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THE HIERARCHICAL RELATIONSHIP

BETWEEN BRAND EQUITY
DIMENSIONS
ARTICLE OCTOBER 2014

1 AUTHOR:
Abdullah Awad Alhaddad
Higher Institute of Business Admini
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European Scientific Journal October 2014 edition vol.10, No.28 ISSN: 1857 7881 (Print) e - ISSN 1857- 7431

THE HIERARCHICAL RELATIONSHIP

BETWEEN BRAND EQUITY DIMENSIONS

Hayan Dib
Abdullah Alhaddad
Marketing And International Trade Department,
Higher Institute Of Business Administration, Syria Damascus

Abstract
Brands have been considered as the second most important assets for
a firm after customers .This study proposes a brand equity model with four
dimensions: brand awareness, brand trust, perceived quality, and brand
loyalty. In addition, the relationships among four dimensions and their
effects on brand equity are investigated empirically. In order to accomplish
the objectives proposed, a model reflecting the hierarchical relationship
between the brand equity dimensions of brand awareness, brand trust,
perceived quality and brand loyalty and brand equity, the model is tested by
structural equations and the sample is 369 students from the higher institute
of business administration (HIBA), the finding show that perceived quality
does not has a significant influence on both brand trust and brand equity, on
other hand, the rest of relationship between brand equity dimensions and
brand equity is confirmed . The study finding can be used by mobile market
in creating brand equity by using some strategies which can lead to the brand
equity.
Keywords: Brand awareness, Perceived quality, Brand trust, Brand loyalty,
Brand equity.
Introduction
Brands have been considered as the second most important assets for
a firm after customers (Doyle, 2001). Brand equity is one of the most
important concepts in business practice as well as in academic research. This
is because successful brands can allow marketers to gain competitive
advantage (Lassar et al, 1995).
The concept of brand equity has been discussed in a different ways,
literatures divide brand equity into three categories: the customer-based
perspective (Aaker, 1991), the financial perspective (Simon and Sullivan,
1993), and the combined perspective (Anderson, 2007).

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Strong brand with positive brand equity has several advantages such
as: consumer preference and purchase intention (Cobb-Walgren et al, 1995);
market share (Agarwal and Rao, 1996); consumer perceptions of product
quality (Dodds et al, 1991); larger margins, increase marketing
communication effectiveness, and great loyalty, (Keller, 1993); consumer
evaluations of brand extensions (Aaker , 1991); consumer price insensitivity
(Erdem et al, 2002); and resilience to product-harm crisis (Dawar and
Pillutla, 2000).
Literature Review
Brand awareness
Brand awareness is widely misunderstood and often wrongly
measured, even by experienced managers (Rossiter and Percy, 1987). Both
Aaker, (1991) and Keller, (1993) show that Brand awareness is based on
both brand recognition and recall, (Aaker, 1991) defines brand awareness as
the ability of the potential buyer to recognize and recall that a brand is a
member of a certain product category, and can be defined as consumers'
ability to identify the brand under different conditions, as reflected by their
brand recognition or recall performance Kotler and Keller, (2006).
The first step to build brand equity is to create brand awareness
(Aaker, 1991) and according to Tong and Hawley, (2009) Brand awareness
is a source of brand equity. Yasin et al, (2007) found that brand awareness
leads to a high level of brand equity. Brand awareness was found to have
positive effect on brand equity (Yoo et al, 2000: Juntunen et al, 2011:
Mishara and Datts, 2011). Based on these the following hypothesis is
proposed in this study:
Hypothesis 1: Brand awareness has a significant positive impact on
brand equity.
Perceived quality
Perceived quality is defined as the customers perception of the
overall quality or superiority of a product or service with respect to its
intended purpose, relative to alternatives (Zeithaml, 1988), on other hand
Aaker, (1991) defines perceived quality reflects upon the customers
perception of the overall quality or superiority of a product or service with
respect to its intended purpose relative to alternatives The consumers
opinion about the products quality and its attributes with regard to its
expected performance forms the measurement scale indicator of the brand
quality perceived by individuals (Ramos and Franco, 2005) and according to
Aaker, (1991) perceived quality lends value to a brand in several ways: high
quality gives consumers a good reason to buy the brand and allows the brand
to differentiate itself from its competitors, to charge a premium price, and to

