The Effect of Economic Inequality on Consumers’ Preference for
Partner or Servant Brand Relationship.
University of Groningen Faculty of Economics and Business MSc Marketing Management
Master Thesis
Completion date: 17 June 2019 First supervisor: Dr. Sumaya Albalooshi Second supervisor: Anika Schumacher, MSc
Lina Anggraini S3637093
Planetenlaan 395, 9742 HN, Groningen The Netherlands
Abstract
The effects of perceived economic inequality in the domain of consumption were investigated in this study, as it is not much known about the specific preferences and consumer attitudes that can prevail when people are influenced by high or low levels of inequality. In particular, whether or not high economic inequality condition can lead customers to convey a greater preference for a product advertised with a servant-like or a partner-like message. The primary proposition of this study is that people exposed to high inequality will desire for power, which they will restore their power through the product. The previous study on compensatory consumption showed that customers consistently prefer products that match their present psychological needs to regain as well as recover what was lost or what they lacked. Building on those findings from precedent studies and researches on inequality, therefrom a 2 (economic inequality: high vs. low) x 2 (brand relationships: servant-like vs. partner-servant-like ad appeal) between-subjects factorial design experiment was performed to test the main hypothesis. The findings indicate substantial difference in the attitude responses, participants in the high inequality condition were reported to have a more favorable response toward the servant-like marketing message. Furthermore, the results of this research show that economic inequality is a significant predictor of desire for power, where the higher the economic inequality the higher the consumers’ desirability for power.
Acknowledgments
First and above all, I praise God, the almighty who serves as guidance and the source of strength and knowledge for without his guidance everything is futile. I should confess that this journey would not lead to the destination without his countless blessing and help.
I would like to express my profound gratitude for Dr. Sumaya Albalooshi's assistance and encouragement as my supervisor. I am indebted to her for inspirational suggestions and useful advice throughout this journey.
I must thank my second supervisor Anika Schumacher, MSc for taking the time to read my work and being part of this process.
I am forever grateful for being surrounded by warm-hearted friends in my life who stay with me no matter how imperfect I am. They all know who they are.
Finally, but by no means least, to my supportive and wonderful family, I warmly thank and appreciate my dear parents and older brothers for encouraging me in all of my pursuits and inspiring me to follow my dreams. They are my world’s most significant individuals, and I dedicate this thesis to them.
Table of Content
1. Introduction… ... ..6
2. Theoretical Framework... ... ..7
2.1 Inequality and Desire for Power ... .7
2.2 Inequality and Brand Relationship... ...9
2.3 Inequality, Desire for Power, and Brand Relationship ... .11
3. Hypotheses ... .13
4. Conceptual Model… ... .14
5. Methodology ... .14
5.1 Manipulation of Inequality…...16
5.2 Desire for Power ...17
5.3 Marketing Communication Framing ... 17
5.4 Mood ... .18
5.5 Comprehension & Attention Check ... 18
6. Results ... .18
6.1 Manipulation Check and Initial Analysis ... .18
7. Main Analysis ... .21
7.1 ANOVA… ... .21
7.2 Moderated Mediation Analysis… ... .23
7.3 Test of Alternative Explanation of Desire for Control… ... .25
7.4 Test of Mediatory Role ... .27
11.6 Appendix F... .50
11.7 Appendix G ... .50
11.8 Appendix H ... .50
11.9 Appendix I ... .50
List of Figures Figure 1: Conceptual model of the research………... ….14
Figure 2: Participants’ response to each of ad appeal………..…22
Figure 3: The differences in participant’s attitude per condition…...…….…...23
Figure 4: The differences in desire for power per condition………....25
1. Introduction
Over the last 40 years, economic inequality, the gap in the distribution of wealth between rich and poor, has been increased in the industrialized world (Brandolini & Smeeding, 2009; Solt, 2016). Economic recovery in many countries around the world has been visible since 2010 through rising employment rates, increasing annual GDP and higher individual incomes. The OECD or known as Organization for Economic Co-creation and Development, however, demonstrates that this economic growth has not been sufficiently inclusive. Since an increase in job opportunities and higher wages should have reduced income disparities. Statistics show that economic inequality, has actually escalated because of the concentration of wealth among financially better-off citizens, and at the same time, the Gini coefficient (used as an indicator of economic inequality) recorded a value of 3.2 in 2014, the highest level in nearly three decades (OECD, 2016).
Economic inequality is associated with decreased educational performance and achievement, declined in government stability and functioning, and even diminished residents' ability to climb the economic ladder (Wilkinson & Pickett, 2009a), and lower life expectancy (Wilkinson & Pickett, 2009b). It is also associated with higher mortality, various physical and mental illnesses, obesity and government corruption (Kawachi & Kennedy, 1999).
