The Moderating Effect of National Culture and
Brand Experiences on the
Brand Equity – Customer Engagement Relation
by
Pilar Leonhardt
University of Groningen
&
Newcastle University Business School
Dual Award Master of Science
Advanced International Business Management and Marketing
Master Thesis
The Moderating Effect of National Culture and
Brand Experiences on the
Brand Equity – Customer Engagement Relation
Dual Award Master of Science
Advanced International Business Management and Marketing
Supervisors:
University of Groningen
(Faculty of Economics and Business):
Drs. Ad Visscher
Newcastle University (Business School):
Dr. Nima Heirati
Pilar Leonhardt
Student Numbers:
S 27 55 72 6
B 140 674 705
Stubenrauchstr. 29
ABSTRACT
This research examines the relationship between brand equity and customer engagement from a consumer perspective across three different countries (Netherlands, Germany and England). More specifically it investigates to what extent brand equity dimensions, such as brand awareness, brand image, brand trust and brand loyalty independently drive customer engagement, particularly co-design (or customization) of athletic shoes/sneakers. Further, this study considers the extent to which cross-cultural differences in terms of uncertainty avoidance and long-term orientation across the Netherlands, Germany and England moderate the relation between brand equity and customer engagement. Finally, it assesses whether previous brand experiences may impact the effects of different brand equity dimensions on customer engagement.
The study develops a theoretical framework and empirically examines it through an online survey (questionnaire) from a total of 403 respondents across Germany, England and the Netherlands. Descriptive and regression analysis were used to test the model through the use of IBM SPSS version 23. The results show that between the brand equity dimensions brand image and brand loyalty generally drive customer engagement. National culture moderates the effect of brand trust on customer engagement. Other brand equity dimension’s relation with customer engagement is not moderated, thus independent from cross-culture. Brand experiences do not have an impact on the relation between brand equity dimensions and customer engagement. Finally, this research contributes to existing studies by adding new and partially objecting findings to current literature on customer based brand equity and customer engagement. It broadens the landscape of outcomes in marketing and business literature and opens room for future reserach. The insight can potentially mean a valuable justification for simplifying international brand and relationship management activity for practitioners. Practical marketing measures can be adjusted accordingly.
Key words: Brand Equity, CBBE, brand awareness, brand image, brand trust, brand loyalty,
ACKNOWLEDGEMENTS
Alice: Where I come from, people study what they are not good at in order to be able to do what they are good at.
Mr Hatter: We only go around in circles in Wonderland, but we always end up where we started. Would you mind explaining yourself?
Alice: Well, grown-ups tell us to find out what we did wrong, and never do it again. Mr Hatter: That's odd! It seems to me that in order to find out about something, you have to
study it. And when you study it, you should become better at it. Why should you want to become better at something and then never do it again?
Alice: You're quite right, Mr Hatter. I do live in a topsy-turvy world. It seems like I have to do something wrong first, in order to learn from what not to do. And then, by not doing what I'm
not supposed to do, perhaps I'll be right.
- Alice in Wonderland
Finding myself at the end of this thesis’ writing process I would like to express my sincere gratitude to everyone who supported me during the past months. First and foremost I want to thank my supervisors Dr. Nima Heirati from Newcastle University Business School and Drs. Ad Visscher from the Faculty of Business and Economics of the Groningen University. I am grateful to both of you for your patience, helpful feedback and support. Even in times where I was going around in circles you encouraged and helped me to find the right way.
TABLE OF CONTENT
1. INTRODUCTION ... 1
1.1. Background ... 1
1.2. Research Objective & Questions ... 2
1.3. Research Rationale & Design ... 3
1.4. Thesis Structure ... 5
2. LITERATURE REVIEW & CONCEPTUAL DEVELOPMENT ... 6
2.1. Brand Equity ... 6 2.1.1. Brand Awareness ... 11 2.1.2. Brand Image ... 11 2.1.3. Brand Trust ... 12 2.1.4. Brand Loyalty ... 12 2.2. Customer Engagement ... 13
2.2.1. Customization through Co-Design ... 14
2.3. The Brand Equity – Customer Engagement Relationship ... 16
2.3.1. Relationship Outcome ... 17
2.4. Moderating Effects ... 18
2.4.1. Culture’s Impact ... 19
2.4.1.1. Conceptualizing Culture ... 21
2.4.2. Brand Experiences’ Impact ... 22
2.5. Conclusion & Hypotheses Development ... 24
2.5.1. Conceptual Model ... 27
3. RESEARCH DESIGN ... 28
3.1. Methodology: Quantitative Survey Research ... 28
3.2.1. Constructs & Measure Specifications ... 29
3.2.2. Primary Data Collection ... 33
3.2.3. Ethical Considerations ... 33
4. RESULTS ... 34
4.1. Preliminary Data Analysis ... 34
4.2. Sample Characteristics & Descriptive Results ... 34
4.3. Principal Component Analysis ... 37
4.3.1. Construct Validity ... 39
4.4 Hypothesis Testing ... 41
5. DISCUSSION ... 46
5.1. Effects of National Culture ... 48
5.2. Effects of Brand Experiences ... 49
5.3. Managerial Implications ... 49
5.4. Limitation & Future Research ... 51
6. CONCLUSION ... 52 7. REFERENCES
8. APPENDIX
LIST OF TABLES
Table 1 Definition Summary 8
Table 2 Brand Equity Dimensions represented in Current Literature 10
Table 3 Overview on Cultural Studies 20
Table 4 Measurement Model Specification 31
Table 5 Sample Profile & Industry Related Information 35
Table 5b Avergae Sample Profile 36
Table 6 Reliability Assessment 38
Table 7 Convergent and Discriminant Validity Assessment 40
Table 8 Regression Analysis Results for H1 42
Table 9 Results for Cross-Cultural Differences (One-way ANOVA) 43
Table 10 Regression Analysis Results for H2-H4 44
Table 11 Hypotheses Test Results 46
LIST OF FIGURES
Figure 1 (Customer Based) Brand Equity Dimensions 13
Figure 2 Conceptual Model 27
Figure 3 Research Process 29
LIST OF ABBREVIATIONS
AMA American Marketing AssociationAVE Average Variance Extracted
BA Brand Awareness
BE Brand Equity
BEx Brand Experiences
BI Brand Image BL Brand Loyalty BT Brand Trust CA Cronbach Alpha CR Composite Reliability CE Customer Engagement
CBBE Customer Based Brand Equity
E England
Etc. Etcetera
GER Germany
H Hypothesis
LTO Long-term Orientation
NL Netherlands
UA Uncertainty Avoidance
1. INTRODUCTION
1.1. Background
The concepts of brand equity and customer engagement have received growing attention from scholars and practitioners during past years. They are regarded central models in brand and relationship management (Keller, 2009; M’zungu, Merrilees & Miller, 2010; Çal, Adams, 2014). Brand equity is considered a sustainable competitive advantage to companies and provides additional tangible and intangible value for customers (Aaker, 1992; Hoeffler, Keller, 2003; Pappu, 2005, Severi, Choon & Ling, 2013). Recently, consumers become able to participate in such value creation themselves. They become prosumers and take part in shaping value. Customer engagement activities like co-design (or customization) strengthen a brand – consumer relationship (Kuvykaite, Piligimiene, 2014). Equally to brand equity, customer engagement is favorable to organizations, because of enhanced and stable relations between consumer and brand (Tsai, Men, 2013).
