The study aims to develop a model for measuring and verifying the relationship between dimensions of brand equity and brand equity as a whole. The study uses quantitative methods to formally evaluate the scale and the impact of the factors on the customer-oriented brand equity of travel agencies in Hanoi. The samples were randomly selected from 215 questionnaires which were distributed and collected. The finding is that dimensions of brand value include brand awareness, brand association, perceived quality, brand loyalty, which have a strong impact on the brand equity of tour operator. This result implies that travel agencies should promote branding to improve brand awareness and brand loyalty in order to improve perceived quality and brand loyalty, thereby increase the brand value and competitive advantages.
THE ELEMENTS AFFECTING THE CUSTOMER-ORIENTED BRAND EQUITY OF TOURISM ESTABLISHMENTS IN HANOI Dr Bui Hung hung.mtdt2012@yahoo.com Faculty of Urban & Environmental Economics and Management, National Economics University, Hanoi, Vietnam PhD student Vu Thi Thu Ha thuhamar4@gmail.com Hanoi University of Industry Abstract The study aims to develop a model for measuring and verifying the relationship between dimensions of brand equity and brand equity as a whole The study uses quantitative methods to formally evaluate the scale and the impact of the factors on the customer-oriented brand equity of travel agencies in Hanoi The samples were randomly selected from 215 questionnaires which were distributed and collected The finding is that dimensions of brand value include brand awareness, brand association, perceived quality, brand loyalty, which have a strong impact on the brand equity of tour operator This result implies that travel agencies should promote branding to improve brand awareness and brand loyalty in order to improve perceived quality and brand loyalty, thereby increase the brand value and competitive advantages Keywords: Brand equity, travel agency Introduction The concept of brand equity has drawn so much attention of many scientists in the world since the 1980s These studies showed the extremely important role of the brand Building brand to increase competitive advantage has been proposed by many researchers such as Aaker (1991,1996), Keller (193, 1998, 2003), Yoo et al (2000, 2001) or Atilgan et al (2005,2009) If the brand is considered as the tip of an iceberg, the brand equity is the sink which helps the businesses survive and stand out in the market among fierce competition Particularly, in the service sector where the product is invisible, the quality is only perceived in the process of using, the process of production and consumption takes place simultaneously, the brand is the first factor to help the customers aware and encourage them to use the service In the context of economic integration and extensive development, Hanoi in general and tourism in particular have the opportunity to develop their great potential However, the competition is also extremely fierce among domestic enterprises and between domestic and foreign enterprises Therefore, branding is extremely necessary and urgent With the understanding of the factors affecting brand equity of travel agencies in Hanoi, the managers can make the right decisions towards the criteria that customers prefer 963 However, the assessment of brand equity in the service sector is relatively new; most of the studies focus on tangible products and there is no formal study about the factors affecting brand equity of travel agencies in Hanoi Thus, the paper focuses on the factors affecting the brand equity of travel agencies in Hanoi to provide the managers and policy makers of travel agencies with a more holistic view The author identifies three main approaches: Finance-oriented approach, Businessoriented approach, and Customer-oriented approach Customer-based approach (a concept of brand equity) is considered in the context of making the marketing decision The brand equity in the financial sense (the value of financial assets which brand equity creates for the business) is defined as the cash flow that accumulates for the branded product compared with non-branded products (Simon and Sullivan, 1993) Buil et al (2008) argue that brand creates profit for the brand and money flow for the organization Brand equity is the added cash flow created by the investments in the brand (Srinivasan and Associate (2005)) However, this approach does not help the managers utilize and develop the brand values (Kim et al., 2008) Business-oriented approach and customer-oriented approach was studied by Farquhar (1989), Aaker (1991a), Srivastava et al (1991)) Farquhar (1989) defines brand equity as the value added to the business, distributor, or the consumer by what the brand brings to the product Brand equity is a set of assets and liabilities associated to a brand name and its symbols that add to or subtract from the value provided by a product/service to a firm or to its customers (Aaker (1991a) Brand equity is the association and behavior of the