Customer - Based brand equity: A case study on brand of traditional pottery village in the Northern provinces of Vietnam

ry. “Perceived quality is an invisible, holistic sense of a brand. However, it is usually based on basic dimensions including product characteristics to which the brand is attached such as reliability and performance” Aaker (1991, 106). It is evaluated by performance, features, conformance to specification, reliability, durability, serviceability - maintenance, conformance, and perfection (With service, it is evaluated by tangible factors, reliability, capacity, responsibility, empathy). Aaker (1991, 55) defines that “brand loyalty is the measure of attachment that a consumer has towards a brand. It reflects how likely a consumer will switch from that brand to another brand, especially when that brand makes a change in price or product features”. Five levels of brand loyalty are non-loyal buyers, the buyer with no reason to change, the loyal buyer with switching cost, the buyer likes the brand, and committed buyer. 2.2.2. Empirical research model on CBBE Table 2.3: List of empirical studies on the factors affecting CBBE No. Factors Author/Year 1 Brand awareness Yoo et al (2000); Yoo and Donthu (2001); Washburn and Plank (2002); Kim and Kim (2004); Pappu et al (2005); Atilgan et al (2005); Villarejo-Ramos and SanchezFranco (2005); Tregear và Gorton (2005); Duhan et al (2006); Buil et al (2008); Kim et al (2008); Atilgan et al (2009); Chen and Tseng (2010); Buil et al (2013); Saydan (2013) Welch (2014); Spielmann (2014); Nguyen Viet Bang (2015); Nguyen Tien Dung (2017); Le Thanh Tam et al (2017); Pham Thi Minh Ly (2014) Tho and Trang (2011); Nguyen Truong Son and Tran Trung Vinh (2011); Hoang Thi Phuong Thao et al (2010). 2 Brand associations Yoo et al (2000); Chen (2001); Yoo and Donthu (2001); Washburn and Plank (2002); Pappu et al (2005); Atilgan et al (2005); Villarejo-Ramos and SanchezFranco (2005); Tregear và Gorton (2005); Buil et al (2008); Atilgan et al (2009); Tong and Hawley (2009); Chen and Tseng (2010); Taglioni et al (2011); Buil et al (2013); Saydan (2013); Welch (2014); Spielmann (2014); Nguyen Viet Bang (2015); Nguyen Tien Dung (2017); Le Thanh Tam et al (2017); Pham Thi Minh Ly (2014); Nguyen Truong Son and Tran Trung Vinh (2011). 3 Perceived quality Kamakura and Russell (1993); Yoo et al (2000); Yoo and 8 Donthu (2001); Washburn and Plank (2002); Kim and Kim (2004); Netemeyer et al (2004); Pappu et al (2005); Atilgan et al (2005); Villarejo-Ramos and SanchezFranco (2005); Orth et al (2005); Duhan et al (2006); Morrison and Eastburn (2006); Buil et al (2008); Atilgan et al (2009); Dopico et al (2009); Burmann et al (2009); Chen and Tseng (2010) Taglioni et al (2011); Buil et al (2013); Saydan (2013); Spielmann (2014); Nguyen Viet Bang (2015); Nguyen Tien Dung (2017); Le Thanh Tam et al (2017); Pham Thi Minh Ly (2014); Thọ and Trang (2011); Nguyen Truong Son and Tran Trung Vinh (2011); Hoang Thi Phuong Thao et al (2010). 4 Brand loyalty Yoo et al (2000); Yoo and Donthu (2001); Washburn and Plank (2002); Kim and Kim (2004); Netemeyer et al (2004); Pappu et al (2005); Atilgan et al (2005); Villarejo-Ramos and SanchezFranco (2005); Buil et al (2008); Kim et al (2008); Atilgan et al (2009); Tong and Hawley (2009); Chen and Tseng (2010); Taglioni et al (2011); Kim (2012); Buil et al (2013); Saydan (2013); Welch (2014); Spielmann (2014); Nguyen Viet Bang (2015); Nguyễn Tiến Dũng (2017); Le Thanh Tam et al (2017); Pham Thi Minh Ly (2014); Nguyen Truong Son and Tran Trung Vinh (2011); Hoang Thi Phuong Thao et al (2010). 5 Brand impression Kim and Kim (2004). 6 Product's functional benefits Vazquez et al (2002); Kocak et al (2007) 7 Product’s symbolic benefits Vazquez et al (2002); Kocak et al (2007) 8 Brand name's functional benefits Vazquez et al (2002); Kocak et al (2007); Burmann et al (2009) 9 Brand's symbolic benefits Vazquez et al (2002); Kocak et al (2007) 10 Brand identity Netemeyer et al (2004); Burmann et al (2009) 11 Product differences Spielmann (2014) 12 Price Orth et al (2005) 13 Social benefits Orth et al (2005) 14 Emation Orth et al (2005) 15 Environmental benefits Orth et al (2005) 16 Personal image Morrison and Eastburn (2006) 17 Attraction Morrison and Eastburn (2006) 18 Relevant brand Shankar et al (2008) 9 19 Trust Kim et al (2008); Burmann et al (2009) 20 Satisfaction Kim et al (2008) 21 Brand trust Atilgan et al (2009) 22 Information Dopico et al (2009) 23 Perceived risk Dopico et al (2009); Kim (2012) 24 Committed relationship Kim et al (2008) 25 Brand empathy Burmann et al (2009) 26 Perceived value Kim (2012) 27 Origin Kim (2012) 28 Loyalty to product origin Spielmann (2014) 29 Perception of authenticity Spielmann (2014) 30 Perceived security Nguyen Viet Bang (2015) 31 Brand strength