Do Social Media Marketing Activities Increase Brand Equity?

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Int. j. econ. manag. soc. sci., Vol(4), No (3), March, 2015. pp. 362-365

TI Journals

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International Journal of Economy, Management and Social Sciences

2306-7276

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Copyright © 2015. All rights reserved for TI Journals.

Do Social Media Marketing Activities Increase Brand Equity?
Hamed Karamian *
Executive Master of Business Administration (EMBA), Department of Management, Khorasgan (Isfahan) Branch, Islamic Azad University, Isfahan, Iran.

Mehdi Ahmadi Nadoushan
Executive Master of Business Administration (EMBA), Esfahan university,Yazd province road and urban housing organization, Yzad, Iran.

Alireza Ahmadi Nadoushan
Management phd student,Alameh tabatabaei university, Yazd province Gas Company, Tehran, Iran.
*Corresponding author: [email protected]

Keywords

Abstract

Brand
Social media marketing
Brand equity

The aim of this study is to investigate the effects of Social media marketing in brand equity. Data were
collected through random questionnaires consumers. 350 questionnaires were distributed in the Hayprastar
in Esfahan. 315 questionnaires were collected. To examine each hypotheses of his study, Pearson
Correlation test has been employed. The final results indicate that Social media marketing activities are
influential in brand equity and also that Social media marketing activities bears on perceived quality, brand
awareness and brand loyalty. Then, all research variables are approved.

1.

Introduction

(Social media marketing is different than traditional methods of marketing; therefore, it requires special attention and strategy building to
achieve brand equity. Social media marketing is related to relationship marketing, where the firms need to shift from “trying to sell” to “making
connections” with the consumers (Gordhamer, 2009). Companies also need to keep away from “big campaigns” and stick with “small acts” since
some small campaigns can easily reach lots of people and accomplish the objectives in a very short period of time (coon, 2010). Social media
marketing is also more sincere in its communication with the consumers, trying to show what the brand is rather than trying to control its image.
Finally, today’s customers are more powerful and busy; therefore, companies should be reachable and available in every social media
communication channel such as Face book, Twitter, Blogs, Forums at any time (Gordhamer, 2009). Thus, it can be said that social media
marketing helps firms to increase brand equity through networking, conversation, and community building.

2.

Brand equity

The term “brand” refers to a combination of names, signs, symbols, and designs through which customers can identify the offerings of a specific
company and distinguish these offerings from those of competitors (American Marketing Association, 1960). A brand can be considered as a
cluster of functional and emotional values which are unique and can provide customers with favorable experience (De Chernatony et al., 2006).
A successful brand is valuable, since it can enable marketers to gain competitive advantages by facilitating potential brand extensions,
developing resilience against competitors’ promotional pressures, and creating entry barriers to competitors (Kim et al., 2008a; Rangaswamy et
al., 1993; Rowley, 2009).
Brand equity is generally defined as the marketing effects, or the value added to the product, specifically attributable to the brand (Keller, 1993;
Rangaswamy et al., 1993). In other words, brand equity is the difference between the utility of the substantial attributes of a focal branded
product and the total utility of the brand (Yoo et al., 2000). Brand equity can be considered a mix of both customer-based brand strength (equity)
and financial brand equity (Barwise, 1993). Financial brand equity refers mostly to the value of a brand for accounting purposes, while
customer-based brand equity refers to the customers’ familiarity and unique associations with the brand in memory (Keller, 1993). As the aim of
this study is to investigate how m-commerce properties influence the behaviors of individual consumers through brand-equity-related factors, a
customer-based perspective is adopted for conceptualizing brand equity. Brand equity has been considered a multi-dimensional construct which
is composed of a variety of factors, as summarized in Table I.
Table 1. Summary
Brand equity factor
Brand loyalty

Definition
A deeply held long-term commitment to consistently repurchase or repatronize a product/service
of the same brand, free from the effects of situational factors and marketing efforts that have the
potential to result in switching behaviors

Perceived quality

A consumer’s evaluation of a recent consumption experience regarding a product’s overall
excellence
Anything, including attributes of a product/service, reputation of a company, and characteristics
of product /service users, which linked in consumer memory to a brand
The strength of the trace of a brand in consumer memory, as reflected by the consumers’ ability
to identify the brand under different conditions

