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MG 3123

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Issues and Controversies in Marketing Project

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Geraldine Cohen

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MG 3123 Issues and Controversies in Marketing

Project

Chinese female consumers perceived brand value

and brand loyalty in the cosmetic industry

Student Name:
Student Number:
Degree Course: Business and Management
(Marketing)
Department: Brunel Business School
Supervisor: Dorothy Yen
2

Submission Date: 7th March, 2013

Word Count: 8784

Abstract
This research study aims to understand Chinese female consumers perceived brand
value and how it influences brand loyalty in the cosmetic industry. Since Chinas
prosperous cosmetic market presents companies with many desirable opportunities,
this project tries to produce a substantial insight on how to improve brand loyalty by
understanding Chinese consumers perceived brand value in a multi-dimensional view.
Due to the fact that consumers perceived value has very often been narrowly
interpreted in terms of money paradigm, as merely a trade-off between a products
quality and price, this research attempts to measure it in a multi-dimensional ways.
Sweeney and Soutar (2001)s multi-dimensional framework is adopted in the research
to measure consumers perceived brand value of a product which include its quality,
money, emotional as well as social values. As for the measurement of consumers
brand loyalty, Zeithaml, Leonard and Parasuraman (1996)s framework is used which
includes both favourable and unfavourable behavioural intentions. Favourable
behavioural intention is measured in terms of purchase intention, price insensitivity
and word-of-mouth communication while unfavourable behavioural intention is
measured by complaining behaviour of consumers.
Primary research data is collected by conducting online questionnaire surveys on
around two hundred Chinese female consumers. Collected data is then analysed by
SPSS and presented in forms of tables and figures for future interpretations. Research
findings are discussed and both academic implications as well as marketing
implications are developed accordingly. Regarding the limitations of this research and
the result produced, recommendations are given for future research.

Acknowledgements
This project has brought me a lot of excitements, challenges and most importantly, a
precious learning opportunity. First of all, I would like to dedicate my special
gratitude to my supervisor, Dorothy Yen. I am truly grateful for all your kindness and
support throughout the project. Thank you for giving me useful advices and constant
encouragements. Without your guidance, this project will not be possible to complete
successfully.
Secondly, I owe my gratitude to my dear parents who have always been there for me
and showered me with their love. Also, I would like to thank all of my friends who
helped me overcome various challenges encountered in this assignment. Last but not
least, I would like to dedicate a big thank you to all those respondents who kindly
participated in completing the research questionnaires.

Content Page

Page number

Chapter One: Introduction---------------------------------------------------------- P.9

1.1 Research Context Chinas cosmetic market-----------------------------------P. 9
1.2 Research Problem and Research Justification----------------------------------P.10
1.3 Research Aims----------------------------------------------------------------------P.11
1.4 Research Objectives---------------------------------------------------------------P.11
1.5 Chapter Overview------------------------------------------------------------------P.12
Chapter Two: Literature Review---------------------------------------------------P.12
2.1 Chinese consumers-----------------------------------------------------------------P.12
2.1.1 Cultural influence on Chinese consumers perceived brand value and
behavioural intention---------------------------------------------------------P.13
2.1.2 Chinese consumers perception and behavioural intention difference between
local brands and foreign brands---------------------------------------------P.14
2.2 Consumers perceived brand value-----------------------------------------------P.15
2.3 Consumers brand loyalty---------------------------------------------------------P.16
2.3.1 Consumers behavioural intentions---------------------------------------P.16
2.4 Theoretical background of proposed framework------------------------------P.18
2.5 Measurement of perceived brand value on loyalty----------------------------P.19
2.5.1 Functional value (Quality/ Performance) -----------------------------P.19
2.5.2 Functional value (Price/ Value for money) ---------------------------P.20
2.5.3 Emotional value-----------------------------------------------------------P.21
2.5.4 Social value----------------------------------------------------------------P.22
Chapter Three: Methodology-------------------------------------------------------P.25
3.1 Introduction--------------------------------------------------------------------------P.25
3.2 Marketing research-----------------------------------------------------------------P.25
3.2.1 Research philosophy--------------------------------------------------------P.25
3.2.2 Research approach----------------------------------------------------------P.25
3.2.3 Research design-------------------------------------------------------------P.26
3.2.4 Research strategy------------------------------------------------------------P.26
5