Le Thanh Tam et al (2017) 32 Brand passion Thọ and Trang (2011) 33 Brand image Hoang Thi Phuong Thao et al (2010) Source: Data of the author 2.3. Building models, scales, and preliminary hypotheses Models, scales, and preliminary hypotheses of the study are shown in the following figure: 10 H10 Perceived quality (Aaker, 1991; Yoo et al, 2001; Pappu et al, 2005; Lassar et al, 1995) Brand awareness (Aaker, 1991; Yoo et al, 2001; Buil et al, 2008) H1 H3 Brand equity of pottery craft village collective brand (Yoo et al, 2001) H8 H7 H5 H6 Brand associations (Aaker,1991; Keller,2013; Lassar et al,1995; Buil et al, 2008; Xiao Tong et al, 2009) Lifestyle H11c H11d H11a H2 H9 Brand loyalty (Aaker, 1991; Yoo et al, 2001; Keller, 2013; Xiao Tong et al, 2009) H11b H4 Gender, age, income 11 CHAPTER 3: METHODOLOGIES 3.1. Methodologies of the thesis 3.1.1. Data collection method 3.1.1.1. Methods of collecting secondary data With secondary data, the author uses desk research to get an overall picture about the research topic and the current situation as well as the research context of the thesis. 3.1.1.2. Methods of collecting primary data - Qualitative research To collect primary data, the author uses two methods: in-depth interview (personal interview) with customers of northern pottery craft village brands and group interviews with experts. As a result of these methods, the author builds the model, hypothesis, and scales measuring research concepts for the thesis. - Quantitative research With the quantitative data, the author uses the interview survey method. As a result of this method, the author has data and scientific evidence analyzed from a large number of customers. These data bring the author to the scientific conclusions and necessary governance implications. 3.1.2. Methods of processing data 3.1.2.1. Methods of processing qualitative data The data collected after qualitative research are reviews, opinions, statements, and comments from research subjects. These data are recorded, stored, and encoded in the computer, then converted into writings and analyzed to make the most general conclusions from qualitative research subjects. 3.1.2.2. Methods of processing quantitative data Quantitative data is processed by 02 steps: Step 1: Collect and prepare data - Interview with survey questionnaires. - Data classification, encryption, data entry. - Data cleaning. Step 2: Data analysis Based on data processing standards developed by the scientists for each test (Cronbach's Alpha, EFA, CFA, SEM), the author conducts the data analysis and evaluation for each specific case. 3.2. Current situation of trademark protection for rural products in Vietnam 12 Table 3.2: SWOT Matrix for the current situation of northern pottery craft villages Strengths (S) S1: Special clay material for unique products S2: Large rive system S3: Pottery products with cultural significance S4: Artistic and limited products S5: Brand associated with the places which are familiar with the consumers Weaknesses (W) W1: Raw materials are gradually scarce W2: Most of the kilns are of poor quality W3: Unsafe products (contain lead, toxic chemicals) W4: Most of the product are counterfeited W5: Distribution channels are narrow W6: Few markets are selling high-quality products W7: Unstandardized prices W8: The tools used to promote the craft villages are mostly not updated W9: There are few people who know the collective brand of the craft villages W10: Craft village association members are not aware of collective brand W11: There is no museum to display or keep the products W12: Lack of young and skilled human resources Opportunities (O) O1: Increasingly high market demand O2: More attention from the state O3: Economic integration, open market Threats (T) T1: Competition becomes fierce both domestically and internationally T2: There are few supportive policies T3: Infrastructure is still poor Source: Data collected by the author 3.3. Qualitative research Two methods including expert interview and personal interview are used with an available discussion outline which is open enough to exploit effectively all aspects. The results of 13 expert interview are as below: Firstly, the research concepts receive a high consensus of 08 experts. However, 01 among 08 experts finds no difference between the two variables which are brand awareness and brand association. The author appreciates this opinion and shall conduct further research. Secondly, the relationship between the independent variables and dependent variables is tested. All of 08 experts find a positive relationship between brand awareness, brand association, perceived quality, brand loyalty, and customer-based brand equity. The relationship among the factors including brand awareness, brand association, and brand loyalty proposed by