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Brandnew Store

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Brandnew Store

Brandnew Store: An understanding of the effects

of customer experience

Master thesis

MSc Business Administration

Marketing Management

Author:

Robert Daling

Date:

11 November 2010

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Management summary

More than 40 percent of those who remember seeing an advertisement fail to register the brand name. Therefore, companies need to be more innovative and creative than before to keep the attention of the customer. An example of an organization which concentrates on brand communication and experience is Brandnew Store (BNS). Brandnew Store is a promotion tool for companies to promote their products on a new and unusual way. In this flexible store, companies can promote their brand(s) during a short period (1 until 4 weeks). They could use these shops to promote their brands or services in a regular retail environment. With A1 locations in the cities Amsterdam, Amstelveen, Rotterdam, and Groningen, it is possible to reach many customers in a short period. This thesis concentrates on the effect of the brand FIAT, which was situated inside the Brandnew Store for one week. The central question of this study is therefore: “What is the

influence of Brandnew Store on brand equity and what are the customer’s experiences and perceptions when visiting Brandnew Store?”

Customer experience definitions found in literature do not include a clear definition and criteria. Most literature provides an overview of customer experience variables that could influence customer experience. Measure scales which are available contain generally sensory variables. In addition, research about customer experience does not indicate a clear distinction between customer experience and brand equity dimensions. Therefore, this thesis investigates if Brandnew Store (=customer experience) has positive or negative effects toward customers. This will be measured by the brand equity dimensions ‘brand awareness’, ‘perceived quality’, ‘brand association’ and ‘brand loyalty’. Also store environment dimensions such as ambient, design, and social factors contribute to the customer experience of Brandnew Store. Eventually, the academic value of this thesis consist of clear criteria of customer experience, practical results how to measure customer experience, and clear results which will indicate if customer experience contribute to customer perceptions.

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The aim of this research is to see if Brandnew Store influences the brand equity dimensions of a brand. In our research, we found a significant positive effect of the concept Brandnew Store

on brand awareness, perceived quality, and brand loyalty. The dimension brand association is

measured individually and show on 9 items positive treatment effects.

To indicate prominent results, we divided our sample in four parts: males, females younger (18-35), and older (>35) customers. We performed an analysis on gender and age. First, we can indicate that Brandnew Store has a larger effect on male customers in comparison to females. This result was not expected, but can be explained because males are more likely to purchase gender-congruent products in comparison to females. Second, we can conclude that Brandnew Store has a larger effect on younger customers in comparison to older customers. This result was expected, because the brand Fiat is aiming at younger customers and promoted their car as a sports car.

Moreover, this thesis also investigated social, design, and ambient factors. Due to fewer store visitors than expected, this research could only investigate design and ambient factors. We found that the interior perception of the store indicate a significant positive effect on customers. However, analysis indicates that lighting inside the Brandnew Store do not influence customers. Therefore, it is interesting to investigate design, store and ambient factors more extensively in the future.

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Preface

This master thesis is the conclusion of the study Business Administration which I started in 2007. After having finalized my bachelor of commerce in 2007, I decided to increase my knowledge about marketing. The Pre-Master Business Administration and the master Marketing Management gave me the opportunity to make this possible. The University of Groningen, the city Groningen, and related workshops helped me to enlarge my personal and academic view. Therefore, I consider this report as a confirmation of my perseverance in personal and professional life.

I would like to thank the people who supported me during the period I studied in Groningen. First of all, I would like to thank my supervisor dr. Karel-Jan Alsem for his enthusiasm, advice, and academic recommendations during this period. The useful feedback has been a great help in finalizing this report.

Finally, I would like to thank my parents, friends, and girlfriend for their support and understanding during the time I studied in Groningen. I could not have done it without them!

Robert Daling

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Table of contents

Chapter 1. Introduction ...9

1.1 Background...9

1.2 Brandnew Store...10

1.3 Problem statement...13

1.4 Structure of the thesis ...14

Chapter 2. Customer Experience...15

2.1 Definitions of customer experience...15

2.2 Criteria of customer experience ...17

2.3 Dimensions of customer experience...19

2.4 Conclusion ...22

Chapter 3. Brand Equity...24

3.1 Definition of brand equity ...24

3.2 Brand equity literature...24

3.3 Dimensions of brand equity...27

3.4 Conclusion ...28

Chapter 4. Store environment ...29

4.1 Definition of retail atmosphere ...29

4.2 Empirical research into environmental factors ...29

4.3 Dimensions of store environment levels ...31

4.4 Conclusion ...32

Chapter 5. Conceptual model and hypotheses ...33

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Chapter 6. Research Design ...37

6.1 Choice of research...37

6.2 Data collection ...38

6.3 Analysis ...40

Chapter 7. Results and hypotheses testing ...43

7.1 Sample ...43

7.2 Validity analysis...45

7.2.1 Internal reliability...45

7.2.2 Factor analysis ...46

7.3 Descriptive...46

7.3.1 Brand equity dimensions ...46

7.3.2 Brand personality scores...48

7.3.3 Overall results ...50

7.3.4 Store environment results ...51

7.4 Hypotheses testing ...52

7.5 Evaluation of results...55

Chapter 8. Conclusion and implication ...58

8.1 Conclusion ...58

8.2 Limitations and recommendations for further research...59

Bibliography ...61

Appendix 1. Questionnaire control group ...65

Appendix 2. Questionnaire experimental group ...68

Appendix 3. Chi-Square Analysis...69

Appendix 4. Factor analysis ...71

Appendix 5. Descriptive results ...73

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List of table and figures

Figures

1. Residents of the Brandnew Store 11

2. Structure of the thesis 14

3. The Iceberg-Model 20

4. The Mehrabian-Russell model of environmental influence 30

5. Conceptual model 33

6. Experimental design 39

7. Brandnew Store experience: FIAT. 39

8. Visual reflection of the representativeness of the sample 45

9. Mean of Brand Equity dimensions 47

10. Brand personality scores 49

11. Opinion about Fiat 50

12. Final marks of Fiat 51

Tables

1. Theoretical definitions of customer experience 16

2. Criteria of customer experience 19

3. Communication objectives 25

4. Environmental shopping behavior factors 30 5. Research questions control and experimental group 42 6. Sample size control and experimental group 44 7. Results of Cronbach Alpha brand equity dimensions 45 8. Results of Cronbach Alpha brand personality dimensions 46

9. Brand equity dimension scores 48

10. Brand personality score ‘excitement’ 48 11. Individual brand personality scores 49

12. Store environment Brandnew Store 52

13. Brand awareness results 53

14. Perceived quality results 53

15. Brand loyalty results 54

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Chapter 1. Introduction

This chapter will provide the reader with a short explanation about brands and the current advertising methods. Furthermore, the important role of new advertising media, like the new concept ‘Brandnew Store’, will be described. In order to give a clear overview of the aim of this research, the central question and the structure of the thesis will be presented.

