Building Brand Equity with Environmental Communication
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Building Brand Equity with Environmental Communication

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  • H1: Hoeffler and Keller (2002) argue that CSR can enhance brand image by generating new abstract associations, the brand may appear as more sincere, caring or genuine).
    According to a survey conducted in 2008 by IFOP (Le Monde, June 3, 2008), consumers pay more and more attention to firms’ societal responsibilities when buying and consuming, and evaluate positively those firms.
    Therefore, when a brand communicates about its environmental involvement, it reactives experiental benefits, and reinforces the favourability of brand environmental associations.
    H2 & H3 : As noted formerly, associating the brand with another entity or cause can improve brand knowledge. Claim perceived characteristics may facilitate knowledge transferability and emphasize the effect of environmental communication on brand equity, such as the perceived congruency between the brand and the cause supported and the perceived credibility of the environmental claim.
  • The availability of the brand name was checked and verified respondent were unfamiliar with it : mean= 1,56 on a seven-point scale
    For the choice of product category, several industries like energy, oil, automotive, and gas were rejected because of their high environmental involvement, and intrinsically controversial, which might boost consumers’ suspicion. In contrast, the furniture and home improvement was chosen because it is an experience-driven category, which makes brand equity more critical.
  • The present research consider the brand WEB SITE (Specifically the brand presentation Web page) for four main reason.
  • The brand presentation Web page stimulus features four elements:
    Timeline, Our vision, fact and figures, and our engagement
    The ensure realism, IKEA’s engagement was used as inspiration for the environmental claims.
  • All constructs use seven-point scales : Brand equity, the congruency between the brand and the cause supported which is CSR, The perceived credibility of the environmental claim, the strength and favourability and consumer’s social consciousness which is introduce as a covariate.
    To assess consumers’ social consciousness and the perceived credibility of environmental claim, ad hoc scales were developed. Other measures rely on previously validated scales.
  • The flow started from web survey, D’ECO Company and the product categories were introduced to respondents, then, respondents were asked to read the web page stimulus, which contains four stimulus features : timeline, our vision, fact and figures and our engagement
  • 2. Then, they completed the rest of the questionnaire with no possibility of going back to review the web pages.
    Subject was randomly assigned to each of the two treatments: environmental communication (which is include moderator variables & control group (which is without question about moderator variables)
    3. The third step is conduct descriptive statistic per each treatment, to check if the manipulation is success or not
    (If there was a significant difference across the two treatments, it shows the manipulation’s success
    4. Before testing the hypotheses, a Pearson correlation test was conduct to find the correlation between the strength and the favourability of the association ecological on customer-based brand equity
    5. The fourth step is T-test, was conducted to test if our hypothesis are statisticaly significant or not.
    6. And last step, Linear regression was conducted to test the other hypotheses.
  • For the multi-items scales, cronbach’s alpha was conducted to check the reliability and satisfactory reliability was found. As we can see, all of cronbach alpha are more than .90 which means excellent.
  • The associations to be assessed come from a qualitative pre-test where 31 consumers were asked to consider the stimuli and to elicit free associations.
    In reaction to the environmental engagement, the brand association mostly cited was ecological.
    As filler tasks, three other associations were measured for young people, low prices, design.
  • This means customer brand-equity increases with the strength and the favourability of the association ecalogical
  • The strength (means of 6.1 vs. 5.3, p<.000) and the favourability (means of 6.4 vs. 5.4, p < .000) of the association ecological are significantly higher when the brand communicates about its environmental initiative than when it does not.
    Brand equity is also significantly higher (mean 4.9) when the brand communicates than when it does not (mean 4.4 in the control group)
    This result show us that environmental communication has a significant effect on brand image environmental dimensions, and therefore brand equity.
  • Linear Regression model was conducted. The strength of the association ecological and brand equity are dependent variable. The perceived congruency, perceived credibility are IV and Societal consciousness is introduced as a covariate.
    Both regression are significant.
    The result show that the congruency between the brand and cause supported significantly increase the strength of the association ecological (0.38***) and also increase brand equity (0.34***), then H2a and H2b are supported.
    The perceived credibility of the claim also significantly increase the strength of association ecological (0.28**) and brand equity (0.36***) which means this result support H3a and H3b.
    As we can see, Societal Consciousness has no significant effect either on the strength of the association ecological or on brand equity.
  • 32% OF STRENGTH OF THE ASSOCIATION ECOLOGICAL IS ASSOCIATED BY IV TAKEN TOGETHER
    For every unit increase of perceived credibility, a 0,28 unit increase in strength of the association ecological
  • 34% OF BRAND EQUITY IS ASSOCIATED BY IV TAKEN TOGETHER
    For every unit increase of perceived credibility, a 0,36 unit increase in strength of the association ecological
  • H1: Hoeffler and Keller (2002) argue that CSR can enhance brand image by generating new abstract associations, the brand may appear as more sincere, caring or genuine).