Understanding cross-cultural influence on customer’s perception of brand equity and customer engagement is essential in the face of increasing international competition. Culture defines people’s way of thinking, their decision-making processes and behaviors (Allik, McCrae, 2004). Its influence on the conceptualization and creation of theoretical paradigms is undisputed. As relational consumer behavior constructs, brand equity and customer engagement underlay such cultural influences (Mooji, Hofstede, 2010; Foscht et al., 2008; Chan, Yim & Lam, 2010). Hence, there is room to explore these influences on a brand equity – customer engagement relation. Incorporating an international research context this study examines the proposed relation across borders and under the moderating effect of national culture, specifically uncertainty avoidance and long-term orientation, of Germany, the Netherlands and England. During the fast paced globalization, taking place in economies nowadays, achieving cross-cultural insights is of high usability to international organizations. The debate about standardization versus adaptation strategies is only one example of how findings could be applied.
Building strong brand experiences that will impact the consumer decision-making process and potentially long-term brand interactions is a major goal for most marketers today. Brand experiences represent another concept from the relationship management field, closely related yet distinct to brand equity and customer engagement. Thus, the brand experience is assumed to impact consumer behavior and can vitally influence the consumer – brand relationship. Because brand experiences might enhance brand equity and with it customer engagement, this research aims to examine the brand equity – customer engagement relation under the moderating effect of previous brand experiences. With sophisticated and more demanding consumers, experiential marketing and brand experiences’ role for equity and engagement is of value to marketers. Insights will be important for brand management strategies and relationship building activities.
1.2. Research Objective & Questions
matters (Hakala, Svensson & Vincze, 2012; Matzler, Grabner-Kräuter & Bidmon, 2006; Severi, Choon Ling, 2013, Çal, Adams, 2014; Table 2). Customer engagement is conceptualized as the degree of customer involvement in design and customization of shoe brands. Finally, this study examines whether a consumers’ previous brand experiences may influence the effects of these dimensions on customer engagement. It is suggested that previous brand experiences may shape future consumer behavior (Chang, Chieng, 2006; Brakus, Schmitt & Zarantello, 2009; Huang, Sarigöllü, 2012; Brodie et al., 2013; Albert, Merunka, 2013; Yu, Park, 2014; Cho et al., 2015). Precisely, this study seeks to address the following research questions
1. To what extent do specific dimensions of brand equity (brand awareness, brand image, brand trust, brand loyalty) independently drive customer engagement across Germany, England and the Netherlands?
2. To what extent do cross-cultural differences across Germany, England and the Netherlands, particularly a) uncertainty avoidance and b) long-term orientation, moderate the effect of brand equity dimensions on customer engagement?
3. To what extent do previous experiences with a specific brand moderate the effect of brand equity dimensions on customer engagement?
1.3. Research Rationale & Design
The relation between brand equity and customer engagement has been recognized as an important interaction with implications for models and managerial practices. Yet, it has been fairly biased so far. This research will focus on a many times unregarded directionality, namely the effect that brand equity might have on customer engagement. The study follows Brodie’s at al. (2011) suggestion to further investigate specific concepts as antecedents of customer engagement in certain contexts. Wirtz et al. (2013) additionally ask for future research on customer engagement drivers, specially under cultural influences.
possible explorations of the hedonic value of processes such as co-design. This paper will empirically test the effect brand equity dimensions (brand awareness, brand image, brand trust and brand loyalty) have on customer engagement.
The research investigates moderating factors, implying that a) national culture and b) brand experiences influence the effect of brand equity dimensions on customer engagement. It is adopted that culture has an impact on consumer behavior and relational concepts. Consumers perceive brands differently across cultures (Mooji, Hofstede, 2010). Much research on culturally influenced brand equity focused on the US, Korea and China. Studies including European countries had divergent contextual focus (Yoo, Donthu, 2001 & 2002; Askegaard, Madsen, 1998; De Mooji, 2003; Ionannis, Rusu, 2012). This study will include the Netherlands, Germany and England. It will respect the national culture dimensions of uncertainty avoidance and long-term orientation representatively. These dimensions show strongest differences in their scores of the respected countries as per Hofstede’s Cultural Dimension Scale (The Hofstede Centre, 2015) and could therefore best explain arising moderation effects. It is rationally suggested that the influence of specific brand equity dimensions on customer engagement will vary across different countries (Germany, the Netherlands and England). Because of the importance for international brands, the moderating effect of national culture on the proposed brand equity – customer engagement relation will be tested.
There is a strong link between brand equity and brand experiences, because brand experiences reinforce brand associations, brand image and brand loyalty (Chang, Chieng, 2006; Brakus, Schmitt & Zarantello, 2009; Huang, Sarigöllü, 2002; Severi, Choon Ling, 2013). Also, customer engagement through co-creation is supposed to enhance customer experiences with a brand (Zine et al., 2014; Hollebeek, 2011b). Conversely, brand experiences will motivate customer engagement (Brakus, Schmitt & Zarantello, 2009; Fogliatto, Silveira & Dorenstein, 2012). A determining overall impact of brand experiences on consumer behavior is proven. Therefore, a moderating effect of brand experiences on the brand equity – customer engagement relation can be anticipated. Because of the closeness of the considered constructs, it is advocated that previous experiences with a brand, positive and negative, shape the relationship between the brand equity’s dimensions and customer engagement.
relevant concepts and relevant relationships among those. Theoretical assumptions are concluded and presented in a conceptual model, based on the secondary literature review and foundation for practical research. In line with the research questions and based on approaches of relevant research (Malhotra, Peterson, 2001; Greve, 2014; Frow et al., 2015) a quantitative survey design approach was chosen for this study. Hypothesized relationships between constructs were tested through statistical techniques.