1.1 Background

‘More than 40 percent of those who remember seeing an advertisement fail to register the brand name’ (Rossiter and Bellman, 2005). Ineffective marketing campaigns occur when the brand name within the campaign is insufficient. Consequence, people are not able to remember the brand or have a competing brand in their mind. Therefore, building a strong brand is a major priority for many firms (Morris, 1996). In addition to this, Keller (2008) indicates that an increase in marketing communication effectiveness is an important benefit of building strong brands. The author indicates that the beginning of successful marketing consist of understanding desires of consumers and invent products to satisfy those. Organizations are not aware of the fact that brands should be continuously built, competitors will catch up. Therefore, Keller (2008) indicates that ‘the power of a brand lies in what resides in the minds of customers’. Due to increasing competition of brands it is increasingly difficult for organizations to persuade consumers. Companies need to be more innovative and creative than before to keep the attention of the customer.

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Currently, most companies use modern advertising channels such as television, radio, magazines, newspapers, direct response (mail, telephone, internet), interactive advertising (websites, online ads, mobile marketing) and outdoor marketing (Keller, 2008). Empirical findings of Leone (1995) concluded that returns of advertising usually diminish during the time a promotion campaign is performed. Furthermore, Vakratsas and Ambler (1999) show that 90% of the advertising effects disappear after three to fifteen months. To improve the effect of their advertising campaigns, companies always look for new ways to promote their brands. Verhoef et al. (2009) indicate that creating a superior customer experience seems to be one of the central objectives in today’s marketing. Moreover, modern consumers have much more choices than ever before (Meyer and Schwager, 2007), such as more channels and more products. Consequently, traditional advertising media have difficulties in creating an experience in customers. An example of an organization which concentrates on brand communication and experience is Brandnew Store (BNS).

1.2 Brandnew Store

Brandnew Store is a concept that is new to the Netherlands. Brandnew Store are flexible brand stores, which rent their four locations to advertisers during a period of 1 to 4 weeks. Advertisers could use these stores to promote their brands or services in a regular retail environment and to create an exclusive brand experience towards customers. To create an overall picture, the expression ‘Brandnew Store’ is the name of the store.

Brandnew Store is all about experience marketing. Companies can use the store for a few weeks to present a product or service with the aim to reach new and existing customers without going for immediate sales. Interactive floor projection (for instance the company logo), plasma screens, decorated walls and ceilings, scent dispensers and a back wall with several nine television screens are available to create the attention of passers-by. Therefore, customers become acquainted with the brand in an interactive way. Brandnew Store is an addition to the traditional media such as newspapers/magazines, television, radio or the internet. The main difference in comparison with traditional media is that all five senses are stimulated. Consumers are able to touch, taste and smell the products, and can ask questions about them. Thus, Brandnew Store provides closer contacts between a brand or product and customers.

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a brand in all four A1 locations. Moreover, all four locations offer the same product or service at the same time. This enables companies to perform a consistent promotion in the different stores. The construction of the stores takes approximately 2 days. It is uncommon for the stores to be empty, because if there is no advertiser available, the empty spaces are offered to charity foundations, which can use the store for a few weeks.

Different brands and products have been using the concept of Brandnew Store. Figure 1 presents the appearance of several brands. Car manufacturer Alfa Romeo presented their newest model, Alfa Mito; health insurance company Ohra gave visitors the opportunity to have their health checked’; L’Oreal created a chemist’s store with only L’Oreal products, and health insurance company FBTO combined its products around the time of the ‘Elfstedentocht’ (a skate tour in the Netherlands) by creating a ‘store’ with a walking route through the eleven cities. Basically, these companies used Brandnew Store to communicate their marketing campaign to consumers.

Figure 1: Residents of the Brandnew Store

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products. Brandnew Store is a promotion tool that can be used to promote brands and products to the audience. Furthermore, because of the unusual retail environment, customers do not experience this medium as a direct advertising like a magazine, newspaper or bus stop advertisements. The aim of the Brandnew Store is also to create an unique experience in order to attract customer’s attention.

The unique A1 location gives companies, which are often located outside the shopping areas, an opportunity to promote themselves in a new way, in a place where customers do not expect a promotion of that particular company. Therefore, furniture stores (e.g. Ikea, Leenbakker or Trendhopper), electronic stores (e.g. Mediamarkt, Saturn or BCC), DIY shops (e.g. Praxis, Gamma or Karwei) and travel agencies (e.g. D-reizen, Holland International or Arke) are stores which could present themselves to consumers in a completely different way than they usually do. Also web stores like Wehkamp and Bol.com could use Brandnew Store in the future. They could use the store as a promotional tool to promote their company and make consumers familiar with their websites. In addition, the concept Brandnew Store is not online available, but online companies could use Brandnew Stores to promote their website to the audience. Moreover, Brandnew Store enables companies to bring their products and service to the customer. Therefore, the promotion in Brandnew Store could be an unexpected surprised for passers-by.

Pop-up stores

Nowadays, there is also a new trend called pop-up stores. These stores are different than Brandnew Store, because pop-up stores are a new way to prevent unoccupied retail stores. The aim of pop-up stores is to sell products in a specific short period (between 2 days and a week). Pop-up stores have no expensive design, because they would like to shift their activities easily. In comparison with Brandnew Store, the aim of pop-up stores is to sell many products in a short period. They do not have the goal to create an experience for customers.

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indicate a clear distinction between customer experience and brand equity dimensions. This research indicates if customer experience has positive or negative results towards customers and will be measured by the brand equity dimensions ‘brand awareness’, ‘perceived quality’ and ‘brand loyalty’. At the end, the academic value consist of clear criteria of customer experience, practical results how to measure customer experience and clear results which will indicate if customer experience contribute to customer perceptions.

1.3 Problem statement

Because Brandnew Store is a new marketing concept, there is limited literature available about its effects. Considering the interesting development of this new concept of promoting brands, the aim of the present study is to investigate the effects of Brandnew Store on the brand equity components. Furthermore, the customer experiences and perceptions when visiting Brandnew Store will be investigated. In addition, dimensions of the retail atmosphere will be investigated to see which ones have a positive influence towards customers.

The central question of this study is therefore:

This central question is divided into several sub questions: 1. What is customer experience?