consumers in the distribution channel which can produce sales as well as increase benefits for branded products compared to non-branded products? In addition, these associations and behaviors can bring advantages and differences to the business Brand equity in customer-oriented approach relates to only consumer perceptions of the brand rather than other objective indicators (Lassar et al., 1995) ) This approach was supported by many researchers such as Aaker (1991,1996), Keller (1993,2008), Kapferrer (1994), Yoo et al Walfried Lassar, Banwari Mittal and Arun Sharma (1995), Zeithaml, (1988) Villarejo-Ramos and Sanchez-Franco (2005), Amarette and Hendriana (2011), Villarejo- Ramos and Sanchez-Franco (2005), Amaretta and Hendriana (2011) because the origin of all activities must come from the customers This paper is also based on this approach The two most prominent researchers for this approach are David Aker and Kevin Lane Keller, whose two most famous books are Managing Brand Equity published in 1991 and Managing Customer ‒ Based Brand Equity published in 1993 The results of these two studies were also searched the most Results from Keller‘s study was based on Aaker's study but it was more comprehensive and rigorous According to Aaker, brand equity consists of brand loyalty, brand association, brand awareness and perceived quality: Brand loyalty is the core dimension of brand equity It's like "the binding that a customer has for a brand" Brand association is anything in the mind of the consumer when thinking about the brand The set of brand associations in a meaningful way is called brand image Brand 964 image plays an important role in differentiating the brand Brand personality is considered as the key association of brand image as it creates the identities and durability of the brand (Aaker D., 1996a; Aaker D., 1996b) Brand association (BAS) is anything in the customer's memory that "links" to a brand Brand awareness refers to the ability of a customer to recognize or remember a brand as a component of a particular product (Aaker D 1991) Perceived quality is the perception of the customer about the quality or overall superiority of a product in relation to other competitive options Therefore, the model of factors affecting brand equity as defined by Aaker is shown below: Brand loyalty Brand association Brand Equity Brand awareness Perceived quality There are many models of brand equity valuation but the author found that Aaker's model is the most suitable tool to analyze the factors affecting the customer-oriented brand asset of travel agencies in Hanoi area The following hypotheses are proposed: H1: There is a positive relationship between brand loyalty and brand value H2: There is a positive relationship between brand association and brand value H3: There is a positive relationship between the level of brand awareness and brand value H4: There is a positive relationship between perceived quality and brand value Methodologies The study uses quantitative methods to formally evaluate the scale and the impact of the factors influencing the customer-oriented brand equity of travel agencies in Hanoi Once the research model and observation variables have been developed, quantitative research is conducted in four steps: Step 1: Design survey sheet, carry out survey trial Questionnaires are delivered directly and send online to the consumers Step 2: Design the official survey sheet Step 3: Conduct the official survey 965 - The appropriate sample size for EFA analysis: The study has 24 variables need to be considered, so the minimum sample size needed is 24 * = 120 observed variables (Hair & ctg 2006) - The appropriate sample size to use regression model: For best regression results, the sample size should be: n> = 8p + 50 (where n is the minimum sample size needed, and p is the independent variable observed in the model) In this study, there are 19 observed independent variables with minimum sample size of * 19 + 50 = 202 (Tabachnick & Fidell, 1996) Thus, the minimum sample size 202 will help the author to achieve study purposes The number of survey sheet delivered is 215, the number of the collected sheet is 215, the number of valid sheet is 215 Method of sampling is convenience sampling The surveyed objects are people in Hanoi Step 4: Data collection and processing: - Statistics to describe the collected data - Analyze and process the data with the support of SPSS software version 22 for window operation - Data analysis is performed by measuring the reliability of the scale using Cronbach'Alpha coefficient, verify the value of the scale by exploratory factor analysis (EFA) and multivariate regression analysis to find out the importance level of the factors Results Descriptive statistics of sample Gender Ages Income Married status Male 33.9% Female 66.1% 50 22.4% 10 million/month 58.5% Not married 43.6% Married 56.4% Descriptive statistics of the sample shows that in the total of 215 respondents, 33.9% is male, female accounts for a larger number of 66.1% People aged 40-50 years old accounts for the