1.4. Thesis Structure
2. LITERATURE REVIEW & CONCEPTUAL DEVELOPMENT
This Chapter critically reviews on constructs of interest introduced in the research questions and objectives in Chapter 1. Firstly, Section 2.1 reviews existing literature on the (customer based) brand equity concept and its sub-dimensions (Figure 1). Next, customer engagement theory is introduced on secondary research basis and the relationship between the two paradigms is specified. Finally, relationship outcomes are suggested and the conceptual model is developed, deriving from the theoretical literature outcome. The structural model (Figure 2) shows relationships among the constructs and addresses the research questions outlined in Chapter 1.2.1. Brand Equity
The American Marketing Association (AMA) defines a brand as a “name, term, design, symbol, or any other feature that identifies one seller’s good or service as distinct from those of others” (American Marketing Association, 2015). More recently, this definition also encompasses a brand as “a customer experience represented by a collection of images and ideas”. This addition shows the shift towards a more consumer-oriented understanding of the brand concept. It is important to comprehend the consumer’s mindset in order to leverage brand associations and finally reach favorable consumer behavior (Çal, Adams, 2014; Keller, 2009). As brands create essential additional intangible and emotional value for consumers, they impact such behavior (Pappu, 2005). Since the late 1980 this particular value is known as brand equity (Aaker, 1992).
monetary equity the brand represents to a firm (Keller, 2009; Ioannou, Rusu, 2012; M’zungum Merrilees & Miller, 2010). Customer based brand equity (CBBE), on the other hand, focuses on the equity created on an individual customer level (Tiwari, 2010). It emphases on consumer brand knowledge structures and positive perceptions in the minds of consumers. This study takes upon a customer-based perspective and considers individual value added, perceptions and behavior. Table 1 presents an overview of definitions with respect to scholars. This variety resulted in a lack of unity for one universal definition.
Table 1 Definition Summary
Reference Definition of (Customer Based) Brand Equity
Aaker, 1992
Definition inherited by Netemeyer, 2002; Hsieh, 2004; Sinha, Ashill & Gazley, 2008
A set of brand assets and liabilities, is linked to the brand’s name and symbol and can subtract from, as well as add to, the value provided by a product or service.
Keller, 1993
Definition inherited by Netemeyer, 2002
The differential effect that consumer knowledge about a brand has on their response to marketing for it.
Yoo, Donthu, 2001
The consumers' different response between a focal brand and an unbranded product when both have the same level of marketing stimuli and product attributes.
Pappu, 2005
The added value of the brand to the consumer. The value is created by marketing activities as perceived by the consumer.
M'zungu, Merrilees & Miller, 2010
The level of awareness, familiarity and the strength, favorability and uniqueness of brand associations that the consumer holds in memory.
Tiwari, 2010
Definition inherited by Çal, Adams, 2014
A set of perceptions, knowledge and behavior on the part of customers that creates demand and/or price premium for a brand - in other words, what the brand is worth to a customer.
Wood, 2010
The aggregation of all accumulated attitudes and behavior patterns in the extended minds of consumers […], which will enhance future profits and long-term cash flow.
Hakala, Svensson & Vincze, 2012 Dimensions that differentiate from other products or services, designed to satisfy the same needs.
Severi, Choon Ling, 2013
Several ways of sub-categorizing brand equity have been addressed. Understanding the composition of sub-dimensions of CBBE will help managers to implement and evaluate strategies to build stronger value to the customer (Sinha, Ashill & Gazley, 2008). Organizational success can only be achieved through systematic understanding of the CBBE creation process (Ioannou, Rusu, 2012).
Table 2 Brand Equity Dimensions represented in Current Literature
Included Brand Equity Dimensions Reference
Brand Awareness Aaker, 1992 Keller, 1993 Yoo, Donthu, 2001, 2002 Pappu, 2005 Chan, Chieng, 2006
Sinha, Ashill & Gazley, 2008 M'zungu, Merrilees & Miller, 2010
Hakala, Svensson & Vincze, 2012 (TOMA) Ioannis, Rusu, 2012
Severi, Choon Ling, 2013 Çal, Adams, 2014 Brand Image Aaker, 1992 Yoo, Donthu, 2001, 2002 Pappu, 2005 Chan, Chieng, 2006
Sinha, Ashill & Gazley, 2008 M'zungu, Merrilees & Miller, 2010 Tiwari, 2010
Hakala, Svensson & Vincze, 2012 Ioannis, Rusu, 2012
Severi, Choon Ling, 2013 Çal, Adams, 2014
Brand Trust
Doney, Cannon, 1997
Doney, Cannon & Mullen, 1998
Matzler, Grabner-Kräuter & Bidmon, 2006 Çal, Adams, 2014
Brand Loyalty
Aaker, 1992
Yoo, Donthu, 2001, 2002 Pappu, 2005
Sinha, Ashill & Gazley, 2008 M'zungu, Merrilees & Miller, 2010 Hakala, Svensson & Vincze, 2012 Ioannis, Rusu, 2012
2.1.1. Brand Awareness
Severi and Choon Ling (2013) identify brand awareness as the basic selection factor for consumers. It is generated by ongoing visibility, which shapes and enhances familiarity with a brand, buying and consumption experiences. Consumer decision-making processes can only be influenced if they are aware in the first place (Keller, 1993). Brand awareness is defined as the consumers’ ability to recall or even recognize a certain brand in different situations. Literature further points out that there is a directional relationship between brand awareness and brand image. Brand awareness is built in memory prior to more extensive brand associations (Severi, Choon Ling, 2013; Pappu, 2005). Adapted here is the definition introduced by Keller (2009): “Brand awareness is related to the strength of the brand node or trace in memory as reflected by consumers’ ability to recall or recognize the brand under different conditions”.
2.1.2. Brand Image
(Keller, 2009). Directionally, brand image is a sequence of brand awareness and an antecedent of brand trust (Severi, Choon Ling, 2013). Brand image is adopted here as all independent perceptions of and preferences for a brand, reflected by brand associations stored in memory (Keller, 2009).
2.1.3. Brand Trust
“The construct of trust involves a calculative process based on the ability of an object […] (e.g. a brand) to continue to meet its obligations” (Doney, Cannon, 1997). The trust dimension is strongly oriented towards the past. It is build on the perceived reliability of a brand, resulting from previous contacts and essential prior experiences (Çal, Adams, 2014). Trust is also an anticipated characteristic of any brand – consumer relationship (Matzler, Grabner-Kräuter & Bidmon, 2006), mainly because of the positive effect trust has on brand loyalty. Brand trust has the ability to affect attitudinal and behavioral loyalty likewise and is therefore of strong value to the firm (Çal, Adams, 2014). Brand trust is also a determinant of the relationship with the brand to the consumer. As such it can impact consumer behavior (Canon, 1997; Çal, Adams, 2014). Brand trust is adopted as the “willingness […] to rely on the ability of the brand to perform its stated function” (Matzler, Grabner-Kräuter & Bidmon, 2006). It includes cognitive trust based on rationale but also affective trust based on emotion (Matzler, Grabner-Kräuter & Bidmon, 2006).