3.2.5 Primary and Secondary research ------------------------------------------P.27

3.2.6 Quantitative and Qualitative research ------------------------------------P.27
3.3 Primary data collection-------------------------------------------------------------P.27
3.3.1 Questionnaire design---------------------------------------------------------P.28
3.3.2 Sampling---------------------------------------------------------------------------P.28
3.3.3 Validity and Reliability-----------------------------------------------------------P.28
3.3.4 Research Limitations---------------------------------------------------------------P.29
3.4 Ethical consideration--------------------------------------------------------------------P.29

Chapter Four: Research Findings, Analysis and Discussion-----------------------P.30

4.1 Introduction-------------------------------------------------------------------------------P.30
4.2 Data consistency and reliability -------------------------------------------------------P.30
4.3 Descriptive analysis----------------------------------------------------------------------P.31
4.4 Statistical analysis results---------------------------------------------------------------P.33
4.4.1 Mean and standard deviation ----------------------------------------------------P.33
4.4.2 ANOVA analysis result-----------------------------------------------------------P.35
4.4.3 Correlation analysis result--------------------------------------------------------P.39
4.4.4 Regression analysis result--------------------------------------------------------P.40
4.4.5 Testing of research hypothesis---------------------------------------------------P.44
4.5 Research findings analysis and discussion-------------------------------------------P.46
4.5.1 Quality------------------------------------------------------------------------------P.46
4.5.2 Price---------------------------------------------------------------------------------P.48
4.5.3
Emotional--------------------------------------------------------------------------P.50
4.5.4
Social-------------------------------------------------------------------------------P.51
4.5.5 Behavioural intentions------------------------------------------------------------P.53
Chapter Five: Conclusion-----------------------------------------------------------------P.55
5.1 Conclusion--------------------------------------------------------------------------------P.55
5.2 Marketing Implications-----------------------------------------------------------------P.55
5.3 Academic Implications------------------------------------------------------------------P.56
5.4 Research limitations and Future Research-------------------------------------------P.57
Chapter Six: References-------------------------------------------------------------------P.58

Chapter Seven: Appendices---------------------------------------------------------------P.65

Appendix 1: Questionnaire------------------------------------------------------------------P.65
Appendix 2: Questionnaire (Chinese version) -------------------------------------------P.67
Appendix 3: Participants Information Sheet---------------------------------------------P.69
Appendix 4: Consistency test output-------------------------------------------------------P.70
Appendix 5: Reliability test output---------------------------------------------------------P.72
Appendix 6: ANOVA analysis output------------------------------------------------------P.75
Appendix 7: Regression analysis output--------------------------------------------------P.81
Appendix 8: Correlation analysis----------------------------------------------------------P.87
List of Tables
Table 1: Major Players in Chinas cosmetic market------------------------------------P.10
Table 2: Hypothesis H1-H4----------------------------------------------------------------P.20
Table 3: Hypothesis H5- H8---------------------------------------------------------------P.21
Table 4: Hypothesis H9- H12--------------------------------------------------------------P.22
Table 5: Hypothesis H13-H16-------------------------------------------------------------P.23
Table 6: Reliability test result--------------------------------------------------------------P.30
Table 7: Frequency of participants age---------------------------------------------------P.31
Table 8: Frequency of participants monthly income-----------------------------------P.32
Table 9: Frequency of participants last purchased product category-----------------P.32
Table 10: Perceived brand values mean and standard deviation----------------------P.33
Table 11: Brand loyaltys mean and standard deviation--------------------------------P.34
Table 12: Different age groups and perceived brand value----------------------------P.35
Table 13: Different monthly income and perceived band value-----------------------P.36
Table 14: Different product categories and perceived brand value--------------------P.38
Table 15: Regression analysis: Purchase intention--------------------------------------P.40
Table 16: Regression analysis: Price insensitivity---------------------------------------P.41
Table 17: Regression analysis: Word of mouth------------------------------------------P.42
Table 18: Regression analysis: Complaining behaviour--------------------------------P.43
Table 19: Testing of research hypotheses-------------------------------------------------P.44
List of figures
Figure 1: The research framework---------------------------------------------------------P.24
Figure 2: Three types of research designs------------------------------------------------P.26
Figure 3: Perceived brand value and different age groups-----------------------------P.35
Figure 4: Perceived brand value and different monthly income-----------------------P.37
Figure 5: Perceived brand value and different product categories---------------------P.38
Figure 6: Regression analysis: Purchase intention--------------------------------------P.40
7