2. What are the dimensions that influence the customer experience? 3. What is brand equity?

4. What are the dimensions that influence brand equity? 5. What are the factors that influence the in-store environment?

The sub questions will be described extensively in chapters 2, 3 and 4. These questions will be helpful in answering the central research question.

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1.4 Structure of the thesis

The next chapter will give definitions of the terms ‘experience’ and ‘customer experience’. It will analyze the criteria and the dimensions that influence the customer experience. Chapter 3 will discuss brand equity and the accompanying dimensions. Chapter 4 will cover the aspects of the store environment and the accompanying dimensions. Subsequently, chapter 5 will elaborate on the conceptual model and hypotheses. The research design and research methods will be presented in chapter 6, while chapter 7 will describe the results of this research. This report will end with a conclusion of the findings and recommendations.

In order to give a clear overview of this thesis, the structure is visualized in figure 2. It is divided into a theoretical part, an empirical part and a concluding part.

Figure 2: Structure of the thesis Chapter 3:

Brand Equity

Chapter 5: Conceptual model and hypotheses

Chapter 6: Research Design Chapter 1: Introduction

Chapter 7: Results

Chapter 8: Conclusions and discussion Chapter 4: Store environment Theoretical part Empirical part Concluding part

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Chapter 2. Customer Experience

In order to investigate the central research question, a description is needed of the available academic literature on the subject of customer experience. This will be presented in the present chapter. Therefore, the theoretical issues about customer experience and the criteria and dimensions of customer experience will be discussed. Also, brand equity and the accompanying dimensions are described. In this way, this chapter will answer sub questions 1 and 2.

2.1 Definitions of customer experience

Creating a superior experience for consumers is one of the central objectives in current retail environment. A clear example of this is the coffee company Starbucks. One of the major elements of its success is based on the creation of customer experience (Michelli, 2007). At Starbucks, consumers are willing to pay more for their coffee, sitting in a trendy environment and listening to their favorite music. In addition, research has shown that creating a customer experience that is unique, can create a higher economic value for firms (Pine and Gilmore 1999). Therefore, a closer look at customer experience is desirable.

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Today’s most recent definitions of experience are described in table 1. These definitions will be compared with each other.

Definition of customer experience Authors

Customer experience originates from a set of interactions between a customer and a product, a company, or a part of its organization, which provoke a reaction.

LaSalle and Britton (2003); Shaw and Ivens (2005) in: Gentile, Spiller and Noci (2007)

Customer experience is the internal and subjective response customers have to any direct or indirect contact with a company.

Meyer and Schwager (2007)

Customer experience includes every point of contact at which the customer interacts with the business, product or service.

Grewal et al. (2009) Customer experience is holistic in nature and involves the customer’s

cognitive, affective, emotional, social and physical responses to the retailer.

Verhoef et al. (2009)

Brand experience1 entails subjective internal consumer responses (sensations, feelings and cognitions) and behavioral responses evoked by brand-related stimuli2 that are part of a brand’s design and identity, packaging, communications and environments.

Brakus et al. (2009)

Table 1: Theoretical definitions of customer experience

Verhoef et al. (2009) indicate that customer experience involves the customer response to the retailer. Besides, Brakus et al. (2009) declare that also behavioral response influences the customer experience. In contrast, Meyer and Schwager (2007) and Grewal et al. (2009) see customer experience as a point of contact with businesses or products and interactions between these and the customer.

From a study of these definitions several notable terms emerge, which are underlined in table 1. These strong terms are: ‘contact’ with a company or customer and ‘interaction’ between a customer and a product, business or service. The definition provided by Brakus et al. (2009) is less clear than the other definitions, because it does not indicate the boundary of customer experience. In addition, the authors do not give a clear definition of what an experience really is. In line with this, Verhoef et al. (2009) indicate that “experience is created not only by those

1 Brakus et al (2009) use the term ‘brand experience’. To be consistent with similar research, we will use

the term ‘customer experience’ in our research.

2

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factors that the retailer can control (e.g., service interface, retail atmosphere, assortment, price), but also by factors outside of the retailer’s control (e.g., influence of others, purpose of shopping)” (Verhoef et al. 2009, p. 32). They indicate that customer experience is an internal and subjective response by customers when they come into contact (directly or indirectly) with the company. The researcher also declares that customer experience can be seen “as a set of internal and subjective interactions between a customer, a company or product.” Moreover, Verhoef et al. (2009) also declare that ‘interaction’ is a part of customer experience.

Continuing from the customer experience definitions described in table 2.1, Meyer and Schwager (2007) describe the purchase, use and service of a product as direct customer contacts. Indirect contacts are unplanned encounters, such as the presentation of a product (often in supermarkets and electronic stores), services, advertising, reviews, etc. Moreover, Brakus et al. (2009) indicate that there are three dimensions to customer experiences: ‘product experience’, ‘shopping and service experience’ and ‘consumption experience’. Product experience occurs when consumers interact with products, when consumers look for products and when they evaluate products. Consumer interactions with the physical environment, the personnel and the policies of a store come under shopping and service experiences. Consumption experience occurs when consumers consume and use the products.

Brakus et al. (2009) observed that experiences can be direct or indirect. They argue that experiences occur directly when consumers shop for, buy and consume products. Experiences are indirect when a product is presented virtually, such as in advertisements or communication through the internet. However, Gentile, Spiller and Noci (2007), Meyer and Schwager (2007) and Grewal et al. (2009) indicate that experiences consist of contact and interaction between customers, businesses or products. In the case of indirect experiences, however, there is no interaction. Brakus et al. (2009) indicate that experience consist of direct and indirect experience and therefore, the definition of customer experience developed by Brakus et al. (2009) is not consistent with other research. In addition, definitions found in the literature do not include the specific criteria of customer experience. To create a complete picture of customer experience, the criteria are described in the next section.

2.2 Criteria of customer experience

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dimensions influence the customer experience. For example, if a customer has eaten at a restaurant with an unfamiliar cuisine (e.g. Mexican food), the customer is probably more aware of the surroundings, environment, scents, music, unfamiliar ingredients etc. Therefore, the customer’s visit is a unique experience and very different from his usual experiences.

As described in section 2.1, customer experience definitions use notable terms such as ‘interaction’ and ‘contact’. Generally, interaction3 can be seen as an action which occurs when two or more objects affected one another. To obtain a clear explanation of the term interaction, this research distinguishes one-sided and two-sided communication.

One-sided communication. The sender sends a message to the receiver, but the receiver will/can not respond.

Two-sided communication describes a situation whereby a message is exchanged between two or more persons. In this situation one person can be receiver or sender at the same time.