2.1.4. Brand Loyalty
Figure 1 (Customer Based) Brand Equity Dimensions
2.2. Customer Engagement
The customer engagement notion cherishes a new concept of the consumer (Prahalad, Ramaswamy, 2004). The new consumer is an active contributor – a participant in the value creation process – as opposed to a passive, receiving individual. The consumer becomes the
prosumer (Kuvykaite, Piligrimiene, 2014, Boyle, 2007; Chan, Yim & Lam, 2010). Customer
engagement embodies dynamic and iterative processes, which are characterized by a psychological involvement-state of fluctuating intensity (Brodie et al., 2013). A multidimensional concept, where cognitive, emotional and/or behavioral dimensions result in a relational exchange between the firm and the consumer (Brodie et al., 2011, 2013; Von Doorn, 2010). A behavioral manifestation towards a brand then goes beyond purchase, resulting from (cognitive and emotional) motivational drivers (Von Doorn, 2010; Bijmolt et al., 2010). Engagement has been defined as a positive state of mind (cognitive), characterized by high energy, commitment (emotional) and loyalty (behavioral) (Porter et al., 2011). Mollen and Wilson (2010) also identify “cognitive and affective [emotional] commitment to an active relationship with the brand […]” as a driving force to engagement participation. Customer engagement creates instrumental and experiential value to the consumer because of the active relationship as well as the affected cognitions, emotions and behaviors (Mollen, Wilson, 2010).
(Customer Based) Brand Equity
Brand Awareness
Brand awareness is related to the strength of the brand node or trace in memory as reflected by consumers’ ability to recall
or recognize the brand under different conditions
Brand Association/Brand Image
All perceptions of and preferences for a brand by consumers, including various types of (strong, favorable and unique)
brand associations stored in memory as points-of-differentiation
Brand Trust
Willingness of the average consumer to rely on the ability of the brand to perform its stated function
Brand Loyalty
Customer engagement behaviors are voluntary resource contributions offered by consumers. As opposed to merely fundamental transactions, interactions between a focal object (brand) and the actor (customer) occur (Jaakkola, Alexander, 2014). Customer engagement is relational behavior, creating a consumer – brand connection. It may manifest in word-of-mouth, customer-to-customer referrals and participation in brand co-creation processes (Brodie et al., 2010; Bijmolt et al., 2010; Kumar et al., 2010). Generally, customer engagement behaviors can be sub-categorized into co-production, co-operation or co-creation. This paper will concentrate on customer engagement into co-creation processes, specifically customer’s engagement in product co-design. Hoyer et al. (2010) define co-creation as a “collaborative […] activity in which consumers actively contribute”. Yim and Lam (2010) also define a behavioral construct of participation. Customers provide information on preferences and become involved in decisions during the co-creation process.
Co-creation is therefore defined as a collaborative development of product designs and customization. The consumer plays an internal role in product designs tailored to the customer’s expectations. Co-creation (co-design) outcomes will closer meet consumer needs and expectations because of individual engagement (Hoyer et al., 2010). Moreover, such co-creation makes consumers better acquainted with the business processes, leads to adjustments of their preferences and finally betters appreciation of the product (Hoyer et al., 2010). From such, it can be concluded that co-creation increases value to the customer. Customer engagement finally leads to the development of mass customized products through the process of co-creation and co-design (Zine et al., 2014). For this research customer engagement will be conceptualized as the degree of customer involvement in design and customization. In particular, this study will explore co-creation processes, resulting in customization through co-design, for specific shoe brands.
2.2.1. Customization through Co-Design
provide different resources (time/effort), which may influence firm and customer value (Jaakkola, Alexander, 2014). Customization is the provision of individually designed products to customers in economic mass markets. When co-design is a manifestation of co-creation it leads to customized products, reaching the mass markets while treating customers distinct in their expectations (Silveira, Borenstein & Fogliatto, 2001).
Mass customization has become a strategy to achieve competitive advantage and differentiation for companies in increasingly competitive markets, including footwear. Companies adopt co-design strategies because they promise successful reflection of market developments. Increasing demand for customized products and shortening product life cycles drive the need for innovative production strategies allowing for consumer individuality (Silveira, Borenstein & Fogliatto, 2001). Customers are stronger than ever looking for opportunities to create value according to their own terms, using manufacturers as a mean to their ends (Zine et al., 2014). The international footwear industry is a representative example of the implementation of the customization through co-design processes. Global brands like Adidas or Nike (with their customization programs MiAdidas or NIKEiD) introduced successful co-design processes during the early 2000s (Berger, Piller, 2003; Ramaswamy, 2008; Moreau, Herd, 2010). Online customer integration allows consumers to become the co-designer of their personal pair of shoes. These processes nowadays serve as main brand-building tools for the overall footwear brand (Berger, Piller, 2003). According to Zine et al. (2014) the personalization and participation ultimately improves customer experiences. Personalized offers increase customer satisfaction and enhance customer loyalty, therefore create value to the consumer as well as to the firm. Other drivers of co-creation are of extrinsic and intrinsic nature and might include self-expression and pride as a result of co-design participation, all influencing customer value (Fogliatto, Silveira, Dorenstein, 2012). Through the engagement in co-design customers can extract desired values more targeted (Zine et al., 2014).
a desired value as per their individual expectations is created (Zine et al., 2014). In programs like MiAdidas or NIKEiD co-design tools enable consumers to act as designers. They create unique products by combining preferred materials, colors, shapes etc. from a given choice of design options, which are offered by the brand manufacturer (Lioa, 2011). Typical co-design tools should make it easy for customers to realize their own designs and solutions of products (Lioa, 2011; Frow et al., 2015).
Following researchers as Füller et al. (2010) this study will examine co-creation processes from a consumer’s perspective. It will examine co-design as a representative paradigm for customer engagement. Customer engagement with different dimensions includes co-creation. Co-creation in turn can have different manifestations in engagement behaviors. For this research the specific concept of co-design will be emphasized. Co-design typically leads to (mass) customization. The interfaces of customer engagement (co-creation à customization through co-design) are discussed above, but will ongoing be used as the same paradigm. Customer engagement is conceptualized as the degree of customer involvement in design and customization for the course of this paper. Therefore, the term customer engagement is also used representative for co-creation and customization through co-design (and vice versa).
2.3. The Brand Equity – Customer Engagement Relationship
Customer based brand equity incorporates an important notion of a customer – brand relationship. As previously shown, brand equity dimensions generate such a relationship. If so, attitudinal dispositions and following behavioral tendencies can be assumed consequences of CBBE (Pappu, Quester & Cooksey, 2005). In line with this, customer engagement can be seen as the outcome of successful relationship management. Different brand equity dimensions may independently drive customer engagement. Engagement in co-creation processes, such as co-design and customization, would then be a behavioral consequence of CBBE. Increased motivation to commit to the customer – brand relationship by increased value (equity) provokes the engagement. After reviewing relevant constructs, this study proposes a directional relation between CBBE and customer engagement (Sarkar, Sreenjesh, 2014). Opposite this suggestion, customer engagement is portrayed as an antecedent of brand relationships in much current literature (Banyte, Dovaliene, 2014).