the author is also agreed by all of 08 experts. Thirdly, the scales measuring research concepts are built with the combination between the original scale of Aaker, 1991, and empirical studies in the world. The scales receiving the consensus of most experts are brand awareness, brand loyalty, and customer- based brand equity. However, the scales of some research variables are adjusted to suit the research context. The combination of opinions from 08 experts and 09 individual customers (presented in Section 3.2.3) brings the author to a unified opinion shown by the calibrated scales in Table 3.2. Fourthly, the group of experts also considers and gives comments on forward translation and back translation of the scales measuring research concepts. Fifthly, the combination between the theory (Orth et al. (2005)) and the analysis of expert interviews brings the author to the conclusion that lifestyle definitely can moderate the relationship between brand awareness, brand association, perceived quality, brand loyalty, and collective brand equity of pottery craft village. The scale of Lifestyle is used by Google consumer segmentation [99], the author also finds that these scales are reasonable and covers the scales of Orth et al (2005). Most of the experts agree that Age can moderate the relationship between independent variables and dependent variable in the author's research model. In fact, many studies have pointed out such role of Age - Raziq et al. (2017), Nguyen Quang Dung (2019), etc. The author shall put this relationship in the model for testing. Sixthly, the demographic variables have different impacts on the relationships of factors affecting CBBE. The author notices this and shall use quantitative data to evaluate the quality of the scale and test the relationship. To check the clarity of texts (easy to read, easy to understand, easy to evaluate) to ensure the customers understand correctly the meaning of the question, the author conducts a personal interview. The results of all methods above lead the author to the official model, hypotheses, and scales for the thesis. 14 Perceived quality (Aaker, 1991; Yoo et al, 2001; Pappu et al, 2005; Lassar et al, 1995) Brand awareness (Aaker, 1991; Yoo et al, 2001; Buil et al, 2008) H3 H1 Brand equity of pottery craft village collective brand (Yoo et al, 2001) H8 H7 H5 H6 Brand associations (Aaker,1991; Keller,2013; Lassar et al,1995; Buil et al, 2008; Xiao Tong et al, 2009) Lifestyle, age H11c H12c H11d H12d H11a H12a H2 H11b H12d H9 Brand loyalty (Aaker, 1991; Yoo et al, 2001; Keller, 2013; Xiao Tong et al, 2009) H4 Gender, income inco me 15 CHAPTER 4: STUDY RESULTS 4.1. Preliminary quantitative research results With the collected samples accounting for 25% (250) of total official samples, the author has 210 useful answer sheets. Cronbach's Alpha test results show that the variable PQ6 is dissatisfied and should be removed. In EFA test, BAS6 has factor loading <0.5, thus BAS6 is excluded from the group of observed variables explaining the research concepts. After removing dissatisfied observed variables, 05 factors are extracted. These five factors explain 64,171% of the total variance of the observed variables. The remaining observed variables which explain perfectly the research concepts will be moved to the next step. 4.2. Official quantitative research results 4.2.1. Sample statistical result The number of customers in each craft village is approximately the same. 64% of the interviewees are female, it indicates that the majority of people buying pottery products are women. This result is understandable as pottery products meet the great needs of women, such as decorating, containing, belief, etc. In terms of age, the largest number of customers is the group of 26-35 years old (276 persons, accounting for 32.1%). Another group of age having a quite large number of customers is 36 - 60 years old, accounting for 26.2% of the interviewees. The group of customers over 60 years old, accounting for 22.3% of the interviewee is also interested in buying pottery products. The reason for this interest is that pottery products meet the needs of this age group such as beliefs, rituals, decoration, or containing. They are also popular purposes the pottery products serve. The age group of 18 - 25 years has the least number of customers (167 persons, accounting for 19.4%). Young people have more interest and access to modern products instead of pottery due to the traditional characteristics of pottery products. In terms of average income, most of the customers have income from 5 to less than 10 million VND which is the basic living standard of Vietnamese people. The percentages of the customer groups with income above 20 million VND and less than 5 million are low (13% and 16% respectively). This indicates that the income of Vietnamese people is distributed quite evenly, and the most popular income level is from 5 million to 20 million VND. Having an interest in new technology is the lifestyle that most interviewees choose to answer (275 persons, accounting for 32.0%). The remaining lifestyle groups with a relatively equal number of interviewees are music and art (accounting for 24.5%), sports (22%), watching television, listening to the news on the radio (21.5%). 