES TABLE 3. 1 Brand personality framework (aaker, 1997). 2 Qualitative research for reducing brand-self similarity variable. 3 Result of collecting questionnaires.
2 Reliability test result. 3 Reliability test result of brand-self similarity after deleted item similarity5. 4 Reliability test result of brand-self similarity after deleted item similarity5, and similarity1. 5 Rotated component matrix.
6 Reliability test result of brand prestige distinctiveness. 7 Correlations of all variables. 8 Coefficients BS, BPD, BSB – CBI. 11 Coefficients of CBI - BL.
14 Summary of hypotheses testing result. 444 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.1 RESEARCH BACKGROUND In early of the 21st century, the mobile phone market experiences the boom of smartphone with the significant increasing of smartphone and changing in market share of many mobile-phone companies. Agile manufacturers with advantage of smartphone reach a miracle development and dominate regular phone manufactures. For years, smartphones as the new experiences and advanced utility of consumer which has brought massive profit for manufacturers may be peaking.
Robert (2013) predicts the possibility that smartphone market has reached the high point sales and now slowing growth. The prediction is strengthened by the lowest smartphone sales growth in nine years of European in 2013, as 12%. Additionally, over half of people who own a cell phone in US have a smartphone, and filling rate of the rest is much slower. These situation poses out a batch of problems that the administrators need to be concerned to maintain growing trend in saturated period.
Smartphone as a small brand of device in the past are now become the most important sector of every mobile phone manufacturers. The contrary with developed countries is emerging markets that Vietnam is a typical example in South East Asia. With GDP growth rate of about 5.42 percent in 2013 (GFK, 2013), Vietnam become a potential market for both international and domestic brand (Nguyen et al. In mobile phone areas, Vietnam is the fastest-growing market for smartphone in South-east Asia in the first-three quarter of 2013 and the values from January to September are more than double those of the same period in previous, this report additionally posits that half of all handset sold are now smartphones (GFK, 2013).
Notably, GFK forecasted that the ratio of smartphone users will increase fast from 23% in 2013 to 25% in 2014 and contributes around 82% of the total revenue of the market in 2014, and now in September 2014, the ratio of Vietnamese smartphone owner is much higher with LUAN VAN CHAT LUONG download : add luanvanchat@agmail. Those data point out the central of mobile-phone competition is shifting from regular cellular phone to smartphone. In that context, brand acts as an important role for building relationships with consumers that could assure for long-term business success of a smartphone manufacture. Assael (1991) proof that, when a customer decide to consume brand and satisfied, they tend to keep consume product from that brand in the future, combined with recommendation it to others, and become a loyalty customer.
Moreover, brand is also play an important role to reduce perceived risk from creating brand identity and image in consumer’s mind (Nandan, 2005). Unfortunately, although the concept of brands and branding have appeared for years in Vietnam and become one of the most growing bodies in marketing sector, branding practices in Vietnamese market in general are still underdeveloped, especially in comparisons between marketing approach of Vietnamese firms and foreign companies in Vietnam, according to Nguyen et al. As mention above, act as the central goal in branding practice is the formation of brand loyalty of customer. Jacoby and Kyner (1973) have described brand loyalty as a behavioral response and as a function of psychological processes of consumer.
Baldinger and Rubinson (1996), add that brand loyalty includes affective loyalty and action loyalty. Especially, Reichheald (1996) interprets the advantages of brand loyalty as follow: create long-term and cumulative profit, reduce of marketing cost by eliminating or minimizing costs from loyal customers, decrease operating cost, provides competitive advantage. The comments above show the important role of creating and maintaining brand loyalty for long term business. Since the crucial role of brand loyalty, its antecedences and consequences are studied deeply and summarized for years (Tepeci, 1999; Taylor et al.
Highlighted in his work, Aaker (1991) propose awareness is the first step toward loyalty and introduce the construct brand-self similarity with fifteen “facets” as measurement scale to describe brand image and self - image. The work of Rogerson (1983), suggests that the rising of reputation by selling high-quality products and providing premium prices, develops brand loyalty. A LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 3 strong brand image and its benefit are stressed in the work of Shiffman and Kanuk (1991), Berry et al. Promotion and perceived quality is also highlighted by Grover and Srinivasan (1992), Aaker (1991) and Elliott (1996).
Innovation remains brand’ product up to date and attracts customer by its superior and exceed customer needs (Nowlis & Simonsen, 1996; Aaker & Keller, 1990). Consumer-brand identification (CBI) is emerged from social identity theory and examines in consumer behavior and brand management context as the antecedence of brand loyalty (Escalas & Bettman, 2003; Lam et al., 2010; Stokburger-Sauer et al., 2012; Papista & Dimitriadis, 2012; Donavan et al. While a comprehensive sense for what creates CBI is of considerable importance to both marketing academics and practitioners, these issues have been examined from many diverse perspectives, causing the fragmented understanding (Stockburger-Sauer et al. While conceptualization of CBI is rooted in social identity theory, it is related to the construct of self-brand connections proposed by Escalas and Bettman (2003), defined as the extent to which an individual has incorporated a brand into their self-concept.
On the other hand, the work of Lam et al. (2010) view CBI as a formative construct composed of three dimensions. The cognitive dimension of their construct is similar to the notion of cognitive organizational identification in the work of Bergami and Bagozzi (2000). However, much is insufficient understood about the drivers of CBI- what factors cause it, and its consequences.
The literature also provide set of antecedents of CBI that includes three primarily cognitive variables (brand-self similarity, brand distinctiveness, and brand prestige) as well as rich brand-related factors (brand social benefits) (Donavan et al., 2008; Lam et al., 2010; Stokburger-Sauer et al. Becerra and Badrinarayanan (2013) suggest that brand identification influences positive and oppositional brand referrals. The work of Stokburger-Sauer et al. (2012) states the positive relationship between CBI and its outcome: loyalty and advocacy, which lead to the need of maximizing CBI in marketing management for the outcome-brand loyalty.
Moreover, CBI LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com 4 demonstrates as a powerful predictor of consumer behaviors by generates supportive behaviors like repurchase intention, word-of-mouth (Kuezel & Halliday, 2008). Notably, most of studies in CBI are carried out in developed country and less research about CBI in developing country. Especially there is the lack of research out CBI in Vietnam context.2 RESEARCH PROBLEM For decades, brands have been crucial for building relationships with consumers assuring long-term business success. In the time of great consumer skepticism toward brands, coupled with the fall in value of traditional media in promoting brands and the current global economic crisis, questions concerning consumer-brand identification have become even more important for brand management.
Bhattacharya and Sen (2003) argued that there is still much to learn about the role of consumer’ identification with a brand as well as its relation to consumer behavior and branding. Scholars recognize that consumer identification process has a significant impact on individual consumer behavior including: consumer buying related decisions (Ahearne et al., 2005), brand preference (Tildesley & Coote, 2009), consumer loyalty (Kim et al., 2001), psychological sense of brand community and brand commitment (Casaló et al., 2008), consumer satisfaction and a higher possibility of repurchase (Kuenzel & Halliday. 2008), positive word of mouth (Del Rio et al., 2001) and predict brand extensions’ success or failure (Viot, 2011).