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have a strong basis for the brand extension. Perceived quality was found to
have positive effect on brand equity (Yoo at al., 2000: Atilgan et al, 2005:
Kambiz and samaneh, 2011). Based on these the following hypothesis is
proposed in this study:
Hypothesis 2: Perceived quality has a significant positive effect on brand
equity.
Brand trust
Brand trust has drawn increasing attention from both practitioners
and researchers in recent years. Moorman, Zaltman, and Deshpande (1992)
defined trust as a willingness to rely on an exchange partner in whom one
has confidence. .Chaudhuri and Holbrook (2001) define brand trust as
consumers willingness to rely on the ability of the brand to perform its
stated function.
Building and maintaining trust is at the core of brand equity, because
it is a key characteristic of any successful long-term relationship (Garbarino
and Johnson, 1999). (Lasser et al, 1995) indicate that brand trust is one of the
brand equity dimensions. In order to enjoy the substantial competitive and
economic advantages provided by brand equity as a relational market-based
asset, companies must build brand trust (Delgado and Munuera, 2005).
Based on these the following hypothesis is proposed in this study:
Hypothesis 3: brand trust has a positive effect on brand equity
Brand loyalty
Brand loyalty is, like brand loyalty, a complex construct in itself,
which needs to be disaggregated if it is to be clearly understood? (Atilgan et
al, 2005). Researchers have been challenged to define and measure brand
loyalty because this dimension is formed by two different components:
attitudinal and behavioral (Dick and Basu, 1994). Brand loyalty is defined as
a situation which reflects how likely a customer will be to switch to another
brand, especially when that brand makes a change, either in price or in
product features (Aaker ,1991) .
Brand loyalty is at the heart of brand equity (Tong and Hawley,
2009) and according to Aaker, (1996) brand loyalty is a core dimension of
brand equity. Brand loyalty was found to have a dominant effect on brand
equity it leads to a high level of brand equity (Gil et al, 2007). Based on
these the following hypothesis is proposed in this study:

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Hypothesis 4: brand loyalty has a positive effect on brand equity.

Relationship between Brand Equity Dimensions:
Yoo et al (2000) noted a hierarchy of effects among brand equity
dimensions. They posited that awareness and associations preceded
perceived value and, in turn, influenced brand loyalty.
Grewal, Krishnan, Baker and Borin (1998) indicate that brand
awareness has a positive and significant relationship on perceived quality in
a bicycle brand study. (Aaker, 1996) also concludes that Brands with greater
awareness and familiarity, consumers tend to ascribe positive quality value.
Keller (1993) shows that brand awareness affected a consumer's decisionmaking, According to Campbell and Keller (2003) suggests that increasing
brand familiarity through accumulated customer experiences not only created
a knowledge structure for the consumer, but also built up confidence about
the brand. Xingyuan et al (2010) indicates that brand awareness and product
knowledge are positively related to brand trust and there is a direct effect of
brand familiarity on brand trust (Ming et al, 2011) at the same time brand
knowledge positively related to brand trust (fuller et al. ,2008). When
students have information on product quality or are satisfied with the quality
of the product based on their previous experience, they are likely to trust the
product. Perceived quality is found to be the main antecedent of brand
loyalty (Biedenbach and Marell, 2009). Trust had been at the centre of
studies that aimed to explain loyalty. Loyalty is developed if there is an
element of trust (Berry, 1993). Brand trust in recent studies has been
recognized as a key variable in long-term relationships with customers,
which in turn positively affects brand loyalty (Matzler, et al, 2008; Sung et
al, 2010; Ming et al, 2011).
Based on the assumed hierarchy of effects between brand equity
dimensions, the current study tests the following hypotheses:
Hypothesis 5: brand awareness has a positive effect on perceived
quality.
Hypothesis 6: brand awareness has a positive effect on brand trust.
Hypothesis 7: perceived quality has a positive effect on brand trust.
Hypothesis 8: perceived quality has a positive effect on brand loyalty.
Hypothesis 9: brand trust has a positive effect on brand loyalty.
Methodology:
The model:
A research framework was designed to test the above hypothesized
relationships, for the purpose, the Mobile market in Syria was targeted; the
target population of interest was defined as the students of a local university.
The model to be tested results from the hypotheses previously figures 1.