Figure 7: Regression analysis: Price insensitivity---------------------------------------P.41

Figure 8: Regression analysis: Word of mouth------------------------------------------P.42
Figure 9: Regression analysis: Complaining behaviour--------------------------------P.43
Figure 10: Testing of research framework------------------------------------------------P.43
Figure 11: Testing of hypotheses H1, H2 & H3------------------------------------------P.46
Figure 12: Testing of hypothesis H4-------------------------------------------------------P.46
Figure 13: Testing of hypotheses H5, H6 & H7------------------------------------------P.48
Figure 14: Testing of hypothesis H8-------------------------------------------------------P.48
Figure 15: Testing of hypotheses H9, H10 & H11---------------------------------------P.50
Figure 16: Testing of hypothesis H12------------------------------------------------------P.50
Figure 17: Testing of hypotheses H13, H14 & H15-------------------------------------P.51
Figure 18: Testing of hypothesis H16------------------------------------------------------P.52

Chapter One: Introduction

1.1 Research Context Chinas cosmetic market
China has become the second-largest economy in the world and the most important
emerging consumer market with a consumer population of nearly 1.3 billion (The
Economist, 2010). Chinas cosmetic market sustained dynamic growth despite global
financial meltdown throughout the last few years. Rapid economic development,
growing middle class consumers and trading-up trends contributed to the continuous
growth of Chinas cosmetic market (Euromonitor International 2011). According to
the National Bureau of Statistics of China (NBS), retail sales of cosmetic of
enterprises with annual sales of five million yuan or above and with an employment
of or over sixty reached 110.3 billion yuan in 2011 which shows a drastic increase as
compared to 48.8 billion yuan in 2007 (NBS 2012). The growth of Chinas cosmetic
retail value accelerated in 2011 with 18.7 year-on-year growth (NBS 2012).

China National Commercial Information Centre (CNCIC 2011 cited in Li and Fung
2012) recorded that cosmetic retail sales rose by 28.2% year-on-year in third-tier
cities in 2010, faster than those in the first-tier (15.8%) and second-tier cities (17.0%).
According to Li and Fung (2012), cosmetics retail sales in lower-tier cities of China
are fast growing while first-tier and second- tier cities captured a bigger share of the
market.
Data by National Bureau of Statistics of China (NBS) show that the retail price index
of cosmetics in China has risen to above 101.6 since August 2011 (NBS 2012).
Although the tax levied on imported cosmetics has been reduced from 6.5% to 5%
since 1 January 2012, the retail price of many cosmetic products remains high (Li and
Fung 2012).

Referring to China National Commercial Information Centre (CNCIC 2011/ Li and

Fung 2012), the top ten players in the major cosmetic sub-sectors which includes
shampoos and conditioners, other hair care products, skin care products, colour
cosmetics and fragrances achieved over 65% of the market share in major department
stores in 2010. The table below shows findings from CNCIC (2011)s market
research.
Table 1:

Major distribution channels for cosmetics in China include department stores,

supermarkets/ hypermarkets, professional stores, specialty stores, internet retailing,
pharmacies and beauty parlors (Li and Fung 2012). Department stores offer a wide
range of merchandises and provide one-stop shopping experience for consumers.
Supermarkets are crucial channels especially for low-range to mid-range cosmetics
products but high-end cosmetics brands. Professional stores are one-stop shop for
customers to shop for cosmetics. Some famous examples include Hong Kong based
Watsons and Sasa, France-based Sephora and China-based Gialen and Cosmart.
Specialty stores provide consumers with high quality services and standardized prices.
Some popular cosmetic companies such as Shiseido, Lancome, Estee Lauder and
Clinique have developed their own online stores during these few years (Li and Fung
2012).
1.2 Research Problem and Research Justification
Although consumers brand value has been a widely researched topic, many prior
10

researches inclined to interpret consumers perceived brand value in an

unidimensional way (Cronin and Taylor, 1992; Anderson and Sullivan, 1990) or in
terms of money paradigm (Monroe, 1990; Mathwick, Naresh and Rigdon, 2001),
instead of from a multi-dimensional view which is highly suggested by Sheth,
Newman and Gross (1991) as well as Sweeney and Soutar (2001).

It seems that no prior researches have been done on multi-dimensional view of female
consumers perceived brand value in the cosmetic industry, much less in the market of
China. Apart from that, although the opportunities presented by the prosperous
Chinese cosmetic market are well-known, very few researches focus on Chinese
consumers multi-dimensional perceived brand value.
Other than that, Pihlstrom and Brush (2008) did a similar research about the influence
of consumers perceived brand value on their behavioural intentions in the mobile
service industry. Their research framework however only includes favourable
behavioural intentions. As variables and linkages predicting positive outcomes may be
asymmetrically related to those that predict consumers disloyalty (Zeithaml, Leonard
and Parasuraman, 1996), it is necessary to take negative behavioural intentions into
considerations for measuring brand loyalty. Hence, this research includes both
favourable and unfavourable behavioural intentions into the research framework for
better measurement of brand loyalty.

1.3 Research Aims

Regarding to the fact that cosmetic market in China is blooming, which presents a lot
of opportunities to cosmetic companies in the market. Since the ability to deliver
superior customer value is critical source of competitive advantage (e.g. Ravald and
Gronroos, 1996; Woodruff 1997) and an important factor for achieving companys
success (e.g. Zeithaml et al., 1996; Parasuraman, 1997), this report aims to study the
Chinese female consumers perceived brand value as well as its influence on brand
loyalty in the cosmetic industry.

1.4 Research Objectives

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Objective1: To study Chinese female consumers perceived brand value in the

cosmetic industry
Objective2: To study the influence of Chinese female consumers perceived brand
value on brand loyalty in the cosmetic industry

1.5 Chapter Overview

In chapter one, the aims and objectives of this research are clearly presented along
with information about the research context as well as discussion about literature gaps
found. Chapter two contains literature collected from previous research on the topics
of Chinese consumers, consumers perceived brand value and consumers brand
loyalty. It also includes the research framework used for measurement of perceived
brand value on loyalty. Research philosophy, approach, design and strategy used are
discussed with justifications in chapter three. Research method used for primary data
collection, research limitations as well as ethical considerations are also mentioned in
this section. In chapter four, the results produced by analysing research findings are
presented in forms of tables and figures. The results regarding the objectives and
hypotheses of the research are discussed. Conclusions and recommendations are
presented in chapter five. This includes a brief summary of research findings,
marketing implications as well as recommendations for future research regarding the
limitations of this research.

Chapter Two: Literature Review

2.1 Chinese consumers
According to a cross-cultural research about East Asian female customer value
perceptions for cosmetic products (Huang and Tai, 2003), Chinese female consumers
are more concerned about the intrinsic attributes than extrinsic attributes of cosmetic
products. Among various intrinsic attributes of all cosmetic products, sensitive or
allergic skin condition as well as natural ingredients are the two most valued
variables rated by Chinese female consumers (Huang and Tai, 2003).
Among all of the extrinsic attributes of cosmetic products, price and brand name
are the two most important variables to Chinese female consumers (Huang and Tai,
12

2003). According to Huang and Tais (2003) research finding, brand consciousness in
terms of its brand name of a cosmetic product is rated to be more important than its
country of origin. However, a research done by HKTDC (2012) shows that the
country where a products certificate is issued has a significant influence on Chinese
consumers confidence towards the product. Its findings show that 89% respondents
had confidence in international product certificates while 42% had confidence in
mainland China product certificates.
2.1.1 Cultural influence on Chinese consumers perceived brand value and
behavioural intention
Hofstede and Hofstede (2005) state that Chinese highly pronounced long-term
orientation derives from Confucianism which strongly influenced China. They claim
that Chinese consumers tend to care more about relationships. Chinese consumers are
more conscious of the relational switching costs (Burnham et al., 2003) which denote
the psychological barriers to switching providers caused by the fear of damaging
personal relationships with staff and peer consumers than consumers from other
cultural backgrounds (Frank, Abulaiti and Enkawa, 2012).