Brand associations
Brand awareness

Reference
Aaker, 1991, 1996; Bakeret al., 2010;
Kim et al., 2008; Oliver, 1999; Yoo et
al.,2000
Aaker, 1991, 1996; Baker et al., 2010;
Yoo et al., 2000
Aaker, 1991, 1996; Baker et
2010;Keller, 1998; Yoo et al., 2000

al.,

Aaker, 1991, 1996; Bakeret al.,2010;
Keller, 1993; Kim et al., 2008a; Yoo et
al., 2000

Considering the various suggestions presented in the literature, it is concluded that brand loyalty, perceived quality, brand associations, and
brand awareness are the most common dimensions used for measuring brand equity (Aaker, 1996; Baker et al., 2010; Chang and Liu, 2009; Yoo
et al,. (2000) in this study. These four dimensions are also critical for the following reasons. First, brand loyalty is considered a core dimension
of brand equity, as it is key for building entry barriers, forming a price premium and avoiding deleterious price competition, and gaining

363

Do Social Media Marketing Activities Increase Brand Equity?
International Journal of Economy, Management and Social Sciences Vol(4), No (3), March, 2015.

strategic advantages in response to the actions of competitors (Aaker, 1996). Additionally, brand image is composed of consumers’ perceptions
about a brand as reflected by a set of meaningful associations in their memories (Aaker, 1991; Keller, 1993), and thus can be appropriately
represented by brand associations.

3.

Social medi marketing

Social media are online applications, platforms and media which aim to facilitate interactions, collaborations and the sharing of content (Richter
& Koch, 2007). They take a variety of forms, including weblogs, social blogs, micro blogging, wikis, podcasts, pictures, video, rating and social
bookmarking. As their use increases exponentially, not only existing social networkers but even business firms and governmental organizations
are joining and using them as communication tools. Unlike individual social networkers, these entities actively make use of the media for
advertising and marketing. While commercial messages and interactions with consumers partner with media, events, entertainment, retailers, and
digital services through social media, it is possible to perform integrated marketing activities with much less effort and cost than before.
According to Kim and Ko (2010), social media can have a dramatic impact on a brand's reputation. One-third of survey participants posted
opinions about products and brands on the brand's blog, and 36% thought more positively about companies that have blogs. A recent study by
DEI Worldwide (2008) provides the following statistics: 70% of consumers have visited social media sites to get information; 49% of these
consumers have made a purchase decision based on the information they found through the social media sites; 60% said they were likely to use
social media sites to pass along information to others online; and 45% of those who searched for information via social media sites engaged in
word-of-mouth. The report states that companies not engaging in social media as part of their online marketing strategy are missing an
opportunity to reach consumers. With a significant percentage of people passing along information to others through social media, the value of
one customer is worth far more than what he or she initially spends. Thus, firms and brands now need to factor in the value of customers and
also the influence of social media on them.
Table 2. The items included in the questioner, Mean and Standard deviation
Alpha
0.934

Brand
awareness

1. I know what the X symbol or logo looks like
2. I know what an this hotel looks like
3. I can easily recognize this hotel among other competing hotels

Brand
loyalty

1. I will recommend this brand to someone who seeks my advice
2. Next time I will stay in this brand
3. I will switch to other brands if I experience a problem with this brand.
4. I consider myself to be loyal to this Brand
5. This brand would be my first choice.

0.910

Perceived
quality

1. The services of this brand are of high quality.
2. In comparison to alternative brands, the likely quality of this brand is extremely high.
3. The likelihood this hotel would be functional is very high.

0.891

Social media
marketing
activities

1. Using X social media is fun
2. I would like to pass along information on brand, product, or services from X social media to my friends
3. Conversation or opinion exchange with others is possible through X social media
4. I would like to upload contents from X social media on my blog or micro blog.
5. Contents shown in X social media seem interesting.

0.857

4.

Reference
Haemoon Oh, Cathy H.C.
Hsu (2014)
Wei-Tsong Wang, Hui-Min
Li, (2012)
Janghyeon Nam et al(2011)
Aypar Uslu, Beril Durmus,
Berna Kobak Kolivar
(2013).

Wei-Tsong Wang, Hui-Min
Li, (2012)
Aypar Uslu, Beril Durmus,
Berna Kobak Kolivar(2013)
Kim AJ, Ko E. (2010).

Hypotheses

H1. Social media marketing activities have positive effect on Brand awareness
H2. Social media marketing activities have positive effect on brand loyalty
H3. Social media marketing activities have positive effect on perceived quality

5.