    According to a survey conducted in 2008 by IFOP (Le Monde, June 3, 2008), consumers pay more and more attention to firms’ societal responsibilities when buying and consuming, and evaluate positively those firms.
    Therefore, when a brand communicates about its environmental involvement, it reactives experiental benefits, and reinforces the favourability of brand environmental associations.
    H2 & H3 : As noted formerly, associating the brand with another entity or cause can improve brand knowledge. Claim perceived characteristics may facilitate knowledge transferability and emphasize the effect of environmental communication on brand equity, such as the perceived congruency between the brand and the cause supported and the perceived credibility of the environmental claim.
  • And for the practical implications, in the context of greater consumer pressure regarding business ethics,

Transcript

  • 1. Carrine Kezia Aulia | 102183022 BUILDING BRAND EQUITY WITH ENVIRONMENTAL COMMUNICATION An Empirical Investigation in France
  • 2. PRESENTATION OUTLINE 1. INTRODUCTION – Research Background – Research Questions 2. LITERATURE REVIEW – CSR and CSR Communication – Brand Equity 3. METHODOLOGY – Research Framework – Research Hypothesis – Stimuli – Data Collection Method – Research Instrument – Research FlowTLINE
  • 3. PRESENTATION OUTLINE 4. RESULTS – Demographic Characteristics – Reliability Analysis – Qualitative Pre-test – Descriptive Statistic per Treatment – Correlation – T-Test – Linear Regression 5. DISCUSSION & CONCLUSION – Discussion, Conclusion, & Implications – Recommendations for further studies TLINE
  • 4. INTRODUCTION
  • 5. RESEARCH BACKGROUND The interest for Corporate Social Responsibility (CSR), is strongly enhanced today as many companies and brands communicate about their societal initiatives in Europe. In France, 68% of consumers think firms should pay more attention to the impact of their actions on the environment and social harmony (Sociovision 2005 Survey) and 54% consider the environmental-friendly attribute as a very important criterion when choosing a product (IFOP 2008 in Le Monde, June 3, 2008) INTRODUCTION
  • 6. RESEARCH BACKGROUND In a context where consumers challenge brands added value and become more critical, societal initiatives and therefore communication about them appear as a key strategic lever to built brand equity (Keller, 2003). Several studies have proposed that societal initiatives and related communication can actively build brand equity (Hoeffler and Keller, 2002; Keller 2003; Bhattacharya et al., 2004), but none have tested it yet. Filling this gap is important: Building brand equity is still a major marketing issue as it increases marketing-mix efficiency, as well as the probability of success of brand extensions (Keller, 1993, 2003; Erdem and Swait, 1998). INTRODUCTION
  • 7. RESEARCH QUESTION How does firm’s environmental communication impact on brand equity through the strength & favourability of brand environmental association? INTRODUCTION
  • 8. LITERATURE REVIEW
  • 9. CSR AND CSR COMMUNICATION CSR aims at “achieving commercial success in ways that honour ethical values and respect people, communities and the natural environment” (Bhattacharya and Sen, 2004, p.13) LITERATURE REVIEW the use of CSR communication is growing, because it provides a corporate marketing tool that can build a strong corporate image and reputation (Hoeffler and Keller, 2002) and achieve social legitimacy (Morsing, 2006)
  • 10. CSR AND CSR COMMUNICATION good performances in terms of CSR positively influence consumers’ attitude towards the firm and purchase intent, but bad performances damage them even more (Creyer and Ross, 1997) LITERATURE REVIEW “the differential effect that brand knowledge has on consumer responses to the marketing of that brand” and measures it through the cognitive antecedents of consumers’ brand knowledge (Keller, 2003, p.60) BRAND EQUITY
  • 11. METHODOLOGY
  • 12. RESEARCH FRAMEWORK METHODOLOGY
  • 13. RESEARCH HYPOTHESES H1 : Environmental communication enhances the strength (H1b), and favourability (H1c) of brand environmental associations, as well as brand equity (H1c) H2 : In case of environmental communication, the perceived congruency between the brand and the cause supported increases the strength of brand environmental associations (H2b), and therefore brand equity (H2a) H3 : In case of environmental communication, the perceived credibility of the environmental claim increase the strength of brand environmental associations (H3b), and therefore brand equity (H3a) METHODOLOGY
  • 14. STIMULI 1. Brand and Sector • Present D’ECO, a fictitious retailer in the furniture and home improvement industry corporate Web Site Home Page. • Fictitious corporate brand was chosen, as in many previous studies (Brown and Dacin, 1997; Swaen and Vanhamme, 2005) to avoid any effect of brand familiarity. (Mean=1,56 on a seven-point scale) • Product category the furniture and home improvement was chosen because it is an experience-driven category which makes brand equity more critical (Erdem and Swait, 1998) METHODOLOGY
