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RESEARCH ON RESPONSE AND RELATIONS BETWEEN CUSTOMERS AND BRAND EQUITY

(A COMPARATIVE STUDY OF MCDONALD AND MAX IN SWEDEN) May, 2011

Authors: Diep Nguyen Thi Bich and Junu Maiya Balami Subject: Master Thesis in Business Administration 15 ECTS Program: Master in International Management Gotland University Spring Semester 2011 Supervisors: Professor Per Lind and Fredrick Sjöstrand

MASTER’S THESIS

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ABSTRACT

Despite of economic downturn in recent years, the food service industry has performed well in Sweden and has grown by 4.1% in 2009. Now, the players are in a battle of differentiating their products/services and offers, as the degree of competition are moderately high in the market. Hence, building a strong brand image has apparently become a foremost tactics particularly in food chain industry.

The study aims to contribute on the concrete importance of brand equity management in the fast food chain especially by illustrating real empirical cases of McDonald and Max in Sweden. This comparative study attempts to figure out consumer’s attitudes, preference and behavior that are affected by equity assets; brand awareness, perceived value, brand loyalty and brand associations in one way or another. Based on a quantitative survey, consumer’s brand knowledge is examined to confirm the brand value added by these brand equity assets.

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ACKNOWLEDGEMENT

This Master thesis was possible with a fruitful collaboration of all people who have contributed with a great willingness and devotion for this study.

First of all, we would like to grant our honor to our supervisors Professor Per Lind and Mr. Fredrik Sjöstrand for their guidance and kind cooperation. Their valuable comment with their vast knowledge and assistance has developed our research in an appropriate way.

We would like to thank our fellow students in Master of International Management 2010-2011 program of Gotland University for their help throughout the whole period of the study.

Last but not least, we owe our deepest gratitude to Mrs Nguyen Hong Thuy, Mr Nguyen Thanh Tam, Mr Nguyen Binh Nguyen, Mr. and Mrs. Ram Lal Balami, Mattias Engström and Hilton Mombosho who are always by our sides and encourage us incessantly. Their patience, blessings and greater support is always appreciable.

Thank you all.

Visby, May 2011.

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ABBREVIATION

BE-Brand Equity

CBBE- Customer Based Brand Equity Management EPS- Extended Problem Solving

LPS-Limited Problem Solving RPS- Routine Problem Solving WOM- Word of Mouth

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CONTENTS

CHAPTER 1 INTRODUCTION ...1

1.1 Background ...1

1.2 Problem discussion ...3

1.3 Purpose formulation ...3

1.4 Organization of the study ...4

CHAPTER 2. RESEARCH METHODOLOGY ...5

2.1 Research strategy ...5 2.2 Research design ...5 2.3 Scientific approach ...6 2.4 Data collection ...7 2.5 Construction of Questionnaire ...8 2.6 Data analysis ...9

2.7 Population and Sample ... 11

2.8 Research method assessment ... 12

2.8.1 Replicability ... 12

2.8.2 Reliability ... 12

2.8.3 Validity ... 13

2.8.4 Limitation ... 13

CHAPTER 3 : THEORITICAL FRAMEWORK ... 14

3.1 An overview of Consumer Behavior Analysis ... 14

3.2 Brand Equity ... 18

3.3 An Overview of Customer Based Brand ... 18

3.3.1.Brand Loyalty ... 20

3.3.2 Brand awareness ... 21

3.3.3 Perceived Quality... 21

3.3.4 Brand Associations ... 22

3.4 Aaker’s Brand Equity Model ... 23

3.5 Brand Equity Relationship and Benefits ... 25

3.6 Marketing Strategy for Brand Equity Management ... 26

3.6.1. Product attributes ... 26

3.6.2. Price Strategy... 27

3.6.3. Target Audience ... 27

3.6.4. Marketing Strategy ... 28

CHAPTER 4. DATA ANALYSIS ... 29

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4.1.1 McDonald ... 29

4.1.2 MAX Hamburger ... 31

4.2 Descriptive statistics ... 32

4.3 Customer based brand equity analysis ... 34

4.4.1 Brand Awareness ... 35

4.4.2 Brand Loyalty ... 37

4.4.3 Perceived quality ... 38

4.4.4 Brand Associations ... 43

CHAPTER 5 DISCUSSION ... 46

5.1 Findings and discussion ... 46

5.1.1 Burger War: Became world news ... 46

5.1.2 Empirical Findings ... 46

CHAPTER 6 CONCLUSION AND RECOMMENDATION ... 50

6.1 Conclusion ... 50

6.2 Recommendation ... 51

REFERENCES ... 53

APPENDIX 1: Questionnaire: Survey on fast food consumption ... 57

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LIST OF TABLES

Table 3.1 Types of Consumer Behavior 15

Table 4.1 McDonald’s different menus around the world 30

Table 4.2 Distribution of the respondents via visiting frequency categories 34

Table 4.3 Distribution of the respondents via budget categories 34

Table 4.4 Customer’s recognition of fast food’s logos and slogans 36

Table 4.5 Customer’s loyalty toward a specific brand 37

Table 4.6 MAX: Estimating the performance and importance of Perceived value 39

Table 4.7 McDonald: Estimating the performance and importance of Perceived value 40

Table 4.8 Importance-Performance grid of the four most prominent for Max and McDonald 42

Table 4.9 Ranking of Fast food preference 44

Table 4.10 Communication mix 45

Table 5.1 Measuring Brand Equity of MAX and McDonald 47

LIST OF FIGURES

Figure 3.1 EKB Model 16

Figure 3.2 Aaker’s Brand Equity Model 24

Figure 3.3 Relationship of Brand Equity 25

Figure 4.1 Characteristics of Respondents 33

Figure 4.2 Top of mind brand 36

Figure 4.3 IPA Analysis of Perceived Value for MAX 39 Figure 4.4 IPA Analysis of Perceived Value for Mc Donald 41 Figure 4.5 IPA Analysis of Perceived Value for MAX and McDonald 43 Figure 5.1 Measuring Brand Equity of MAX and McDonald 47

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CHAPTER 1 INTRODUCTION

Today, the best known brands like Microsoft, Google, and Coca-Cola are spending large amount of money on advertising. The advertising research (2007) has founded Microsoft expenses more than 20 percent of their annual revenue, Google-around $188 million and Coca-Cola – more than $2.5 billion in advertising. It is surprising. They have already a strong brand name, a reputed image and own identification but still they concentrate on marketing mix strategy. Why? It is obvious that to attain first choice in consumers mind and to enjoy competitive advantage in the contemporary market. Hence, the objective of this study is to dig out the reason behind the performance of this branding and attached equity assets that influence the whole process.