Whilst there is a fairly wide understanding of some of the effects of economic inequality and its role in shaping societies, less is known about its effects in the consumer domain on individuals. Therefore, to address this gap in the literature, the current study focuses on investigating some of the of effects of economic inequality on consumer behavior, particularly this research aims to focus on the impact of inequality on consumer-brand relationships. Focusing specifically on how inequality induces powerlessness and how powerlessness shapes consumer-brand relationships, considering that there is still a lack of research on power in the field of consumer behavior, as it is perceived as complicated for some parties to imagine how power could have value either for practitioners or consumers (Rucker, Galinsky & Dubois, 2012). There are various consumer-brand relationships in nature due to the prevalent impact of economic inequality. Thus, to avoid generalizations, this research will focus on the relationship with brands as a servant or partner (Fournier, 1998). This master thesis focuses on the societal outcome and the impact of inequality towards purchasing decisions which can provoke the feeling of powerlessness. More specifically, we argue that consumer in high inequality condition (vs. low inequality) will choose servant (vs. partner) brand relationships with their brands due to the desire for power.
2. Theoretical Framework
2.1 Inequality and The Desire for Power
Inequality is arguably 21st century’s contentious societal issue. Despite the existence
United Nation Development Program (2015) explained inequality as a state of not being equal, particularly in terms of status, rights, and opportunities. It also clearly defined inequality into two perspectives; inequality of outcomes or also known as achievement-oriented perspective, where it primarily concerned with the inequality in the material dimensions of well-being, such as income levels, education, and health status. The other one is inequality of opportunities, it focuses solely on circumstances beyond anyone's control, which affects one's potential results, such as unequal access to employment or education. In this context, the objective should not be to equalize income, but it depends on personal and social circumstances (Sen, 1999:70) that include the individual's age, gender, family background, and disability. On the other hand, up to the present literatures on economic inequality have also been discussed different types of inequality, such as income, pay, or wealth inequality, all of which have been discussed in terms of poverty issues, personal relative deprivation, and general comparison of one's financial circumstances with other members of the society. Inequality can therefore, be described from multiple views, but for the purpose of current research, the focus is on economic inequality in general, where the extent to which wealth is concentrated in the hands of a small part of the population is defined (Côté, House, & Willer, 2015).
It is undeniable that there is the existence of chronic power disparities across a wide range of outcomes among those who belong to higher versus lower socioeconomic groups in society (Fontaine & Vorauer, 2019). The most general meaning of power found in literature and everyday thinking is the capability of causing effects, impacting things or changing things, either in the physical or social world (Turner, 2005). Keltner, Gruenfeld & Anderson (2003) proposed that power is associated with the possession of resources and rewarding contexts, and it makes people act at will without interference, it provides people with control over others and reduces social resistance and constraint (Overbeck, Neale & Govan, 2010). This, coupled with easier access to resources and opportunities, gives powerholders greater control over what matters to them as well as an act at will (Smith, Jostmann & Galinsky, 2008).
Some events may occur where consumers perceive that they have even more of lower power, one of them is experiencing economic inequality, on the other words, they see themselves as individuals who are powerless in the economic or material domain. Hence, in the condition like this they would have higher desirability for power. As previously noted, economic inequality is one deep-seeded structural basis for people to desire for power. Power has been argued to be a pervasive and fundamental component of social systems and hierarchies (Rucker et al., 2012). Indeed, when society is full of social stratification then it will create structural differences in power. For example, those in an environment of high inequality often feel powerless compared to those living in a more equal society (Bruner & Goodman, 1947).
2.2 Inequality and Brand Relationship
Pickett & Wilkinson, 2010; Bratanova, Loughnan, Klein, Claassen, Wood, 2016), they also would less willing to cooperate with others, especially when there is a visibility upon economic disparities in the neighborhood (Uslaner & Brown, 2005; Nishi, Shirado, Rand & Christakis, 2015). Layte & Whelan (2014) found that in countries with higher levels of economic inequality, residents are more likely fearing that others will look down on their profession or income.
Therefore, personal relationship that is formed within the condition of high inequality can spillover to the type of relationships that people wish to develop with the brands as a way to address these unpleasant feelings and threats (Escalas & Bettman, 2003). When individuals in their interpersonal relationships experience anxiety, they use brands as a means of coping with their in-group identities and social environment. Moreover, people form strong brand bonds to strengthen and meet their needs of feeling secure and respected (Loughran & Swaminathan, 2011; Rindfleisch, Burroughs & Wong, 2008; Allen, Fournier & Miller, 2008; Swaminathan, Page, Gürhan, 2007).
as partners or even servants, in other words, the brand either being an equal partner or act a master of quasi-social relationships (Fournier, 1998).
