REGENT BUSINESS SCHOOL

An evaluation of the role of marketing strategies in developing brand equity of a DNA
forensic and...
An evaluation of the role of marketing strategies in developing brand equity of a
DNA forensic and relationship testing co...
DECLARATION
I, Nevin Siralen Pillay, do hereby declare that this dissertation is the result of my
investigation and resear...
ACKNOWLEDGEMENTS

•

Firstly, I wish to acknowledge my inspirational parents, Krish Pillay and
Kogie Pillay for their endu...
ABSTRACT	
  
	
  
Brand equity is important in today’s marketplace in the building, maintaining and
using a brand to obtai...
DEDICATION

To my parents, Krish and Kogie Pillay. Thank you for being the parents you are.

v	
  
	
  
 

Table of Contents

Contents

Page Number

Title Page

i

Declaration

ii

Acknowledgements

iii

Abstract

iv

Dedicati...
CHAPTER TWO: LITERATURE REVIEW
2.1

Introduction

7

2.2

Brand Equity

7

2.3

Brand Loyalty

10

2.4

Perceived Quality
...
3.6

Research Objectives

29

3.7

Target population

29

3.7.1

Sampling and Sample Size

30

3.7.2

Sampling Method

30
...
4.4

Section A: The Sample Demographic

40

4.4.1

Gender

40

4.4.2

Age

41

4.4.3

Marital Status

42

4.5

The Researc...
5.4

Research Limitations

77

5.5

Recommendations and Conclusions

78

BIBLIOGRAPHY

80

APPENDIX A

86

APPENDIX B

87
...
LIST OF FIGURES	
  

Page Number
Figure 2.1

Brand Equity Model

9

Figure 2.2

Loyalty Pyramid

12

Figure 2.3

The Value...
LIST OF TABLES	
  

Page Number
Table 3.1

Questionnaire Response Percentage

34

Table 4.1

Your Gender

40

Table 4.2

Y...
Table 4.21

You particularly like DNA Test as a brand.

53

Table 4.22

DNA Test has a good reputation.

53

Table 4.23

D...
Table 4.40

DNA Test product and service are efficient / I consider myself to be loyal to the DNA
Test brand.

67

Table 4...
CHAPTER 1
INTRODUCTION
1.1

Introduction

The term brand equity refers to the monetary value of brand names. A brand with ...
Brand valuation is the task of estimating the total financial value of a brand. However
measuring such value, according to...
change has been challenging. Primarily because of the negative perceptions regarding
DNA testing. As such, bringing consum...
organisations benefit from significant brand loyalty, then a new entrant will face an up
hill battle to obtain a share of ...
1.6

Research Questions
•

What is the relationship between the marketing strategies and quality of the
service, consumer ...
Chapter 3: Research Methodology
The research design and methodology will be outlined within this chapter, including
sampli...
CHAPTER TWO
LITERATURE REVIEW
2.1 Introduction
The literature review is essentially an analytical and intensive analysis o...
image, advertising spend and price deals also affect brand awareness and brand
associations positively.
However brands dif...
Figure 2.1. Brand Equity Model

Resonance
4. Relationships – what about you
and me?
Judgments and feelings
3. Response – w...
2.3.

Brand Loyalty

The concept of brand loyalty is defined by many different approaches, that range from
preference, to ...
(2006:222) and Kotler and Pfoertsch (2010:311) acknowledge that definition of brand
loyalty defined by Jacoby and Kyner in...
Figure 2.2. The Loyalty Pyramid

Committed Buyer
Likes the brand – considers it
a friend
Satisfied Buyer with Switching
co...
associated with another brand. For these consumers there is the risk that
another brand may not function as well in a part...
will be useful, but the perceived quality itself is a summary, global construct.
Perceived quality is based on the judgmen...
is absent of defects.
• Features: consequential elements of the product that compliment its
characteristics.
• Performance...
advantage.
• Price Premium – Perceived quality provides the advantage of charging a price
premium. The price premium can i...
member of a certain product category. The consumer forms a link between product
class and the brand. Aaker (1991) suggests...
Brand awareness can be an indicator of substance. Considering a groups brands is the
first stage in the buying process. Br...
Product
Associations

Functional
Attrribute
Associations
Non-Functional
Attribute
Associations

Brand Associations
Corpora...
will explore the consumers perception on five selected marketing elements, namely
price, online presence, distribution int...
2.7.2. Online Presence
Online presence is the process of presenting and drawing traffic to a brand through the
use of the ...
Advertising researchers have identified that advertising is successful in generating
brand equity (Boulding, Lee and Stael...
advertising could reduce a brand association, which leads to decreasing the brand
equity. Promotions often fail to establi...
•

Perceived comparative quality

•

Perceived brand leadership

•

Perceived brand value (brands functional benefits)

•
...
• brand awareness requires continuously exposing consumers to the brand and
linking the brand in the memory of the consume...
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Introduction
Research methodology is the complete process of the research study (Co...
3.3 Research Design
A research design guides the researcher in planning and implementing the study in a
way that is likely...
3.4.1 Positivist Research Strategy
The positivist research methodology uses surveys to gather data. The survey strategy
is...
3.6

Research Objectives
The objectives of this study were as follows:

•

Examine the relationship between the marketing ...
responses were received. The researchers sample size is also based on limitations of
the population researched.
3.7.1

Sam...
precise and unbiased information. Rossouw (2010:128) describes surveyresearch as a
multi-tiered process.
Figure 3.1: Stage...
3.9

Questionnaire Construction

Goddard and Melville(2009:47), state that questionnaires normally consist of a list of
qu...
3.10

Pilot Study

Zikmund, Babin, Carr and Griffin (2012:63), define a pilot study as a strategy used to
test the questio...
3.12

Response Percentage

Two hundred questionnaires were distributed to the participants. The response
percentage for th...
The t-test, mean, and Chi-square will be implemented. The questionnaire will be
analyzed, through the use of a mean statis...
•

Criterion-Related Validity
Criterion-related validity is related to the ability of the questions, within the
questionna...
- This study is limited to customers whom have used the product of the brand. Thus
this research cannot determine a genera...
3.18

Conclusion

In this chapter the research methodology for this study was discussed. Included in the
chapter, was the ...
CHAPTER FOUR
RESULTS, DISCUSSIONS AND INTREPRETATION OF FINDINGS
4.1.

Introduction

In the previous chapter, an overview ...
data was ordinal in nature, and non-parametric tests required as per the tests for
normality (as per the Kolmogorov-Smirno...
4.4.2

Age

Figure 4.2.

Age of Respondents

Frequency Bar Chart of Respondents Age

Frequency

100
80
60
40
20
0
Under 25...
4.4.3. Marital Status
Figure 4.3.

Martial Status
Frequency bar Chart of Respondents Maritial Status

Frequency

80
60
40
...
4.5.1. Reliability
Table 4.4

Reliability Statistics
Reliability Statistics
Cronbach's Alpha

N of Items
.825

21

The Cro...
Table 4.5

Gender
Age
Marital Status
Q4
Q5
Q6
Q7
Q8
Q9
Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20
Q21
Q22
Q23
Q24

Tests ...
validity. Normality tests have demonstrated that the data is not normally distributed.
Therefore, the analysis was determi...
offers good value for money evokes a strong positive emotion. (Median = 2 and
Standard Deviation of 1.156, n = 130)
Table ...
Table 4.9

DNA Test sells a product or service of high quality

DNA Test sells a product or service of high quality
Freque...
Table 4.11

The pharmacies where I can buy DNA Test products or services sell
well known brands

The pharmacies where I ca...
Table 4.13

The adverts for DNA Test products and services seem expensive

The adverts for DNA Test products and services ...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing co...
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An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing company