1.1 Background

In the market, several products are introduced and numbers of brands proliferate, Aaker (1991). In the midst of numerous product/ brands choice, how consumers behave to a particular brand is a triggering fact for everyone. Perhaps it could be the brand of a product that creates a unique identification and differentiation in the consumer’s mind or various brand elements that excitingly lead consumers for purchase intention or any competitive offerings that enhance them to retain their loyalty and preferences. Answers could be many but all of them are somehow related with branding.

Branding existed for centuries as a way of distinguishing the goods of one producer from those of another, while modern branding finds its origin in the 19th century (A.Room, 1992). Then, branding started becoming a special meaning to consumers and now prominently consider as company’s most valuable assets in many countries. According to American Marketing Association (Keller, 1998:2), a brand is a “name, term, sign, symbol, or design, or a combination of them intended to identify the goods and services of one seller or a group of sellers and to differentiate from those of competitors”. Branding is the foremost component exists with the product when it is introduced in the market. To make it meaningful and attractive, a brand name is given in different forms. For example, brand name based on People (McDonald, Estee Lauer cosmetics), places (British airways, Chrysler’s New Yorker), company name (Volvo, General Electric), animals or birds (Dove, Mustang automobiles), things or objects (Apple computers, Shell gasoline) or something that sounds scientific (Intel micro processors, Lexus automobiles). Besides, there are various components either explicitly

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or implicitly attached with brand, so called as brand elements like logos, image and symbols. So, marketers have a lot of choices to identify their products in different ways and in different forms such as name and other brand elements (Keller, 1998). The reason behind these varied choices is that they add value to a product in terms of perceived quality, inferred attributes, and eventually, consumer’s awareness and brand loyalty. The perspective of acknowledging the benefit of “additional value” by brand connotations is labeled as customer-based brand equity.

The basic notion of Customer Based-Brand Equity is that the power of brand lies in what customers have learned, felt, seen and heard about the brand followed by their experiences over time (Keller, 1998). It is a collection of brand assets such as awareness, loyal customers, perceived quality and associations attached to a brand (its name and symbol) which add or subtract value to the product or service being offered (Aaker, 1991). In fact it embraces all tangible and intangible attributes that the business stands for.

Within the marketing literature CBBE can be sort out into two groups for easy understanding; Consumer perception (brand awareness, brand associations, perceived quality) and Consumer behavior (brand loyalty, willingness to pay a high price). These dimensions allow marketing managers to notice that to understand Brand equity is to learn a best way of structuring marketing tactics to win over consumer’s mind and heart by ensuing maximum consumer satisfaction level and brand loyalty, which in turn affect on profitability of firm. Further, it provides a competitive advantage that often presents a real barrier to the competitors. Thus, brand equity functions as a judgmental asset for the companies who are seeking for growth opportunities in the market. For this reason, the issue of brand equity has emerged as one of the most crucial topic in marketing management. And many researchers like Aaker (1991), Keller (1993 &1998) and Prasad (2000), have been interested in the concept of brand equity management and emphasized its importance in competitive market. The concept of Consumer based brand equity was put forward in this research study to give an overview of brand’s performance based on consumer’s perspective by comparing what happens if the same product or service did not have brand identification or have poor brand equity. This approach was necessitated because each consumer’s activities are influenced somehow by brand and its attached equity relating to what is in consumer’s head about a particular brand, the firm and its product and how they behave correspondingly. Therefore, it is understandable that how greater impact does CBBE brings in marketing world.

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1.2 Problem discussion

The complexity of surviving in a competitive world is not merely increasing a number of customers and selling more products. When it comes to booming service industry, a company requires to prioritize on keeping loyal customers and expanding a market share too particularly in fast-food industry, products and services are likely similar. Hence, product variation and unique brand connotations are indispensable for these companies to create a high level of awareness and familiarity in consumer’s memory (Keller, 1998). This allows consumers to act more favorably to strong brand over poor brand.

The emphasis of the study is to reveal the importance of brand equity and its associate components namely; brand awareness, brand loyalty, brand image and perceive quality in interaction to popular fast-food chains in Sweden: McDonald and Max Burger. With their comparative study , The previous studies on CBBE approach have found focused on the other era of service sector; such as hotels, bank, healthcare, beauty etc. and now the this study has consider a fast food industry setting to measure both product and service characteristics in terms of brand equity.

1.3 Purpose formulation

The purpose of this study was to virtually examine the influential affect of brand equity on consumer behavior and firm’s performance and it attempts to do so by illustrating the relationship encircled between brand equity, consumer and the firm with both theoretical concept and practical exemplification. Therefore, the thesis is expected:

- Firstly, to contribute to extensive Customer Based Brand Equity (CBBE) model by corresponding concepts and previous literatures;

- Secondly, to deliver an outline of the associations between consumers with McDonald and Max Burger brand in the peripheral of CBBE framework

- Thirdly, to propose some suggestions for maintainable brand equity of fast food industry, specifically McDonald and Max Burger

To achieve the above mentioned purpose of the research, the authors made an effort to study with the following research question:

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• What are the values added by brand equity that makes it so addressable and valuable to the marketers?

So, the academic intention of this study is to highlight the crucial importance of brand equity management in the firm. Research investigation was undertaken with a central theme of this problem statement in relation to concepts and theories based on which questionnaire was set up to experiment on empirical cases i.e. MAX and McDonald. Thereafter the findings and conclusions were extracted to accomplish the purpose of this research.

1.4 Organization of the study

The organization of the study gives you a synopsis of entire thesis. It constitutes of five parts as outlined below.

Part 1 Introduction This section reveals about a background of brand equity management in general and purpose of conducting the research regarding brand equity.

Part 2 Research Methodology This division states on research methods that are required to apply for empirical cases. They guide researchers in making inquiries in an appropriate way so as to collect needed materials for the study.

Part 3 Theoretical framework This part proposes relevant theories and concepts to evidently support the thesis writing and also discloses corresponding previous studies and literatures.

Part 4 Data analysis This chapter introduces empirical cases with a background and eventually analyze materials discover from data collection regarding empirical cases. Part 5 Empirical Findings In this section, collected data from Data analysis chapter are

discuss by highlighting important facts on empirical cases and also examine if a research problem is answered.

Part 6 Conclusion and Recommendation This final part underlines a summary of thesis research in response to a research problem and offers some recommendations on the basis of findings.

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CHAPTER 2. RESEARCH METHODOLOGY

The intention of this chapter is to define and demonstrate appropriate research methods applied for this study. It presents an accurate means of arranging questionnaire survey to target group to make data collection valid and reliable.