2011b). It is of great interest to practitioners because of the active role of the consumer. Customer engagement enjoyed key research priority from 2010 until 2012, assigned by the
Marketing Science Institute (Brodie et al., 2010). Particularly in relationship-management and
-research scholars have consequently begun to explore the connection between customer engagement and brand equity. However, research seems considerably focused on a one-way model: Hoyer et al. (2010) propose that increased value generated by co-creation improves brand equity. Prahala and Ramaswamy (2004) likewise argue that higher levels of co-creation will increase perceived value because of experiential involvement. Eventually, Boyle (2007) established a directional connection between customer engagement and brand equity. He provides a process model outputting brand loyalty, love and admiration for a brand. A five stage conceptual model by Kuvykaite and Piligrimiene (2014) finally advocates customer engagement influencing brand equity dimensions. Greve (2014) firstly showed that stronger brand image (as a brand equity dimension) has a positive effect on customer engagement, yet other brand equity dimensions have been paid little attention to. This paper will investigate the brand equity – customer engagement relation following Kuykaite and Piligrimiene (2014) and Greve (2014) and aims at revealing the influence of brand equity on customer engagement. It is therefore proposed that brand equity, directly or indirectly, plays an antecedent role to customer engagement.
2.3.1. Relationship Outcome
are directly manufactured to the customer’s requirements, they create desired value for the consumer. They state that the consequences are improved customer satisfaction. Hollebeek (2011b) adds patronage, retention and loyalty as affected by increased customer engagement. The level of perceived value rises with interactive and personalizing activities. The perceived value of the process outcome will be increased because of the devotion of cognitive, emotional and affective resources through the consumer.
The relationship outcome of CBBE and customer engagement is represented by increased passion, undoubtedly meaning value to the customer (Hollebeek, 2011b; Batra, Ahuvia & Bagozzi, 2012). Stronger relationships between consumer and brand also influences the consumer to be resistant to negative information about the brand and/or forgive brand failures more easily. While this may be unconscious, it still ultimately increases overall perceived value (Batra, Ahuvia & Bagozzi, 2012). Increased CBBE results in positively biased perceptions of the brand value (Albert, Merunka, 2013). The following active participation in co-design will further strengthen this perception as well as the consumer-brand relationship. By this, the CBBE – customer engagement relationship will lead to increased customer value, due to the emotional connections established (Maxian et al., 2013). Troye and Subbhellen (2012) examined effects of customer engagement and found positively biased evaluation of the engagement outcome. Their explanation is biased sensory perception, which is cognitively impacted to match a positive evaluation of the process result. Such positive evaluation can again, be taken to increase overall customer value. Also, consumers generally hold an extreme preference towards their individually designed product (Moreau, Herd, 2010). This higher placed value on co-designed products represents the higher value resulting from the brand equity – customer engagement relationship. The relationship outcome as conceptualized by increased consumer value ultimately closes the circle of value creation to the customer. CBBE per definition means increased value already. Next, a positive relation between CBBE and customer engagement is proposed. If brand equity impacts customer engagement positively, the consumer-brand relationship is strengthened. Finally, the relationship outcome, as argued above, will enhance customer value all over again.
2.4. Moderating Effects
their purchase intentions and eventually their relation with a brand. Increasing consumer-independency in choice, mind and value creation challenges organizations. Which aspects shape consumers in their every day consumptions? How can those be improved to create stronger relationships and value? These are just some questions that arise when considering consumption environments. Consumer behavior, and in this brand equity dimensions and customer engagement, underlay cultural influences immensely and experiential marketing may be an answer to cope with the need for live brands (Mooji, Hofstede, 2010; Foscht et al., 2008; Huang, Saragöllü, 2002; Zine et al., 2014). Such factors impact consumer characteristics and needs and shape their reception. Therefore, this study will respect a) national culture and b) brand experiences as impacting moderators of the brand equity – customer engagement relationship.
2.4.1. Culture’s Impact
Whenever a brand is marketed across borders, a basic decision is to standardize or to adapt. The question ascends from the underlying assumption that under the influence of cross-cultural environments, consumers will perceive one and the same brand differently. This effect of culture on brand perception will be reflected in the creation of brand equity in different countries (Mooji, Hofstede, 2010). A brand will most likely be more successful if it is embedded in the cultural context surrounding it (Hsieh, 2004). International companies need to consider the implications of cross-cultural influence on consumer’s perception and brand equity creation processes in order to achieve favorable consequences (increased customer engagement) (Foscht et al., 2008).
really need and want (Chang, Chieng, 2006). Only then will they be willing to commit to the customer – brand relationship and engage.
Table 3 Overview on Cultural Studies
Study Cultures Studied Context
Hofstede, 1993 Cultural Constrains in Management
Askegaard, Madsen, 1998
Denmark, Sweden, Great Britain, The Netherlands, France, Ireland, Spain, Italy, Germany, Norway, Austria, Greece, Portugal,
Switzerland, Belgium
Food Culture across Europe
Yoo, Donthu, 2001, 2002 US, Korea
Developing and then testing a measure of the brand equity creation process
De Mooji, 2003
44 countries in total, among which 15 European countries
Influence of Culture on Consumption
Allik, McCrea, 2004 36 countries Geography of Personality Traits
Chan, Yim & Lam, 2010 Hong Kong, USA Customer Participation in Value Creation
Mooji, Hofstede, 2010, 2011 Applications to global branding and advertising Morris, Waldman, 2011 France, Germany, Italy, the
Netherlands, the US Culture and Metaphors in Advertising Ioannis, Rusu, 2012 USA, Moldavia, China,
Cyprus Brand Equity
the Netherlands or England have not been subject of studies focusing specifically on brand equity and/or customer engagement. This research will fill a gap in literature on such a geographical focus of research subjects.
Chan, Yim and Lam (2010) question why and when customers are motivated to facilitate engagement. Motivational drivers are not only of economic nature but also tend to include psychological and social satisfaction and relational value (Hoyer et al., 2010). Apparently, not only brand equity, but also the customer engagement process, is affected by national culture (Chan, Yim & Lam, 2010). Motivation to engage is dependent on the individual’s perception of engagement worth. Because motivation is also socially and relationally driven, it may be triggered by environmental and societal recognition. Such is impacted by national culture. Again, cross-cultural dimensions are at play, influencing customer engagement. Emotional and hedonic motivators are drivers of consumer behavior. If people buy “beyond reason” culture will always impact consumer behavior (Mooji, Hofstede, 2010). If cross-cultural environments determine CBBE creation, it will ultimately result in variations of customer engagement and its relations. Different brand equity dimensions, such as brand awareness, brand image, brand trust and brand loyalty, may drive customer engagement independently and distinct.