  1. 1. REGENT BUSINESS SCHOOL An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing company. NEVIN SIRALEN PILLAY MBA 2013
  2. 2. An evaluation of the role of marketing strategies in developing brand equity of a DNA forensic and relationship testing company. by NEVIN S PILLAY Student No: MBA 210020 F Submitted in partial fulfillment of the requirements for the degree: MASTERS DEGREE IN BUSINESS ADMINISTRATION (MBA) at the REGENT BUSINESS SCHOOL SOUTH AFRICA Supervisor: SALESH PANDAY 2013
  3. 3. DECLARATION I, Nevin Siralen Pillay, do hereby declare that this dissertation is the result of my investigation and research and that this has not been submitted in part or full for any other degree to any other University. …………………………………… 28 May 2013 …………………. Nevin Siralen Pillay Date         ii    
  4. 4. ACKNOWLEDGEMENTS • Firstly, I wish to acknowledge my inspirational parents, Krish Pillay and Kogie Pillay for their enduring support, unwavering understanding and unspoken encouragement, this during my entire natural existence. “I love the both of you” • Secondly, I want to thank my siblings, Kesigan, Preveshan and Rushanta. Your understanding and thoughtfulness during my studies, has not gone unnoticed. • I would also like to express my sincere gratitude to my supervisor, Salesh Panday, whose guidance and support have been essential in completing this dissertation. • A deserved mention to Leticia Augustine for her assistance with administering of the questionnaire and the hours dedicated to formatting this study. • Lastly I wish to acknowledge 3 genuine gentleman, Wayne Barr, Kumaren Chetty and Marc van Heerden. Without your continuous support and encouragement completing this degree would have been unachievable. iii    
  5. 5. ABSTRACT     Brand equity is important in today’s marketplace in the building, maintaining and using a brand to obtain strategic advantage. Brand equity refers to the basic idea that a product's value is enhanced when it is associated or identified over time with a set of unique facets that define the brand. This study aims to evaluate the role of marketing strategies in developing brand equity for DNA Test, the business referenced in this study. DNATest is a South African company specializing in forensic and relationship DNA testing. The predicament that DNATest finds itself in is that the company has been the first marketers of direct-to-consumer DNA testing in South Africa. Leading this change has been challenging. Primarily because of the negative perceptions regarding DNA testing. As such, bringing consumers attention to the brand and not only its product is consequential. Hence building brand equity is one of the fundamental elements for a businesses success and growth. Building brand equity will become a key asset to the company. The significance is that by enhancing its brand equity the company is more likely to increase its profits. The study was based on the quantitative approach. A structured closed ended questionnaire was designed using the Likert scale of rating. In this study all individuals included in the sample size are past clients of the company, DNA Test. These individuals have used the services of DNATest. This qualified them to be part of this study in terms of the inclusion criteria of this study. The research recommends to DNA Test management that an understanding that the brand is an essential asset for the company and that long term brand equity is vital. Further, the research recommends that in building brand equity a brand identity strategy with a convergent plan of activities to impact and influence the consumer is necessary. iv    
  6. 6. DEDICATION To my parents, Krish and Kogie Pillay. Thank you for being the parents you are. v    
  7. 7.   Table of Contents Contents Page Number Title Page i Declaration ii Acknowledgements iii Abstract iv Dedication v Table of Contents vi List of Figures xi List of Tables xii CHAPTER ONE: INTRODUCTION 1.1 Introduction 1 1.2 Background to the Problem 2 1.3 Problem Statement 3 1.4 Aim of the Study 4 1.5 Objectives of the Study 4 1.6 Research Questions 5 1.7 Significance of the Study 5 1.8 Format of the Study 5 1.9 Conclusion 6 vi    
  8. 8. CHAPTER TWO: LITERATURE REVIEW 2.1 Introduction 7 2.2 Brand Equity 7 2.3 Brand Loyalty 10 2.4 Perceived Quality 13 2.5 Brand Awareness 16 2.6 Brand Associations 18 2.7 Marketing Mix Elements 19 2.7.1 Price 20 2.7.2 Online Presence 21 2.7.3 Distribution Intensity 21 2.7.4 Advertising Spend 22 2.7.5 Price Promotion 22 2.8 Customer Based Brand Equity 23 2.9 Conclusion 25 CHAPTER THREE: RESEACH METHODOLOGY 3.1 Introduction 26 3.2 Rationale for the Methodology 26 3.3 Research Design 27 3.4 Research Strategy 27 3.4.1 Positivist Research Strategy 28 3.5 Aim of the Study 28 vii    
  9. 9. 3.6 Research Objectives 29 3.7 Target population 29 3.7.1 Sampling and Sample Size 30 3.7.2 Sampling Method 30 3.8 Research Method 30 3.9 Questionnaire Construction 32 3.10 Pilot Study 33 3.11 Administration of Questionnaire 33 3.12 Response Percentage 34 3.13 Data Analysis 34 3.14 Validity and Reliability 35 3.14.1 Validity 35 3.14.2 Reliability 36 3.15 Limitations of the Research 36 3.16 Elimination of Bias 37 3.17 Ethical Considerations 37 3.18 Conclusion 38 CHAPTER FOUR: DATA ANALYSIS, INTRPRETATION AND FINDINGS 4.1 Introduction 39 4.2 Response Rate 39 4.3 Analysis and Interpretation of Data from Respondents 39 viii    
  10. 10. 4.4 Section A: The Sample Demographic 40 4.4.1 Gender 40 4.4.2 Age 41 4.4.3 Marital Status 42 4.5 The Research Instrument 42 4.5.1 Reliability 43 4.5.2 Factor Analysis 43 4.6 Section B : Brand Interaction Factors 45 4.7 Research Correlations 56 4.7.1 Place 56 4.7.2 Price 60 4.7.3 Promotion 63 4.7.4 Product 66 4.7.5 Customer Response 69 4.8 Conclusion 71 CHAPTER FIVE: CONCLUSION AND RECOMMENDATIONS 5.1 Introduction 72 5.2 The Objectives of the Study 72 5.3 Findings from the Study 72 5.3.1 Findings from the Literature Review 72 5.3.2 Findings from the Primary Research 75 ix    
  11. 11. 5.4 Research Limitations 77 5.5 Recommendations and Conclusions 78 BIBLIOGRAPHY 80 APPENDIX A 86 APPENDIX B 87 APPENDIX D 89 x    
  12. 12. LIST OF FIGURES   Page Number Figure 2.1 Brand Equity Model 9 Figure 2.2 Loyalty Pyramid 12 Figure 2.3 The Value of Perceived Quality 15 Figure 2.4 Brand Association 19 Figure 2.5 The Marketing Mix 20 Figure 3.1 Stages in the Survey Process 31 Figure 4.1 Gender of Respondents 40 Figure 4.2 Age of the Respondents 41 Figure 4.3 Marital Status of Respondents 42     xi    
  13. 13. LIST OF TABLES   Page Number Table 3.1 Questionnaire Response Percentage 34 Table 4.1 Your Gender 40 Table 4.2 Your Age 41 Table 4.3 Your Marital Status 42 Table 4.4 Reliability Statistics 43 Table 4.5 Tests of Normality 44 Table 4.6 The price of DNA Test service or product is high. 45 Table 4.7 The price of DNA Test service or product is value for money. 46 Table 4.8 The price of DNA Test service or product is low. 46 Table 4.9 DNA Test sells a product or service of high quality. 47 Table 4.10 The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands 47 Table 4.11 The pharmacies where I can buy DNA Test products or services sell well known brands 48 Table 4.12 DNA Test brand is advertised appropriately. 48 Table 4.13 The adverts for DNA Test products and services seem expensive. 49 Table 4.14 I consider myself to be loyal to the DNA Test brand. 49 Table 4.15 DNA Test product or service would be my first choice should I require another DNA test 50 Table 4.16 I will use DNA Test product or service again. 50 Table 4.17 I can recognise the DNA Test brand among competitive brands. 51 Table 4.18 I am aware of the DNA Test brand. 51 Table 4.19 DNA Test provides excellent quality. 52 Table 4.20 DNA Test products and services are trustworthy and reliable. 52 xii    
  14. 14. Table 4.21 You particularly like DNA Test as a brand. 53 Table 4.22 DNA Test has a good reputation. 53 Table 4.23 DNA Test is a brand leader. 54 Table 4.24 DNA Test products and services are efficient. 54 Table 4.25 Are you willing to pay a higher price for a DNA Test product or services as compared to other competitive offerings 55 Table 4.26 I will recommend DNA Test service or product to others 55 Table 4.27 The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands / The price of DNA Test service or product is high. 57 57 Table 4.28 The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands / DNA Test product or service would be my first choice should I require another DNA test 58 Table 4.29 The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands / The pharmacies where I can buy DNA Test products or services sell well known brands Table 4.30 The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands / I consider myself to be loyal to the DNA Test brand. 59 Table 4.31 The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands / I am aware of the DNA Test brand. 60 61 Table 4.32 The price of DNA Test service or product is value for money / The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands Table 4.33 The price of DNA Test service or product is value for money / DNA Test product or service would be my first choice should I require another DNA test 61 Table 4.34 The price of DNA Test service or product is value for money / DNA Test provides excellent quality. 62 Table 4.35 The price of DNA Test service or product is value for money / I will recommend DNA Test service and products to others 63 Table 4.36 DNA Test brand is advertised appropriately / The pharmacies or website where I can buy DNA Test products or services sell a wide range of well known brands 64 Table 4.37 DNA Test brand is advertised appropriately / DNA Test product or service would be my first choice should I require another DNA test 64 Table 4.38 DNA Test brand is advertised appropriately / DNA Test provides excellent quality. 65 Table 4.39 DNA Test brand is advertised appropriately / You particularly like the DNA Test brand 66 xiii    
  15. 15. Table 4.40 DNA Test product and service are efficient / I consider myself to be loyal to the DNA Test brand. 67 Table 4.41 DNA Test product and service are efficient/ DNA Test product or service would be my first choice should I require another DNA test 67 Table 4.42 DNA Test product and service are efficient/ You particularly like the DNA Test brand 68 Table 4.43 I will use DNA Test product or service again / DNA Test sells a product or service of high quality 69 Table 4.44 I will use DNA Test product or service again / I consider myself to be loyal to the DNA Test brand 69 Table 4.45 I will use DNA Test product or service again / I am aware of the DNA Test brand 70 xiv    
  16. 16. CHAPTER 1 INTRODUCTION 1.1 Introduction The term brand equity refers to the monetary value of brand names. A brand with a strong brand equity is a valuable asset. (Lamb, Hair, McDaniel, Boschoff and Tereblanche, 2008:216). Brand management is a topic of significant interest for both academia and industry. Building powerful brands is seen as one of the key responsibilities of brand managers, for the success of any organisation. (Kim, 2004) Lamb et al. (2008:216) refer to brand equity as the monetary value of brand names. They further imply that a brand that has high awareness, perceived quality and brand loyalty among customers has high brand equity. Hence brand equity is a multidimensional concept. According to Aaker (1991:39) brand equity is a set of brand assets and liabilities linked to a brand, its name and symbol, which adds to or subtracts from the value that customers attach to a businesses goods or services. Keller (1993:10) contends that customer-based brand equity arises from businesses marketing efforts. This is derived from the customers memory towards the brand which consists of the brand image and brand awareness. Farquahar (1990:8-10) asserts that brand equity follows from a positive analysis of, or attitude toward the branded products. Other familiar aspects of brand equity include perceived quality, brand loyalty, brand awareness and brand associations. Store image, advertising spend and price deals also affect brand awareness and brand associations positively. However brands differ in the amount of power and value they have in the market place. A formidable brand has high brand equity. Brand equity is the positive distinctive effect that comes from understanding the effect that a brand name has on customers response to the brands products or service. A further measure of brand equity is the extent to which customers are willing to pay more for the brand. Kotler and Armstrong (2004 : 292) reveal that a study found that 72 percent of customers would pay a 20 percent premium for their brand of choice; 40 percent of customers went as far as a 50 percent premium. 1    
  17. 17. Brand valuation is the task of estimating the total financial value of a brand. However measuring such value, according to Kotler et al. (2004:292), is difficult. Pierce and Almquist (2002:8-9) state, “Brand equity has emerged over the past few years as a key strategic asset, CEO’s in many industries now see their brands as a source of control and a way to build stronger relationships with customers.” Powerful brand equity adds to a company’s competitive advantage. The brand equity study aims to value a brand in financial terms. The brand value is used as a marketing matrix, but according to Du Plessis, Jooste and Strydom (2005:462), brand value has also been produced for a range of uses including capital gains tax, litigation and business mergers and acquisitions. Brand equity has a positive relationship with brand loyalty. According to Aaker (1991), brand equity is a complex concept which is made up of brand loyalty, brand awareness, perceived quality, brand associations and other exclusive assets. The multidimensional consumer brand based equity scale developed by Yoo and Donatha (2001) suggests that brand equity can be measured by 4 dimensions; • brand loyalty • brand awareness • perceived quality, and • brand associations An organizations marketing strategy is a comprehensive plan which combines all of its marketing goals. A comprehensive marketing strategy draws from market research and focuses on the right product mix in order to achieve the maximum profit potential and sustain the business. The marketing strategy is also the foundation of the businesses marketing plan. 1.2 Background to the Problem DNATest is a South African company specializing in forensic and relationship DNA testing. The predicament that DNATest finds itself in is that the company has been the first marketers of direct-to-consumer DNA testing in South Africa. Leading this 2    