2.1 Research strategy

In general, a research is conduct to discover solution to a research problem. To attain this goal, a research plan must be design which is termed as research strategy. It guides necessary steps and tools to follow for collection of required research materials. Later on, collected data are analyzed and examined to draw a scientific and valid answer to a research question. As a foremost research strategy in this thesis, substantial information was gathered on the basis of background study regarding Brand Equity. Thereafter, a questionnaire was designed on the foundation of CBBE approach and piloted on McDonald and MAX, to explore an impact of CBBE at their corporate level. So, the questionnaire survey has planned to circulate among consumers for data collection and results can extract accordingly. Further, conclusions and recommendations will be made based on the findings.

2.2 Research design

A research design is a detail work plan that is carried out to structure a flow of steps proceeds to obtain the required answers for research problem. Nevertheless, it varies as per the nature of research study. Bryman & Bell (2007) classify research design in five different groups:

• Experimental Design- Analysis of data based on Experiment based on casual effect research question

• Cross-sectional Design-Analysis of data based on more case studies with two or more variables at the same time in different countries

• Longitudinal Design-Analysis of data at several different times • Case Study Design-Data analysis of single case

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Since the research is about the study of consumers’ response on Brand equity of MAX and McDonald in Sweden so, it needs to weigh up firm’s performance in fulfilling consumer’s expectation in terms of Brand Equity. This has necessitated a comparative research design to undertake for a research. As a part of research method, quantitative method has been approached with an intention to gather enormous consumer’s responses towards both brands. Normally, there are two types of research method for the collection of data.

• Qualitative Method-Emphasize on generating theories based on interpretation and observation. The interviews and focus group are used for collection of data which are flexible and textual.

• Quantitative Method-Emphasize on testing existing theories based on quantification. The structured models of questionnaires, survey and observation are used for collection of data which are rather flexible and numeric.

According to Leedy (2001), quantitative method is used to describe prophesy, measurable phenomena with measurable variables. It means the data is tested in a statistic base by developing hypothesis and mathematical model on the foundation of existing theories. For this, the method employs a lot of subjects, the specimen of respondent that makes more opportunities to create any kind of generalization. Therefore, the use of quantitative method raises the higher chances of covering larger respondents in comparison to qualitative method. For the reason, questionnaire survey was passed out to numbers of consumers in Sweden to cover 200 fast food consumers. The benefit of using questionnaire survey is it allows collecting data from a geographically scattered sample group, Gratton and Jones (2004). In addition, it is both time-saving and cost-saving.

2.3 Scientific approach

Bryman & Bell (2007) have offer two distinctive methods for research; inductive and deductive. They state that these are basic methods to guide whether information is gathered to test or construct theories. When researchers would like to build the theory on the basis of their results throughout investigation, they often use inductive approach. Meanwhile, deductive approach is frequently used to test hypotheses in order to substantiate the general ideas. The thesis’s aim is not to create a new hypothesis but to illustrate the theory of CBBE with a comparative study of consumer’s reaction towards strong brands Max and McDonald and their equity assets. Hence, this thesis research is developed upon the deductive approach.

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2.4 Data collection

In research methodology, obtaining obligatory data is another important requirement. Lack of needed data can not accomplish the purpose of conducting any research. Hence, data collection should be undertaken in a planned and efficient manner to assemble data within a specified time to resolve stated problem. Two ways of data collection are used in research; primary data and secondary data. According to Bryman and Bell (2007), primary data is the information related to research problems and assembled mostly for the purpose of study, from which the scholars can accumulate by their own way, for example interviews, surveys, tests etc. They are foremost answers to the subjected questions and it need to gather by the researcher himself. So, researcher has to take initiative to find suitable data which is very flexible and innovative. In contrast, secondary data relates to the information which has been assembled by other investigators in previous literatures, science journals, and articles etc but can be influential to others depending on research objectives. Hence, the secondary data can provide a wider chance or set of options for researchers as it saves both time and cost and meanwhile supply the suitable tools and data to investigate.

The study has used both primary and secondary data to acquire extensive information on consumer’s reaction towards brands - MAX and McDonald. The questionnaires were distributed via online and written form among consumers in Sweden which had been performed on the month April, 2011.

With an intention to meet 200 sample size, 80 questionnaires were distributed by online survey on spreadsheets.google.com in Sweden and 120 questionnaires via printed version to consumers by approaching authors themselves. Although we receive 200 sheets as per a target sample size but only 180 sheets were valid. This means it accounted 90% of research accomplishment (i.e.180 valid sheets out of target size 200). There were 20 incomplete questionnaires because some of participants had not pay attention on detailed characteristic when using services and products of both restaurants. The unfinished questionnaires were not considered since they might lead to inaccuracy in outcome.

While doing online survey, the questionnaire was forwarded to all people who were fast food consumers in Sweden and were in connection with authors. Similarly, the printed sheets of questionnaire were disseminated at Sergels Torg, Stockholm and Visby, Gotland in Sweden. Sergels Torg is the most central public square in Stockholm and is just a three-minute walk

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from the central station. Similarly, Visby is the central part of Gotland, whereby both MAX and McDonald’s restaurant are situated in Östercentrum, a place full of crowds of people both day and night and apart from that Pingstchurch and Gotland University were also chosen for this survey to distribute questionnaire. The survey aimed to cover a diverse group of people that mirror consumers in the fast food restaurants, especially in MAX and McDonald in Sweden.

The secondary data from credible internet sources for instance; companies’ websites, official sources were collected and used as reference. Besides, relevant literatures at Gotland University and Stockholm University were also the most utilized sources in our thesis.

2.5 Construction of Questionnaire

Constructing relevant questionnaire is a complex task. They are not merely a list of questions but the way to extract needed information to reach out the problem solution. Hence, it is one way of primary data collection. Based on the nature of research methods and research purpose, questionnaires can be constructed either open or closed questions. Open questions are unstructured and respondents are asked to answer in their own way and outdrawn for qualitative information. But Closed Questions are opposite, structured, and done to obtain quantitative information. As Bryman & Bell (2007) state, the chances are given for respondents by open questions and will serve to enlarge their knowledge in desired area. Nevertheless, closed questions are far easier to process for analysis than open questions and also increase possibilities for comparative results.

The questionnaire of this thesis included 18 questions and was categorized into two parts. The first part has covered general questions about participants including their gender, age (less than 15, between 15 and 35, 35 and above) and mother tongue. The second part consisted of both open questions and closed questions. The open questions were designed to know overall status of two restaurants in consumers’ mind such as asking respondents to give the name of fast food restaurant appear in their mind at first. Similarly, closed questions were designed to evaluate the significance of service factors concerning products, price, promotions, service quality, and satisfaction level. This arrangement was done to devise consumer’s own preference first and then, grade the significance of brand equity’s dimensions. It helps to draw a cognitive conclusion of Brand equity Management in both brands by assessing consumers’ awareness, loyalty and brand knowledge.