In addition, there is a focus of understanding the relationship between consumers and brands in a social setting, since Kim & Kramer (2015) found that partner and servant roles indicate social and hierarchical stratification, a value system based on these characteristics is likely to have a systematic impact on consumer responses to a servant versus a partner's brand relationships. Thus, this research will focus only on these two roles because hierarchical differences are salient and can be observed in the context of economic inequality. It is also consistent with the idea that all relationships between two entities are likely to involve different levels of hierarchy, in such a way that either entity is equal to or one entity can dominate the other (Gruenfeld, Inesi, Magee & Galinsky, 2008). Notably, the people at the top of the hierarchy or the superiors are expected to give order and directions to those on the lower place of hierarchy to complete task, forming servant-like relations within the different hierarchical levels, because they are attentive to the features of other that are instrumental for accomplishing the power-holders goal (Yukl & Fu, 1999; Galinsky, Magee, Inesi & Gruenfeld, 2006). Therefore, it goes the same for relationships between consumers and their brands (Dong & Aggarwal, 2016).
2.3 Inequality, Desire for Power, and Brand Relationship
Fritsche & Jugert (2017) suggested that economic inequality could pose a psychological threat. In the end, this would lead to the perception of powerlessness. Power has predominantly been defined as asymmetrical control of valued resources in social relationships (Thibaut & Kelley, 1959; Keltner, Gruenfeld & Anderson, 2003; Magee & Galinsky, 2008). Often being powerless is an aversive state that affects the psychological and material well-being of individuals (Keltner et al., 2003; Smith et al., 2008). Individuals often seek to restore power because of their aversive nature. For example, Rucker and Galinsky (2008; 2009) found that people compensate for the lack of power by redirecting the resources they have (e.g. money) toward acquiring high-status objects, particularly when the status of the product is visible and conspicuous.
Inequality, which is seen as the beginning of a threat in ones' life, makes people crave for power in their life, in particular, Schwartz, Dodge & Coie (1993) pinpointed that individuals with less power interpret ambiguous events as more threatening. The threat they experience from high inequality condition drives people in their relationships with others to seek dominance and power (Bartholomew & Horowitz, 1991) because they believe that power can satisfy their desire and needs, diminish the reliance to others, and be more self-assured (Keltner et al., 2003).
relationships over partner-like brand relationships (Kim & Kramer, 2015). Hence, in this paper researcher argues that people will prefer servants-like brand relationship with their brands only if they are exposed to high inequality since they desire for power.
3. Hypotheses
As mentioned previously, this study expects that for consumers experience high inequality will exhibit a higher desire for power, should therefore, be far more prefer servant-brand relationship. Particularly, it examines the effect of inequality on the consumers' preference on a brand relationship, as mediated by the desire for power. More formally, the hypotheses are as follows:
H1: In contrast to participants in the low economic inequality condition, participants in the high economic inequality condition will show a higher preference for advertisement appeal with a message corresponding to a servant-like brand relationship.
4. Conceptual Model
Figure 1: Conceptual Model of the research
5. Methodology
As mentioned above, we are building on existing literature on inequality and its relationship to consumer behavior in this research. More specifically, this study explores the effects of inequality on consumer preference for what kind of brand relationship they form with the brand. Furthermore, we ran an experiment in an attempt to learn more about the potential mediators of the hypothesized main effect i.e. desire for power. Based on the theories examined in the previous sections and the conceptual model, it is expected for the participants in the high inequality condition, as opposed to those in the low inequality condition, will choose servant-like relationships with brands, driven by the desire for power.
A total of 276 participants agreed to participate in the experiment (131 Male, 145 Female, Mage = 25.33), the survey was designed and distributed through Qualtrics. Participants were randomly assigned to a 2 (Inequality: high vs. low) x 2 (brand relationship: servant vs. partner), between-subjects factorial. All participants resided
Inequality
Desire for Power
Brand relationships: servant vs. partner
in Indonesia. Subsequently, a total of 64 participants were excluded from further analysis after an initial examination of the data due to various breaches of predetermined criteria. They either failed one of the two attention checks, failed to provide the correct percentages when asked to recall their province's wealth distribution, or indicated that they did not understand the information provided previously. Therefore, all analyses were carried out with the remaining 212 participants. Two lucky participants were also rewarded for participating with Rp 200,000 monetary compensation.