largest proportion of 37.3%, the respondents younger than 20 years old is 966 only 5.3% Income statistics show that over a half of the respondents earn more than 10 million VND/month In addition, the proportion of the married and unmarried is approximately equal Verify reliability of the scale Synthesis of observed variables in the model The number of observed variables Type of variable Brand awareness Independent variable Brand association Independent variable Brand loyalty Independent variable Perceived quality Independent variable Brand equity Dependent variable Name of variable Verify reliability of the scales Correlation coefficient between variable and total Cronbach‘Alpha Source Variable ―Brand awareness‖ of travel agencies I am aware of how X looks like 0.603 0.765 I can realize X among other competitive brands 0.745 0.708 I know the brand X 0.801 0.795 Variable ―Brand association‖ of travel agencies Some personalities of brand X appear quickly in my mind 0.635 0.806 I can quickly image the logo, symbol of brand X 0.553 0.742 I have difficulty in recalling brand X in my mind 0.604 0.764 Variable ―Perceived quality‖ of travel agencies X is a high-quality brand 0.684 0.825 Sure that quality of brand X is extremely high 0.752 0.648 Maybe brand X has many interesting programs 0.895 0.786 Maybe X is very reliable 0.659 0.702 Yoo et al (2000) Yoo et al (2000) Yoo et al (2000) 967 Correlation coefficient between variable and total Cronbach‘Alpha X must have high quality 0.679 0.748 X seems to have poor quality 0.708 0.729 Variable ―Brand loyalty‖ of travel agencies Source Yoo et al (2000) I think I am loyal to X 0.559 0.802 X is my top choice 0.864 0.677 I will not use the tours from another brand if X has them 0.675 0.735 Variable ―Brand equity‖ of travel agencies Even if the brands are the same, the use of X instead of other brands is still considered meaningful 0.847 0.759 If another brand is exactly the same as X, I still choose X 0.865 0.785 If another brand is as good as X, I still choose X 0.679 0.825 If another brand is not different from X, choosing X is still a smart choice 0.723 0.689 Yoo et al (2000), Yoo & Donthu(2001) X is a particular brand Souce: Collection of the author According to Nunally & Burnstein 1994; according to Nguyen Dinh Tho & Nguyen Thi Mai Trang, 2009, the authors found that: The observed variables are greater than 0.6 which shows that these variables are closely related to each other and these scales are all selected Observed variables have correlation coefficient between variable and total greater than 0.3, all of these variables are accepted and will be included in EFA Alpha values: greater than 0.8 means good scale; from 0.7 to 0.8 is usable scale; 0.6 or more is usable in case that the research concept is new or new in the research context (Nunally, 1978; Peterson, 1994; Slater, 1995, cited by Hoang Trong and Chu Nguyen Mong Ngoc., 2005) Result of EFA With independent variables: Rotatel component Matrix, Kaiser- Meyer – Olkin and Bartlett‘s test 968 Factors NB1 0.756 NB2 0.789 NB3 0.825 LT1 0.761 LT2 0.825 LT3 0.679 TT1 0.812 TT2 0.723 TT3 0.895 TT4 0.684 TT5 0.748 TT6 0.864 CL1 0.748 CL2 0.746 CL3 0.694 KMO 0.866 Chi-Square 10764.302 Df 423 Sig 0.000 With independent variables: Rotatel component Matrix, Kaiser- Meyer – Olkin and Bartlett‘s test Factors TS1 0.811 TS2 0.762 TS3 0.844 TS4 0.648 KMO 0.768 Bartlett‘s test Chi-Square 2365.768 Df 254 Sig 0.000 Source: Survey of the author 969 EFA is used to varify the values of the scale The observed variables with load factor 0.5) ensure a significant level of factor analysis (Hair et al., 1998) The KMO coefficients of independent and dependent variables are 0.866 and 0.768 respectively (> 0.5), with mean Sig.=0.000 which reveals that factor analysis is appropriate, the variables are correlated and satisfy the conditions in factor analysis Verify the importance of factors The results of multivariate regression analysis show the impact level of the factors; the level of impact expresses by the Beta regression coefficient through the equation: TSTH = 0.385NBTH + 0.288LTTH + 0.172TTTH + 0.499CLCN The results tell us: For a change of brand equity, the travel agency needs 0.172 brand loyalty which means 0.172 of loyalty that a customer has for a travel brand For a change of brand equity, the travel agency needs 0.288 brand association which means 0.288 of anything in the consumer's mind when thinking about the travel brand For a change in brand equity, the travel agency needs 0.385 brand awareness which means 0.385 of the ability of a customer to recognize or recall a brand as a constituent element of a particular product For a change in brand equity, the travel agency needs 0.499 perceived quality which means 0.499 customer‘s perception of the quality or superiority of the product in comparison with other competitive options Discussion and Conclusion After analyzing the data, the factors affecting customer-oriented brand equity of travel agency in Hanoi are assessed Thereby, we can see that to improve customeroriented