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In addition, the authors used Likert-scale with 5 points in the questionnaire in which, the respondents were required to grade the scale of their satisfaction for particular thing. In this survey “1” represents “The least important” and “Do not satisfy at all”, in contrast, “5” represents “The most important” and “Satisfy totally”. The Likert-scale (develop by Rensis), has been used by many researchers for nearly four decades and mostly used in survey research. According to Neuman (2000), the advantage of using Likert scale is because it is simple and easy to use. He also proposes the reliability of data conducted with this scale is highly valued. Therefore, it is easy for the authors to elucidate the analysis for the credibility it has created for.

2.6 Data analysis

Office Excel is seen as the popular and advanced software used for data analysis. Due to its user-friendliness, accumulated data for this thesis research were analyzed in Excel which is often used in business research.

For the statics base, mean average and standard deviation are computed to evaluate the variability of dataset. According to Business Dictionary (2011), the mean is a very useful measure to describe a lot of data since it is the mathematical average of all values. Besides, the Business Dictionary states that standard deviation serves as a measure of unpredictability of a random variable. Hence, both mean and standard deviation has been used as per requisition in data analysis including pie-chart and bar-diagrams to make data analysis more illustrious.

IPA (Important performance) analysis

According to Bacon (2003), Martilla and James were the first people presented the simple technique called IPA analysis in 1977. The fundamental notion of IPA is using a market survey to interpret the consumer’s satisfaction in the attributes which is prioritized by them in order to understand improvement attributes of service quality.

The IPA analysis is 2*2 matrixes comprise of Importance and performance attributes with their gap analysis in four quadrants, the Importance and Performance will be evaluated from 0 to 4 or 5, where 0 scores for the lowest. Bacon (2003) has well-versed that once the importance and performance attributes are plotted, IP gap is divided into four quadrants and

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based on those priorities, improvement attributes are drawn. The points of attributes are plotted according to Customer’s priority on those particular service qualities whereby, the cross point for quadrant is set in such way that it acts as a median to divide all four quadrants equally. The four quadrants are:

• Keep up the good work- Both importance and performance exceeds high score • Concentrate here- importance scores high but performance falls low score • Low priority- Neither performance meet the standard nor the importance scores

high

• Possible overkill-Performance scores high although the importance standards is low

Wade & Eagles (2003) recommend this analysis as best fitting for the survey which uses Likert scale. Since the questionnaire in the thesis research was set on the base of Likert scale with 5 points so, IP analysis is best suited to formulate the accumulated data.

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2.7 Population and Sample

In research methodology, defining a sample is a sort of efficiency which will show the accuracy of data collection. Therefore, being a precise for sample and population is an integral part of research design.

Population is defined as audience aim for the collection of information sought by the researcher for the particular problem, (Malhotra & Birks, 2007). However due to their vague nature individual data collection is impossible to done with all of them so on the base of target population, a sample size is extracted to represent the population. Thus, a sample is selected as to exemplify the whole population in a small and limited number making sure that right respondents will be choose depending upon age group, demographics, gender or many others for accuracy of survey.

Bryman & Bell (2007) offer two kinds of approaches in business studies: Probability approach and non-probability. Firstly, in probability approach, a sample can be chosen randomly, i.e., each person in the population has the equivalent opportunity of being chosen. Simple random sample, systematic sample, stratified random sampling and multi-stage cluster samplings are four types of probability sample. Secondly, non-probability sampling in which, a sample is not chosen randomly, thus the specimens have not been representative and it is impossible to carry out a legitimate inference about population. The non-probability includes convenience sampling, snowball sampling and quota sampling.

In the case of this study, it is not possible to recognize every people in Sweden

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thusthe thesis was implemented by applying convenience specimens. According to Business dictionary online (2011) the convenience sampling is frequently used to prevent the low response rate and gather the data on time. Since time and resources are the big obstacles, in addition, the authors do not have the list of fast food customers in Sweden to create a random sample, the convenience sampling is helpful and suitable for the research purpose to collect empirical material.

The purpose of conducting this convenience sampling has many good reasons. The most importantly, Max is a national Brand and Swedish people are strongly familiar with it but the international people are not. In contrast, McDonald is a recognizable and global brand which is popular among both Swedish and other people who are now living in Sweden. Another good reason behind executing the survey on Gotland and Stockholm is that

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• Gotland is a touristic place having many immigrants and frequent visitors of different nationalities and

• Simultaneously, Stockholm is the capital city with numerous MAX and McDonald’s restaurants including many other fast food chains and with enormous number of people.

Authors have undertaken the survey in these places by themselves via interaction. The survey began with the question: “Have you ever bought fast food”. From that, the population can be restricted by only people buy fast food to gather data from people who are in buying fast food situation. If the participants have never bought fast food before, they may not answer many questions in the questionnaire. Furthermore, it would be inaccurate if the data is collected from people who do not buy fast food while the thesis concentrate on customers’ perception about Max and McDonald based on evaluation about their products and services.

2.8 Research method assessment

2.8.1 Replicability

By suggestion from Malhotra Birks (2007), the survey focuses on characterizing the procedures of study related to data collection process, choose participants and design questionnaires in order to raise the replicability of the study.

2.8.2 Reliability

Saunder (2003) argues that there are four factors may affect to reliability of the thesis’s result, they are “subject or participant error, subject or participant bias, observer’s bias and observer’s error”. In order to test the result’s reliability, there are two main ways (Muijis, 2004). The first method is repeated measurement in which, the same results are displayed even though it is measured at different times. The second one is internal consistency reliability.

In the survey, first a pre-test was taken with a sample of 8 students from Gotland University was accomplished to heighten the reliability of the questionnaire. They were asked for their viewpoint about fast food restaurants and feedback regarding the questionnaire so; they informed that questions were easily understandable and take not more than 5 minutes to complete. Nevertheless, one item was added in brand loyalty to identify the customer

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awareness toward fast food restaurants’ slogans and two items about “accuracy of serving the order” and “additional service (i.e. access to wireless, internet; music, toys for children and many others)” were also added on to fulfill a better construct. In addition, we also save all answers for re-examine later.

2.8.3 Validity

The participants took part in the survey were people living in Sweden who could come from many other countries. For that reason, the researchers attempted to verify the ability to take care of those who have been using the products of two restaurants. Besides, the researchers made an effort to build the questionnaires which can achieve the answers for the research problem. The simple English was used in this thesis as well to prevent misunderstanding because English is not mother tongue of almost respondents.