Ye, Bose and Pelton (2011)s research suggests that Chinese consumers brand
perceptions and brand choice are highly connected to their self-concept. According to
self-congruity theory (Sirgy, 1982), consumers prefer certain products or brands that
are consistent with their self-image and those which can enhance their self-image.
Two important self-concept motives are self consistency and self-esteem. In other
words, certain products and brands serve as mirrors, allowing consumers to see
positive reflections of them selves and present the positive side of self to others
(Sirgy, 1982).

The impact of Chinese consumers self-concept on their brand perceptions and brand
choice are supported by some prior research studies. He and Mukherjee (2007) stated
that Chinese consumers attitudes and store loyalty are driven by self consistence as
well as social confirmation. Wang et al. (2009) suggest that self-image congruence
with product and company-brand personality positively affects purchase intention.
Their research suggests that Chinese consumers use name brands as a superior vehicle
for self expression. When they perceive congruence between their self-image and
brand personality, they tend to have strong purchase intentions toward the brand.
Eisingerich and Rubera (2010) found that self-brand relevance is correlated to
13

Chinese consumers brand commitment. In short, these researches support the

correspondence between self-concept and brand perceptions in the Chinese context.

Chinese consumers brand perceptions and brand choice are believed to be highly
influenced by their cultural backgrounds. Chinese consumers seemed to get caught in
the middle of the continuum between following the eastern collectivist tradition which
highlights the importance of conformance as an important aspect of self and
recognising their need for uniqueness as an individual (Ye, Bose and Peltons 2011).
Liao and Wang (2009) recognised a contradiction across China. Referring to their
findings, although some Chinese consumers may possess little knowledge about a
particular brand, they heavily consume name-brand products for material possession
or social needs. Therefore, they have a tendency to choose well-known and highly
advertised brands.

Ye, Bose and Pelton (2011) claimed that Chinese consumers awareness and
expression of their psycho-sociological identities are reflective in building
relationships with products and brands. Additionally, they supported that personal care
products are closely related to consumers self concept as they facilitate selfexpression. However, on the contrary to some prior researches, their research findings
show that the direct effect of Chinese consumers self-consciousness has a negative
impact on brand consciousness. It is explained by the deeply held Confucian values in
the Chinese culture which emphasize on collectivism, harmony, tradition and loyalty.
As a result, Chinese consumers may have difficulty in connecting to the Western
sense of brand concept (Sung and Tinkham, 2005). Other than that, it is worth
noticing that branding is still a fairly new concept in the Chinese culture with
relatively limited penetration (Bruce, 2010) which may affect the impact of Chinese
consumers sense of self on brand consciousness and brand selection.

2.1.2 Chinese consumers perception and behavioural intention difference

between local brands and foreign brands
According to Taube and Heinbergs (2011) market research, brand image is found to
have a stronger effect for foreign brands than that of local brands in China. In addition

14

to that, due to the robust halo effect of brand image, Chinese consumers perceive the
effect sizes of marketing mix elements as relatively less variant for foreign brands.
Their result states that because of a better established market position of foreign
brands, reasonable or attractive prices have a positive effect on repurchase intention
for foreign brands while the perceived price of a product is found to have no effect on
repurchase intention for local brands due to the insecurity of consumers which is
induced by a large number of local brands and a blurred position of brands in the
market. However, the perceived quality of a product has a significantly stronger
relationship on repurchase intention for local brands since the consumers
expectations are lower. They also found that the perceived price for both groups has
no effect on recommendation intention, while the perceived quality has a significant
effect.