  18. 18. change has been challenging. Primarily because of the negative perceptions regarding DNA testing. As such, bringing consumers attention to the brand and not only its product is consequential. Hence building brand equity is one of the fundamental elements for a businesses success and growth. Building brand equity will become a key asset to the company. The significance is that by enhancing its brand equity the company is more likely to increase its profits. The DNA forensic industry is one of the most vibrant sectors of the modern economy due to a unique convergence of social demands and technological change. The capacity of DNA testing has grown, costs have dropped and as such forensic DNA testing is now more easily accessible by the public. Technological advancements such as higher throughput DNA sequencing machines for DNA identification has reduced per unit cost of testing thus increasing the affordability of DNA testing and improving testing market applications. Other advancements include portable DNA profiling techniques used at crime scenes. According to Pharmaceutical Market Research (2011), the number of crime laboratories in the U.S. performing forensic analyses grew from 300 in 1999 to an estimated 475, in 2010. These laboratories analyze evidence from millions of cases annually and even though the market for forensic analyses and related products is smaller than the market for biotechnology and pharmaceutical products, crime laboratory DNA analyses serve a critical function and the DNA testing market sector will expand significantly in the future. Given the importance that brand equity has for companies conducting business in today’s environment, it seems acceptable to research how the marketing strategies used by DNATest influences and develops its brand equity. 1.3 Problem Statement The study intends to establish the role and importance of marketing strategies in developing brand equity for a DNA relationship and forensic testing company. Brand loyalty is customers preference for the products and services of the organisation that currently exists in the market. Jones and George (2008:197) reason, that if established 3    
  19. 19. organisations benefit from significant brand loyalty, then a new entrant will face an up hill battle to obtain a share of the market. New entrants must carry immense advertising costs to build customer consciousness of the goods and services their businesses provide. Hence for an existing business’s competitiveness establishing brand equity is key. The businesses brand can add weighty value when it is well recognised. Further this has a positive relationship in the mind of the consumers. The purpose of this study is therefore to evaluate ways on how to establish brand equity through selected marketing strategies and to examine the relationship between brand equity, the marketing mix elements and consumer response, so that recommendations can be made to management on its importance and thereby help the company gain an advantage over its competitors. 1.4 Aim of the Study The aim of the study is to evaluate the role of marketing strategies in developing brand equity for a DNA relationship and forensic testing company with specific reference to a Durban based company: DNATest. 1.5 Objectives of the Study • Examine the relationship between the marketing strategies and the perceived quality of the service, consumer response, brand association, brand awareness and brand loyalty. • Identify the important factors among the marketing mix elements on consumer response • Identify the important factors among the brand equity factors on customer response. 4    
  20. 20. 1.6 Research Questions • What is the relationship between the marketing strategies and quality of the service, consumer response, brand association, brand awareness and brand loyalty? • What is the relationship between perceived quality, brand association, brand awareness and brand loyalty with consumer response? • What are the important factors among the brand equity factors on customer response? 1.7 Significance of the Study The study is significant in that it will provide valuable theoretical information to DNATest management. In addition, this study will make recommendations to the management at DNATest, and highlights possible ways of building and maintaining brand equity in order to remain competitive within the pharmaceutical industry. The study will also provide insight to illustrate a scientific contribution to an improved understanding of the marketing mix elements on brand equity and consumer response. 1.8 Format of the Study This dissertation consists of five chapters structured as follows: Chapter 1: Introduction This chapter will introduce the topic, provide the introduction and background problem to the study. The aim, objectives, research questions and significance of the study will also be discussed in this chapter. Chapter 2: Literature Review The literature review is essentially an analytical and intensive analysis of previously conducted research into the study. The aim of the literature review is to analyze the theoretical and methodological contributions on the study as well as review the current knowledge and important findings. 5    
  21. 21. Chapter 3: Research Methodology The research design and methodology will be outlined within this chapter, including sampling techniques, methods of data collection, research instrument, pilot study, administration of the questionnaire, data analysis, reliability and validity. Chapter 4: Statement of Results, Discussion and Interpretation of Findings In this chapter, the focus will be on the data analysis, interpretation and evaluation of the findings of the study. Simple statistical methods will be used to calculate the results which are depicted graphically. Chapter 5: Conclusions and Recommendations This chapter presents the results of the statistical data analysis. In this chapter, the study will present the research findings, summarizes the conclusions and provides some suggestions to the business on which marketing strategies provide value in enhancing the brand equity of DNATest. 1.9 Conclusion Branding as a concept has been around for many years. Brands help identify as well as differentiate the goods and services of one organization from those of another. Brands aid in simplifying the shopping process for customers as well as aid in the processing of information about a product or service whilst giving the customer confidence about their purchasing decision. Brands have also become important to managers and they now aware that brands are an important company asset. The need for the creation of brand equity is the focus of brand managers. This chapter briefly discussed the background of brand strategies and brand equity, and stated the research problem. It also outlined the research aim, objectives, questions and format of the study. The next chapter reviews literature which provides a comprehensive summary of the various literature sources and presents a theoretical framework for the research. 6    
  22. 22. CHAPTER TWO LITERATURE REVIEW 2.1 Introduction The literature review is essentially an analytical and intensive analysis of previously conducted research into the study (Dawidowitz 2010:6). The aim of the literature review is to analyze the theoretical and methodological contributions on the study as well as to review current knowledge and important findings relating to the study. The literature review begins this study by applying an academic approach to studying the theories of professionals and academics of marketing in order to credibly analyze the theories and associate these theories to the research objective, the literature review is divided into three parts. The chapter recognizes the three parts as being brand equity, marketing mix elements and consumer based brand equity. 2.2. Brand Equity Lamb et al. (2008:216) refer to brand equity as the monetary value of brand names. Lamb et al. (2008:216) further imply that a brand that enjoys high awareness, perceived quality and brand loyalty among its customers will have a high brand equity. Hence brand equity is a multi-dimensional concept. According to Elliot and Percy (2007:82) understanding brand equity must be seen from the consumers point of view, as it is ultimately the consumers view that will affect the brand. Thus brand equity is a function of associations that are built and nurtured in customers mind. Keller (2003:17) defines brand equity as the value of the brand in the market place. This supports Aaker (1991:39) who defined brand equity as a set of brand assets and liabilities linked to a brand, its name and symbols, which adds or subtracts from the value that customers attach to the businesses goods or services. Keller (2003:60), in contrast defines brand equity from a cognitive psychological point of view. Customerbased brand equity arises from a business’s marketing efforts. This is derived from the customers memory towards the brand which consists of the brand image and brand awareness (Keller 2003:59). Other familiar aspects of brand equity include perceived quality, brand loyalty, brand awareness and brand associations. Store 7    
  23. 23. image, advertising spend and price deals also affect brand awareness and brand associations positively. However brands differ in the amount of power and value that they have in the market place. A formidable brand has higher brand equity. Brand equity is the positive distinctive effect that the brand name has on customers response to the brands products or service. A further measure of brand equity is the extent to which customers are willing to pay more for the brand. Kotler and Armstrong (2004 : 292) reveal that a study found that 72 percent of customers would pay a 20 percent premium for their brand of choice; 40 percent of customers went as far as a 50 percent premium. Keller (2012) developed a brand equity model. The concept behind the brand equity model attests to the fact that in order to build a strong brand businesses must shape how customers think and feel about the product. Keller (2012) draws the conclusion that businesses have to build the right type of experience around their brand, so that customers have specific, positive thoughts, feelings, beliefs, opinions and perceptions about the brand. Keller (2012) affirms, that when businesses have a strong brand, customers will buy more of the businesses products, customers will recommend the businesses products, customers will be more loyal to the businesses products and businesses are less likely to lose customers to competitors. Keller’s strategic model illustrates the four steps that businesses need to follow in order to build a strong brand equity. 8    
  24. 24. Figure 2.1. Brand Equity Model Resonance 4. Relationships – what about you and me? Judgments and feelings 3. Response – what about you? Performance and imagery 2. Meaning – what are you? Salience 1. Identity – who are you? Adapted from Keller, K., Strategic Brand Management 4edn. (New York: Pearson 2012) Keller (2012:76) states that the four steps of the pyramid represent four fundamental questions that customers ask, often subconsciously, about a business’s brand. Keller (2012:76) further argues that each of these four steps must be in place in order for a business to develop a successful brand. A brand with powerful brand equity has a valuable asset. Brand valuation is the task of estimating the total financial value of a brand. However measuring such value according to Kotler et al. (2004:292) is difficult. Pierce and Almquist (2002:8-9) state, “Brand equity has emerged over the past few years as a key strategic asset, CEO’s in many industries now see their brands as a source of control and a way to build stronger relationships with customers.” Powerful brand equity adds to a company’s competitive advantage. The brand equity study aims to value a brand in financial terms. The brand value is used as a marketing matrix, but according to Du Plessis, Jooste and Strydom (2005:462), brand value has also been produced for a range of uses including capital gains tax, litigation and business mergers and acquisitions. 9    