2.8.4 Limitation

A short span of time had limited the research though best efforts were made during the last five months. Besides, the length of the questionnaire was also a problem which the authors had to consider as well because the participants could have pay less concentration on the second part of this survey and on online survey participants also lack interest and motivation, as a result, many respondents have drop out the survey.

The selected sample may not also generalize the population of Sweden due to small specimens of 200 respondents. In many cases, the participants were assumed that they were truthful and frank so, the credibility of data collection also depends on consumer’s honesty. Furthermore, to the quantitative methodology used in this research, it would be useful for further investigations to conduct more open and unstructured questions from other sides (i.e. companies’ out-look) to create an extensive and generalized comparative study on response and relation between customers and brand equity

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CHAPTER 3 : THEORITICAL FRAMEWORK

This chapter is a principal base for the thesis study as it supports the research purpose by relevant concepts, theories and models. With available literatures, CBBE framework has conceptualized in a scientic base and has narrate with consumer behavior process at a firm’s level.

It understands from introduction chapter that brand equity is an integrated and indispensable part of marketing management. It is an equity assets come along with a branding of a product influencing entire process of consumer activities. Hence, the chapter starts with a brief description of consumer and their activities in the market and steadily it will connect with a fundamental concept of CBBE approach.

3.1 An overview of Consumer Behavior Analysis

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A consumer behavior is an ongoing buying process of various consumer actions like searching, selecting, purchasing, consuming, evaluating and disposing the products to attain their needs and desires (Belch & Belch, 2004 cited in SueLin, 2010). In other words it is a series of exchange process that initiates from acquiring (searching and selecting the product with enough information), then moving to consuming (the reason to purchase) and at the end to disposing (after purchasing activities like consumer satisfaction). Thus, it is understandable that the most reason for an organization to exit in the long run is to fulfill exchange partners, needs and desires by performing all three activities of pre-purchase, purchase and post purchase. In marketing consumers are regarded as “king”. Mowen (1995) also defines them as human behavior attending an exchange process to satisfy needs and desires. Everyone practices consumer experience in one way or another like demanding needed things, buying desired things, and exploring excitement words in the market used by consumers like, “Wow! My favorite”, “Ugh!! It is weird”, “hmm, it is expensive”, “Common, Lets’ buy Ben and Jerry’s chocolate ice-cream” are the ordinary reactions and practices shown in the marketplace. Also, different aspects of consumer buying behavior like; selecting a toy for babies to luxurious car depends on varied consumer’s taste and preference. Hence, it is important for producers to acknowledge a changing pattern of consumer behavior in different situation over time so, as to produce new product, new taste and new technology to make them acceptable by consumers and satisfy them (Howard, 1989).

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The pattern of consumer behavior relies on their involvement in accumulating information as illustrate in the table 3.1. According to this table, consumers in Extended Problem Solving stage are unfamiliar with product category. They are presumably potential consumers who are easily enthused by effective communication mix and sales promos. In contrary, Routine Problem Solving consumers are committed to a particular brand and have high degree of confidence on solving a problem in cognitive way. Hence, their buying behavior proceeds with low involvement. Nevertheless, consumers in Limited Problem Solving stage are in between. They are completely aware about the product category but still interested in trying and switching new and different brands.

Table 3.1: Types of Consumer behavior Pattern of Behavior Consumer life

cycle Confidence and awareness Involveme nt Hierarchy of Effects (i)Extended Problem Solving (EPS) - New entrants Introduction • Lack of consumer ability Unfamiliar about products and brand and low confidence level High Awareness Attitude Behavior (ii)Limited Problem Solving (LPS) - Switchers and experimental

Growth Sufficient brand and product knowledge but motivate to try new things

Medium The hierarchy of effects could be both, same as in high or low depending upon purchase decision. iii)Routine/Habitual Problem Solving (RPS)- -Loyal consumers Maturity • Lack of consumer motivation Confidence about brand and product

Low Awareness

Behavior

Attitude

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Apart from consumer’s indefinite nature, there are many determinants underlie on their product choice. Howard (1989) suggests that EKB model (see figure 3.1) simplifies a whole consumer behavior process by answering “why and how consumers buy” and more of it, CBBE framework strive to transparent a bundle of equity attributes stick with a brand/product and has been indirectly emerge by consumer own buying behavior.

Englet Kollatand Blackwell (EKB) Model

Figure 3.1: Englet Kollatand Blackwell ( EKB) Model Source: Howard (1989:111)

EKB model is a comprehensive model that unified five different classes of concepts and their inbound relationship in proceeding buying behavior. It has 5 different parts.

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1. Input- The stimulus that connects us around the world from which consumer receives the information like: Marketing stimuli (Advertising. Bonus and schemes, store display), own experiences and conversations with others, external search etc.

2. Information Process- The hierarchy of involvement in acquiring information helps to develop perception towards a product and a particular brand which leads on simplifying decision making process. The five methods of information processing are: (a) Exposure (b) Attention (c) Perception (d) Yielding (e) Retention

3. Decision Process- A simple way of buying behavior that triggers anytime in consumer mind for purchase intention. It begins with realization of problem, need, want or desires, then seek for meaningful search based on input, and then right evaluation of alternatives and ultimately final choice. But the decision process doesn’t end here with pre-purchase or purchase activities. It also includes post-purchase activity considering the satisfaction level.

4. Decision Process Variables- The individual qualities that help on making a right product choice by determining brand personality.

5. External Influences- They are external stimuli, which is also termed as “circle of social influence” like culture, social class, reference group, family influences etc. Both these variables (Decision process and external) act like a clue for marketers to undertake appropriate marketing strategy.

This model has clearly pictures a flow of buying process in a common way. Howard (1998:117) also adds that this model emphasize on “what we know” about buying behavior of individual units in ordinary life, like a buyer feel a problem need of a product, through information search for alternatives, choose a familiar brand that he comfort with and have confidence about the quality of that particular brand, but various internal and external stimuli affect on choosing the brand/product, and later on his outcome determines a confidence level, resulting to repeat purchase. Thus, this model completely reflects the whole notion of buying behavior and for this reason EKB model is applicable in the study. However, the researcher, John A. Howard criticizes this model as less qualitative and quantitative comparative to Howard’s model-CDM (consumer Decision Model) in his book Consumer Behavior (1989:117).