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Perceiv
ed

H
H8

Brand
awaren

Brand
loyalty

H
H

Brand
trust

Brand
Equity

H
H

H
Figure 1.The research model

Samples definition
In order to test the proposed model we select a sample of university
students because they are one of the most important customers of mobiles. A
total of 382 business students from the higher institute of business
administration (HIBA) participated in the study. Because of missing data, 13
questionnaires had to be excluded from further analysis. The Demographic
profile of the sample is given in table 1.
Table 1. Demographic profile of the sample

Gender

Income (SP)

Age

Education level

187

Male
Female
Total
None
<10000
10000-20000
>20000
Total
<20
20 - 25
>25
Total
Under graduate
Post graduate
Total

N
185
184
369
197
116
40
16
369
140
215
14
369
346
23
369

%
50.1
49.9
100
53.4
31.4
10.8
4.3
100
37.9
58.3
3.8
100
93.8
6.2
100

European Scientific Journal October 2014 edition vol.10, No.28 ISSN: 1857 7881 (Print) e - ISSN 1857- 7431

Method of data obtainment

The questionnaire was designed as a survey instrument including all
constructs of the proposed model to investigate the hypotheses of interest.
The questions in the questionnaire are based on a review of the literatures
and researches. The survey questionnaire consists of six sections. The first
section is designed to obtain sample characterization. The second section is
designed to measuring the brand awareness with a three items using fivepoint Likert-type scale adapted from (Yoo et al, 2000).The third section
deals with the measurement of perceived quality with six items using a fivepoint Likert-type scale following (Yoo et al, 2000). The forth section is
designed to measuring brand loyalty with three items using a five-point
Likert-type scale following (Yoo et al, 2000).The fifth section is designed to
measuring brand trust with three items using a five-point Likert-type scale
following (Li et al, 2008).The sixth section is designed to measuring brand
equity with four items using a five-point Likert-type scale following (Yoo et
al, 2000). Respondents are asked to indicate their agreement level of each
item of the sections on the 5-point Likert scale anchored by strongly
disagree (=1) to strongly agree (=5)..
Analysis of result
In this section we will evaluate the measurements scales used in the
research and then we will use the regression analysis to proceed an
estimation of the structural model. Figure 2 shows the estimation model with
the standardized regression weights.

0.25

Perceive
d

0.01
0.28

Brand
awaren

Brand
loyalty

0.14
0.66

Brand
trust

0.19

0.2

Brand
Equity

0.2

0.28
Figure 2.Final model

We applied Cronbachs alpha statistic to measure the consistence of

each item under the same construct (supplied by the SPSS).Table 2 reveals
the composed reliability of independent and dependent variables. We can

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notice that all constructs have greater than the suggested value of 0.6
recommended by (Malhotra, 2004).
Table 2. Construct reliability
Construct
Brand awareness
Perceived quality
Brand trust
Brand loyalty
Brand equity