One-sided communication is often used in sales and advertising. Two-sided communication is used when a customer interacts with a person, business or product. Thus, in order to call a

process customer experience, two-sided communication is necessary. The theoretical issues

presented in sections 2.1 and 2.2 are used to come to a final definition of customer experience. It is based on the definition by Grewal et al. (2009), which has been explained in section 2.1. The present study comes to the following definition of customer experience:

3 http://www.wordiq.com/definition/Interaction

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To elucidate this, various examples are shown in table 2.

Activity Communication Experience /

no experience Buying a TV from Mediamarkt Two-sided communication Experience

Buying a cauliflower in the supermarket Two-sided communication Experience

Visiting an FC Groningen football match and watching advertisements from shirt sponsors.

One-sided communication No experience

Buying a beer at the FC Groningen football match

Two-sided communication Experience

Grabbing a bottle of Coca Cola from the supermarket shelve

One-sided communication No experience

Tasting new alcohol-free beer by Heineken in a supermarket

Two-sided communication Experience

Purchasing a book from Selexyz Two-sided communication Experience

Reading an exciting book One-sided communication No experience Receiving an e-mail from a friend One-sided communication No experience Listening to a song on the radio One-sided communication No experience Watching a KPN advertisement on television One-sided communication No experience Visiting a car company Two-sided communication Experience

Buying tickets at the desk of Six Flags Two-sided communication Experience

Riding on a roller coaster One-sided communication No experience

Table 2: Criteria of customer experience

Recently, organizations introduced speech communication systems to offer their customers fast service. When the system answers the question accurately and is able to perform a conversation with the customer, it consists of two-sided communication and therefore becomes a customer experience.

2.3 Dimensions of customer experience

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process of consumers. In addition, Verhoef et al. (2009) recognize the importance of past customer experiences, social and store environment, service interfaces, retail atmosphere, assortment, price and retail brands on future environments. According to the author, these components can influence the total customer experience. There are several dimensions that influence the experience of customers. In this section, the sensory, affective, behavioral and intellectual (Brakus et al., 2009) dimensions will be discussed.

Munzinger et al. (2004) developed the Iceberg-Model which shows the difference between brand-iconography and brand-credit (figure 4). Brand-brand-iconography consists of consumers’ sensory perception and the brand appearance from the point of view of consumers. Concrete dimensions of iconography are colors, logos, seeing feeling, hearing, touch and smell. These dimensions are able to create customer experience at all touch points. Brand-credit is consumers’ sympathy, trust, loyalty and emotional connection toward a brand. Munzinger et al. (2004) indicate that iconography triggers emotions and memories of previous experiences, which in turn create new expectations.

Figure 3: The Iceberg-Model (Munzinger et al., 2004)

Because of the above, customer’s sensory components can influence the experience of a brand, product or business. According to Brakus et al. (2009) customer experience exists of four dimensions. The first dimension, ‘sensory’, can affect experience by using the customer’s five senses (sight, hearing, smell, taste and touch). The three other dimensions, ‘affective’, ‘behavioral’ and ‘intellectual’, are the outcome of the experience. To distinguish these dimensions, a brief explanation is presented.

Brand-Iconography Brand- Credit

Apparent:

What customers see, feel, hear, touch and smell.

Latent:

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Sensory

The sensory dimension has a strong impression on the consumer’s senses. Therefore, the sensory dimension exists of the five senses: sight, hearing, smell, taste and touch. These senses are able to create or change a customer’s experience. Parsons and Conroy (2006) argue that sensory stimulation is important because of two reasons. First, sensory stimuli can attract people to a store. Secondly, sensory stimuli can be used in a way to enhance the value of the object in order to create a sustainable competitive advantage. Hoyer and MacInnis (2007) describe how perception occurs when stimuli are registered by one of the five senses: sight, hearing, taste, smell and touch. The sensory dimension can be used to differentiate companies and products. Furthermore, it can motivate customers and add value to products.

In conclusion, there is no one-to-one relation between an experience and one of the four dimensions. An experience can include several customer experience dimensions at the same time. For example, color, design, smell and shape are sensory experiences, but may also result in affective experience (emotions) or intellectual experience (thinking about the design). Below, the outcomes of experiences (affective, behavioral and intellectual) will be described.

Affective

According to Schmitt (1999), affective marketing incorporates customers’ inner feelings and emotions. The author also indicates that affective experiences are able to create positive moods linked to a brand. Brakus et al. (2009) describe affective experiences as consumers’ feelings, sentiments and emotions towards a brand. Because of the affective dimension, consumers will select a brand or service because they like it, even though they are not aware of it.

Behavioral

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Intellectual

When a consumer encounters a specific brand or store, he/she will have many ideas about the business or products. One single experience can make people think positively or negative about the brand. Smith and Yang (2004) indicate that creative thinking occurs when different thoughts are produced at the same time. An experience can intensify consumers’ thoughts and can increase the image towards a brand.

In conclusion, sensory dimensions can affect the emotions, behavior and thoughts of customers. The three dimensions affective, behavioral and intellectual are the outcome of the experience. These dimensions can positively influence the customer’s experience.

2.4 Conclusion

One of the central objectives in the current retail environment is to create a superior experience for consumers. The most recent definitions of customer experience were developed by Meyer and Schwager (2007), Verhoef et al. (2009), Brakus et al. (2009) and Grewal et al. (2009). However, research about this topic is relatively new. Therefore, only a limited amount of literature is available about the measurement and criteria of customer experience. Moreover, the definitions of customer experience are different from each other and do not include clear criteria what experience exactly is. Therefore, we provided an own definition of customer experience. We think that in order to call a process customer experience, two-sided communication is necessary. Therefore, our definition of customer experience becomes: “Customer experience is every

two-sided communication at which the individual customer interacts with a person, business or product.”

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new store which will promote their brands and/or products on a totally different way in comparison with the previous promotion. In conclusion, Brandnew Store meets the criteria of customer experience and therefore we can conclude that that Brandnew Store can be seen as an experience.

Several authors (Gentile, Spiller and Noci, 2007; Verhoef et al, 2009; Grewal et al., 2009) give variables that could influence customer experience. However, a clear measurement scale is not available. Moreover, literature about customer experience does not indicate a clear distinction between customer experience and brand equity dimensions. This thesis indicates if Brandnew Store has positive or negative effects toward customers. In addition, customer experience can be seen in different ways. First, customer experience can be seen as an experience of a customer. Second, it can be seen as an expression of a brand to create experience. In this thesis, we use customer experience as an expression of a brand to create experience.

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Chapter 3. Brand Equity

To investigate the influence of Brandnew Store, this section consists of academic literature on the subject of brand equity. Therefore, clear definitions about brand equity and brand equity dimensions will be discussed. Also, this chapter answers sub question 3 and 4.