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3.2 Brand Equity

Brand equity or strong brand is one of the primary assets for business triumph (Prasad & Dev, 2003) . It starts with branding of a product where branding gives a name, logo, symbol to a product or service making a product different from its competitiors. Since, brand offers distinctive collaboration of functional and symbolic aspects of product so, Prasad and Dev (2000) treat brand as representative of a business. Once the brand is well accepted by consumers and set up as a strong brand in the market, firm intends to go international by global expansion.. From this, it is noticable that Global branding is a planned and visionary strategy of a firm. Global brand offers a standardized and same product formulation to consumers across the world (Hankinson & Cowking, 1996). Well-build brands like Marlboro, McDonald, Coca-Cola, Levi, Rolex and many others did by denoting “masculine man smokes Marlboro”, “fashion of eating American Hamburger”, “refreshness” and “jeans for good quality”. They all symbolize a sort of universal desires “One fits for all” (Hankinson & Cowking, 1996). Thus, the concept of brand and global brand is essential to know as the study is about brand equity management of a national brand-MAX and a global brand-McDonald. Wood (2000) defines Brand Equity as an attempt of showing a relationship between consumers and brand. It identifies all the benefits attached with brand which is offered for purchase or sell influencing consumer behavior so that the firm can enjoy a competitive advantage by distinguishing the product, allowing price premium and gaining customer loyalty and winning over poorly brand. .So, it is consider as more than a name to a product, Moreover, Brand Equity is understand as a pragmatic framework of consumer behavior where repeat purchase is made by consumer for a reason that highly satisfied from brand, perceiving all values offered so far (especailly price paid) and the commitment be made for that brand. (Prasad & Dev, 2003).

3.3 An Overview of Customer Based Brand

The CBBE is a multi-dimensional approach comprising of equity assets such as brand awareness, brand loyalty, perceived value and brand association comes with brand and has an attached relation with consumer’s preference, perception and behavior influencing firm’s performance. From the pre-purchase activities and purchase activities of problem recognition to product choice, brand equity stands as “reason to buy” for consumers and their post

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purchase activities of consumption determines satisfaction/dissatisfaction level which leads to add/subtract to brand loyalty to the firm i.e., provides “Brand value” to the firm.

Many researchers like Aaker (1991), Keller (1993, 1998), Blackston (1992), Sharp (1995), Berry (2005) have increasingly spotlighted in this holistic approach because of the benefits it generate are justifiable and worth value in the marketing. However, they have interpreted this perspective in different manner:

Aaker (1991) states brand equity as value producer to both customer and firm by focusing on five dimensions; brand awareness, brand loyalty, perceived value, brand associations and proprietary assets. Aaker’s CBBE model is further discussed in figure 3.2.

Keller (1993, 1998) proposes the CBBE as simultaneous impact of brand knowledge on consumer responding back to brand (Keller, 1998:45). According to him, brand knowledge is memory tracer which can be grabbed by favorable, strong and unique brand associations via whatever means (E.g. past experiences, advertising).

Berry (2000) has also supported Keller’s idea by centralizing brand meaning to brand awareness.

Prasad & Dev (2003) define this customer centric framework of Brand equity with satisfaction that is resulted from firm’s performance in response to consumer’s brand awareness.

Thus, it is explicit that apart from the researcher Aaker, other researchers have concentrate on only one or two attributes of brand equity but yet all their focus was on the value added to product by consumer’s association and perceptions of a particular brand. However, the study has prioritized Aaker’s Brand equity model to conceptualize CBBE framework as it is an integrated approach of brand with attached components; brand awareness, perceived value, brand loyalty and brand associations. For understandable perceptive it can be comprehend as “Added Value” attached to a product which resides in consumer’s thoughts, words and actions. Whatever the consumer knows, feels, thinks and behaves are all consequences of brand equity management. For instance, let’s take COKE.

• What consumer know -Logo , Slogan-“The pause that refresh you”, Jingles-“I’d like to buy the world a coke” or “Jingle Bell”, A Jumbo coke bottle in a Word of Mouthan’s body shape.

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• What consumer think (remember) - Polar Bear Ad or Animated cola factory Ad, Past experience with Coke and its promos like Coke T-shirt, Coke-Cap, Coke-Pen etc. • How consumer behave- Buy Coke instead of Pepsi or Red bull or other juice, Buy

coke although is it bit expensive than Pepsi (accept perceive value in terms of price), Buy New Coke or Diet coke (Brand extension), Buy McDonald with Coke.

With this sufficient brand knowledge consumer gain high confidence level on choosing a brand “Coke” in the product line of drinking. As a result, a purchase decision of buying a coke will be speedy as it lessens both consumer’s time and efforts on acquiring information. Further, Brand Equity components can be discussed below:

3.3.1.Brand Loyalty

Brand loyalty, is an attachment that a customer has towards a brand. It reflects on repeat purchase and customer’s commitment to a brand measuring consumer behavior as how likely they will switch to another brand, especially when that brand makes a change, either in price or in product features (Aaker, 1991). It exists with prior purchase and use experiences. It is a consumer’s strategy of reducing risk associated with purchase decision. In general, longer the consumer like to continue to purchase from the same supplier, stronger the brand loyalty (Eugene W.Anderson, 1994). Some consumers may buy a particular brand repeatedly without thinking of any reasons, simultaneously other evaluate a brand and repeat buying because they are truly committed to it. So, Brand loyalty constitute of both behavioral and attitudinal sense. And it also offers some protection in a marketing downturn or in the brand’s fortunes fall. For example, New coke, when the world was against it, it was Coke’s loyal customer which encourage it to back to old coke and their patience maintain the coke’s reputation. Also, Brand loyalty is a judgmental basis for measuring consumer’s satisfaction. When a new customer is satisfied with the product, quality and price offered, it remains as a good brand image in his memory and later he used this experience for a repeat purchase. His experience likely acts as WOM for prospective customers and as a result more consumers are drag towards that brand. Thus, the consistency of brand loyalty and customer satisfaction contribute in firm’s profitability by increasing market share, say Anderson, Fronell & Lehman (1994).

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3.3.2 Brand awareness

The ability of consumer to recognize or recall a brand under any circumstances is simply term as brand awareness. Consumer will choose the brand they know/familiar with and sometimes based on perceived quality. For instance, “I’ll choose the brand I know; I’ve heard the brand, so it must be good”, suggests by Macdonald (2000). It acts as a nod to consumers on saving time. So, if consumers are highly aware about brand and its associations, they require low involvement in decision making process for a product choice of familiar brands. On, the other hand, consumer needs to involve much to collect sufficient brand information if is not aware about the brands. Thus, it is apparent that brand awareness and Involvement has indirect proportional relationship. Brand awareness can be strengthen by reinforcing a brand name with complete brand elements – logo, symbols, packaging, character or often more desirable to develop a slogan or jingle that are easy and influential to memorize. Therefore, different marketing mix such as advertising, promotion and public relation should undertake to make brand recognizable and to increase its familiarity among consumers.