  25. 25. 2.3. Brand Loyalty The concept of brand loyalty is defined by many different approaches, that range from preference, to repeat purchase and to varying degrees of commitment. Immensely satisfied customers have numerous benefits for an organization. One of the key benefits, is that satisfied customers are less price sensitive. Although the relationship between customer satisfaction and loyalty does vary across competitive situations and industries, loyal customers remain loyal to a product for an extended period of time and furthermore, talk favorably to others about the company and its products (Kotler et al. 2004 : 19). Hoyer (2012:251) states that brand loyalty occurs when consumers make a conscious evaluation that a brand or service satisfies their needs to a greater extent than brands do and make a decision to buy the same brand repeatedly for that reason. Datta (2003:138) advocates that brand loyalty is a fundamental concept in strategic marketing. Companies set up marketing strategies to raise brand loyalty so as to retain a strong market share, whilst gaining higher profits. Brand loyalty leads to additional marketing advantages such as word of mouth referrals as well as better competitive resistance. Consumers are increasingly being flooded with competitive claims. This makes the consumer decision making process more difficult. It can also develop into an expensive exercise for a company to maintain brand loyalty amongst existing customers. Therefore it has become imperative for marketers to recognise the factors that persuade a consumer to remain loyal to a brand. Hoyer (2012:215) expands these understandings and further defines brand loyalty as essentially a result from very positive reinforcement, which is related to choice tactic. In that brand loyalty develops when a consumer becomes skillful in using a particular product or service, such as a specific brand of smart phone. Hoyer (2012:215) asserts that when faced with the leaning curve needed to switch to a different brand of smart phone, the consumer will tend to be brand loyal because of a cognitive lock in. This is agreement with the findings of Pritchard and Howard (1997:4) who expand these understandings and further define brand loyalty as a network where the consumers root tendency and resistance to change, is maximized by the extent to which consumers are motivated to seek information. This cognitive decision by consumers for their preference allows consumers to freely initiate choices that are meaningful and important. Both Verma 10    
  26. 26. (2006:222) and Kotler and Pfoertsch (2010:311) acknowledge that definition of brand loyalty defined by Jacoby and Kyner in 1973 is still valid today. Jacoby and Kyner (1973:6) describe brand loyalty as “The biased (i.e. non-random), behavioral response (i.e. purchase), expressed over time by some decision-making unit, with respect to one or more alternative brands out of a set of such brands, and is a function of psychological (decision-making, evaluative) processes.” In 1997 Pritchard and Howard expanded the definition to other extent of loyalty namely, undivided loyalty, divided loyalty, unstable loyalty and no loyalty. Brand commitment decreases uncertainty and saves a customer the cost of seeking brand new relational exchanges with other competing brands. Boote (2003:142), findings are affirm those of Fournier (1998), who observed that interpersonal relationships with brands are stronger with women than with men. Fournier (1998) developed this theory by using phenomenological interviewing techniques with 3 groups of women in traditional, transitional and postmodern life stages. Fournier (1998) observed that these life stages had a substantial bearing on brand loyalty. The traditionalist female being the most loyal, with the post modernist female being the least loyal. Fournier (1998) deduced that consumers are occupied with a number of brands that add value to their lives, some of which are psychosocial, some of which are functional. Boote (2003:142), affirms that while some of these decisions are rational, all are ego based and therefore significant to those who engage them. Likewise, Chaudhuri and Holbrook (2002:36) declare that brand loyalty is greatest under conditions of high-perceived differences (Or high involvement) among brands in a product class. This is simplified by greater differences between competing brands leading to increased and greater risks in making brand choices, thereby strengthening brand loyalty to a particular brand. The loyalty pyramid presented by Aaker (1991) is still used today. Aaker (1991) presented the loyalty pyramid, as depicted in figure 1.1. The loyalty pyramid depicts several levels of loyalty. Each Level represents a different marketing challenge and a different type of asset to manage and exploit. 11    
  27. 27. Figure 2.2. The Loyalty Pyramid Committed Buyer Likes the brand – considers it a friend Satisfied Buyer with Switching costs Satisfied / Habitual buyer - No reason to change Switchers / Price sensitive indifferent – No brand loyalty Source: Aaker, D., Managing Brand Equity (New York: The Free Press 1991), 40 • At the highest loyalty level are the committed consumers. These consumers take delight in being consumers of the brand. The brand is essential to them either as an expression of who they are or as a functional necessity. These consumers admiration, belief and trust in the brand is such that they will advocate the continued use of the brand. The importance of the committed consumer is not in his/her direct business but rather the impact that they have on the market and other potential users. • At the fourth loyalty level sit the consumers who actually enjoy the brand. These consumers fondness for the brand may be based on an association such as an experience, perceived high quality or a symbol. There exists an emotional attachment at this loyalty level. It is difficult to understand why consumers at this level like the brand other than the fact that there may exist a long term relationship with the brand. Consumers at this loyalty level maybe further classified as friends of the brand. • At the third loyalty level sits switching-cost loyal consumers. These are consumers who are content with the brand. These consumers may have switching tendencies, which may arise from costs, time or performance that is 12    
  28. 28. associated with another brand. For these consumers there is the risk that another brand may not function as well in a particular context. In order to draw these consumers, competitors need to compensate for the consumers need to switch. • At the second loyalty level sit the habitual consumers. These consumers are not discontent with the brand. With these consumers there is no dissatisfaction that is sufficient enough to encourage change, especially if the change involves effort. Consumers at this loyalty level can be vulnerable to switching to competitors who can advance a noticeable advantage for switching. Generally these consumers will be difficult to switch as there exists no reason for the consumer to be on the look out for alternatives. • At the bottom loyalty level is the switcher or price-buyer. This is the non-loyal consumer who is absolutely indifferent to the brand. Each brand is seemingly adequate and the brand name plays little role in the purchasing decision. Whatever is on sale or provides convenience, is preferred (Aaker: 1991). Datta (2003) established that the performance of the brand is a vital factor which influences the consumers loyalty to the brand. When the consumer has a positive experience with the brand, the consumer will have an inclination to use the brand again. Datta’s (2003) research revealed that the major factors that influence brand loyalty are the product performance, the satisfaction of customers, price, habit, the history of brand usage and brand names. Datta (2003:139) describes involvement as “A general term that can be defined as the degree of personal relevance of an object or product or service to a customer.” Higher involvement may lead to an extensive information search and if the consumer is satisfied with the product, it might lead to repeat purchases and ultimately, brand loyalty. Low involvement may lead to brand loyalty through habitual purchasing. 2.4. Perceived Quality Perceived quality is an intangible, overall feeling about a brand. However, it usually will be based on underlying elements which include characteristics of the products to which the brand is attached, such as performance and reliability. To understand perceived quality, the identification and measurement of the underlying dimensions 13    
  29. 29. will be useful, but the perceived quality itself is a summary, global construct. Perceived quality is based on the judgment made by consumers. This judgment is based on the product or services overall excellence or superiority, (Tellis, Yin and Niraj: 2009:135) The consumers subjective judgment of quality is influenced by the consumers unique needs, product experiences and how they consume the product. High perceived quality indicates that, as a result of the long term experience related to the brand, consumers are conscious of the superiority and the differentiation of the brand. Perceived quality is valuable (Davis, Aquilano and Chase 2003:76). Davis et al. (2003) further state that the perceived quality of a brand provides a central reason to buy. Perceived quality influences which brands are included and excluded from the consideration set and which brand is to be chosen. A fundamental positioning characteristic of a brand is its location within the dimension of perceived quality. A perceived quality advantage gives the option of charging a premium price. The price premium will enhance profits and will provide resources to reinvest in the brand. Perceived quality can also be of benefit to partners such as retailers, distributors and other channel members. Touminen (1999:83) agrees with Aaker (1991:85-86) that channel members are forced to carry brands that have a high perceived value. Additionally, perceived quality can be exploited by introducing brand extensions. This involves using the brand name to enter new product categories. A powerful brand with respect to perceived quality will be able to find higher success probabilities and expand further than a weak brand. David Garvin of the Harvard Business School developed a system of thinking about the quality of products. Garvin’s system remains widely accepted. Garvin (1985:42) identified the following general dimensions of product quality; • Style and design: appearance or feel of quality. • Serviceability: the ease of servicing the product. • Durability: the expected economic life of the product. • Reliability: consistency of performance of the product over time and the brand from purchase to purchase. • Conformance quality: the degree to which the product meets specifications and 14    
  30. 30. is absent of defects. • Features: consequential elements of the product that compliment its characteristics. • Performance: the degree to which the characteristics of the product functions. Aaker (1991:86) pointed out the importance of perceived quality; Figure 2.3. The Value of Perceived Quality Perceived Quality Reason – to- buy Differentiation / Position A price premium Channel member interest Brand extension Source: Aaker, David A. (1991), Managing Brand Equality. New York: Free Press. 86 • Reason-to-buy – The perceived quality of a brand gives sufficient reason-tobuy. This includes influencing which brands are to be considered and which brands are not considered. The customer usually lacks the drive to gain and sort through information which might lead to an objective determination of quality or the information required may not be available. Ultimately perceived quality is linked to the purchasing decision. Hence the task of advertising and promotion is more likely to be effective if perceived quality is high. • Differentiation / Position – A key positioning characteristic of a brand is it’s position on perceived quality. With some products the different brands are not distinguishable to most consumers. Differentiation can play a vital role in separating one brand from another. Perceived quality can provide an important basis for differentiation. Hence differentiation can be a key competitive 15    
  31. 31. advantage. • Price Premium – Perceived quality provides the advantage of charging a price premium. The price premium can increase profits, and provide resources with which to reinvest in the brand. These resources can be used in brand-building activities such as research and development, enhancing brand awareness and brand associations, and to improvements in the product. A price premium will therefore reinforce the perceived quality. The adage "you get what you pay for" is central in the case of goods and services for which objective information is not immediately available. A loyal customer base, higher brand loyalty and resourceful, and successful marketing programs will result from a price premium. • Channel Member Interest – Perceived quality can also be of benefit to retailers, distributors and other channel members as it will aid in gaining increased distribution channels. The image of a channel member is influenced by the products or services which it sells. With a perceived quality product the channel member can offer a high-perceived quality product at an attractive price to draw traffic. • Brand Extensions – In addition, the perceived quality can be exploited by introducing brand extensions and using the brand name to enter new product categories. A strong brand with respect to perceived quality will be able to extend further and will find a higher success probability than a weaker brand. Aaker (1991) observed perceived quality as firstly being the perception of the customer. Thus perceived quality cannot necessarily be objectively determined. This is because perceived quality is a perception and further because judgments about what is important to the customer are subjective. Hence perceived quality differs from satisfaction and is an intangible overall impression of the brand. 2.5. Brand Awareness Brand awareness is the consumers ability to recognise or recall that a brand is a 16    
