The Effects Of Information Sources On Dual Brand Equity

During the business operation of service industry, fewer and fewer enterprises provide only intangible services as before, while more and more firms also provide tangible products (hereinafter referred as"product") in there service. The proportion of service and product is different in terms of various industries and enterprises such as beauty parlors, hospitals, hair salons, restaurants and retailers. In these type of business, the quality of the product directly impacts on the customer service experience. Then it will further impact on the consumer overall evaluation of the service. The various service experiences will in turn affect consumer perception and evaluation of the products, and further affect on their purchase decision. Thus, in order to arouse customer's attention and interest, firms use diversified sales promotion tools such as advertising, catalogues and experience promotions, to provide customers with service brand information of the firm itself and the information of the products which are being used. Hence, it becomes a common practice that the promotion of a service enterprise involves both service brand and product brand.The differential effect of brand knowledge on consumer response to the marketing of the brand is defined as customer-based brand equity (Keller, 1993). Brand knowledge is conceptualized as consisting of a brand node in memory to which a variety of associations are linked including brand characteristics, brand revenue, user and perceived assets and all other attributes. Since such service cannot be provided without product, the information provided for customers is not only service related, but also tangible products related. Therefore, the service firms provide the information advocating both service company brand and product brands. That means the information sources which come from firm's promotion affect both service brand equity and product brand equity. Herein, the service brand equity and product brand equity under the influence of the same information source are defined as"dual brand equity". However, when the service brand name is different from product brand name, it is quite interesting that many respondents in the interview forget a great many product brand information, but at the same time remember service brand information and form brand knowledge of service company, although they have received both service and brand information from the same source simultaneously. Thus it is believed that the dual brand equity is not the simple addition of service brand equity and product brand equity. The effects of information source on the proposed equities should be studied separately under the same framework.It is noted that such services are usually provided by professionals, such as cosmetologists, doctors and hairdressers. They take advantage of the intensive contact opportunity when they provide service and get involved in consumer's information searching process. On one hand, they are the important information disseminators for product sales because their recommendation can possibly influence consumer's purchase decision; on the other hand, they are the receiver of feedback from consumers and the feedback contributes to company decisions. While to consumers, they assume two roles, namely service personnel and information supplier. Borrowing the concept of"Recommendation Agent"in information management system(Xiao & Benbasat,2007), we name these professionals recommendation agent. Likewise, the product recommendation is called agent's recommendation. When consumers acquire information from various channels and consume at service firms, recommendation agents, as a special information source, play an important role in search for further information. In this research, that important role in dual brand equity establishment utilizing information source is further discussed.Based on literature review and in-depth interview, this research set up the framework which structures the effect of information sources on dual brand equity and empirical test is made to verify the effects of recommendation agent's product promotion on dual brand equity. Each construct is expressed in a scale based on the interview and questionnaire. Among the three scales, information source scale and recommendation agent's promotion scale are self-developed in this research, while brand equity scale is an existing mature scale. The scales are applied to consumers in beauty parlors and data are analyzed on SPSS16.0 and AMOS16.0. Altogether, 11 major hypotheses which are consisted of 25 minor ones are tested using SEM and multiple regression analysis.The finding shows that in the service firms which provide both product and service, perceptive importance of information source has positive effect on both product and service brand equity. Over-promotion and moderate recommendation are moderators between perceptive importance and brand equity. Finally, the service brand equity has spill-over effect on product brand equity.The major conclusion of the research include: (a) Service firms can utilize the same information source to foster service brand and strengthen the product brand. If a company devotes to the brand development, the best information source is direct experience. If a service firm wants to realize win-win strategy with product firm, a good choice is to provide product information on service firm's website. (b) Service enterprises should make out appropriate recommendation agent's promotion strategy to avoid over-promotion of the product brand in use; however, moderate recommendation by service personnel is appropriate. (c) Service company's brand equity has spill-over effect on product brand equity, but not usually vice versa. The contribution of the research is mainly as follows:Firstly, service brand equity and product brand equity are brought up under the same framework, and the dual brand equity effect model under an identical information source is constructed and tested. The previous research can only interpret the effect of information source on single brand equity and fails to explain dual brand equity effect. Service is different from the traditional tangible product brand in terms of its intangibility. Therefore, service brand is more depend on enterprise and is regarded as company brand. In the coexistence of corporate brand and product brand, pervious research can hardly explain how they interact with each other. This research helps to clarify that problem.Secondly, the positive correlation between service brand equity and product brand equity is tested and that evidences brand spill-over theory. Previous theory mentioned brand equity's effect on service brand only and neglected the counter spill-over effect in the industry where service is major offering and product is in secondary place.Thirdly, recommendation agent evaluation scale is developed on the basis of introducing the same concept in management information system. In addition, the construct of recommendation agent's promotion is developed with two dimensions, i.e. over promotion and moderate recommendation. The respective scales are also acquired through in-depth interview and preliminary research. The development of the scales pave the way for the successive empirical study.Finally, in the dual brand equity effect model, two moderate variables, over promotion and moderate recommendation, are creatively designed. That not only contributes to brand equity theory, but also lay a theoretical foundation for utilizing recommendation agent functions in the establishment of dual brand equity.There are some limitations of this research. First, the research is majorly targeted at beauty parlors in Changchun and the samples are collected by means of intercept interview. Further test needs to be done on whether the conclusion is applicable for other areas in China. Second, since the study focuses on cosmetology only, it is yet to be verified if the model can be used in other service industries.