5.1 Manipulation of Inequality
According to Coté et al. (2015)'s manipulation method, each participant was randomly assigned to view a pie chart portraying either a very equal or very unequal distribution of wealth, which they were told represents their state of residence status. Participants were initially required to provide certain demographic information such as gender, age, ethnicity, annual household income, employment status, and socioeconomic status. After a short wait for people to believe that the computer accumulated the above information, respondents were then presented with a fictitious pie chart showing how the economic wealth of their province was distributed amongst every quintile.
For the purpose of ensuring the credibility of the data provided, participants were then told that the pie charts were developed using data collected from the Indonesian Central Bureau of Statistic in 2018. In this study, two conditions were randomly assigned to respondents. First, a high-inequality condition in which the pie chart revealed high disparities in the distribution of wealth (1% of wealth owned by the poorest fifth of the population, 3% by the second poorest fifth, 4% by the middle fifth, 11% by the second richest fifth and 81% by the wealthiest quintile, irrespective of their actual state of residence, check Appendix A). Second, there was another pie chart which displayed low inequality and more equal distribution of the wealth (Poorest fifth of the population owns 11% of private wealth, second poorest fifth owns 15% of private wealth, Middle fifth owns 18% of private wealth, second wealthiest fifth owns 21% of private wealth) which corresponded to the state that was declared as their home state (Appendix A).
their province is economically suffering, and finally how satisfied they were with their province's current situation.
5.2 Desire for Power
Participants' desire for power was measured using the desire for power scale by Anderson, John & Keltner (2012) (Appendix C), which consists of a stem ("Please indicate how strongly you agree or disagree with all the following statements...") and eight items: "I can get people to listen to what I say"; "My wishes do not carry much weight," reverse scored; "I can get others to do what I want"; "Even if I voice them, my views have little sway," reverse scored; "I think I have a great deal of power"; "My ideas and opinions are often ignored," reverse scored; "Even when I try, I am not able to get my way," reverse scored; and "If I want to, I get to make the decisions" (1 = strongly disagree, 7 = strongly agree). Scores on this scale are correlated with the actual power hierarchies of people and predict the same behaviors as structural power manipulations and autobiographical recall manipulations (Anderson & Berdahl, 2002; Anderson & Galinsky, 2006). We aggregated the items and the reliability analysis showed that the scale was highly reliable (α = 0.86).
5.3 Marketing Communication Framing
either partner or servant advertisement such as logo, colors, font, etc. remained unchanged except for the message.
The messages presented clearly personified the servant characteristics (Trapped in the Dark? Lumitz works for you to ensure that you are never in the dark. Leave it to us to lighten up your world anywhere and anytime - Lumitz: At your service with LED lighting solutions) (see Appendix D), and partner characteristics (Trapped in the Dark? Lumitz works with you to ensure you are never in the dark. Together we lighten up your world anywhere and anytime - Lumitz: Your partner in LED lighting solution) (Appendix D). After reading the advertisements, they completed a small survey under Aggarwal's (2004) procedure and answered seven questions about their attitudes towards the advertised brand. All measured on a seven-point Likert scale (Unfavorable – Favorable, Negative – Positive, Bad – Good, Unappealing – Appealing, Do not like at all - Like very much, Unpleasant – Pleasant, Not Likeable – Likeable) (Appendix E). The attitude scale of reliability analysis deemed all items worth retaining to be α = 0.81. All items were aggregated into a single variable. The participants then assessed the extent to which the brand they saw inspired servants, partners or none of those relationships (Appendix F).
5.4 Mood
We also included a measure for the mood of the respondents in the survey. The mood was measured using a bipolar scale of seven points and the respondents reported to what extent they felt happy-unhappy, stressed-relaxed and angry-calm. After performing a reliability analysis, for the main analysis, all items were kept with Cronbach's alpha showing the scale to be reliable with α = 0.85 and we also aggregated them into one measure.
5.5 Comprehension & Attention Check
programs have recently seen a significant increase in ratings. Many sports start with the letter 'B'. However, we ask that from the list below you select a sport that does not start with the letter 'B' but starts with the letter 'H'.” After that, we gave the answers below (Baseball, Basketball, Soccer, Bowling, Hockey, Other). The final question was to check whether the entire survey had attracted proper attention.
6. Result
Summing up, in the first part of the survey respondents responded more specifically to questions about the understanding of the pie chart of inequality (high or low) that we projected to them. Later in the second part of the survey, we asked them questions related to manipulation and measurement of our dependent variable. In the end, the respondents had to answer questions of comprehension and attention that enabled us to check if they understood all the parts of the survey clearly. In the end, the 212 participants were included for further analysis.