  32. 32. member of a certain product category. The consumer forms a link between product class and the brand. Aaker (1991) suggests that brand awareness involves an uncertain feeling that the brand is recognized, to a belief that it is the only one in the product category. Brand awareness is composed of brand recognition and brand recall. Brand recognition conveys the consumers’ ability to validate previous knowledge of the brand when given the brand as a reminder. Brand recognition means that consumers identify with the brand, by either having heard or having previously seen the brand. Touminen (1999:75) states that brand recognition is particularly important when a buyer chooses a brand at the point of purchase. The next level of brand awareness is brand recall. Brand recall relates to the consumers ability to recall the brand when given the product category, the needs fulfilled by the category, or some other type of probe as a cue. Hence brand recall requires that consumers can correctly recall the brand from memory. Touminen (1999:77) states that brand recall is based on unaided recall, which is a substantially more difficult task than recognition. The first-named brand in an unaided recall task has achieved top-of-mind awareness. The comparative importance of brand recognition and recall depends on the extent to which consumers make decisions in the store versus outside the store. Brand recognition may be more significant to the extent that product decisions are made in the store (Keller 1993, 3; Keller 1998, 87–92). Brand awareness can be characterised according to depth and breadth. The depth of brand awareness concerns the likelihood that a brand element will come to mind and, the ease with which it does so. A brand that can be easily recalled has a deeper level of brand awareness than one that can only be recognised. The breath of brand awareness concerns the range of purchase and usage situations where the brand element comes to mind. The breadth of brand awareness depends to a large extent on the organisation of brand and product knowledge in a customers memory (Keller 1998, 88). Brand awareness provides the anchor to which other associations can be linked. Touminen (1999:77) states that recognition gives the brand a sense of awareness, and people like the familiar. In the absence of motivation to engage in attribute appraisals, familiarity will suffice. 17    
  33. 33. Brand awareness can be an indicator of substance. Considering a groups brands is the first stage in the buying process. Brand awareness can be crucial in getting into this group. Aaker (1991) and Keller (1993:17) attest that brand awareness has an important role in consumer decision making for three major reasons. Firstly that brand awareness is important in that consumers think of the brand when they think about the product category. Raising brand awareness increases the likelihood that the brand will be a member of the consideration set. Second, brand awareness can affect decisions about a brand in the consideration set. Thirdly, brand awareness affects consumer decision making by influencing the formation and strength of brand associations in the brand image. 2.6. Brand Association Brand associations are symbols and images associated with a brand. Brand associations are not “reasons-to-buy” but provide a relationship and differentiation which is not replicable by competitors. Brand association relates to the perceived quality of a brand. Aaker (1991:18) defines brand associations as "anything linked in memory to a brand", and brand image as "a set of brand associations, usually in some meaningful way." Aaker (1991) categorized brand associations into product attributes, intangibles, customer benefits, relative price, use/application, user/customer, celebrity/person, lifestyle/personality, product class, competitors and country/geographic area. Chen (2001:439) has identified two types of brand associations. One is product association including functional attribute association and non-functional attribute association. The other is organizational association including corporate ability association and corporate social responsibility association. Positive brand associations are gained if the product which the brand represents is durable, marketable and desirable. The customers must be convinced that the brand has the features and attributes to satisfy their needs. This will result in customers having positive interaction with the product. Positive brand association helps an organization to gain goodwill, and thwarts a new competitor’s entry into the market. Figure 2.4. Brand Associations 18    
  34. 34. Product Associations Functional Attrribute Associations Non-Functional Attribute Associations Brand Associations Corporate Ability Associations Organisational Associations Corporate Social Responsibility Associations Source: Chen, A,C., Journal of Product and Brand Equity. Vol 10, Iss 7,. P 439 Chen (2001: 440) found that the corporate social responsibility association is sometimes absent from a subject’s free associations. The other three attributes of brand association, were then used to identify the orientation of association for each brand. The results are the same as that of using the favorable association. In addition, he also found that the number of brand association and total association have a significant relationship with brand equity. But the core of brand association, instead of total association, is the key factor in driving brand equity building. The greater the numbers of the core brand association, the higher the brand equity. However, there is no significant difference for the other brand associations between the high and low equity brands. Marketers should develop a core association to position its brand strategy to create competitive advantages. 2.7. Marketing Mix Elements It is the responsibility of the marketer to employ marketing activities and build integrated marketing programs to create, communicate and deliver value to customers (Keller 1993:17). Marketing activities take on different forms. Traditionally these activities are depicted in terms of the marketing mix, which are a set of tools that the business uses to pursue its marketing objectives. These tools are traditionally referred to as the 4 P’s of marketing namely, price, place, promotion and product. This study 19    
  35. 35. will explore the consumers perception on five selected marketing elements, namely price, online presence, distribution intensity, advertising spend and price promotion. The chosen elements, even though they do not cover all forms of marketing efforts, do present the relationship between marketing efforts and brand equity. Figure 2.5. The Marketing Mix Product Variety, Quality, Design, Features, Brand name, Packaging Price List price, Discounts, Allowances Payment period, Credit Terms Target Market (Intended Customers)   Promotion Advertising, Personal Selling, Sales Promotion, Public Relations Place Channels, Coverage, Assortments, Locations Inventory, Transport, Logistics Source: Adapted from: Kotler and Armstrong, 2001:67 2.7.1. Price Price is what is given up in an exchange to acquire products or a service (Lamb et al. 2008: 357). Price is key to revenue which directly relates to the profit of a business. To earn a profit, businesses must determine a price that is not too high or too low. The business must determine a price that equals the perceived value of target customers. High-priced brands are often perceived to be of higher quality and less vulnerable to competitive price cuts than low-priced brands (Blattberg and Winniewski, 1989:291). Price is therefore positively related to perceived quality. By increasing perceived quality, price can be increased. Brand-loyal consumers are willing to pay the full price for their favorite brand because they are less price sensitive than non-loyal brand consumers. 20    
  36. 36. 2.7.2. Online Presence Online presence is the process of presenting and drawing traffic to a brand through the use of the internet. This process is a combination of website design, website development, blogging, search engine optimization, pay-per-click marketing, reputation management, and social media to create a long term presence online (Compukol:2012). The development of the internet has allowed businesses not only to be present online but also to conduct business online. This has been achieved through transactions such as selling online and accepting online reservations. In many instances, transactions performed online are more convenient and cost effective. Customers are becoming more accustomed to the efficiency and convenience that online businesses offer. A business’s online presence is therefore a necessity in the marketplace of today. 2.7.3. Distribution Intensity Distribution intensity is evaluated by the customers perception of the advertising spend for the brand (Kirmani and Wright 1989:345).Distribution is regarded as intensive when products are placed at multiple outlets to cover the market. Consumers are more satisfied when a product is available in a greater number of outlets because they have access to the product where and when they want it (Ferns, Oliver and Kluyver, 1989:107). Intensive distribution decreases the time consumers must spend searching the stores and travelling between stores, provides convenience in purchasing, and makes it easier to obtain services related to the product. As distribution intensity increases, consumers have more time, increased consumer place utility and perceive more value for the product. The increased value results mostly from the reduction of the sacrifices the consumer makes to acquire the product. Such increased value leads to greater consumer satisfaction, perceived quality, brand loyalty, and consequently to greater brand equity. Positive brand associations will increase along with a consumers satisfaction with the product (Yoo, Donthu and Lee, 2000:197). 2.7.4. Advertising Spend 21    
  37. 37. Advertising researchers have identified that advertising is successful in generating brand equity (Boulding, Lee and Staelin, 1994:35). Simon and Sullivan (1993:31) show a positive effect of advertising spending on brand equity. Cobb-Walgren, Beal and Donthu (1995:25), find that spending on advertising has positive effects on brand equity and its dimensions. Advertising is an important extrinsic cue signaling product quality and advertising spend confirms that the business is investing in its brand, which implies superior quality (Kirmani and Wright, 1989:347). Further advertising spending levels are excellent indicators of not only high quality but also good buys. There is a positive relationship between advertising and perceived quality. Hence, advertising spending is positively related to perceived quality, the product of which is higher brand equity. Advertising plays a significant role in increasing brand awareness as well as creating powerful brand associations. Continuous advertising increases the likelihood that a brand will be included in the consideration set, which simplifies the consumer's brand choice. Shimp (1997:33) affirms in an extended hierarchy of effects model that advertising is positively related to brand loyalty because it reinforces brand-related associations and attitudes toward the brand. It can be deduced that a greater amount of advertising is related positively to brand awareness and associations, which leads to greater brand equity. 2.7.5. Price Promotion Price promotion is a short-term price reduction such as special sales. Keller (2008), considers price promotion to weaken brand equity, due to short-term benefits received by consumers. This is measured as the perceived relative frequency of the price deals shown for the product. Despite the immediate short-term financial gain, price promotions (e.g. short-term price reductions such as special sales, media-distributed coupons, package coupons, cents-off deals, rebates and refunds) are believed to erode brand equity over time. An image of bad quality may result due to frequent price promotions. This may jeopardize brands in the long run because they cause consumer confusion based on unanticipated differences between expected and observed prices. Shimp (1997:33) concludes that price promotion campaigns do not last long enough to establish long-term brand associations, which can be achieved by other efforts such as advertising and sales management. Relying on sales promotion and sacrificing 22    
  38. 38. advertising could reduce a brand association, which leads to decreasing the brand equity. Promotions often fail to establish a repeat purchase pattern after an initial trial. This is because consumers are temporarily attracted to the brand by the transactional utility that the price promotions provides and when the promotions end, the consumer will lose interest in the brand. Thus, changes in brand loyalty after the end of deals may occur unless the brand is perceived to be superior to, and to meet consumer needs better than competing products. 2.8. Consumer-based Brand Equity Customer based brand equity results in the creation of a strong brand. This is achieved when brand awareness and image are at a high level. Customer-based brand equity can be defined as the differential effect that brand knowledge has on consumer response to the marketing of that brand. There are three key factors to this definition: • Differential effect - brand equity starts with differences in consumer response. If no differences occur, then the brand can in essence be classified as a generic version of the product or commodity. • Brand knowledge - these differences in reaction are a consequence of consumers’ knowledge about the brand. Thus, even though strongly influenced by the marketing activity of the business, brand equity eventually depends on what exists in the minds of consumers. • Consumer response to marketing- the differential response by consumers that makes up the brand equity is reflected in perceptions, preferences, and behavior related to all aspects of the marketing of a brand (Keller 1993, 8– 9;Keller 2008:18). Aaker (1996:120) defined brand equity as; • Loyalty (brands real or potential price premium and customer based satisfaction) 23    