In addition, , the image of brand comes as an inseparable consideration of Brand awareness. Brand image is referred to as consumer perceptions about the brand or how they view it. According to Keller (1993), brand image is also seen as “a symbolic construct created within the minds of people and consist of all the information and expectations associated with a product or service”. Effective brand image management is one of the competent marketing strategy as it clearly sets the components of image e.g.store location, waiting time for a meal, food, quality menu variety , interior decoration, professional appearance and cleanliness producing positive impact on customer (Kisang Ryu, 2008).

3.3.3 Perceived Quality

Aaker (1991) defines perceived quality as the customer’s perception of the overall quality of a product or service and their behavioural sense of accepting it. It is an intangible and overall feeling about a brand. However it is usually based on underlying dimensions which include characteristics of the products to which the brand is attached such as reliability and performance. In service industry, four attributes: food quality, service quality, atmosphere and novelty and their influence on repeat Intention to Purchase are discovered (Weiss et al, 2004 cited in Ashton, 2010). It predicts consumer’s intention to buy and also measures the satisfaction level. According to the journal, (Ashton, 2010) researchers like Paswan et al,

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(2007) and McDougall find that perceived quality is the core relationship between quality and value that comes as an implication of improve service element associate with it and the value paid for. In another words, if a product cost is too high and consumers are not willing to pay for it, its value is said to be not perceived by consumers instead consumers may prefer to purchase lower quality product with a reasonable price. So, price is one of the determining factors for perceived value.

3.3.4 Brand Associations

Brand associations are the other informational indication linked to the brand in memory and contain the meaning of the brand for consumers. Associations come in all forms and may reflect characteristics of the product or aspects independent of the product itself. For Examples:

Possible Starbucks Associations

These brand associations are strongly depend on how marketing program and other factors affect consumers’ brand experiences. The more deeply person thinks about product information and relates it to existing brand knowledge, the stronger the resulting brand associations. The brand associations are created either by direct experience or from information communicated by other commercial or non-partisan sources (e.g. consumer reports or the media) and word-of-mouth (Keller, 1998). Research has shown that attitudes formed from direct behavior or experience is more accessible that attitudes based on information or other indirect forms of behavior (Keller, 1998).

Great coffee Black gold Expensive and luxurious Starbucks logo Stronger coffee

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3.4 Aaker’s Brand Equity Model

The researcher, David A.Aker has introduced Aaker’s Brand Equity Model in 1991 as a conceptual foundation for Customer based brand equity. He defines Brand equity as:

“A set of brand assets and liabilities linked to a brand, its name and symbol that add to or subtract from the value provided by a product or service to a firm and / or that firm’s customer.” (Aaker, 1991, s. 15)

His emphasis are on five brand assets: (1) Brand Loyalty (2) Brand Awareness (3) Perceived Quality (4) Brand Associations (5) Other proprietary. Here, the fifth assets are proprietary Brand assets which are intellectual property like patents and trademarks providing innovative competency to brand as a legal protector. A figure 3.2 reflects CBBE framework including these five assets. According to him, brand assets come as attached and indispensable attributes with a brand to a product to create a value to both consumer and firm. So, brand components must work collectively as a system of brands instead of individual performer. The attributes like brand awareness, perceived value and Brand associations together influence consumer’s perception by giving “Reason to buy” a product. Simultaneously, brand loyalty acts as an outcome of consumer behavior which adds value to a product by allowing premium charges and product extension. Furthermore, the pros are discussed in section 3.5 Brand relationships and benefit. Therefore, the model has given appropriate guidelines to marketers to build a relationship between brands and consumers to generate valuable benefits. Understanding this brand capital is apparently seemed as a weighing up investment pattern.

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BRAND

EQUITY

Anchor to which other association can be attached Familiarity-Liking Signal of Substance/commitmen t Brand to be considered Reason-to-buy Differentiate/position Price Channel Member Interest Extensions Retrieve information Position Reason-to-buy Create positive Attitude/feelings Extensions Provides value to Customer by Enhancing Customers’: • Interpretation/Proce ssing of Information • Confidence in the purchase Decision • Use Satisfaction

Provides value to firm by enhancing: • Efficiency and effectiveness of Marketing programs • Brand Loyalty • Prices/Margins • Brand Extensions • Competitive Advantage Brand Loyalty Brand Awarenes s Perceived Quality Brand Association Reduced Marketing Costs

Attract New customers • Creative Awareness • Reassurance

Time to Respond to Competitive Threats

Figure 3.2: Aaker’s Brand Equity Model Othe Proprietary Brand Assets Competitive Advantage

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3.5 Brand Equity Relationship and Benefits

After knowing the whole concept of Brand equity framework, it will be unjustifying if the relationship of brand equity with consumer and firm is ignored. While building and managing the brand equity, it creates a triangular relationship between consumers and firm around the peripheral of product as shown in figure 3.3. Brand equity is attached with a brand when it is offered to sell/purchase influencing consumer attitude and behavior. In another words, each consumer’s thoughts, feelings, image, beliefs, experience and many others exist on consumer minds are shaped in respond to products, price, communication, marketing mix, brand extension and their impact add/subtract value to firm in the process (Keller 2003). He also emphasized on this relationship by proposing that more a brand has positive customer-based brand equity, more probability of accepting a new brand extension by consumers is high. In addition, consumers will be less sensitive to price increases and more willing to seek the brand in a new distribution channel or withdrawal of advertising support. Thus, the relationship is directly proportional and provides competitive advantage and value to the firm. So, building customer-focused brand relationship is crucial.

Source: Designed by authors

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Brand Equity management has become increasingly a prosperous interest for many marketers because of the value it generate by sustaining the relationship with consumer and firm. “The assessment of the value of brand equity can be based on the price premium that the name supports, the impact of the name on customer preference, the replacement cost of the brand and the stock value minus the value of other assets” (Aaker, 1991, s. 271)

The major advantages observed in Brand equity are mentioned below:

• Past experience or brand knowledge affects consumer’s confidence in product choice • Familiarity with brand leads to Less effort and time-consuming information process

and speedy purchase decision

• Perceived quality boosts Highly satisfaction resulting repeat purchase and maintain brand loyalty

• Well known brand for perceived value enhance to Brand extension ;one brand- many products

• Brand loyalty and perceived value protects a brand from market fall and also allow Price premium charged to consumers

• A strong brand image with strong brand association can be a real threat to competitors • Growth of firm via brand extensions, increased in sales, number of customer and

increased shareholder’s value

• Brand equity in total make possible for a firm to expand as a chain to go nationally or internationally

• Positive Brand image earn trust from stakeholders

• Low marketing cost because of WOM prevails through satisfied customer

3.6 Marketing Strategy for Brand Equity Management

“We have to find ways to measure and justify the megamillions our clients have to spend to build strong brands” (Peter A.Georgescu cited in Aaker(1991:15)). Hence, marketing strategy is that way of building and managing brand equity as stated below.