2.4.1.1. Conceptualizing Culture
dimension is relatively strong. Because Germany, the Netherlands and England received relatively unequal scores in the two chosen dimensions, natural cross-cultural differences can be assumed. A relatively high indifference between the values for UA and LTO faces relative equality of values for most of the other dimensions. All three countries score within a three point differences on power distance (Germany/England=35, Netherlands=38). Germany and England also score alike on masculinity versus femininity (=66), which with the same value for two out of three countries is not promising to illustrate cultural difference. Individuality shows the next highest dissimilarity between the countries, yet does not exceed the relative contrast of UA and LTO. Those dimensions show the highest variance of values across Germany, the Netherlands and England. Therefore, it can be suggested that the influence of UA and LTO on brand equity and customer engagement show strongest impact.
I. Uncertainty Avoidance
UA is portrayed as the “degree to which people in a country prefer structured over unstructured situations” (Hofstede, 1993). This dimension is also seen as the “extent to which people feel threatened by uncertainty and ambiguity” (Mooji, Hofstede, 2010). For the dimension of uncertainty avoidance Germany received a score of 65, the Netherlands received a score of 53 and England received a score of 35 (The Hofstede Centre, 2015).
II. Long-term versus Short-term Orientation
LTO reflects the “extent to which a society exhibits a pragmatic future-oriented perspective rather than a conventional historic or short-term point of view” (Mooji, Hofstede, 2010). For the dimension of LTO Germany received a score of 83, the Netherlands received a score of 67 and England received a score of 51 (The Hofstede Centre, 2015).
2.4.2. Brand Experiences’ Impact
product’s environment (point of sale). It can also be a virtual product presentation (e.g. in advertising or online) (Brakus, Schmitt & Zarantello, 2009). Experiences can thus occur directly or indirectly depending on the extensity of the stimuli exposure. Brakus, Schmitt and Zarantello (2009) define brand experiences as subjective, internal consumer responses (sensations, feelings, and cognitions) and behavioral responses evoked by brand-related stimuli. Stimuli are part of a brand’s design and identity, packaging, communication and environment. Brand experience can vary in strength and valence, meaning while they can be strong or weak, they can even manifest negatively.
“It is imperative to acknowledge that brand equity is an inseparable part of marketing and it is essential to companies to build strong brand experience that will impact the consumer decision making process” (Severi, Choon Ling, 2013). Deriving from the assumptions made about brand experiences, a connection to brand equity and customer engagement is suggested. The concepts seem related, but conceptually distinct. The interconnection between brand experiences and brand equity seems usually initiated by brand experiences. Hakala, Svensson and Vincze (2012) see CBBE as the effect brand knowledge has on consumer behavior, adopting Keller’s (1993) definition. Chang and Chieng (2006) claim that consumer-brand relationships are formed by experiences inherited in brand knowledge. Consequently brand experiences influence brand equity. Severi and Choon Ling (2013) state that brand awareness is affected by experiences. According to Chang and Chieng (2006) brand experiences reinforce and enhance brand associations immensely (supported by Huang, Sarigöllü, 2002). Chang and Chieng (2006) find a relationship between consumer’s experiences and brand image. And, Brakus, Schmitt and Zarantonello (2009) prove the positive effect brand experiences have on brand loyalty. Following this thought, prevailing experiences can shape consumers attitudes (created through brand images) towards brands strongly (Yoo, Donthu, 2001; Chang, Chieng, 2006). Overall, brand experiences have a crucial impact on consumer behavior, including customer perceived brand equity.
brand experiences, no relation or even knowledge about a brand is necessary (Brakus, Schmitt & Zarantello, 2009). Customer engagement presupposes a state of action taking. To conclude, brand experiences are considered as a moderating factor of the brand equity – customer engagement relation. This is following the approach of Chang and Chieng (2006) who propose a significant influence experiences have on consumer – brand relationships. As suggested, brand experiences hold the power to drive consumer behavior (Brakus, Schmitt & Zarantello, 2009; Chang, Chieng, 2006). Consequently, this study plausibly expects brand experiences to alter the relationship between brand equity’s dimensions and customer engagement.
2.5. Conclusion & Hypotheses Development
Chapter 2 reviews current research and literature findings. Brand equity, its dimensions, as well as customer engagement have been illustrated. Additionally, national culture and brand experiences were introduces as main drivers of contextual impact. Overall, it is proposed that the particular model of brand equity acts as a driver of customer engagement in specific contexts. Customer engagement is the co-creation process where consumers are involved in customization through co-design. Research suggests brand equity is a motivator for customers to engage with certain brands. Previously, it was implicated that customer engagement increases CBBE because a relationship is developed. Opposite, it is suggested here that an existing relationship will in turn drive customer engagement. CBBE represents such a relation between consumer and brand (Tiwari, 2010). This relationship is characterized by strong brand awareness, a positive brand image, brand trust and brand loyalty (Hakala, Svensson & Vincze, 2012; M’zungu, Merrilees & Miller, 2010; Matzler, Grabner-Kräuter & Bidmon, 2006; Severi, Chhon Ling, 2013). All these are presumably drivers of customer engagement, because they hold motivational power to reinforce and strengthen the relationship.
relationship, because of its ability to affect attitudinal and behavioral consumer behavior (Çal, Adams, 2014). Trust will then confirm a consumer’s preference for a brand based on rational and emotional factors (Matzler, Grabner-Kruter & Bidmon, 2006). As such, it could also encourage the consumer to enter an engagement with the trusted brand, because of little perceived risk. Engagement in customization is therefore anticipated to be stronger for trusting customers. Finally, brand loyalty is the ultimate consumer behavior dimension of brand equity. Because it consists of cognitive, affective and action levels, it is also described as overall attachment to a brand (Yoo, Donthu, 2001). It is therefore suggested, that the higher an overall attachment to a brand, the stronger the urge of the consumer to strengthen the relationship with it. In order to do so, the consumer is then ought to engage with the brand and get involved, for example, in co-designing and customizing branded products. While every brand equity dimension is suggested to drive customer engagement, it can be assumed that they do not do so to the exact same extent. Possibly, the single driving force of each dimension differs to the other ones. The relative strength of each dimension in driving customer engagement could be assessed.