  39. 39. • Perceived comparative quality • Perceived brand leadership • Perceived brand value (brands functional benefits) • Brands personality • Customers perception of the organisation (trusted, admired, reliable) • Perceived differentiation to competing brands • Brand awareness (recognition and recall) • Market position (market share), prices and distribution coverage. Touminen (1999:78) defines customer-based brand equity is an asset made up of brand awareness, brand associations, perceived quality and brand loyalty. The fundamental premise with customer-based brand equity is that the power of a brand lies in the minds of consumers what they have learned about the brand over time and what they have experienced with the brand. Understanding brand equity from the consumer’s viewpoint is useful because it determines individual plans for marketing tactics and strategies. Marketers must take an all-encompassing view of marketing activity for a brand and understand the different effects it has on brand knowledge. Markets must fulfill the long-term success of all future marketing programs for a brand and hence, this is greatly affected by the knowledge about the brand in memory that has been built in by the businesses shortterm marketing efforts. Consumers are more accepting of new brand extensions when the brand has positive customer based brand equity. Customer-based brand equity arises when the consumer recognises the brand and holds some positive brand association of the brand in his/her memory. Positive consumer response will lead to better sales, lower costs and greater profits for the business (Keller 1993, 8; Keller 2008:18). Brand knowledge is therefore vital when creating customer-based brand equity. Brand knowledge is a composed of; • brand awareness, which relates to consumers capability to distinguish or recall the brand and • brand image, which consist of consumers opinions of and associations with the brand. 24    
  40. 40. • brand awareness requires continuously exposing consumers to the brand and linking the brand in the memory of the consumer to its product category, to purchase, usage and consumption situations. Building a positive brand image involves establishing strong, unique and favorable associations with the brand. 2.9. Conclusion The above studies show that a more consumer orientated marketing perspective would regard brand equity as having more to do with what is in the eye of the beholder. Consumers have a very clear idea of what is meant by a strong brand. A brand with high or strong brand equity, bring competitive advantages to the consumer response. This implies that the brand is an asset, which needs to be managed. A strong brand will further aid in increasing market share, allow for premium pricing, reduce promotional expense and a level of immunity from new entrants. The next chapter, describes the research methodology used in this study. 25    
  41. 41. CHAPTER THREE RESEARCH METHODOLOGY 3.1 Introduction Research methodology is the complete process of the research study (Collis and Hussey, 2006:34). The research methodology includes the theoretical framework to the collection and analysis of data. The purpose of this chapter is to present a summary of the research methodology that was utilized in this study. This consists of the methods and techniques which have been utilize to focus on the research questions and an explanation of the sample group and the sample selection technique. Furthermore a description is provided for the measuring instrument that has been used and the method of analysis which has been applied to the collected data. 3.2 Rationale for the Methodology The positivistic (quantitative) paradigm and the phenomenological (qualitative) paradigm are the two core paradigms to research. The research problem determines the paradigm which is adopted for the research study. Burns (2007:18) states that the qualitative paradigm has no objective truth because it is based on interpretations and is subjective in nature. A qualitative paradigm is a suggestion on perception, and as such reality is shaped and investigated through people’s opinions. Quantitative research is a scientific study that includes experiments and systematic techniques that give emphasis to control and quantifies measures of performance. The primary data for this study was obtained using the quantitative methodology. Collis and Hussey (2006:53) point out that most significant issues of the surveys are determining the sample and relevance of the questions. Questions can be asked as formally written questionnaires, telephonically or directly. For this study the research instrument in the form of a written questionnaire was compiled to collect the primary data. This questionnaire was also chosen because it is considered to be inexpensive, less time consuming and provides good quality data easily. 26    
  42. 42. 3.3 Research Design A research design guides the researcher in planning and implementing the study in a way that is likely to achieve the intended goals (Burns 2007:27). According to Zikmund (2008:22), quantitative research designs tend to be highly structured and include tight controls to eliminate contaminating influences. In planning a research project it is thus critical that the researcher not only chooses a viable research problem, but should also take into account the kind of data that will be required in investigating the research problem. Research design, in essence, is the planning of the research study. It is essential to identify resources and procedures that will be followed as well as data that will be gathered with the aim of solving the research problem (Leedy 2008:67). There are two main approaches used in gathering and analysing data: the qualitative and quantitative method. The method used in this study will be a quantitative approach. The intention of quantitative research is first, to predict, describe and elucidate quantities, degrees and relationships and secondly, to generalise from a sample to the relevant population via the collection of statistical data. Quantitative research relies on measurement to compare and analyse different variables (Saunders and Thornhill2006:62). The purpose of quantitative research may also be described as the evaluation of objective data that consists of numbers, where the aim is not to deal directly with everyday life but rather with an abstraction of reality (Zikmund 2008:30). 3.4 Research Strategy Research strategy is an all encompassing plan which provides a systematic approach in solving the research questions (Saunders and Thornhill, 2006:88). Saunders and Thornhill (2006:91) state than an effective research strategy contains clear objectives, data collection resources, appropriate data collection methods, limitations and ethical constraints which support the study research strategy. Saunders and Thornhill (2006:91) further affirm it is also beneficial for the researcher to use specific data collection methods to support the arguments. 27    
  43. 43. 3.4.1 Positivist Research Strategy The positivist research methodology uses surveys to gather data. The survey strategy is an accepted and frequently used strategy in business and management research. The survey strategy tends to be used for exploratory and descriptive research (Saunders, Lewis and Thornhill, 2009:144). The study used the survey approach to gather primary data because it was selfexplanatory and easy to understand (Krishnaswamy, Sivakumar, and Mathirajan, 2006:167). However, Saunders et al. (2009:144) state that due to the set choice of answers in survey questionnaires, the strategy is considered authoritative. This study used the survey strategy for the following reasons; • Surveys are inexpensive (in particular self-administered surveys); • Surveys are useful in describing the characteristics of a large population. No other method of observation can provide this general capability; • Surveys can be administered from remote locations using mail, email or telephone; • Unvarying questions make measurement more precise by enforcing uniform definitions upon the participants; and • Usually, high reliability is easy to obtain by presenting all subjects with a standardized stimulus; observer subjectivity is removed (Krishnaswamy et al., 2006:167). 3.5 Aim of the Study The purpose of this study is to evaluate the role of marketing strategies in developing brand equity for a DNA relationship and forensic testing company with specific reference to the company called DNATest. 28    
  44. 44. 3.6 Research Objectives The objectives of this study were as follows: • Examine the relationship between the marketing strategies and the perceived quality of the service, consumer response, brand association, brand awareness and brand loyalty. • Identify the important factors among the marketing mix elements on consumer response • Identify the important factors among the brand equity factors on customer response. This study employed a survey research strategy in the form of a forced-choice questionnaire. The respondents view is best reflected when using a force-choice question as the respondents can only chose one answer from the given options. Saunders et al. (2006:95) are of the opinion that important research strategies include an analysis of literature reviews, analysis of case studies, interviews, observations, experiments and surveys. The five point Likert scale was employed in the questionnaire. The use of the survey strategy, made it possible to collect information and data from the participants that was related to the research. The survey method was found to be easy, inexpensive, efficient and an accurate way of accessing the information about the population (Zikmund, 2008:49). 3.7 Target Population A research population is also known as a well defined, large collection of individuals or objects that have similar characteristics or traits (Siegel 2011:601). Researchers often cannot question every individual in the population because it is too expensive and time consuming. Hence rather than testing large populations, researchers turn to sampling techniques. A sample is a segment of the population that consists of the same characteristics as the population on whom the study is being conduct with (Burns 2007:31). The researchers population size is unknown. In this study the sample size was two hundred, two hundred were administered and one hundred and thirty two 29    
  45. 45. responses were received. The researchers sample size is also based on limitations of the population researched. 3.7.1 Sampling & Sample Size Siegel (2011:601) states that it is not always possible or practical to include the entire study population in the research study. Hence a representative sample will be selected from the study population. Salkind (2007:371) validates this by stating that a sample is a representative portion of the population. The advantages of sampling is that the smaller number of elements to be studied makes the research more manageable and time efficient, less costly, and potentially more accurate. The target population size is two hundred and a sample size of one hundred and thirty will be administered. These figures were determined using the table developed by Sekeran (2003:253), for determining sample size from a given population. The sample size is also based on limitations from the organisation researched. As mentioned above according to Burns (2007:31) a sample is a segment that consists of the same characteristics as the population on whom the study is conducted. In this study all individuals included in the sample size are past clients of the company, DNA Test. Thus they have all used the services of DNATest. This qualified them to be part of this study in terms of the inclusion criteria of this study. 3.7.2 Sampling Method The research was carried out through a non-probability sampling technique also referred to as convenience sampling method. This technique allows for the selection of a particular group within the population in the full knowledge that it does not represent the wider population (Leedy, 2008:67). The sample group, as stated earlier, was selected as they were easily accessible (Rossouw, 2010:114). 3.8 Research Instrument A research instrument is defined as a measurement tool for a research study which has to be reliable and valid. (Saunders et al., 2007:145). This is a quantitative study that includes a questionnaire to collect data by means of a survey. Questionnaires collect 30    
  46. 46. precise and unbiased information. Rossouw (2010:128) describes surveyresearch as a multi-tiered process. Figure 3.1: Stages in the survey process 1. Design the questionnaire     2. Planning and drawing the sample 3. Administering, training and planning of field implementation of the study 4. Computer linked processing of the data 5. Analysis and reporting of data Source: Rossouw (2010:128) The questionnaire is the favored tool of many of those engaged in research and it can often provide a cheap and effective way of collecting data in a structured and manageable form. (Wilkinson and Birminham, 2003:7). Further Saunders and Thornhill (2006:67), state that the layout of the questionnaire should be appealing to encourage the respondent to complete and return the questionnaire. The questionnaire should not appear to be extensive and time consuming. A reliable method of obtaining valid responses to questions is to keep the wording of each question as well as the appearance of the questionnaire uncomplicated. A self administered questionnaire, attached as Appendix B, was used whereby respondents were expected to read the survey questions and chose their preferred answer. 31    
  47. 47. 3.9 Questionnaire Construction Goddard and Melville(2009:47), state that questionnaires normally consist of a list of questions or statements that respondents are requested to answer or indicate the extent to which they agree/disagree with a given statement. The questionnaire for this study will be divided into two sections, namely: Section A: Demographic Information Section B: Brand interaction factors The questionnaire is presented in a Likert - type scale with Strongly Disagree forming the one end of the continuum and Strongly Agree the other end. According to, Leedy (2008:58) the Likert scale is the most widely used scale and is convenient when the researcher wants to measure a construct. Questionnaires are quick and easy to administer as they can provide a large amount of information in a short time, do not require trained interviewer and are relatively less expensive (McNabb, 2010:72). The questionnaire was presented with a cover letter presented as Appendix A, and the questionnaire presented as Appendix B. The cover letter was used to inform the respondents about the purpose of the study. It also served to assure the respondents that all information obtained through the questionnaire would be used for this study only and will be kept confidential. Additionally the cover letter provided the respondents with the details and contact information of the researcher. At the beginning of the survey questionnaire, the researcher included an introduction that was enticing and clearly stated the purpose of the research. Moreover, the introduction also included instructions on completing the survey questionnaire, and an estimate of how much time it would take. The respondents were given an assurance that their information/responses will be kept confidential. The design of a questionnaire contributes to its reliability and validity as a measuring instrument. 32    