3.1 Definition of brand equity

To create a clear description of brand equity, a closer look to the definition ‘brand’ is necessary. According to Kotler (1991), “a brand is a name, term, sign, symbol, design or a combination of these elements, which is intended to identify goods or services of a seller and differentiate them from those of competitors.” Moreover, Franzen (1998) described a brand as a network of associations in the brain of the customer.

Aaker (1991) defines brand equity as “a set of brand assets and liabilities linked to a brand, its name and symbol that add to or subtract from the value provided by a product or service to a firm and/or to that firm’s customer”. Keller (2008) states that brand equity will have a different outcome when a product or service has been branded, from a product or service that has not been branded. The author defines customer-based brand equity as “the differential effect that brand knowledge has on consumer response to the marketing of that brand.” In conclusion, customer-based brand equity includes all the thoughts, feelings, perceptions, images and experiences towards the brand. The next section contains academic literature on brand equity and the relevant brand equity dimensions.

3.2 Brand equity literature

There are many definitions of brand equity available in the literature and nearly all researchers use their own definitions. Besides, brand equity is viewed from many perspectives, which results in different authors describing various brand equity dimensions. In this section, we will discuss the relevant dimensions of brand equity found in literature.

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This is called ‘Advertising Response Matrix’ and consists of (1) advertising input, (2) output at the individual level, and (3) effects at the market level. Our research focuses on communication objective and therefore we will explain the individual level, which consists of three main groups:

Output Communication objectives

1) Psychological advertising response (Reaction to a single advertisement)

Advertising attention Advertising appreciation Advertising awareness 2) Psychological brand responses Brand awareness

Brand association 3) Brand behavior responses Purchase intentions

Trial purchases

Brand loyalty* and repeat purchases* * These are marketing objectives

Table 3: Communication objectives (Franzen, 1998)

Alsem (2006) indicates that the clearest communication objectives are psychological brand responses (brand awareness and brand association), because these objectives are influenced by communication. Table 3 contains all possible communication objectives, with the exception of brand loyalty and repeat purchases. Brand responses are a part of brand equity (Aaker 1991) and will be described below.

According to Aaker (1991), brand equity consists of five different dimensions:

Brand loyalty Brand loyalty occurs when favorable attitudes and beliefs towards a brand result in repeat buying behavior.

Brand awareness Brand awareness involves the strength of the brand in the customer’s mind. Brand awareness consists of brand recognition and brand recall. Perceived quality Perceived quality is the customer’s perception/judgment of the quality of

a product or service.

Brand associations Aaker (1991) defines brand associations as anything linked in memory to a brand. For example: product attributes, life-styles, customer benefits etc. Other proprietary

assets

These assets include patents, trademarks and channel relationships.

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to store and retrieve information from the product and service. Second, it can increase the customer’s confidence in the purchase decision, because he/she is more familiar with the brand or product. Finally, when the customer uses the product, consequently satisfaction and value of the brand will increase.

According to Keller (2008), brand equity occurs when the customer has a high level of familiarity with the brand. This means that in the customer’s memory occur strong, favorable and unique brand associations. In addition, consumer response can lead to enhanced revenues, lower costs and higher firm profits (Tuominen, 1999). According to Keller (2008) brand knowledge consists of two sources: brand awareness and brand image.

Brand awareness

Brand awareness consists of brand recognition and brand recall performance (Keller, 2008). The author indicates that brand recognition involves consumers that are able to recognize the brand as one that they were exposed to before. Brand recall is the consumer’s ability to redeem the brand from memory when a need occurs that must be fulfilled by the product category (Keller, 2008).

Brand image

According to Keller (2008), brand image is defined as “consumer perceptions of a brand reflected by the brand associations held in consumers’ memory”. The strength, favorability, and uniqueness of brand associations can create a positive brand image in customers.

Furthermore, Yoo and Donthu (2001) developed a consumer-based brand equity scale based on Aaker (1991) and Keller (1993) conceptualizations of brand equity. Yoo and Donthu (2001) distinguish three dimensions, i.e.: brand loyalty, perceived quality and brand awareness/associations. These three dimensions create a new measurement model of customer equity.

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3.3 Dimensions of brand equity

Brand awareness

According to Aaker (1991) brand awareness is “the ability for a buyer to recognize or recall that a brand is a member of a certain product category”. As indicated before, Keller (2008) argues that brand awareness consists of brand recognition and brand recall performance. Therefore, brand recognition occurs when consumers go to the store and recognize the brand as one they already were exposed to before (Keller, 2008). Brand recall occurs when consumers retrieve the brand (e.g. Coca Cola), when they think of the type of products (e.g. soft drinks). To measure the influence of Brandnew Store, brand recognition is not a good measure, because customers are already in the store and therefore definitely recognize the brand. Moreover, it is possible to measure brand recall, because it reflects the ability of customers to recall the names of a brand category the customers may know.

Perceived quality

Perceived quality is the customer’s perception/judgment of the overall quality of superiority of a product of service (Keller, 2008; Zeithaml, 1988). It is based on the subjective evaluations of product quality by customers (Yoo and Donthu, 2001). According to Keller (2008), there are several dimensions that contribute to perceived quality. These are: performance, features, conformance quality, reliability, duration, serviceability, style and design. These dimensions influence attitudes and behavior towards brand.

Brand associations

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Brand loyalty

Brand loyalty is the attachment that a customer has to a brand (Aaker, 1991 and Yoo and Donthu, 2001). Customer loyalty could be explained as how often customers purchase a brand and the quantity they purchase (Keller, 2008). Tuominen (1999) indicate that there are two approaches to brand loyalty: behavioral approach and cognitive approach. The behavioral approach focuses on the number of times one brand is purchased over time. The cognitive approach is a commitment to a brand that is not only based on continuous behavior. For example, a customer could buy a particularly brand because it has the lowest price. An increase of this price may cause a shift to another brand.

Summarizing these dimensions, brand loyalty occurs after consumers purchase a product or service, while brand awareness, brand association and perceived quality can be affected before the consumers purchase the product.

3.4 Conclusion

Franzen (1998) indicate that brand responses are influenced by communication. The definitions of brand equity that are used most in literature, are those formulated by Aaker (1991) and Keller (1993 and 2008). According to these researchers, various dimensions are used to measure brand equity. In this research, we combined the dimensions of Aaker (1991), Keller (1993) and Yoo and Donthu (2001), which resulted in the following four dimensions: brand loyalty, brand awareness, perceived quality and brand image. These are the dimensions that will be used in this study.