Increasing CBBE could leverage co-creation advantages to firms. Engagement activity can be increased through motivators driven by brand equity dimensions. Positive brand equity would then trigger consumers to engage with their favorite brands, which would potentially be useful to firms. Co-creation is becoming increasingly important and consumer’s input is highly valued in order to systematically create demanded offers for consumers. Therefore, it will be of interest to managers and institutions to grasp triggers and motivators that drive people to engage with brands and invest in the consumer – company relationship. If findings show that increased brand equity (dimensions) inherit the power to motivate consumers to generate content and input in a co-creation process, those insights will be highly useful for strategies in relationship- and brand management. Therefore, the brand equity – customer engagement relation deserves to be tested. In this respect it is proposed, that brand equity dimensions are key triggers for customers to engage with brands. In order to examine to what extent specific dimensions of brand equity (brand awareness, brand image, brand trust, brand loyalty) independently drive consumer engagement across countries hypothesis one is developed.
Variations in consumer behavior between cultures are proven (Hofstede, 1993). This study is keen to identify the relativity of brand equity dimensions and the moderating power of culture on the brand equity – customer engagement effect. Distinct brand equity creation will then relatively drive customer engagement. It is proposed that brand equity dimensions (brand awareness, brand associations/brand image, brand trust and brand loyalty) drive customer engagement across countries differently. The assumption that culture moderates relevant concepts is made to due culture’s powerful influence on consumer behavior and perceptions. If brand’s perceptions vary despite consistent brand communication, afore mentioned brand equity dimensions will be moderated by cultural dimensions. Following the logic of stronger brand equity dimensions driving stronger customer engagement motivation, the cultural impact on brand equity would moderate the effect on customer engagement. This holds managerial implication for marketing and brand management. It will show that despite consistent brand communication, international contexts create unsteady environments for brands. Increasing the understanding of these environments, including triggers and barriers, will bring forward possible adjustments and increase marketing effectiveness. Customers’ perception of the brands will directly influence corresponding consumer behavior, including customer engagement behaviors. To investigate the extent to which cross-cultural differences between Germany, the Netherlands and England, particularly a) uncertainty avoidance and b) long-term orientation, influence the effect of brand equity dimensions on customer engagement hypothesis two and three are developed.
H2: The level of uncertainty avoidance across Germany, the Netherlands and England moderates the effect of a) brand awareness, b) brand image, c) brand trust and d) brand loyalty on customer engagement.
H3: The level of long-term orientation across Germany, the Netherlands and England moderates the effect of a) brand awareness, b) brand image, c) brand trust and d) brand loyalty on customer engagement.
H1c H1d H1a
engagement. Brand experiences logically strengthen brand awareness (Severi, Choon Ling, 2013), they reinforce and enhance brand image (Huang, Sarigöllü, 2002) and positively impact brand loyalty (Brakus, Schmitt & Zarantello, 2009). Moderated brand equity dimensions will then result in a differentiated effect on customer engagement. It is assumed that positive experiences will enhance CBBE dimensions and differentiated drive customer engagement. In order to examine to what extent previous experiences with a specific brand influence the effect of brand equity dimensions on consumer engagement hypothesis four is developed.
H4: The consumer’s previous brand experiences moderate the effect of a) brand awareness, b) brand image, c) brand trust and d) brand loyalty on customer engagement.
2.5.1. Conceptual Model
The developed research hypotheses capture the expected relations between constructs. A conceptual model, offered in Figure 2, was developed in order to present the concepts underlying this research as well as their relations. It is argued that increased brand equity will lead to increased customer engagement, strengthening the customer – brand relationship. According to Prahalad and Ramaswamy (2004) the consumer’s previous brand experiences becomes important for the relationship. Culture is supposed to further influence the positive effect of brand equity on customer engagement. As shown, the overall outcome of the paradigm is supposed to be increased customer value.
Figure 2 Conceptual Model
3. RESEARCH DESIGN
The previous Chapter reviewed theories and relevant literature relating to the research’s background. A conceptual model and hypotheses were developed. Next, Chapter 3 will present the appropriate and executed research design. It will show the usefulness in answering the research questions and statistically test the hypothesized relationships proposed by the conceptual model. Chapter 3 will elaborate on the construct’s operationalization and the empirical study.
3.1. Methodology: Quantitative Survey Research
In general, business or marketing research studies are build on either one of two methodologies: qualitative or quantitative methods. Their relative value to research results has been discussed considerably, because no method is superior in all situations (Bryman, 1984; Malhotra, Agarwal & Peterson, 1996). While qualitative research usually aims at understanding symbolic interactionism or phenomena, quantitative methods focus on empirically verifying hypotheses. Quality research seeks to understand behavior from the individual reference frame, quantitative approaches focus on general causes and consequences of phenomena (Deshpande, 1983; Bryman, 1984). “The point about the phenomenological position is that it takes the actor’s perspective as the empirical point of departure” (Bryman, 1984), which also includes a great subjectivity and close involvement between the participant and the researcher. Quantitative survey research approaches on the other hand “are taken to exhibit a tendency for the researcher to view event from the outside and from the point of view of a cluster of empirical concerns, which are imposed upon social reality with little reference to the meaning of the observations to the subject of investigation” (Bryman, 1984). Because the research questions and hypotheses require empirical and objective testing, a quantitative approach seems best: a quantitative paradigm promises verification, confirmation and controlled measurement (Deshpande, 1983).
3.2. Method
analyses for empirical estimation (Bettis et al., 2014). Through items constructs can be operationalized and the instrument allows for maximal objectivity between participants and the researcher (Bryman, 1984). According to Malhotra, Agarwal and Peterson (1996) comparability and objectivity are particularly important in cross-cultural contexts to secure reliability. The survey further provides easy replication possibilities and optimal use of path analysis and regression techniques (Bryman, 1984).
Figure 3 Research Process
3.2.1. Constructs & Measure Specifications
In order to capture theoretical constructs in primary research these have to be operationalized. The conceptualization of constructs helps operationalizing and matching them for data collection through survey research. Operationalized constructs are then represented through measurement instruments, which help empirically measure the latent constructs (Bagozzi, Yi, 2012). Items for measuring the relevant constructs were adopted from relevant previous studies. By drawing on existing studies it is assured that all items are reliable and valid. The measurement items used for the current study are presented in Table 4. It has been cautioned to use single-item measures in order to prevent mono-operationalization bias and loss of model quality (Hair et al., 2012). Multiple items also ensure that the defined constructs from Chapter 2 are fully encompassed by the survey research and supposed to clarify the construct distinctiveness to the participants. For model specification dependency relationships are necessary and further determine the analysis techniques (Hair et al., 2012). Moreover control variable items are included in the survey.