  48. 48. 3.10 Pilot Study Zikmund, Babin, Carr and Griffin (2012:63), define a pilot study as a strategy used to test the questionnaire using a smaller sample compared to the planned sample size. A pilot study is also used to validate the main study. Further, pilot studies are used to determine limitations, oversights or inaccuracies before the final circulation of the questionnaires. Walliman (2005:282) injects that the pilot study also allows the researcher to confirm that the questionnaire includes all the information that is necessary to conclude the study. The designed questionnaire was piloted on ten participants, selected from the sample. The findings of the pilot study did not reveal any flaws in the questionnaire design. The pilot study did however reveal that the participants were eager to respond to the questionnaire. Based on the success of the pilot study, the final questionnaire was distributed to the sample population. 3.11 Administration of the Questionnaire Saunders and Thornhill (2006:310), clarify that the purpose of administering a questionnaire is to gain access to the sample and to take full advantage of the response rate. Questionnaires are easy and quick to administer, thereby allowing for the retrieval of information within a short period of time. One hundred and thirty two respondents took part in the survey. The questionnaires were emailed to the participants. A covering letter presented as Appendix A was presented to the participants explaining the purpose of the study. Participants were guaranteed of the privacy of their information, and that their identities would be kept confidential. To encourage participation, the time required for completion of the survey was stipulated and simple instructions on how to complete the questionnaire was also given. 33    
  49. 49. 3.12 Response Percentage Two hundred questionnaires were distributed to the participants. The response percentage for the survey is shown on Table 3.1. Table 3.1: Questionnaire Response percentage Total Number of Questionnaires Total Responses Response sent to Respondents Received Percentage 200 132 65% The researcher allowed seven days for the completion and return of the questionnaire. After a week, only sixty questionnaires were received. The researcher then extended the collection period to fourteen days. After fourteen days, a response percentage of sixty five percent was achieved with one hundred and thirty two out of the two hundred questionnaires being returned, fully completed. Babbie (2010:72) states that the overall response percentage is a guide to the representativeness of the sample respondents. Saunders and Thornhill (2006:325), indicate that a sixty per cent response percentage is good. Hence for this study the response percentage of sixty five percent is deemed acceptable. 3.13 Data Analysis The reliability of measurement scales will be used using Levene's Test for Homogeneity of Variances and Cronbach's alpha coefficient analysis method. The data analysis will describe demographic data using descriptive statistic analysis according to the valid questionnaires. An analysis will ascertain the relationship among the marketing mix elements, brand equity and consumer response, using structural equation modeling. Multiple regression statistical method using the Statistical Package for Social Science (SPSS 11.0) will determine the most influential factor among the marketing mix elements on brand equity, the influence of brand equity on customer response and the effect of the marketing mix elements on customer response. 34    
  50. 50. The t-test, mean, and Chi-square will be implemented. The questionnaire will be analyzed, through the use of a mean statistical method, as summarization of the central tendency in a distribution. The t-test will be used in conjunction with the mean, and both tests when applied should give the same interpretation concerning the variable being tested. The researcher will further use the Chi-Square test for independence. This test will determine if independence between variables exists. 3.14 Validity and Reliability Validity and reliability are closely related because if an assertion being measured is valid, then it implies that the assertation is also reliable. Therefore, it could be argued that a measure can only be valid if it is reliable (Joseph and Samouel, 2007:170). 3.14.1 Validity Validity is the extent to which an instrument measures what it is intended to measure. It measures the concept under investigation accurately (Collis and Hussey, 2006:55). To ascertain the validity of the research questionnaire, the researcher will conduct a field test to ascertain the validity of the instrument in terms of appropriateness, utility, and clearness. Ten people will be chosen to participate in a pilot test to review the questionnaire for clearness, subject matter, wording, and length. The validity of a research study is the degree to which the study correctly answers the question it is intended to answer (Gravetter and Forzano, 2009:157). The questionnaire was used complied with the following validity features: • Content Validity Content validity is defined as the extent to which the measuring device provides adequate coverage of the investigative questions (Saunders et al., 2009:373). The questionnaire integrated a selection of questions to attain validity. Questions were based on information collected from the literature review to make sure that they correspond to validated factors (Babbie, 2010:155). 35    
  51. 51. • Criterion-Related Validity Criterion-related validity is related to the ability of the questions, within the questionnaire to make accurate predictions (Saunders et al., 2009:373). • Construct Validity Construct validity is the degree to which the measurement questions actually measure the presence of the points the study intends to measure (Saunders et al., 2009:374). 3.14.2 Reliability Reliability of a measurement procedure is the constancy or stability of the measurement (Gravetter and Forzano, 2009:82). The similar instrument must be able to produce the similar data at a later stage under the same conditions. Rubin and Babbie (2009:82) stated that reliability is subject to a precise technique being applied repeatedly to the same object which would produce the same results each time. It is an extent of consistency in measurement. The researcher may achieve this by means of a test – retest. Rubin et al. (2009:82) characterized test-retest as a method for evaluating a measure’s consistency or stability. A pilot test will be administered by the researcher on 10 people. These individuals will be asked to complete the entire questionnaire twice. These respondents would have similar characteristics to the target population. The survey will be conducted with this group and then within seven to ten days the survey will be repeated with the same group. The scores will be compared and a high percentage of agreement between the two scores will indicate a reliable survey. Those questions will a low score, will be deleted from the survey. 3.15 Limitations of the Research The study provides a theoretical and substantive explanations of the most influential factors that the marketing mix elements have on brand equity, that brand equity has on customer response and that marketing mix elements have on customer response. However there are still some limitations to be considered. 36    
  52. 52. - This study is limited to customers whom have used the product of the brand. Thus this research cannot determine a general conclusion for prospective customers who have not had similar usage experience. - This study will be limited to 200 individuals. The researcher is aware that the total number of survey participants in the study may not be enough for the purpose of a nationwide study. 3.16 Elimination of Bias Bias is a form of systematic error that can affect scientific investigations and distort the measurement process. A biased study loses validity in relation to the degree of the bias(Cooper and Schindler, 2005:371). The researcher understands that it is difficult or even impossible to completely eliminate bias. The questionnaires used for this study will eliminate bias due to the consistent phrasing of questions for all respondents. The quantitative approach for this study will eliminate bias as it requires the researcher to keep a small distance from the participating subjects. Respondents will be randomly selected. The researcher will remain objective throughout the study. 3.17 Ethical Considerations There are ethical considerations in any form of research. The research process may cause tension between the goal of the researcher to make generalizations for the good of others, and the right of the participants to maintain privacy. Avoiding harm and doing good pertains to ethics. The aim of ethics in research is to make sure that no one is harmed or suffers negative repercussions from the research. (Beauchamo and Bowie 2007: 17) Legal requirements for the protection of data and the confidentiality of the respondents will be observed by the researcher. The purpose, importance and goals of this study will be made known to the respondents. The survey will be voluntary and the respondents identity will be kept confidential. 37    
  53. 53. 3.18 Conclusion In this chapter the research methodology for this study was discussed. Included in the chapter, was the size and response percentage of the study’s sample. This chapter also includes the reasons for the choice of the sample and an explanation of the validity and reliability of the data collected. The next chapter presents the results, discussion and interpretation of findings of the study. 38    
  54. 54. CHAPTER FOUR RESULTS, DISCUSSIONS AND INTREPRETATION OF FINDINGS 4.1. Introduction In the previous chapter, an overview of the research design and methodology was discussed. This chapter analyses the responses and presents the research findings from the surveyed data. A research correlation is used and shows the relationships between certain key aspects of the marketing mix elements. A quantitative survey with a questionnaire was used as a data collection tool. The results of each question are presented and discussed. The questionnaire was analyzed through the use of the IBM SPSS 21software package. 4.2. Response Rate Two hundred questionnaires were emailed to clients of DNA Test. One hundred and thirty respondents took part in the survey and a response of 65% was realized. The questionnaires were emailed to the participants. All one hundred and thirty questionnaires were filled in appropriately and were error free, no questionnaires were rejected. The questionnaire consisted of twenty four questions which were directed at evaluating the role of the marketing strategies in developing brand equity. Specific reference was made to perceived quality, brand awareness and brand association. Descriptive statistics were used to summarize the information and illustrate the context of the composition of the respondents. 4.3. Analysis and Interpretation of data from respondents Statistical analysis was carried out with the use of IBM SPSS 21. The statistical analysis of the questionnaire provided to participants was done using inferential and descriptive statistics. Descriptive statistics were produced as frequency tables, frequency bar charts and distribution tables. Inferentially, non-parametric Chi-Squares and Spearman’s correlation analysis were conducted. Spearman’s Rho was used as the 39    
  55. 55. data was ordinal in nature, and non-parametric tests required as per the tests for normality (as per the Kolmogorov-Smirnova, and Shapiro-Wilk), Reliability analyses, Median analysis and Factor analyses were performed. Tests performed were determined by the level of measurement yielded by the questionnaire (nominal, ordinal, categorical), and as dictated by the assumptions underlying each test, with the ultimate goal of answering the study’s research questions. 4.4. Section A: The Sample Demographic 4.4.1. Gender Figure 4.1. Gender of Respondents Frequency Frequency Bar Chart of Respondents Gender 120 100 80 60 40 20 0 Male - 98 Female - 32 Gender Table 4.1 Your Gender Your Gender Female Male Total Frequency 32 98 130 Percent 24.6 75.4 100.0 Valid Percent 24.6 75.4 100.0 Cumulative Percent 24.6 100.0 The findings in Table 4.1 reveals that 24.6% of respondents are female, and 75.4% are male(N = 130). It is evident that males make up the greater population of DNA Test clients. 40    
  56. 56. 4.4.2 Age Figure 4.2. Age of Respondents Frequency Bar Chart of Respondents Age Frequency 100 80 60 40 20 0 Under 25 25 to 30 30 to 40 40 to 50 Above 50 Respondents Age (in years) Table 4.2 Your Age Your Age Under 25 25 to 30 30 to 40 Above 50 Total Frequency 6 40 77 7 130 Percent 4.6 30.8 59.2 5.4 100.0 Valid Percent 4.6 30.8 59.2 5.4 100.0 Cumulative Percent 4.6 35.4 94.6 100.0 The findings in table 4.2 reveals that 4.6% of respondents are under the age of 25 years, 30.8% are between 25-30 years, 59.2% between 30 – 40 years, and 5.4% above 50 years (N = 130). The majority of clients are between the age of 30 to 40 years old. There were no respondents between the ages of 40 to 50 years old. 5.4% of respondents were above the age of 50 years. 41    
