BRAND EQUITY, PERCEIVED VALUE AND REVISIT EQUITY, PERCEIVED VALUE AND REVISIT ... to investigate the...

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  • BRAND EQUITY, PERCEIVED VALUE AND

    REVISIT INTENTION IN THE

    US MID-PRICED HOTEL SEGMENT

    By

    BONGRAN JIN SUN

    Bachelor of Art

    Ewha Womans University

    Seoul, Korea

    1996

    Submitted to the Faculty of the Graduate College of the

    Oklahoma State University In partial fulfillment of The requirements for

    The Degree of MASTER OF SCIENCE

    December, 2004

  • ii

    Woogon Kim

    Hailin Qu

    Gerald Leong

    A.Gordon Emslie

    BRAND EQUITY, PERCEIVED VALUE AND

    REVISIT INTENTION IN THE

    US MID-PRICED HOTEL SEGMENT

    Thesis Approved:

    __________________________________________

    Thesis Adviser

    __________________________________________

    __________________________________________

    __________________________________________ Dean of Graduate College

  • iii

    ACKNOWLEDGMENTS

    It has been an interesting and sometimes difficult journey. I wish to express my gratitude to

    the many who encouraged, supported, and sometimes prodded me along this path.

    I would like to thank my advisor Dr. Woogon Kim for giving me the brilliant idea of this

    study. My sincere appreciation extends to my other committee members. I want to deeply thank Dr.

    Hailin Qu who guided me in my fundamental knowledge of research and Dr. Jerald Leong whose

    sincere and warm trust always encouraged me.

    I would like to give my special appreciation to my husband, BJ, for his endless

    encouragement during times of difficulty, love and understanding throughout this entire process.

    Thanks also go to my parents, parents-in-law and other family including my three elder sisters and

    sisters-in-law for their unchanged trust in my endeavor.

    Finally, I am grateful to all the faculty of the Hotel and Restaurant Department who taught

    me through my degree course.

  • iv

    TABLE OF CONTENTS

    I. INTRODUCTION............................................................................................................... 1

    Background of the Study .............................................................................................. 1 Statement of Problem.................................................................................................... 2 Theoretical Framework................................................................................................. 2 Research Questions....................................................................................................... 4 Significance of the Study.............................................................................................. 4 Boundaries of the Study................................................................................................ 4 Definition of the Terms................................................................................................. 5 Organization of the Study ............................................................................................. 5

    II. LITERATURE REVIEW ................................................................................................. 7

    Conceptualizing of Measuring Brand Equity ............................................................... 7 Measurement of Brand Equity ...................................................................................... 9 Financial Perspectives................................................................................................. 10 Institutional Brand Equity Measurement .................................................................... 11 Customer Perspectives ................................................................................................ 12 Institutional Research on Measurement Brand Equity ............................................... 18 Combined Perspective ................................................................................................ 20 Validation of the Measuring Instrument ..................................................................... 21 Brand Equity Research in the Service Industry .......................................................... 22 Brand Equity in Hotels................................................................................................ 23 Pros and Cons of the Perspectives .............................................................................. 26 Summary of the Literature Review............................................................................. 26

    III. Methodology ................................................................................................................... 29

    Conceptual Model....................................................................................................... 29 Research Design.......................................................................................................... 33 Sampling ..................................................................................................................... 35 Analysis....................................................................................................................... 36

    IV. ANALYSES & RESULTS ............................................................................................. 37

    Characteristics of the Sample...................................................................................... 37 Measurement model.................................................................................................... 37

  • v

    Structural model.......................................................................................................... 40 Mean Difference of Brand Equity in the Measured Hotels ........................................ 42 Demographic Impact on Consequences of Brand Equity ........................................... 43

    V. CONCLUSION................................................................................................................. 44

    Research Summary & Implication.............................................................................. 44 Limitations & Suggestions.......................................................................................... 45

    REFERENCES...................................................................................................................... 47

    APPENDIXES A - IRB Approval .............................................................................. 51 APPENDIXES B - Cover Letter................................................................................. 52 APPENDIXES B - Survey Questionnaire .................................................................. 53 VITA........................................................................................................................... 54 ABSTRACT................................................................................................................ 55

  • vi

    LIST OF TABLE Table1. The Brand Equity Ten9

    Table2. Measures Used in Previous Studies on Consumer-based Brand Equity...............15

    Table3. A measure of the Expost Utilities of Brand.17

    Table4. Measures of Hotel Brand Performance and Awareness...................................24

    Table5. Summary of Literature Review 27

    Table6. Top six mid-priced Hotel in US....33

    Table7. Questionnaire Composition...34

    Table8. Demographic Characteristics of Respondents .....................38

    Table9. Reliability & Construct validity...39

    Table10. Construct Intercorrelations..40

    Table11. Standardized structural Path Estimates and Hypotheses test...41

    Table12. Mean Differences of Dimensions of Brand Equity.....43

    LIST OF FIGURE

    Figure1. Brand Equity...3

    Figure2. Organization of the Study..6

    Figure3. Dimensions of Brand Knowledge...8

    Figure4. BrandValuation..11

    Figure5. Brand Equity Measurement with the Brand Asset Valuator (BAV).19

    Figure6. Global Brand Equity Valuation Model.20

    Figure7. A Service-Branding Model...22

    Figure8. Antecedents and Consequences of Brand Equity.24

    Figure9. Hotel Brand Awareness Performance Matrix.....21

    Figure10. Conceptual Model of the Study..29

    Figure11. The Result of Overall Model of Predictors of Key Relationship Outcomes.42

  • 1

    I. INTRODUCTION

    Background of the Study

    Over the past few decades, there has been an explosive interest in brands among practitioners

    and researchers. The notion that a brand has an equity that exceeds its conventional asset value was

    developed by financial professionals (Motameni et al., 1998). According to Cobb-Walgren (1995),

    the probability of failure of a new brand launching in the market is as enormous as the cost of

    bringing new brand to market. Due to brands special attributes contributing to firms assets, hotel

    brands are regarded as very important properties that add significant value to the firms. Thus, many

    hotel companies are looking for expansion opportunities to acquire existing brands rather than to

    develop new brands. For example, Starwood Lodging Trust acquired Westin Hotels & Resort and

    changed its name to Starwood Hotels & Resorts. Bass PLC purchased both the Inter-Continental and

    Forum brands to strengthen its international exposure. Marriott international took over Ritz-Carlton

    by adopting an acquisition strategy rather than developing a new luxury segment.

    In marketing aspects, building a strong brand yields a number of marketing advantages. This

    includes greater custo