Methodology

5.1 Research Model
The research model guiding this research is depicted in Figure 1. The proposed model draws from the diverse research. The research model in
Figure 1 posits the social media marketing activities has a positive effect on brand equity.
Brand awareness

Social media marketing activities

Perceived Quality

Brand loyalty
Brand equity

Figure 1. Research Model

5.2 Sample and data collection
Convenience samples were drawn from the Esfahan city. Major shopping districts in Esfahan are in Hayprastar area and consumers living there
tend to be more conscious of purchasing brands. Since this study focuses on SMM, respondents were restricted to consumers who had purchased
any Brands item within the previous two years and who had previous experience with social media sites. Data were collected from survey
questionnaires from December 1 to 10, 2014. From among the 350 survey questionnaires distributed, 315 were finally analyzed after excluding
incomplete responses.

Hamed Karamian *, Mehdi Ahmadi Nadoushan, Alireza Ahmadi Nadoushan

364

International Journal of Economy, Management and Social Sciences Vol(4), No (3), March, 2015.

5.3 Data analysis
In order to achieve the purpose of this study and to test hypotheses, the SPSS 17.0 was used. With SPSS 17.0, descriptive analysis was adopted
to analyze the results of the preliminary test, to find out demographic characteristics of the sample and to test hypotheses. Also, Cronbach's α
was adopted to test reliability.

6.

Finding

Pearson Correlation test was utilized in order to examine each hypothesis of the study. In what follows we offer an evaluation of these
hypotheses.
H1. Social media marketing activities have positive effect on Brand awareness
As shown in table 3, at error level α = 0.05 and certainty level of 95%, the test result reveals a significant relationship between Social media
marketing and brand awareness. Correlation coefficient was set at 0.751 which proves positive Correlation and significant relationship (P-value=
0.000). Therefore, the hypothesis is accepted.
Table 3. Results of Pearson Correlation test between
Social media marketing and brand awareness
Social media marketing

Pearson Correlation
Sig. (2-tailed)
N

brand awareness
.751**
.000
315

**. Correlation is significant at the 0.01 level (2-tailed).

H2. Social media marketing activities have positive effect on brand loyalty
As shown in table 4, considering the test results it can be concluded that there is a positive, significant Correlation between Social media
marketing and brand loyalty at error level of 0.05 and certainty level of 0.95. The Correlation coefficient was set at 0.802. (P-value= 0.000).
Table 4. Results of Pearson Correlation test between
Social media marketing and brand loyalty
Social media marketing

Pearson Correlation
Sig. (2-tailed)
N

Brand loyalty
.802**
.000
315

**. Correlation is significant at the 0.01 level (2-tailed).

H3. Social media marketing activities have positive effect on perceived quality.
As shown in table 5, the test results for the second hypothesis indicate that, there is a positive, significant relation between Social media
marketing and perceived quality at error level of 0.05 and certainty level of 0.95. The Correlation coefficient was set at o.756. (P-value= 0.000).
Table 5. Results of Pearson Correlation test between
Social media marketing and perceived quality
Social media marketing

Pearson Correlation
Sig. (2-tailed)
N

Perceived quality
.756**
.000
315

**. Correlation is significant at the 0.01 level (2-tailed).

7.

Conclusions

Analyses of the correlation between chief research variables indicate that correlation between social media marketing and brand equity is
positive and significant. Then, all research variables are approved. The aim of this study was to understand the effect of social media marketing
on brand equity formation from the perspective of the consumers. The results of the study are believed to put significant contribution to practice
and literature since social media marketing can be defined as a new, but rapidly growing platform for building relationships with customers and
forming positive image of the brands in their eyes. Social media marketing helps companies and consumers find new communication routes.
Companies can use social media marketing to establish relationships with loyal consumers and affect their personal perception of the product,
publish their own information and also learn from and about their customers. So using social media marketing companies can expand
communication with customers and increase customer loyalty day by day. Consumers, identify social media as a more trustworthy source of
Information compared to the traditional marketing communication tools that companies use. On this basis, companies can get feedback from
customers, according to which they can figure out what the customers’ desire and what products are in demand, and supply them faster than their
competitors. Finally, the quality of products and services can be enhanced with the use of social media whose relation to the perceived quality
has been approved in this research.

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Aaker, D.A. (1996), “Measuring brand equity across products and markets”, California Management Review, Vol. 38 No. 3, pp. 102-20.
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