6.1 Manipulation Check and Initial Analysis
An independent-group t-test was carried out for a comparison of means between three independent groups. First, by random exposure to the pie chart, their perceptions of inequality were tested. After performing the initial independent t-test, it is finally confirmed the success of the manipulation. Participants exposed to high inequality were in fact perceived to be less equally distributed in term of the wealth distribution in their state of residence (M = 2.82, SD = 1.28) In contrast to those exposed to a low level of inequality (M = 3.64, SD = 1.29). Based on the results, we can conclude that those exposed to high inequality believed the distribution of wealth less equally distributed (t (212) = 4.75, p < .001).
indicated that they were less satisfied with the economic condition of their province (M = 3.45, SD = 1.21) compared to those in the low inequality condition (M = 4.06, SD = 1.27, t (212) = 3.48, p < .001). These results also appear to be consistent with our manipulation check, and they are significant. Overall, as all these three checks of manipulation are significant, we can again conclude that the manipulation worked. Moreover, we performed another t-test to check mean differences towards manipulation for the brand roles of servant and partner. Participants answered questions about the extent to which they believe that the advertisement displayed elicits specific relationships with the customers. After the respondents were getting exposed the servant brand role advertisement, they seemed to believe that the stimuli we presented to them elicited servant relationships (M = 6.46, SD = 1.03) compared to those who were received the partner advertisement (M = 1.27, SD = 0.44). The results are highly significant (t (212) = 46.64, p < .001).
7. Main Analysis
7.1 ANOVA
In the interest of determining the effect of inequality and brand relationships (servant-like and partner-(servant-like ad appeal) on product attitude, a study setting of 2 (economic inequality: low vs. high) x 2 (brand relationships: servant-like ad vs. partner-like ad) between subjects' factorial analysis of variance was conducted. An insignificant main effect of inequality on product attitude (F (1,185) = 0.28, p= 0.44, η2p = 0.03) was shown after undertaking the 2-way ANOVA. Notably, there was a significant interaction effect found between inequality and brand relationships with F (1,185) = 0.48, p = 0.02, η2p = 0.07 which it is aligned with our prediction in this study. Another highly significant interaction effect was also seen between brand relationships on product attitude (F (1,185) = 0.57, p < .001, η2p = 0.05).
Figure 2: The differences in participants’ response to each of ad appeal under high and low inequality conditions
We undertook another contrast analysis to decompose the interaction between brand relationships and product attitude. The result is not contrary to our expectations, in the high inequality condition those that have been exposed to the marketing message with elements of servant-like brand relationship showed more positive attitude toward the product (M = 5.64, SD =1.28) in comparison to respondents that exposed to partner-like ad appeal (M = 5.21, SD = 1.18; F (1,185) =11.20, p < .001, η2p = 0.02, CI [1.17, 1.11]). As we have predicted before, non-significant differences in attitude were revealed among participants in the low inequality condition towards either servant-like (M = 5.61, SD = 1.38) or partner-like marketing message (M = 5.63, SD = 1.18, F (1,185), p < .001, η2p = 0.02). Figure 3 better explains our results.
4.85 4.9 4.95 5 5.05 5.1 5.15 5.2 5.25
High Inequality Low Inequality
B ra nd re la ti o ns hi ps
Participants' Responses to each of Ad Appeal
Figure 3: The levels of attitude among participants in high and low inequality conditions
7.2 Moderated Mediation Analysis
Using Andrew Hayes’ Model 15 the moderated mediation analysis was performed. Inequality as the independent variable and product attitude as the dependent variable were entered to the respected column of analysis. In this analysis, the mediator variable was also included, namely desire for power and one moderating variable of the brand relationships (servant-like and partner-like ad appeal). The results show that desire for power is significantly predicted by inequality with b = 2.02, 95% CI [1.79, 2.24], t = 17.69, p < .001. Moreover, the R2 = 0.77 indicates that inequality is able to explain roughly 77% of the variance in desire for power. The positive effect in coefficient indicates that with increased inequality, would also increase the desire for power. The analysis in regression table proved that inequality does not significantly predict product attitude with b = -0.08, 95% CI [-3.75, 3.59], t = -0.04, p = 0.96, and here the correlation between desire for power and product attitude is also insignificant (b = 0.25, 95% CI [-1.16 1.67], t = 0.34, p =0.72). The interaction term of brand relationship and attitude is not significant as well (b = 0.38, 95% CI [-1.39, 2.16], t = 0.42, p = 0.66). The conditional direct effect of inequality to product attitude at the
4.9 5 5.1 5.2 5.3 5.4 5.5 5.6 5.7
High Inequality Low Inequality
L ev el s o f Att it ude
The Differences of Participants' Attitude per Condition
values of brand relationships is also not significant with b = -0.12, 95% CI [-0.56, 0.31], t = -0.55, p = 0.58, followed by another insignificant result on conditional indirect effect of inequality to product attitude at the values of brand relationships (b = 0.12, 95% CI [-0.04, 0.33], t = -0.51, p = 0.56. In addition, there is also an existence of zero in index CI [-0.47, 0.32] of moderated mediation table. Therefore, referring to the result of our analysis, for the current finding no moderated mediation effect can be identified. It is also seen that the confidence intervals include zero within each level of the variable of brand relationships, more specifically for servant-like marketing message b = 0.05, 95% CI [0.41, 0.31], and partnerlike marketing message b = -0.01, 95% CI [-0.95, 0.92].