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Chapter 4. Store environment

More and more retailers attempt to create an environment in their store that encourages shopping. There are many aspects of store environment, such as design, scent, music etc. that can create a unique environment. Tauber (1972) acknowledges that the decision to shop in a specific store or mall could influence the shape of a final consumer decision. The present chapter will investigate the dimensions of retail atmosphere and which of those affect consumer decisions. Moreover, this chapter answers sub question 5: What are the factors that influence the in-store environment?

4.1 Definition of retail atmosphere

Verhoef et al. (2009) indicate that one of the dimensions that influence customer experience is retail atmosphere. Levy and Weitz (2009) define retailing as a set of business activities that add value to the products and services sold to consumers. These retailing activities sell products or service to consumers for personal use. Kotler (1974) uses a slightly different term: “atmospherics”. He defines it as: “a term used to describe the conscious designing of space to create a certain effect in buyers.” According to Milliman (1986), these atmospherics are scent, freshness, temperature, shape, size etc. Furthermore, Yalch and Spangenberg (1990) indicate that visual communication, lighting, colors, music and scent can stimulate customers’ perceptual and emotional responses and are able to influence their purchase behavior. In general, “atmosphere is a term used to describe the experience ‘felt’ but not always seen” (Milliman, 1986).

4.2 Empirical research into environmental factors

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of four dimensions. The research of Mehrabian and Russell (1974) and Donovan and Rossiter (1982) are summarized in the table below.

Approach (M &R, 1974)

Avoidance (M &R, 1974)

Response to store environment (Donovan and Rossiter, 1982)

Physically staying in the environment

Desiring physically to leave [?]the environment

Store patronage Exploring the environment Avoiding to move

through the environment

In-store search Desiring to communicate

with others

Ignoring communication attempts

Interaction with staff Enhancement of performance and satisfaction Interference of performance and satisfaction

Repeat shopping, reinforcement time and money expenditures

Table 4: Environmental shopping behavior factors

Mehrabian and Russell (1974) identify three dimensions of affective response: pleasantness, arousal and dominance. Their model is an environmental psychological approach regarding the store atmosphere. In this model, the environmental stimuli consist of physical features such as color, store, layout and lighting, while the emotional states are divided into pleasure, arousal and dominance. Pleasure involves the way a person feels about the environment, while arousal entails a person’s excitement about the environment. Approach behavior is willingness or desire to move towards the environment and explore it. The Mehrabian-Russell model is shown in figure 2.

Figure 4: The Mehrabian-Russell model of environmental influence

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The authors show that the environment affects buyer behavior in three ways: 1. message-creating medium (communication with symbolic cues)

2. attention-creating medium (attract customers from target segments and create a different experience than competitors)

3. affect-creating medium (using colors, textures, sound, scents and special design to enhance the desired experience).

Summarizing, store characteristics can help retailers to create value, enhance the perception of customers and obtain a sustainable competitive advantage.

4.3 Dimensions of store environment levels

Store environment can be divided into different levels. One distinction is the individual environment and the factor level (Baker, 1986). Individual environment dimensions are noise, music, color and scent, while the factor level dimensions consists of ambient, design and social factors (Baker, 1986). The classification of these factors originates from a research by Kotler (1974), who distinguished four dimensions of sensory store atmosphere: visual, aural, olfactory (scent) and tactile. In this section, the three dimensions of factor level will be discussed, because these dimensions are more suitable to Brandnew Store. Besides sensory variables, factor level also contains interior (design) and social factors.

Social factors

People in the environment can be classified as social factors. Dimensions of social factors are: other customers and service personnel. Both have the properties number, appearance and behavior (Baker, 1986). Baker et al. (2002) indicate that friendly behavior of employees creates a more active, arousing store environment, as opposed to unfriendly and unpleasant employees. In addition, a high image of the social store environment will cause a greater arousal in the customer (Baker, Grewal and Levy, 1992).

Design factors

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pattern and accessories (aesthetic elements), as well as layout, comfort and signage (functional elements) can help to influence the customers’ expectations (Baker, 1986).

Ambient factors

Ambient factors are background conditions that exist below the level of our immediate awareness such as air quality (temperature, humidity, circulation and ventilation), noise, scent and cleanliness (Baker, 1986). Ambient cues are the characteristics of the environment that influence the five senses of consumers. Even if the cues are not noticed, they may still affect the perception, attitudes and behavior of consumers (Baker, 1986). In line with this, Wakefield and Baker (1998) acknowledge that ambient conditions are often nonsignificant, because lighting and temperature are environmental cues that are not noticed unless they are seen as unpleasant. Moreover, clever design of the background conditions can create a desired behavioral response among consumers. The impact of the store environment depends on the customers’ shopping goals (Levy and Weitz, 2009). In line with this, Kaltcheva and Weitz (2006) indicate two shopping motives: recreational motivational orientation and task-oriented motivational orientation. Consumers who are recreational oriented try to receive satisfaction from the shopping activity itself. These consumers shop for fun. They would like to shop in an exciting atmosphere, a complex environment with fast music, bright lighting and red or yellow colors (Levy and Weitz, 2009). Task-oriented consumers do not seek satisfaction from the shopping activity itself. They prefer to shop in a calming environment with a simple atmosphere, dimmed lighting and blue or green colors.

4.4 Conclusion

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Chapter 5. Conceptual model and hypotheses

After the presentation of the theoretical part, a conceptual model can be designed. The aim of the present study is to investigate the influence of Brandnew Store on brand equity. Thereby, the key of this research is to investigate if there is a difference between the image of a brand and the image of the same brand promoted in Brandnew Store.

Based on literature and dimensions of customer experience and brand equity, we designed the following conceptual model. The relations between the variables are explained by hypotheses in the following section.

Figure 5: Conceptual model

5.1 Hypotheses

Aaker (1991) indicate that brand awareness is a buyer’s ability to recall the brand and tell which product category it is a member of. According to Keller (1993), there are three major reasons why brand awareness is important. First, consumers are able to think about the brand when they think about the product category. Second, the consideration set of consumers can be positively affected by brand awareness. Third, brand awareness influences consumers’ decision making and can positively enhance the brand image. To measure the influence of Brandnew Store, brand recognition is not possible, because customers are already in the store. Therefore, they will definitely recognize the brand. Thus, in this research brand awareness consist of brand recall. We

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would like to investigate the brand recall of Brandnew Store and whether Brandnew Store positively influences the brand awareness of a brand. Therefore, the next hypothesis is formulated.

Hypothesis 1: Brandnew Store positively influences customers’ brand awareness.

