How Much Do Product Differentiation, Marketing Investments and Brand Equity Actually Affect Price? An Empirical Study in the Consumer Market

2012 ◽  
Author(s):  
Nebojsa St. Davcik
2015 ◽  
Vol 49 (5/6) ◽  
pp. 760-781 ◽  
Author(s):  
Nebojsa S. Davcik ◽  
Piyush Sharma

Purpose – This paper aims to show the effect of brand equity, marketing investment and product differentiation on price in small and medium enterprises (SMEs), multinational companies (MNCs) and retailers (private labels). Academics have been researching brand equity, return on investment and effects of product differentiation for many years, but there has been little work that has taken a holistic view. Design/methodology/approach – The author studied an aggregate data set for 735 fast-moving consumer goods (FMCG) brands, taken from Nielsen (10,282 households). Regression analysis was used in the first step, a cluster analysis in the second step of modeling procedure. Findings – The study suggests that brand equity, marketing investment and product differentiation are closely associated with price. Using a cluster analysis, the authors found that the premium price is significantly associated with product differentiation based on innovation and company type. Practical implications – The managerial implications of the models estimated by regression analysis are discussed as well as the results of the cluster analysis and possible research enhancements. Originality/value – The role of the value in brand performance output has not been investigated in the financial context, only in consumer or marketing mix context. Little is known about how price strategy depends on brand equity, product innovation activities or marketing investments intended to improve brand performance, neither how this strategy improves brand performance among different players in the market (retailers, SMEs and MNCs).


2018 ◽  
Vol 8 (4) ◽  
pp. 65
Author(s):  
Anne Schmitz ◽  
Nieves Villaseñor-Román

In spite of the importance of the brand management in marketing studies and practice, there is a scarcity of prior research on the links between brand equity and financial performance, particularly in unlisted (unquoted) firms. The study contributes to prior research along a number of dimensions. It provides evidence on the relevance of brands for unlisted firms of several industries, by showing that brand equity is associated with financial performance even in non-quoted firms without world-recognized brands. Second, the study analyzes the association between brands and accounting-based measures of performance, across different windows and financial indicators. Finally, the evidence on earnings persistence is particularly relevant, as it potentially sheds light on the existing debate on the association between brand equity and stock markets. To the extent that firms with greater brand equity have more persistent earnings, current earnings contain greater information about future earnings, which show the relevance of brand management in the strategic planning of unlisted firms.


Author(s):  
Chin-Lung Hsu ◽  
Judy Chuan-Chuan Lin

This study investigates determinants of the adoption behavior of smartphone users. Despite the increasing number of smartphone users, the literature on information technology usage has paid little attention to the motivation behind smartphone adoption. This study identifies three determinants of smartphone adoption behavior: innovative characteristics, brand equity and social influences. Data were collected from 293 smartphone users. The analytical results have indicated that users choose to use smartphone not only for its usefulness, enjoyment and compatibility to their lifestyle (i.e. innovative characteristics), but also for its cost effectiveness (i.e. brand equity). Additionally, users will search for related information for the suitability of their adoption decisions (i.e. social influence). Together, the above factors account for over 60 percent of adoption behaviors. Moreover, the findings also indicate that perceptions of use varied over the innovation diffusion stage. Implications and suggestions for practitioners are also discussed.


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