brand equity of travel agencies in Hanoi, different solutions should be combined, specifically: First: Group of solutions to strengthen and enhance the brand loyalty of travel agencies‘ customers Loyalty is a factor depending heavily on feelings and experiences Only with good experience, the customer will continue to use the product Therefore, good customer care policies are needed Building and supervising customer satisfaction indicators on a regular basis are necessary Second: Group of solutions to increase brand association of travel agencies‘ customers Brand association is an important dimension of brand equity Therefore, if the travel agency does not have effective solution to improve the brand identity, positioning and repositioning the brand in customer‘s minds is essential for brand association Logos, colors, slogan, etc are the elements that customers find most easy to think about a travel brand However, in building the brand, it is important to ensure that these associations can 970 create the identity which links to the customer and promote the communication; the design and spaces of publications should be unified Third: Group of solutions affecting the brand awareness of the customer towards travel agencies in Hanoi The businesses should focus on building the brand identity that is different and meaningful in customer‘s mind The customers can easily recognize the brand identity of a particular travel agency among other brands Brand awareness is evaluated by the customers of travel agencies as the second important factor (the first important factor is perceived quality), thus the travel agencies should focus on investing in this group of solutions Fourth: Group of solutions to improve the perceived quality of the customer towards travel agencies in Hanoi As the travel product consists of two parts which are tourism and other supporting services (food service, traveling ), product quality depends on both services and physical products In order to improve perceived quality, it is necessary to improve the quality of customer service; improving the level and attitude of employees also contributes greatly to the quality perception of the customers As surveyed, the factor that increases the brand equity of the travel agencies the most is perceived quality of the customer, thus the businesses should focus on improving product quality by delivering high-quality product and service packages References Aaker D (1996a), Building Strong Brands, 1st Ed., Free Press, New York Aaker D (1991), Managing Brand Equity, The Free Press, New York, NY Aaker D (1996b), ―Measuring Brand Equity across Products and Markets‘‘, California Management Review, 38, (Spring), p.102 Farquhar, P.H., Han, J.Y and Ijiri, Y (1991), Recognizing and Measuring Brand Assets, ReportNumber 91-119, Marketing Science Institute, Cambridge, MA Farquhar, Peter H (1989), "Managing Brand Equity," Marketing Research, (September), 24-33 Keller, K.L (1991), Conceptualizing, Measuring, and Managing Customer-based Brand Equity, Report Number 91-123, Marketing Science Institute, Cambridge, MA Keller, K.L (1993), ―Conceptualizing, measuring, and managing customerbased brand equity‖, Journal of Marketing, Vol 57, January, pp 1-22 Martin, G.S and Brown, T.J (1990), ―In search of brand equity: the conceptualization and measurement of the brand impression construct‖, in Childers, MacKenzie, Leigh, Skinner, Lynch Jr, Heckler, Gatignon, Fisk and Graham, (Eds), Marketing Theory and Applications, Vol 2, American Marketing Association, Chicago, IL, pp 431-8 Nguyễn Đình Thọ & Nguyễn Thị Mai Trang (2011), ‗Giá trị thương hiệu thị trường hàng tiêu dùng‘, Nghiên cứu khoa học Marketing - Ứng dụng mơ hình cấu trú tuyến tính SEM, Nguyễn Đình Thọ & Nguyễn ThịMai Trang, NXB Lao Động 971 10 Simon, C.J and Sullivan, M.W (1993), The measurement and determinants of brand equity: a financial approach, Marketing Science, 12(1), pp.28-53 11 Srinivasan, V., Park, Chan Su, & Chang, D R (2005) An Approach to the Measurement, Analysis, and Prediction of Brand Equity and Its Sources Management Science, 51(3), 1433–1448 12 Walfried Lassar, Banwari Mittal, Arun Sharma, (1995) "Measuring customer‐ based brand equity", Journal of Consumer Marketing, Vol 12 Issue: 4, pp.11-19 13 Zeithaml, Valarie A.(1988), ―Consumer perceptions of price, quality, and value: A means‒ end model and synthesis of evidence‖, Journal of Marketing, 52(July), ‒ 22 14 http://www.marketingchienluoc.com/ 972 ... customer has for a brand" Brand association is anything in the mind of the consumer when thinking about the brand The set of brand associations in a meaningful way is called brand image Brand 964 image... making the marketing decision The brand equity in the financial sense (the value of financial assets which brand equity creates for the business) is defined as the cash flow that accumulates for the. .. brand For a change of brand equity, the travel agency needs 0.288 brand association which means 0.288 of anything in the consumer's mind when thinking about the travel brand For a change in brand