Item number
3
6
3
3
4

Reliability
.828
.799
.865
.765
.863

Fit indices (supplied by the AMOS) calculated for the measurement

model indicated a good fit between the structural model and data. The root
mean square error of approximation (RMSEA) value below 0.08 indicates a
reasonable error of approximation (Browne and Cudeck, 1993). As
suggested for an acceptable model, both comparative fit index (CFI) and
goodness of fit index (GFI) values are above 0.90 (Jaccard and Wan, 1996).
The other fit measures like Normed Fit Index (NFI), is more than 0.9 which
showed a well-fitting model (Bentler, 1992). Table 3 provides the value of
the fit indices of the model.
Table 3. Fit indices of the empirical model
Test
RMSEA
GFI
NFI
CFI

Value
0.058
0.913
0.902
0.943

Regarding the hypothesis tests (supplied by the AMOS), as shown in

Table 4, seven out of nine hypothesized relationships are supported in the
estimated structural model except for H2 and H7 which had low estimates.
Therefore perceived quality does not have a significant influence on both
brand trust and brand equity. As shown in Figure 2, brand awareness has
significant positive effects on both perceived quality ( = 0.25, t-value =
5.02) and brand trust (= 0.66, t-value = 8.63) and brand equity (= 0.28, tvalue = 4.38). Hence, H5 and H6 and H1 are supported. Furthermore, brand
trust also has significant positive effects on brand loyalty ( = 0.22, t-value
=4.16) as well as brand equity ( = 0.25, t-value =4.92), indicating that H9
and H3 are supported. A significant positive effect of perceived quality on
brand loyalty ( = 0.28, t-value = 3.33) is also found, and thus H8 is
supported. Finally, brand loyalty is found to have a significant positive effect
on brand equity (= 0.19, t-value = 3.38), and thus H4 is supported.

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Table 4. Result of the structural model

Structural equations
Brand awareness
perceived quality
Brand trust
Brand loyalty
Brand awareness
Brand awareness
perceived quality
perceived quality
Brand trust

brand equity
brand equity
brand equity
brand equity
perceived quality
brand trust
brand trust
brand loyalty
brand loyalty

Estimate
0.277
0.099
0.250
0.188
0.248
0.661
0.144
0.275
0.215

C.R.
4.367
1.495
4.923
3.381
5.019
8.630
1.618
3.328
4.163

P
***
0.135
***
***
***
***
0.106
***
***

Result
Supported
Rejected
Supported
Supported
Supported
Supported
Rejected
Supported
Supported

Conclusion and implications

Based on the results obtained in this study brand awareness has
significant positive effects on both perceived quality and brand trust and
brand equity. Brand trust also has significant positive effects on brand
loyalty as well as brand equity. A significant positive effect of perceived
quality on brand loyalty is also found .Finally, brand loyalty is found to have
a significant positive effect on brand equity. We also observe that brand
awareness has the bigger impact on brand equity when compared with the
other dimensions. Some of the finding in this study consists with results of
previous researches, but contrary to the expectation, perceived quality did
not influence both brand trust and brand equity.
The brand awareness is important because it helps a certain mobiles
brand-name become a customers decision choice set. In other words, if
customers are not aware of a certain mobile when they search for a certain
mobile, then it is very unlikely for them to choose this mobile. Whereby
brand awareness mostly influences the cognitive component, and brand
equity cannot be created without brand awareness. Hence, Mobiles Company
and brand managers are advised to look carefully at their brand marketing
communication strategy to help maintain customer recognition and recall of
a mobiles brand-name compared to its competitors.
This study also offers contributions to academicians in several ways.
To date there have been number of studies in brand literature that focus
largely on the main effects of brand equity dimensions on brand equity.
Summing up the results, the study goals were reached and the study
provides a model to enhance the brand equity and gives several important
implications for strategic brand management.
Research limitation and future research
There are several limitations to this study. First, it is studied just the
direct effect of the brand equity dimensions on brand equity. It is suggested

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that future research can study the indirect effect between the brand equity
dimensions and brand equity. Second, other variable needs to be studied,
such as brand image, brand association. Third, we should investigate this
study in service industries. Forth, the subject of this study is student. It is
suggested that future research can expand its participants to general
consumers. Finally we should try to replacing this study with more product
categories.
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