  • 15. STIMULI 2. Environmental Communication Medium • This research uses Web Site as medium for four main reasons : 1. Website is the most frequent medium used to engage in corporate social responsibility’s communication (Van de Ven, 2008) 2. Website are preferred medium to communicate CSR involvement because of the richness of argumentation and opportunities for interactivity they provide (Coupland, 2005) 3. For product categories such as furniture and home improvement, Websites are widespread; 47% of French consumer look for information on the Internet before buying furniture in an outlet (Netratings French Panel, 2006) 4. Brand Websites can target the best brand clients and influence their attitudes and perceptions of the brand’s personality (Muller and Chandon, 2004) METHODOLOGY
  • 16. STIMULI 1. Brand and Sector METHODOLOGY
  • 17. METHODOLOGY
  • 18. DATA COLLECTION METHOD & RESEARCH INSTRUMENT Subjects = French Measures = Use seven-point scaled questionnaire METHODOLOGY
  • 19. RESEARCH FLOW 1. Web survey – Introduced the D’ECO Company and the product categories – Read the Web page stimulus METHODOLOGY
  • 20. RESEARCH FLOW 2. Qualitative Pre-test 3. Questionnaire – No possibility to going back to review the web pages – Subject was randomly assigned to each of the two treatments: environmental communication and control group 4. Descriptive Statistic 5. Correlations 6. T-test 7. Linear Regression METHODOLOGY
  • 21. RESULT
  • 22. DEMOGRAPHIC CHARACTERISTIC Subjects = 165 respondent – Age = Between 25 and 45 years old – Various areas in France and is heterogeneous in terms of gender and socio-economic status RESULTS
  • 23. RELIABILITY ANALYSIS RESULTS
  • 24. QUALITATIVE PRE-TEST 31 customers were asked to consider the stimuli and to elicit free association (Van Riel et al., 1998). The brand association mostly cited was ecological. RESULTS
  • 25. DESCRIPTIVE STATISTIC PER TREATMENT (on seven-point scales) RESULTS
  • 26. CORRELATION The strength of the association ecological and brand equity (Pearson = 0.5, p < .000) The favourability of the association ecological and brand equity (Pearson = 0.4, p < .05) RESULTS
  • 27. T-Test RESULTS p < .000 p < .000 H1b H1c H1a p < .05
  • 28. LINEAR REGRESSION RESULTS H2a H2b H3b H3a
  • 29. LINEAR REGRESSION-FINDING RESULTS Perceived congruency Perceived credibility Social consciousness Strength of the association ecological β = -0,02 β = 0,28*** β = 0,38*** ADJ R2 = 0,32*** H2b H3b
  • 30. LINEAR REGRESSION-FINDING RESULTS Perceived congruency Perceived credibility Social consciousness Brand equity β = 0,34*** β = 0,36*** β = 0,00 ADJ R2 = 0,34*** H2a H3a
  • 31. HYPOTHESES-FINDING H1 : Environmental communication enhances the strength (H1b), and favourability (H1c) of brand environmental associations, as well as brand equity (H1c) ACCEPTED H2 : In case of environmental communication, the perceived congruency between the brand and the cause supported increases the strength of brand environmental associations (H2b), and therefore brand equity (H2a) ACCEPTED H3 : In case of environmental communication, the perceived credibility of the environmental claim increase the strength of brand environmental associations (H3b), and therefore brand equity (H3a) ACCEPTED RESULTS
  • 32. DISCUSSION & CONCLUSION
  • 33. DISCUSSION, CONCLUSION, & IMPLICATIONS Environmental communication positively influences the strength and favourability of brand environmental association, therefore improving brand equity. Two moderators reinforce the impact of environmental associations: the perceived congruence between the brand and the cause, and the perceived credibility of the claim DISCUSSION AND CONCLUSION
  • 34. DISCUSSION, CONCLUSION, & IMPLICATIONS Manager should favour environmental arguments in their corporate communication to improve brand image through societal associations They should focus their communication on causes that are congruent with their brands to facilitate brand equity building, and ensure they are credible when proclaiming these argument DISCUSSION AND CONCLUSION
  • 35. RECOMMENDATIONS FOR FURTHER STUDIES This research proves a general positive effect of environmental communication on brand equity in certain favourable condition, a lot more need to be investigated to understand the boundary condition. This research only use focus on one media, future studies will have to generalize results to several media as stimuli. (e.g., company profile, radio scripts, press release, consumers’ associations articles, or newspaper articles. Future research should also replicate the result to other contexts, as societal consciousness seems to vary across them (Maignan and Swaen, 2000). Replicated across different industries regarding CSR involvement, and especially environmental ones probably plays a role, certain engagement becoming prerequisite and no more value adding for the brand DISCUSSION AND CONCLUSION