According to Aaker (1991), perceived quality can be defined as “the customer’s perception of the overall quality or superiority of a product or service relative to alternatives.” In addition, perceived quality is based on the subjective evaluations of product quality by consumers (Yoo and Donthu, 2001). Tuominen (1999) indicates that perceived quality can be used to introduce brand extensions. Furthermore, strong brands will receive higher successes in comparison to weaker (less-known) brands. Therefore, we want to investigate if Brandnew Store positively influences the perceived quality of a brand.

Hypothesis 2: Brandnew Store positively influences customers’ perceived quality.

When a person thinks about the product and relates this to existing brand knowledge, it will positively contribute to brand association. Tuominen (1999) indicates that brand associations are mental linkage to the brand. According to Keller (1993), brand associations can be divided into brand attributes, benefits and attitudes. Further, the authors indicate that direct experiences are able to create a strong brand attribute and benefit associations. Thereby, Keller (2008) indicates that uniqueness of brand associations increases brand image. Therefore, we want to investigate if Brandnew Store positively influences the brand image of a brand.

Hypothesis 3: Brandnew Store positively influences customers’ brand association.

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vulnerability in relation to competitors. Therefore, we want to investigate if a change in promotional activities of a brand influences customers’ brand loyalty.

Hypothesis 4: Brandnew Store positively influences customers’ brand loyalty.

Experiences and shopping pleasures vary with consumer age. Hoyer and MacInnis (2007) indicate that browsers are younger in comparison with other customers. Besides, Duncan et al. (1995) indicate that older customers are more likely to enjoy their shopping, because stores and malls are often safe places and pleasant to shop in. In addition, when customers’ ages increase, they will make more use of local shops (Meneely et al, 2009). Furthermore, Cox et al. (2005) declare that a higher age has a positive impact on the level of enjoyment consumers have in shopping. The author indicates that older customers appreciate personal service more highly than other age groups. Moreover, younger consumers are used to self-service, because they grow up with it (Meneely et al, 2009). Chebat et al (2009) indicate that younger shoppers spent significantly more with the presence of pleasant ambient scents. Since companies will try to attract customer attention by creating an experience around their product or service, we expect a larger effect for younger customers. However, products of a company could attract attention of a specific age group (e.g. beer brand or L’Oreal products). In this particular situation, car brand Fiat uses the Brandnew Store to promote their new car. The brand Fiat is aiming at younger customers and their cars (e.g. Fiat Punto Evo) will be more driven by younger customers. Therefore, the next hypothesis is formulated.

Hypothesis 5a: Brandnew Store has a larger effect on younger customer than on older customers.

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Above literature declares that consumer decision making traits of males are different in comparison to females. Otnes and McGrath (2001) indicate that it is more important to make a comfortable environment for males than for females, because most retail stores are already designed for females. Therefore, stores should encourage the interaction between males and merchandise. Moreover, Fugate and Phillips (2010) declare that males are more likely to purchase gender-congruent products in comparison to females.

The distinction between males and females depends on the experience created inside the Brandnew Store. The first campaign promoted in the Brandnew Store could be more suitable for females (e.g. drugstore with female products), while the next campaign could target males (e.g. beer brand or car company). In this particular situation, car brand Fiat uses the Brandnew Store to promote their new car. We expect that males are already acquainted with the car brand Fiat and females are less familiar with this brand. Therefore, we expect a larger effect in females, because the experience of Brandnew Store could influence the attitude of females more in comparisons to males. Therefore, the next hypothesis is formulated.

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Chapter 6. Research Design

This present chapter will explain the choice of research and procedures. Thereby, the data collection method and the experimental design are described. Moreover, the testing methods of this thesis will be explained.

6.1 Choice of research

There are several research methodologies available to perform a reliable study. Malhotra (2007) distinguish two types of research design: exploratory and conclusive research. Exploratory research is able to give insights into the problem. This type of research consists of personal interviews (Malhotra, 2007). Conclusive research is more formal and structured in comparison with exploratory research. This type of research can be split in descriptive research or causal research. Descriptive research describes the market characteristics or functions. Examples of these are market studies, sales analysis studies and advertising studies (Malhotra, 2007). Causal research has the objective to determine cause and effect relationships. Effect research involves a causal relationship between an input variable (e.g. Brandnew Store) and the communication goal (Alsem, 2007). Thereby, causal research exists of three methods: 1) observational, 2) survey and 3) experimental. Observational research is a method whereby the researcher observes people and record impressions of their behavior. The survey method is a technique whereby the research can measure the relationship between two of more variables. Experimental research is a method whereby the researcher randomly assigns participants to conditions. These conditions are identical except for the independent variable (Malhotra, 2007). To perform an answer on the central question, this research consists of an experimental method. With an experiment, we are able to compare a situation before and during the Brandnew Store experience. We will explain this method in the next paragraph.

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6.2 Data collection

In order to measure effects of Brandnew Store, our research consists of a ‘control’ and an ‘experimental’ group. This type of research is able to measure the influence before and during the Brandnew Store experience. The control group is performed in Westerhaven Groningen and in the shopping mall Paddepoel. During this data collection, the Brandnew Store was not opened yet. Afterwards, the experimental group is performed in front of the Brandnew Store in Groningen. The two places have been chosen because of their differences in experience and consumer evaluation.

Procedure data collection

In order to receive information from the experimental group, we planned to interview customers who just visited the Brandnew Store. However, due to limited visitors we were not able to obtain the minimum number of respondents. Therefore, the experimental group consists of passer-by customers who were interested in the Brandnew Store (e.g. closer look to the store). These customers were addressed to have a closer look inside the store. After this, we asked the respondents to fill-in the questionnaire. There is a small change that we could possibly influence the respondents with our method. However, before the questionnaire started we did not say anything about the aim of our research. Therefore, in our opinion this method can be seen as a valid method. Furthermore, we observed that there is no causal connection between the Brandnew Store and the respondents. For example, it was possible that only car lovers were interested in the Brandnew Store and this could create less reliable results. During the survey, we did not observe a causal connection between the respondents. In addition, also our sample results show a distinction between the respondents. Therefore, in our opinion the sample can be seen as a valid sample.

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Experimental designs: 2 (time: t1 vs. t2) x 2 (gender: male vs. female) x 2 (age: younger (18-35) vs. older (>35) between-subjects ANOVA.