Problem Definition & Approach
Data Collection
Ø Online Questionnaire
Research Design
Ø Quantitative Survey Research
Data Analysis
Validated measurement items were adapted to match the definite research context and therefore, where necessary, altered in wording to fit the shoe/sneaker setting. All construct were captured on a 7-point Likert scale, which was anchored at 1 = ‘Strongly Disagree’ and 7 = ‘Strongly Agree’. Additionally, relevant questions on previous involvement and context-specific measures were gathered as multiple choice or open-ended questions. The dependent variable of brand equity was measured through six items, completed by four to six items on each CBBE dimension. Three general brand equity items were adopted from each Yoo and Donthu (2001, 2002) as well as Matzler, Grbaner-Kräuter and Bidmon (2006). Studies presented by Severi, Choon Ling (2013) and Yoo and Donthu (2001, 2002) offered four measurement items for brand awareness. Greve (2014) and Cho et al. (2015) provided a total of six brand image items. Matzler, Grbaner-Kräuter, Bidmon (2006) and Cho et al. (2015) offered six items for brand trust. Further, brand experiences were measured by the use of items from Yoo and Donthu (2001) and Brakus, Schmitt and Zarantello (2009) (sensory
brand experiences). In total, ten customer engagement measurement items were adopted from
3.2.2. Primary Data Collection
Subsequently within the research process, an online questionnaire was chosen as the primary data collection tool (IYoo, Donthu, 2001; Chang, Chieng, 2006; Füller 2010; Ioannou, Rusu, 2012). The questionnaire was built and distributed through the online survey service Qualtrics. The survey design was extensively pretested with N=42 respondents (N=15 from Germany, N=14 from the Netherlands, N=13 from England). The pretest secured satisfactory measurement of the constructs, reliability of the measurement items and nonexistence of non-response items (Malhotra, Peterson, 2001; Hair et al., 2014). In addition to quantitative pretesting, a number of respondents (N=5) gave qualitative feedback on understanding, readability and other difficulties with the questionnaire structure. After validation the survey was distributed online. Low costs for the researcher and high convenience for respondents, because of independence to the researcher, are among the advantages of online research methods (Malhotra, Peterson, 2001). Also, because of the online co-design subject, it can be suggested that potential respondents are online affine, additionally justifying the chosen channel with likely characteristics of respondents.
Data collection followed a convenience, snowball and self-selected sampling principle in the German, Dutch and English market. The survey targeted all customers/consumers of athletic shoes/sneakers, independent of age and occupation. The initial sample was gained through the researcher’s personal and professional network. Participants were contacted directly via email and social media channels. Next, snowballing mechanisms developed the sample. The survey was also distributed in online forums, survey respondent groups and by university supply (Blackboard platform at Groningen University, Postgraduate Matters newsletter by the Newcastle University Business School). With such, self-selected participants were reached.
3.2.3. Ethical Considerations
4. RESULTS
After gathering responses for 21 days, the online-survey was closed. The questionnaire came back with a rare data set of N=414 participations. The total sample was cleaned and analyzed descriptively. The variable’s psychometric properties were examined and scale reliability was secured. Hypothesis testing was conducted using regression analysis and ANOVA testing. Data analysis was performed using IBM SPSS version 23 (IBM SPSS, 2015).
4.1. Preliminary Data Analysis
The raw data was first scanned for non-responses and the extent of missing data. Scanning highlighted 11 cases of incomplete responses with more than 50% missing values. Those cases were excluded from the final data set in order to guarantee reliability and prevent non-random values (Babin et al., 2013; Hair et al., 2014). Items where checked for non-response or non-randomly missing patterns. The highest non-response rate of 15.9% occurred for the question of occupation. For other measurement items the null hypothesis could be accepted and for non-systematically missing values mean imputation from valid data was used. Preliminary data analysis finally resulted in a valid data set of 403 cases for further analysis.
4.2. Sample Characteristics & Descriptive Results
Table 5 Sample Profile & Industry Related Information
Variable Category Frequency (N=403) Percentage
Gender Male
Female 133 270 33 67 Age 21 and below
22 – 25 26 – 30 31 – 40 41 – 50 51 and older 81 187 75 30 13 17 20.1 46.4 18.6 7.5 3.2 4.2 Occupation Student NA Management Employee Other 213 64 27 25 74 52.7 15.9 6.7 6.2 18.5 Country of Origin Germany
Netherlands England 129 122 152 32 30.3 37.7 Favorite Brand Nike
Adidas New Balance Reebok 256 92 38 17 63.5 22.8 9.4 4.2 Frequency of Purchase Very Often Often Occasionally Neither Often nor Seldom Seldom Very Seldom Never 29 73 160 37 77 23 4 7.2 18.1 39.7 9.2 19.1 5.7 1.0 Purchasing Channel Online
Offline
132 271
32.8 67.2 Knowledge about the
possibility to co-design shoes online
Concerning industry related information participations were asked to choose their favorite between four sneaker brands (Nike, Adidas, Reebok, New Balance). 63.5% stated their preference for Nike, followed by Adidas (22.8%), New Balance (9.4%) and Reebok (4.2%). Most people buy shoes occasionally (39.7%). The rest mainly splits between purchasing often (18.1%) or seldom (19.1%). The average shoe size is 43 (EU) for males and 39 (EU) for females (Table 5b). As Table 5b also shows, males spent an average of €341 on cloths in the past three month, whereas women only spent €273. The majority of both genders still prefer to purchase shoes offline (67%) as opposed to online (33%). And while 75.7% of the survey participants claim to know about the possibility to customize (co-design) shoes online, only 17.1% already took advantage of that possibility and actually participated in customization in the past.
Table 5b Average Sample Profile
Variable Average Male Average Female
Shoe Size 43 39
Money (€) spent on cloths
during the last 3 month 340.59 272.83 Knowledge about co-design
(N=yes) 107 198
Customized in the past (N=yes / %=share of knowledgeable people)
27 (=25%) 42 (=21%)
4.3. Principal Component Analysis
In order to test the reliability of a construct’s measurement, scale indicator reliability tests are conducted. The blocks of items are tested for the estimation of each overall construct through the use of factor analysis (including item loadings) in SPSS. Appropriateness for measuring the underlying construct is measured by considering each item’s loading. Loadings explain the single item’s strength on the overall measurement scale. The usual recommendation of loading per item is >0.70 (Hair et al., 2012), more liberal approaches accept values at >0.50. In the case of lower loadings, affected items should be considered for cut-off. Moreover As observable in 6 some loadings of survey items are not within the required values and therefore not acceptable to represent the construct’s measurement. In an attempt to cope with the outfalls their respective impact of item exclusion from the scale on AVE and internal reliability (CA) was tested. In order to reach sufficient AVE values and improve the scale reliability, some items were removed from further analysis. BEx1 (loading=.497) and CC6 (=.347) did not fulfill the requirements and were extracted from the analysis. Their extraction caused a required AVE value for the BEx and the CC-scale. After item-reduction, all AVE values are within requirements and can be considered reliable. Item deletion caused improvement of the evaluation conditions and secured content validity, integrity as well as model quality. Table 6 shows all deleted items in italic. Cronbach Alpha (CA) tests were