4.2.2. Results of testing scales Cronbach's Alpha test results show that the observed variables are satisfied. EFA results remove BL3 which has factor loading less than 0.5. Five groups of factors explain 16 61.193% of the data variation. Thus, there is a total of 29 observed variables creating 5 factors, which are eligible for CFA analysis. CFA analysis (to test the conformity of model, assess scale reliability, test convergent validity, uniqueness, discriminant validity) is conducted and all factors meet the requirements. 4.2.3. Testing model and hypotheses of the thesis Results of testing model and hypotheses of the thesis The results indicates that the model conforms with the research data as Chi-square/df= 1.583 (0.9; RMSEA= 0.026 (<0.08). SEM analysis results: Correlation relationship between the factors Estimate S.E. C.R. P Standardized PQ <--- BAW 0.111 0.043 2.583 0.010 0.104 BAS <--- BAW 0.139 0.040 3.484 0.000 0.138 BAS <--- PQ 0.112 0.036 3.060 0.002 0.118 BL <--- BAW 0.126 0.045 2.831 0.005 0.112 BL <--- BAS 0.146 0.043 3.403 0.000 0.131 BL <--- PQ 0.135 0.041 3.316 0.000 0.129 CBBE <--- BAW 0.221 0.039 5.724 0.000 0.221 CBBE <--- BAS 0.210 0.037 5.654 0.000 0.212 17 CBBE <--- PQ 0.174 0.035 4.939 0.000 0.186 CBBE <--- BL 0.156 0.033 4.699 0.000 0.175 Then the author test again the reliability of the model with Bootstrap by repeated sampling with the size N = 3000. The estimated results show the appearance of bias and standard error of bias (SE-Bias) between bootstrap estimates and the optimal estimates of the study, but it is insignificant. This indicates that the estimates in this study are reliable. Specifically, the absolute value CR <= 2, so the bias is very small. Thus, it is concluded that the estimates in the model are reliable. 4.2.3. Testing the influence of control variables (gender, income) on pottery craft village collective brand equity Result of testing the influence of control variables Mean Std Deviation p CBBE <--- Gender Female 3.58 1.02 0.003 Male 3.77 0.95 CBBE <--- Income Below 5 million VND 3.71 0.99 0.428 From 5 to 10 million VND 3.64 0.99 From 10 to 15 million VND 3.69 0.94 From 15 to 20 million VND 3.62 1.05 Over 20 million VND 3.57 1.05 Thus, the analysis results show that there are differences in the mean of CBBE between males and females (p<0.05). Mean of CBBE in the male group (3.77) is higher than the female group (3.58). In addition, there is no difference in mean of CBBE among groups of income (p>0.05). 4.2.4. Testing the influence of moderating variables (lifestyle, age) The author conducts a multi-group structure analysis to test the research model with moderating groups by 02 models: invariant model and (partial) variant model. The result is that hypotheses H11c and H11d are disproved, H11a, H11b, H12a, H12b, H12c, H12d are accepted. Specifically: Lifestyle moderates the relationship between BAW and CBBE. In which, BAW factor positively influences CBBE factor the most strongly in group Like watching television, listening to news on the radio (0.518); the second strongest influence is from group Like sports (0.330); followed by the group Like music and art (0.299); the weakest influence is from the group Like new technology (0.173) Lifestyle moderates the relationship between BAS and CBBE. In which, BAS factor 18 positively influences CBBE factor the most strongly in group Like new technology (0.452); the second strongest influence is from group Like music and art (0.321); followed by the group Like watching television, listen to news on the radio (0.202); the weakest influence is from the group Like sports (0.109) Age moderates the relationship between BAW and CBBE. In which, BAW factor positively influences CBBE factor the most strongly in group Over 60 years old (0.549); the second strongest influence is from group 36-60 years old (0.284); followed by the group 26- 35 years-old (0.263); the weakest influence is from the group 18-25 years old (0.110) Age regulates the relationship between BAS and CBBE. In which, BAS factor positively influences CBBE factor the most strongly in group Over 60 years old (0.452); the second strongest influence is from group 26-35 years old (0.314); followed by the group 36- 60 years old (0.232); the weakest influence is from the group 18-25 years old (0.154) Age regulates the relationship