Gender Age

Male Female Younger (18-35) Older (>35) t1 (Control group Brand FIAT t2 (Experimental group)

Figure 6: Experimental design

Brandnew Store experience: FIAT

As described earlier, car brand Fiat hired the Brandnew Store to promote their new car: Abarth Punto. Abarth is owned by Fiat and is specialized in tuning the Fiat models. The temporary Abarth stores with the Abarth 500 are settled in Amsterdam and Rotterdam, while the Abarth Punto Evo is situated in Amstelveen and Groningen. The Brandnew Store used in our research promoted the Abarth Punto Evo. Furthermore, in every location visitors are able to make one’s confession about their worst car sin. With their worst car sin, visitors stand a change of winning an Abarth 500. Figure 7 show a presentation of the experience created in the Brandnew Store.

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6.3 Analysis

The research questions of the control and experimental group are represented in table 5 on page 40. The first column contains the dimension of our research. The column ‘items’ contains the research question we will use during the research. The third column is about which researchers developed the accompanying items. The scale ‘researcher’ is used because the corresponding proposition is not found in literature frameworks.

This research consists of a ‘posttest-only control group design’. This is a true experimental design in which the experimental group is exposed to the treatment but the control group is not (Malhotra, 2007). Furthermore, this design does not involve a premeasurement. It can be symbolized as:

Experimental group: R X O1 Control group: R O2

Treatment effect is: TE: O1 – O2

The treatment effect indicate that a given group of test units was exposed to the treatment variable (X) and the response was measured at two different points in time, O1 and O2 (Malhotra, 2007).

In this research we will compare causal relations by an ANOVA test. This test is a statistical technique which measures the differences among means for two or more populations (Malhotra, 2007). Moreover, the ANOVA test is the best way to investigate our experimental design, which is visualized in figure 6. However, if we had used a 2 (time: t1 vs. t2) x 2 (gender: male vs. female) a Regression Analysis was more appropriate.

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Dimensions Items Scale Brand awareness  I can recognize brand x among other

competing brands  I am aware of brand x

 Some characteristics of brand x come to my mind quickly

Yoo and Donthu (2001)

Yoo and Donthu (2001) Yoo and Donthu (2001)

Perceived quality  The quality of brand x is extremely high  The likelihood that brand x would be

functional is very high  I trust the product of brand x

Yoo and Donthu (2001) Yoo and Donthu (2001)

Researcher Brand loyalty  I consider myself to be loyal to brand x

 Brand x would be my first choice  I will not buy other brands if brand x is

available at the store

 I will recommend this brand to others

Keller (2008),

Yoo and Donthu (2001) Yoo and Donthu (2001)

Brakus et al (2009) Overall  What is your overall opinion of this brand Keller (2008) Ambience factors*  I am satisfied with the lighting in the store

 I am satisfied with the music in the store

Wakefield and Baker (1998)

Design factors*  What do you think about the interior of the shop

Wakefield and Baker (1998)

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Sophistication:  Upper class  Charming Ruggedness:

 Tough * Only in the experimental group.

Table 5: Research questions control and experimental group

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Chapter 7. Results and hypotheses testing

This chapter explains the results of the control and experimental group. First, the sample sizes of both groups are presented. After that, a validity measurement is performed. Furthermore, prominent finding of our research are described in paragraph 7.3. Finally, the hypotheses are tested.

7.1 Sample

In total, we asked 195 respondents to fill in the questionnaires. 175 people have a driving license, while 20 people do not have one. People with no driving license were not able to fill-in the questionnaire. Therefore, the control group consists of 92 respondents and the experimental group of 83 respondents. The variable age and gender of both groups are presented below. In order to have a representative sample, each box of the experimental design should have about 20 respondents.

Control group

The control group exists of 92 respondents which are split up into 51 males and 41 females. Moreover, 52 respondents were between 18 and 35 years old and 40 respondents do have an age of 36 and older. Most respondents are well educated: MBO (21.9 percent), HBO (38.5 percent) and WO (20.8 percent). Moreover, 34.4 percent of the respondents live together or are married without children, while 25 percent lives together or is married with children. Furthermore, 16 respondents (17.4 percent) had a Fiat in the past and four respondents (4.3 percent) own a Fiat. The gender and age size of the control group is described in table 6.

Experimental group

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To show if our sample is representative we performed a chi-square statistic. This statistic is used to test the statistical significance between the control and experimental group. Gender has a Chi-Square of 0.522 and age has a Chi-Chi-Square of 0.532. This indicates that there is no significant difference between the sexes and ages in the control and experimental group. Thus, we can indicate that both samples are similar and therefore our analysis is representative. The outcomes of the analysis are presented in appendix 3.

In order to see if our sample experiment is comparable, we use the CBS statistics of the city Groningen. Figure 8 shows that the percentages of the experimental sample are comparable with the CBS statistics. However, there are small differences between the control group ‘younger’ and ‘older’ respondents in comparison with the CBS statistics of the city Groningen. These differences can be explained due to the start of the academic year. Because of this, the amounts of younger people that are situated in the center of Groningen increases and thereby explain our results.

Item Sample control (n=92) Sample experiment (n=83) CBS (city Groningen, January 2010) Pearson Chi-Square Gender Male 55.4% (n=51) 50.6% (n=42) 49,4% 0.522 Female 44.6% (n=41) 49.4% (n=41) 50,6% Age Younger (18-35) 56.5% (n=52) 51.8% (n=43) 46,8% 0.532 Older (>35) 43.5% (n=40) 48.2% (n=40) 53,2%

Table 6: Sample size control and experimental group

0 10 20 30 40 50 60

Male Female Younger (18-35) Older (36+)

P e rc e n ta g e Control Experimental CBS

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7.2 Validity analysis

To investigate if the used scale is reliable a Cronbach Alpha and a Factor Analysis are performed. The Cronbach Alpha measures the internal consistency reliability betweens the scale items. Factor Analysis is a technique for summarizing a large number of variables by means of a smaller number of factors (Malhotra, 2007). Both analyses will be explained in this paragraph.

7.2.1 Internal reliability

To measure the internal reliability, a Cronbach Alpha analysis is performed. The items should be consistent in what they indicate about the characteristics. Thereby, the Cronbach Alpha varies from 0 to 1 and should have a value of at least 0.6 or more to indicate satisfactory internal consistency reliability. The dimensions brand awareness, perceived quality and brand loyalty meets this criteria. Nevertheless, the item brand association does not meet the criteria. Therefore, this variable is not presented in the next table. The results of the control and experimental group are described in table 7.

Cronbach Alpha α/r

Brand awareness (3 items) Control: Experimental: 0,728* 0,699** Perceived quality (3 items) Control: Experimental: 0,828* 0,897* Brand loyalty (4 items) Control:

Experimental:

0,831* 0,801*

Table 7: Results of Cronbach Alpha brand equity dimensions

* Significant at p <0.01 level ** Significant at p <0.05 level

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