  57. 57. 4.4.3. Marital Status Figure 4.3. Martial Status Frequency bar Chart of Respondents Maritial Status Frequency 80 60 40 20 0 Single - 61 Married - 43 Divorced - 6 Separated - 20 Maritial Status Table 4.3 Your Marital Status Your Marital Status Single Married Divorced Separated Total Frequency 61 43 6 20 130 Percent 46.9 33.1 4.6 15.4 100.0 Valid Percent 46.9 33.1 4.6 15.4 100.0 Cumulative Percent 46.9 80.0 84.6 100.0 The findings in table 4.3 reveal that 46.9% of respondents are single, 33.1% are married, 4.6% are divorced, and 15.4% separated (N = 130). Most of the clients of DNA Test are single. The demographic data is generally representative of the population of DNA Test clients. 4.5. The Research Instrument The research instrument consisted of 21 items which was administered to 200 and responses were received from 132 participants. Items consisted of categories ranging from nominal to ordinary level of measurement. 42    
  58. 58. 4.5.1. Reliability Table 4.4 Reliability Statistics Reliability Statistics Cronbach's Alpha N of Items .825 21 The Cronbach’s Alpha is > 0.7, therefore the scale is reliable, and results valid (N = 21, α = 0.825). A Factor Analysis revealed that there were at least 5 significant dimensions. Cronbach’s Alpha is sensitive to multidimensionality, often with the result of lowering the general internal consistency. 4.5.2. Factor Analysis A Factor Analysis was conducted as a data reduction method to ascertain what factors primarily account for the variability seen in the data. The five factors from the research instrument account for 83.073% of the overall variance. The factors for the study (from the research instrument) are as follows: - Factor 1; Will use product or service again, can recognize the brand among competitive brands, aware of and like the brand, provides excellent quality, service and product is trustworthy and reliable, has a good reputation and is a brand leader; - Factor 2; The price of service or product is high, the brand is advertised appropriately, the adverts seem expensive, are willing to pay higher price for product or services as compared to other competitive offerings; - Factor 3; The price of service or product is value for money, the product or service is of high quality, product or service would be first choice should another DNA test be required and will recommend service and products to others; - Factor 4; The pharmacies or website sell a wide range of well-known brands; -Factor 5; The price of DNA Test service or product is low, loyal to the DNA Test brand and products and services are efficient. 43    
  59. 59. Table 4.5 Gender Age Marital Status Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 Q19 Q20 Q21 Q22 Q23 Q24 Tests of Normality Tests of Normality a Kolmogorov-Smirnov Shapiro-Wilk Statistic df Sig. Statistic df .469 130 .000 .535 130 .302 130 .000 .760 130 .267 130 .000 .749 130 .259 130 .000 .808 130 .280 130 .000 .704 130 .349 130 .000 .761 130 .401 130 .000 .663 130 .255 130 .000 .837 130 .324 130 .000 .788 130 .192 130 .000 .876 130 .273 130 .000 .764 130 .342 130 .000 .747 130 .417 130 .000 .636 130 .261 130 .000 .823 130 .240 130 .000 .818 130 .337 130 .000 .741 130 .296 130 .000 .769 130 .295 130 .000 .760 130 .224 130 .000 .843 130 .217 130 .000 .845 130 .365 130 .000 .774 130 .205 130 .000 .805 130 .259 130 .000 .843 130 .312 130 .000 .742 130 Sig. .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 Table 4.5 reveals that data is not normally distributed therefore non-parametric tests should be conducted. Resulting the use of the Spearman’s Rho as a measure for correlations, as this is particular to non-parametric correlations, and the Chi-Square was used. Saunders and Thornhill(2009:449), state that where the requirement for Pearson’s Chi-Square if more than five counts, for more than 80% of the cells have been violated, the Fisher’s Exact Test is to be used as this takes into consideration this violation, and is particular to small sample sizes. Overall, the conclusion for the demographics consisted mainly of single (46.9%), males (75.4%), respondents between the ages of 30-40 years (59.2%). The research instrument has been demonstrated to be reliable. Reliability is a requirement for 44    
  60. 60. validity. Normality tests have demonstrated that the data is not normally distributed. Therefore, the analysis was determined to be conducted, based on non-parametric testing, and with due cognizance of the level of measurement (ordinal and nominal) excluding parametric tests like ANOVA, MANOVA, T-Tests and the like which require normally distributed data, with homogeneity of variance, and that exist at an interval or ratio level. 4.6 Section B: The Brand Interaction Factors A five point Likert Scale was used to measure the output of each item answered by the participants, each response has been graphically represented. These results and findings we complied by evaluating and analyzing the data gathered via the questionnaire to individuals whom have used the services of DNATest, the case study for this research. A research correlation is used and shows the relationships between certain key aspects of the marketing mix elements. A quantitative survey with a questionnaire was used as a data collection tool. The results of each question are presented and discussed. The questionnaire was analyzed through the use of the IBM SPSS 21software package. Table 4.6 The price of DNA Test service or product is high The price of DNA Test service or product is high Frequency Percent Strongly agree 22 16.9 Agree 44 33.8 Uncertain 13 10.0 Disagree 51 39.2 Total 130 100.0 Valid Percent 16.9 33.8 10.0 39.2 100.0 Cumulative Percent 16.9 50.8 60.8 100.0 The findings in table 4.6 reveals that 16.9% of respondents strongly agree that the price of DNA Test service or product is high, 33.8% agree, 10% are uncertain, and 39.2% disagree. There is no consensus of the price of DNA Test service or product is high. This signifies that clients of DNA Test represent low to high income groups, and as such have a difference in opinion about the price of DNA Test product or service. This is significant as management of DNA Test have to look at price in building brand equity. As price is a source of meaning and identity for a brand. A brand that 45    
  61. 61. offers good value for money evokes a strong positive emotion. (Median = 2 and Standard Deviation of 1.156, n = 130) Table 4.7. The Price of DNA Test service or Product is value for money The price of DNA Test service or product is value for money Strongly agree Agree Disagree Total Frequency 65 47 18 130 Percent 50.0 36.2 13.8 100.0 Valid Percent 50.0 36.2 13.8 100.0 Cumulative Percent 50.0 86.2 100.0 The findings in table 4.7 reveals that 50% of respondents strongly agree that the price of DNA Test service or product is value for money, 36.2% agree, and 13.8% disagree. The significance of this is that the majority of DNA Test customers feel that service or product has a high value without costing much. (Median = 1.50 and Standard Deviation of 1.006, n = 130) Table 4.8. The price of DNA Test service or product is low The price of DNA Test service or product is low Frequency Percent Strongly agree 16 12.3 Agree 2 1.5 Uncertain 19 14.6 Disagree 73 56.2 Strongly Disagree 20 15.4 Total 130 100.0 Valid Percent 12.3 1.5 14.6 56.2 15.4 100.0 Cumulative Percent 12.3 13.8 28.5 84.6 100.0 The findings in table 4.8 reveals 12.3% of respondents strongly agree that the price of DNA Test service or product is low, 1.5% agree, 14.6% were uncertain, 56.2% disagreed, and 15.4% strongly disagree. 71.6% of the respondents disagree and strongly disagree that the price of DNA Test service or product is low. This means that the majority of the respondents feel that the price of DNA Test product or service is high. (Median = 4 and Standard Deviation of 1.151, n = 130) 46    
  62. 62. Table 4.9 DNA Test sells a product or service of high quality DNA Test sells a product or service of high quality Frequency Percent Valid Percent Strongly agree 85 65.4 65.4 Agree 32 24.6 24.6 Uncertain 13 10.0 10.0 Total 130 100.0 100.0 Cumulative Percent 65.4 90.0 100.0 The findings in table 4.9 reveals that 65.4% of respondents strongly agree that DNA Test sells a product or service of high quality, 24.6% agree, and 10% are uncertain. This is significant for DNA Test as 90% of the respondents agree and strongly agree that the quality of the service or product is recognised as having a superior quality. The significance of this to DNA Test management is that the majority of it’s clients feel that its product and service is of high quality and that DNA Test should continue to follow it’s policy on delivering a quality product and service. (Median = 1 and Standard Deviation of 0.671, n = 130) Table 4.10 The pharmacies or website where I can buy DNA Test products or service sell a wide range well-known brands The pharmacies or website where I can buy DNA Test products or services sell a wide range of well-known brands Frequency Percent Valid Percent Cumulative Percent Strongly agree 13 10.0 10.0 10.0 Agree 21 16.2 16.2 26.2 Uncertain 54 41.5 41.5 67.7 Disagree 42 32.3 32.3 100.0 Total 130 100.0 100.0 The findings in table 4.10 reveals that 10% of respondents strongly agree that the pharmacies or website where they can buy DNA Test products or services sell a wide range of well-known brands, 16.2% agree, 41.5% were uncertain, and 32.3% disagree. The respondents are largely uncertain as well as disagree about the range of well known brands being stocked at the pharmacies and website which sell DNA Test products and services. The significance of this is that DNA Test management will need to understand why this is such and how they can address this and change this perception. (Median = 3 and Standard Deviation of 0.943, n = 130) 47    
  63. 63. Table 4.11 The pharmacies where I can buy DNA Test products or services sell well known brands The pharmacies where I can buy DNA Test products or services sell well known brands Frequency Percent Valid Percent Cumulative Percent Strongly agree 25 19.2 19.2 19.2 Agree 6 4.6 4.6 23.8 Uncertain 64 49.2 49.2 73.1 Disagree 35 26.9 26.9 100.0 Total 130 100.0 100.0 The findings in table 4.11 reveals that 19.2% of respondents strongly agree that the pharmacies where they can buy DNA Test products or services sell well-known brands, 4.6% agree, 49.2% were uncertain, and 26.9% disagree. The respondents were largely uncertain about the recognizable brands sold at the pharmacies which stock DNA Test product. This affirms the findings in Table 4.11. The significance of this is that DNA Test management will need to understand why this is such and how they can address this and change this perception. (Median = 3 and Standard Deviation of 1.033, n = 130) Table 4.12 DNA Test brand is advertised appropriately DNA Test brand is advertised appropriately Frequency Percent Strongly agree 32 24.6 Agree 33 25.4 Uncertain 29 22.3 Disagree 14 10.8 Strongly Disagree 22 16.9 Total 130 100.0 Valid Percent 24.6 25.4 22.3 10.8 16.9 100.0 Cumulative Percent 24.6 50.0 72.3 83.1 100.0 The findings in table 4.12 reveals that 24.6% of respondents strongly agree that the DNA Test brand is advertised appropriately, 25.4% agree, 22.3% were uncertain, 10.8% disagree, and 16.9% strongly disagree. There is a somewhat flat agreement to disagreement as to DNA Test’s advertising. Cumulatively 50% of the respondents agree to strongly agree the brand is advertised appropriately. Management of DNA Test need to address its advertising policy, so that its adverts are more appropriately advertised. (Median = 2.50 and Standard Deviation of 1.396, n = 130) 48    
  64. 64. Table 4.13 The adverts for DNA Test products and services seem expensive The adverts for DNA Test products and services seem expensive Frequency Percent Valid Percent Strongly agree 6 4.6 4.6 Agree 8 6.2 6.2 Uncertain 66 50.8 50.8 Disagree 50 38.5 38.5 Total 130 100.0 100.0 Cumulative Percent 4.6 10.8 61.5 100.0 The findings in table 4.13 reveal that 4.6% of respondents strongly agree that the adverts for DNA Test products and services seem expensive, 6.2% agree, 50.8% were uncertain, and 38.5% disagreed. A significant 50.8% of respondents were uncertain if the adverts for DNA Test products and services seemed expensive. This affirms the findings of tables 4.11 and 4.12 and as such management of DNA Test need to revise their current advertising policy so that the brand has customer appeal rather than seeming expensive. (Median = 3 and Standard Deviation of 0.763, n = 130) Table 4.14 I consider myself to be loyal to the DNA Test brand I consider myself to be loyal to the DNA Test brand Frequency Percent Valid Percent Strongly agree 71 54.6 54.6 Agree 13 10.0 10.0 Uncertain 32 24.6 24.6 Disagree 14 10.8 10.8 Total 130 100.0 100.0 Cumulative Percent 54.6 64.6 89.2 100.0 The findings in table 4.14 reveals that 54.6% of respondents strongly agree that they consider themselves to be loyal to the DNA Test brand, 10% agree, 24.6% were uncertain, and 10.8% disagreed. More than half of the respondents strongly agree that they are loyal to the DNA Test brand. Customer loyalty is achieved when consumers become committed to a brand and make repeat purchases over time. Brand loyalty is a result of consumer behavior and is affected by a person's preferences. Loyal customers will consistently purchase products from their preferred brands, regardless of convenience or price. Companies will often use different marketing strategies to cultivate loyal customers, be it is through loyalty programs (i.e. rewards programs) or trials and incentives. Companies that successfully cultivate loyal customers also develop brand ambassadors – consumers that will market a certain brand and talk positively about it among their friends. This is free word-of-mouth marketing for the 49    

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