between PQ and CBBE. In which, factor PQ positively influences CBBE factor the most strongly in group 18-25 years old (0.472); the second strongest influence is from group 26-35 years old (0.266); followed by the group 36-60 years old (0.207); the weakest influence is from the group Over 60 years old (0.135) Age regulates the relationship between BL and CBBE. In which, BL factor positively influences CBBE factor the most strongly in group 18-25 years old (0.522); the second strongest influence is from group 26-35 years old (0.305); followed by the group 36-60 years old (0.201); the weakest influence is from the group Over 60 years old (0.111). CHAPTER 5: COMMENTS AND RECOMMENDATIONS 5.1. Summary of study results and discussion Firstly, the first 02 questions of the thesis are answered, including: What are the factors influencing pottery craft village brand equity? And how is the influence? Results: Brand awareness has the strongest impact on the collective brand equity of pottery craft village (with impact coefficient = 0.22), followed by brand association (0.21); followed by perceived quality (0.17) and brand loyalty (0.16). Besides, brand awareness affects brand loyalty (0.13), affects brand association (0.14), and perceived quality (0.11). Perceived quality affects brand association (0.11), affects brand loyalty (0.15). Brand association affects brand loyalty (0.14). Similarities with the author's research: Most researches in the world and Vietnam confirm the relationship between BAW, BAS, PQ, BL and CBBE: Yoo et al (2000); Yoo and Donthu (2001); Pappu et al (2005); Buil et al (2013); Nguyen Viet Bang (2015); Nguyen Tien Dung (2017); Kim and Kim (2004); Tho and Trang (2011), etc. 19 Differences from the author's research: The results of the study once again confirm that there are differences between the two concepts of brand awareness and brand association (two variables have been measured by independent scales) which is similar to the results of Washburn et al (2002 ) or Pappu et al (2005) or Buil et al (2008) and different from that of Yoo et al (2000, 2001). Meanwhile, Yoo et al (2000, 2001) combined two variables of brand awareness and brand association into one and measured by a common scale. In addition, the impact level of these factors on CBBE is very different in different studies. This can be explained by the different research contexts of each study. Secondly, the third question of the thesis is answered: Is there a moderating of the variables age and lifestyle to the relationship between brand awareness, brand association, perceived quality, brand loyalty and CBBE? The multi-group analysis leads the author to the result that the hypotheses H11c, H11d are disproved, the remaining hypotheses H11a, H11b, H12a, H12b, H12c, H12d are accepted. The study of Orth et al. (2005) confirms that lifestyle moderates the relationship between perceived quality and brand equity. However, the author's study results indicate that lifestyle only moderate the relationships between brand awareness and brand equity, between brand association and brand equity. The levels of moderating vary by each group of lifestyle. Another new point the thesis has found is that age moderates all 04 relationships: between brand awareness and brand equity, brand associations and brand equity, perceived quality and brand equity, brand loyalty and brand equity. The levels of moderating vary by different groups of age. 5.2. Some proposals and recommendations 5.2.1. Some proposals for manufacturers and collective brand managers of pottery craft villages 5.2.1.1. Group of solution based on secondary data Based on the current status of secondary data of the thesis (Table 1.1: SWOT Matrix for current situation of northern pottery craft villages - Section 1.1), the author proposes some recommendations on products, prices, distribution channels, promotion-mix 5.2.1.2. Group of solution based on primary data Analysis results show that there is a difference in mean of CBBE between males and females. In which, the mean of CBBE in the male group (3.77) is higher than that of the female group (3.58). Thus, male customers will need to be paid more attention in communication programs on pottery craft village collective brand. 20 Group of solutions to improve brand awareness of pottery craft villages. According to the survey results, brand awareness is the factor that has the strongest impact on brand equity of pottery craft villages (with an impact coefficient of 0.22). Therefore, we need to take strong measures to improve collective brand awareness of pottery craft villages. The results show that the weakest scale is BAW4 which is the collective brand of X pottery village is mentioned by many people when they need pottery products. However, the surveyed objects have many very di