3.6.1. Product attributes - The notion of brand equity management starts with a product. So, attributes of product is the foremost consideration of strategy in Brand equity management. Consumers perceive the quality and value of the product depending on its product quality.

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According to Keller (1998), prior researchers have acknowledged the general dimensions for product Quality. • Performance • Features • Quality • Reliability • Durability • Serviceability • Style and Design

Above attributes helps to develop consumer’s attitude towards a brand and influence their intention to purchase.

3.6.2. Price Strategy - Price is an amount of money that consumers are ready to sacrifice to acquire something from the product. It is another determinant factor for consumer’s purchase decision. Setting price for the product and the added value provide by brand is a tactful and complex. But the pricing strategy is to understand the amount of value consumer is willing to pay and premium over product costs (Keller, 1998). Hence, lowering cost is seen as a competitive strategy in introducing new products. Low prices lead to increased sales minimizing the costs that in turn enlarge the profit. But this low-price approach may not be same for existing product because there is a relationship between price and quality in the existing market. Keller (1998) has termed it as “price bands” and in the market there is an acceptable price range. So, the pricing policy is to adopt value-based strategies -selling the right product at the right price as per consumer wish.

3.6.3. Target Audience - Understanding consumer is to understand the business and depending on the nature of this very decisional variable is crucial in market segmentation. Knowing needs and wants of distinct groups of homogenous consumers is a clear way to set clear objectives and to take marketing strategy accordingly. The possible consumer Segmentation Bases according to Keller (1998:112)

• Behavioral- User status, Usage rate, Usage occasion, Brand loyalty, Benefits sought • Demographic-Income, Age, Sex, Race, Family

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• Psychographic-Values, opinions and attitudes • Geographic- International, Regional

3.6.4. Marketing Strategy - Marketing communication is considered as voice of the brand which informs, persuades, and reminds consumers about the brands they sell Keller (1998). The purpose of designing the marketing strategy is flowing the brand knowledge to create positive brand image and brand awareness among consumers in information process chain. It acts as means of bringing the consumers and firm together to in a cycle of consumer buying process.

Marketing communication has various alternatives like: • Advertising-TV, Radio, Newspaper, Magazines • Personal Selling-Door to Door

• Publicity and Public Relations

• Trade Promotions-Trade shows, Point of purchase (shopping cart ads), In-store radio or TV • Consumer Promotions-samples, coupons, premiums, Refunds/Rebates, Bonus packs,

price-offs

Thus, what employees and customers say, how they say, how they behave, how employees offer service to customer, how they keep them informe about product are an impact of marketing tools (Grönroos, 2007). It effects on shaping the image of the orgnaization in the minds of customersby determining WOM.

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CHAPTER 4. DATA ANALYSIS

This chapter highlights the factual state of both MAX and McDonald in the Swedish food market, their marketing strategy and Brand equity management. The data was collected in response to these brands among fast food consumers, which was performed via questionnaire survey on April 2011.

4.1 Fast food Overview

Fast food is a term given to food that can be prepared and served very quickly, typically sold in a restaurant with precooked ingredients. The modernization of first fast food restaurant starts with White Castle in the US in 1920s. It is the first most popular burger restaurant in the US. Slowly, 7-Eleven, KFC and then McDonald came into existence in the fast food world. For many businesses, entry in this fast food sector has become exceedingly enthusiastic for the profit and reputation it generates for. The moderate growth of this market even in tough macroeconomic circumstances will not be any surprise, especially in Sweden, where food service industry values 2.8% of the European food industry (The data monitor online, 2011: 0181-2333). If market segment is observe, fast food accounts for 17.8% share in 2009. Currently, powerful brands like McDonald, MAX, Burger King, Subway and many others are in this fierce competition of hamburger because of their own known brand identity and loyal customers. Hence, brand equity has operated as a weapon of differentiating a same product in different name with unique associations.

4.1.1 McDonald

McDonald was started as barbecue meals by brothers, Dick and Mac McDonalds, in San Bernardino, California and it was officially founded later on 1948; with varieties of foods like hamburger, cheeseburger, soft drinks, milk, coffee, potato chips and slice of pie. According to the website of McDonald (2011), later in 1995 it was introduced in Red and White with Golden Arches in Des Plaines by Ray Kroc. So, the credit of McDonaldizing goes to Ray Kroc. Currently, McDonald has more than 32,000 global restaurants serving more than 60 million people in 117 countries each day.

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By the year of 1967 when McDonald started to go internationally, Max hamburger was just introduced in Sweden and now it has 235 outlets in Sweden which is almost like 75% of nation’s burgers (MAX online, 2011). Based on The Hubpages online (2011), as a famous global marketer, it has adapted its successful formula of “food, fun and families” in going overseas Keller (1998). The successful story behind McDonald being the dominant and the largest chain of hamburger in the fast food chain is that it offers specific menu varies from country to country from satisfying the local people by adopting local custom and religious beliefs of a particular country.

The table 4.1 reveals customer perspective strategy of McDonald from one country to another according to changing customer’s preference and taste. Consumers from all over the world has well perceive McDonald’s products and offers despite of its higher price margin, for this reason it’s global image is rapidly flourishing in the market. McDonald’s world famous foods are fries, Big Mac, Quarter Pounder, Chick Mc Nuggets, Egg Mc Muffin and pie. When it comes to the list of Sweden, it has serve Mc Feast, a quarter pound patty, in Swedish flavor.

Table 4.1 McDonald’s different menus around the world

Sn. Country Popular Product Key ingredients Local Custom N Religious belief

1. India Maharja Mac instead of Big Mac Chicken or Lamb Beef is prohibited 2. Norway McLaks- A sandwich Grilled salmon & Dill sauce Fish-loving

3. German Big Mac with Pilsner Beer Beer German Beer

4. Canada Mclobster- a lobster roll Lobster

5 Japan

• Teriyaki McBurger • Ebi-chiki

• Ebi Filet-O

• Green Tea flavoured milk shake

• Pork-patties • Shrimp-nuggets • Shrimp-burger

Japanese flavor

6. Chile Burger with avocado sauce Sauce made by avocado No ketch up 7. Saudi

Arabia McArabia

A grilled chicken sandwich served on a flatbread

No pork products and all meat sold is halal 8. Sweden McFeast A quarter pound patty, lettuce,

Figure

Table 3.1: Types of Consumer behavior  Pattern of Behavior  Consumer  life
Figure 3.1 : Englet Kollatand Blackwell ( EKB) Model  Source: Howard (1989:111)
Figure 3.2: Aaker’s Brand Equity Model  Othe Proprietary Brand Assets Competitive Advantage
Figure  3.3:  Relationship  of  Brand
+7

References

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