Figure 4: The levels of desire for power among participants in high and low inequality conditions
7.3 Test of Alternative Explanation of Desire for Control
In regard to testifying for the alternative explanation, we replace the mediator desire for power with desire for control. It has been known that one of the potential psychological consequences of inequality is triggering people to have higher desirability for control. The desire for control can be viewed as an individual's need and motive for exercising and feeling control over his or her own environment and actions (Faraji-Rad et al. 2017; Allen et al., 1980; Lefcourt et al., 1981; Lefcourt et al., 1984). We used the work of Burger and Cooper (1979) on the desire for control scale. The reliability analysis showed that the scale was highly reliable (α = 0.88). A desire for control is incredibly important to us, not only because it has been proved to be the main psychological factor influencing personal well-being (Nikolaev & Bennet, 2015) and satisfaction in life (Verme, 2009), but also because it is more rooted in our subconscious than we might recognize.
Before including the desire for control in moderated mediation analysis, we have to check the impact of inequality on desire for control by using independent sample
t-6.55 4.53 0 1 2 3 4 5 6 7
High Inequality Low Inequality
D es ir e fo r po w er
test. The result reveals that the effect of inequality on desire for control is not significant (F (1,189) = 0.29, p = 0.27, η2p = 0.2, 95% CI [-4.87, 5.10]).
Another moderated mediation analysis was also conducted by using Andrew Hayes’ Model 15 accordingly. We entered inequality as the independent variable and the product attitude was also included as the dependent variable along with the desire for control as the mediator, and one moderating variable, namely brand relationships. The findings indicate that there is no significant interaction between inequality and desire for control with b = -0.12, 95% CI [-0.36, 0.10], t = -1.09, p = 0.27, and R2 = 0.07 suggests that only around 7% of variance in desire for control is explained by inequality. The negative coefficient reveals that the desire for control will be lessened as inequality diminished.
7.4 Test of Mediatory Role
In this research another test for the mediatory variable was also conducted, at this time we wanted to test the role of mood. The results of the reliability analysis showed that the scale to measure mood was highly reliable (α = 0.84). Given the results of previous studies, mood can play an important role in the attitude of people. Research generally suggests that positive mood can increase attitude towards a brand (Barone, Miniard & Romeo, 2000). In addition, the presence of inequality could affect mood. Oishi et al. (2011) found that high levels of inequality elicit an unhappy feeling. Moreover, people who are depressed or unhappy use more products than consumers who are relatively happier (Garg, Wansink & Inman, 2007). It has also been discovered that a decrease in people’s happiness at rising levels of inequality especially in European countries and in Latin America (Graham & Pettinato 2002; Schwarze & Härpfer 2002; Alesina et al. 2004). Thus far, there are no particular studies that mention the relationship between inequality and people's mood or happiness in Asian countries.
Figure 5: The levels of mood among participants in high and low economic inequality conditions
While initially mood was not taken into account as the main interest of this study, the role of mood cannot be put aside and must be considered. The follow up moderated mediation analysis was performed using Andrew Hayes’ PROCESS Model 14, here mood was entered as a mediator of the interaction between economic inequality and product attitude. Previously, economic inequality predicted the desire for power significantly (b = 2.02, 95% CI [1.79, 2.24], t = 17.69, p < .001).
Most captivatingly, now mood is also successfully predicted by economic inequality with b = -0.37, 95% CI [-0.87, - 0.07], t = -1.88, p = 0.04, the negative sign in the coefficient indicates that by increasing inequality, otherwise stated when the economic inequality changed from low to high condition, mood scores will decrease as well. Moving to the regression table, now it is proven that mood is also a significant predictor of product attitude (b =0.37, 95% CI [0.17, 0.73], t = 3.34, p < .001). The existence of zero could not be found either in the confidence intervals for the direct effect of economic inequality (b = -0.03, 95% CI [0.36, 0.29], t = -0.22, p = 0.02), or in the interaction through mood on product attitude, at each level of the moderator (brand relationships) with b = 0.03, 95% CI [0.23, 0.27], t = -0.32, p = 0.03). The result
4.5 4.6 4.7 4.8 4.9 5 5.1 5.2
High Inequality Low Inequality
Levels
o
f M
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d
of the moderated mediation index also shows a significant result as the confidence interval did not span zero CI [0.08, 0.09]. To be more specific, for servant-like ad appeal b = -0.148, 95% CI [0.33, 0.30], and for partner-like ad appeal b = -0.149, 95% CI [-0.49, -0.37]. Therefore, the results demonstrate that mood is indeed an important predictor in the model, as at this stage when mood is included in the model, we can infer there is a moderated mediation effect.
8. Discussion
The objective of this research was to prove that in a condition of high economic inequality, individuals show a more positive attitude towards products that have servant-like features, also it was included “desire for power” in the process as a mediator. The results of a 2x2 intersubject design experiment validated the main hypothesis by demonstrating that participants in the high level of economic inequality, compared with those in low economic inequality when accompanied by a servant-like marketing message, the brand was in fact evaluated more positively. No such preference for partner-like cue was expected or found among the participants in the low inequality condition.
The proposed moderated mediation was not confirmed to be significant, whereas the desire for power was successfully predicted by inequality. The study may have produced insignificant results because it was not very powerful with N = 212 participants, additionally, it is due to the project time constraints. On a positive note, it can still be concluded that the research was conceptually on the right track, since the differences in groups are consistent with the hypothesis we proposed.
Replicating the design of the study with larger sample size is conceivably lead to significant results throughout the whole model. While the analysis found some significant results in terms of the interaction between inequality and brand relationships, brand relationships and attitude, as well as inequality and the desire for power, nevertheless, the desire for power did not affect our model and there was no expected effect can be reported here. Again, it is highly suggested and might also be interesting to explore the results of a similar study for a larger sample and drawing conclusions based on their comparison. Further to that, future work can consider all the potential limitations mentioned and carry out an analysis for a country other than Indonesia and the United States, as it has ever conducted in the USA in the previous study. Essentially, future researcher should explore various brand relationships in the context of inequality, except those of partner and servant brand relationships, which possibly can also reveal significant and meaningful results, and provide new insight for marketers.
to scrutinize the specific emotions that participants are experiencing by creating a more extensive scale a measure of discrete emotional states that can distinguish specific emotions, or a comprehensive option for text entry, where it is possible to see precisely how economic inequality induces certain feelings.
The major contribution of this study is the addition of research on the impact of economic inequality, especially in the domain of consumption. It enriches and contributes to the literature on how inequality shapes consumers’ choices, what they value, and most importantly what they want to compensate at coping with psychological deficit or threat (compensatory consumption), as it also shows the propensity of people to choose and prefer products that satisfy their psychological needs, rather than utilitarian needs. This study strengthens the existing concept that people form brand relationships in the same way that they establish social relationships, especially when they are living in the context of inequality.
Type of product or service can be an interesting moderator for further investigation and as an addition to the model. It is also intriguing to examine people’s responses to servant versus partner brand when it comes to a service provider e.g., professional house cleaning service or bank. Relatedly, power distance (Hofstede 1983) might moderate the effect of inequality on responses to servant versus partner brands. This potential moderating role may depend on culture, as power distance differs throughout the world's cultures (Pratto et al., 2000).
Another plausible mechanism is that consumer pre-existing attitudes toward certain products, which is a higher brand familiarity levels generated through direct or indirect brand-related experiences are linked to a well-developed brand knowledge structure and attributes (Alba & Hutchinson, 1987). In fact, the high familiarity feeling with one’s brand marketing communication is not likely to produce significant changes in consumers' attitude and brand evaluation (Sundaram & Webster, 1999). If that is the case, then there is no certain advertisement appeal or words’ framing should result in a higher preference for these products, even under economic inequality conditions. Lastly, it is a difficult task to formulate consistent marketing strategies, but it is even more challenging to implement them ethically. Important to acknowledge that marketing involvement in underprivileged or vulnerable populations should always be based on a strong ethical framework, and should not take advantage of their vulnerabilities, rather, it is formulated to be fair and non-exploitative, whilst at the same time providing valuable service to consumers. The most notable objective is to keep marketing as accurate and non-manipulative as possible.
9. Conclusion
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11. Appendix
1. Manipulation of Inequality
Appendix A:
High Inequality Pie Chart
Appendix B: Inequality Manipulation-related Tasks
Using the pie chart, please fill in the correct answers:
-What percentage of the private wealth is owned by the wealthiest fifth of the population?
-What percentage of the private wealth is owned by the poorest fifth of the population? -What percentage of the private wealth is owned by the middle fifth of the population? Perception: How equally distributed do you perceive the wealth in your home state? (Extremely unequal - Extremely equal)
Suffer: To what extent do you feel that your state is suffering economically? (Far too little - Far too much)
Satisfaction: How satisfied are you with the economic status of your state? (Extremely dissatisfied - Extremely satisfied)
Comprehension: Do you feel that you understood the information represented in the pie chart about wealth distribution in your state? (Yes - No)
Appendix C: The Desire for Power
Please indicate to what extent you agree or disagree with the following statements. (1= strongly disagree, 2 = disagree, 3 = somewhat disagree, 4 = neither agree, nor disagree, 5 = somewhat agree, 6 = agree, 7 = strongly agree)
1. I can get others to listen to what I say 2. My wishes do not carry much weight. 3. I can get others to do what I want.
4. Even if I voice them, my views have little sway. 5. I think I have a great deal of power.
Appendix D: The Desire for Control
Below you will find a series of statements. Please read each statement carefully and respond to it by expressing the extent to which you believe the statement applies to you. For all items, a response from 1 to 7 is required. Use the number that best reflects your belief when the scale is defined as follows:
1 = The statement does not apply to me at all 2 = The statement usually does not apply to me 3 = Most often, the statement does not apply
4 = I am unsure about whether or not the statement applies to me, or it applies to me about half the time
5 = The statement applies more often than not 6 = The statement usually applies to me 7 = The statement always applies to me
1. I prefer a job where I have a lot of control over what I do and when I do it. 2. I enjoy political participation because I want to have as much of a say in
running government as possible.
3. I try to avoid situations where someone else tells me what to do. 4. I would prefer to be a leader than a follower.
5. I enjoy being able to influence the actions of others.
6. I am careful to check everything on an automobile before I leave for a long trip. 7. Others usually know what is best for me.
8. I enjoy making my own decisions.
9. I enjoy having control over my own destiny.
10. I would rather someone else take over the leadership role when I’m involved in a group project.
11. I consider myself to be generally more capable of handling situations than others are.
12. I’d rather run my own business and make my
13. I like to get a good idea of what a job is all about before I begin.
14. When I see a problem, I prefer to do something about it rather than sit by and let it continue.
15. When it comes to orders, I would rather give them than receive them. 16. I wish I could push many of life’s daily decisions off on someone else.
17. When driving, I try to avoid putting myself in a situation where I could be hurt by another person’s mistake.
18. I prefer to avoid situations where someone else has to tell me what it is I should be doing.
19. There are many situations in which I would prefer only one choice rather than having to make a decision.
20. I like to wait and see if someone else is going to solve a problem so that I don’t have to be bothered with it.
Appendix E: Marketing Message
Appendix F: Attitude
Based on the information presented in the advertisement, please rate your attitude toward ‘Lumitz’ on the following:
(1) Unfavorable - (7) Favorable (1) Negative - (7) Positive (1) Bad - (7) Good
(1) Unappealing - (7) Appealing
(1) Do not like at all - (7) Like very much (1) Unpleasant - (7) Pleasant (1) Not likeable - (7) Likeable
Appendix G: Manipulation Check Test
Based on the information presented in the advertisement, please rate the extent to which Lumitz aims to elicit the following relationships with its customers (1= strongly
disagree, 2 = disagree, 3 = somewhat disagree, 4 = neither agree, nor disagree, 5 = somewhat agree, 6 = agree, 7 = strongly agree):
• Servant-like relationships • Partner-like relationships • No relationships
Appendix H: Mood Check Scale
Please indicate your mood while responding to questions in this survey in the following scale
(1) Sad - (7) Happy (2) Stressed – (7) Relax (3) Angry – (7) Calm Appendix I: Attention Check
- What is your favorite TV sport? Most people like to watch television programs. Recently, sports television programs have seen a major increase in ratings. Many sports start with the letter 'B'. However, we ask that from the list below you select a sport that does not start with the letter 'B' but starts with the letter 'H'.