2.2 Consumers perceived brand value

Consumers perceived value is defined by Zeithaml (1988) as the consumers overall
assessment of the utility of a product (or service) based on perceptions of what is
received and what is given while Day (1990) suggested that it represents the
difference between consumers perceived benefits and costs. The perceived benefits
refer to consumers desired value whereas the perceived sacrifices refer to both
monetary (price) and non-monetary (time, effort) considerations. (Cronin, et al., 2000)

Other than that, consumers perceived value occurs at various stages of the purchase
process which include pre-purchase stage where consumers expectation is formed,
transaction stage where evaluation is formed as well as post-purchase stage where
after-use assessment is formed (Woodruff, 1997). As a result, perceived brand value
can be generated without the product or service being bought or used.

Consumers perceived value differs from person to person due to the differences on
personal values, needs, preferences and financial ability. (Ravald and Gronroos,
1996,) Wilson (2010) stated that there is no objective perception of a single reality
and there are always some differences in perception. There is consensus regarding the
multidimensional and subjective nature of consumer perceived value as described by
different researchers (e.g. Sheth et al., 1991b; Sweeney and Soutar, 2001). According
15

to Zeithaml (1988), what constitutes value is highly personal and due to its
idiosyncratic nature, it is very likely to vary from one consumer to another. Thus,
consumers perceived brand value is a very subjective assessment of a brands product
or service from the consumers own perspectives.

It is believed that consumers perceived value changes over time as Zeithaml (1988)
suggested that improved technology and increasing competition lead to the
development of technically better products, the features that signal superiority change.
In additional to that, Sheth et al. (1991b) stated that different value dimensions may
be important depending on the decision level and on the type of product or service
being considered.
Generally, the more value a product delivers to consumers, the more successful the
product (Jang, Dickerson and Hawley, 2005). Consumers perceived value is seen as
the central driver in a purchase decision (Woodruff, 1997) since consumers select
products they perceive as the best value. It is suggested that customer loyalty can be
achieved by offering products with superior value to consumers which eventually
drives the companys financial performance (Smith and Wright, 2004).

2.3 Consumers brand loyalty

Brand loyalty is brand advocating. Consumers brand loyalty is regarded as deeply
held commitment to re-buy or re-patronise a preferred good or service consistently in the
future, thereby causing repetitive same-brand or same brand-set purchasing, despite
situational and marketing efforts having the potential to cause switching behaviours
(Oliver, 1997) Zeithaml, Leonard and Parasuraman (1996) stated that consumers
brand loyalty can be manifest in multiple ways, for example by expressing a
preference for a company over others, by continuing to purchase from it or by
increasing business with it in the future. They suggested that consumers behavioural
intentions can be viewed as indicators that signal whether customers will remain
with or defect from the company.

2.3.1 Consumers behavioural intentions

16

Consumers purchase intention refers to their intentions of continuing to do business

with a company, purchasing repeatedly and frequently from a company (Zeithaml,
Leonard and Parasuraman, 1996). Some researchers argued that a consumer
purchasing repeatedly from a company may not be based on a preferential disposition
towards the company but on various bonds that act as switching barriers (Sorbacka,
Strandvik and GroEnroos, 1995).

Price insensitivity refers to the extent which a consumer is willing to pay a higher
price for a companys product, continue to purchase product from a company with a
price increase and continue the relationship with a company even if alternatives are
less expensive (Zeithaml, Leonard and Parasuraman, 1996). Price sensitivity is said to
differ among demographic groups where female, married, older and do not work
outside home is the most price sensitive group among the rest. (Zeithaml and Berry
1987 J32*) It is also greater for higher priced packaged goods, durable good and
service than for low priced, non-durable products. Consumers price sensitivity can be
affected by various factors, such as complexity, price dispersion, lack of price
information and processing time required. (Zeithaml, 1988)

Word-of-mouth communication of consumers refers to recommending a company or

product to others, encouraging others to do business with a company and saying
positive comments about the company to others (Zeithaml, Leonard and Parasuraman,
1996). Gounaris and Stathakopoulos (2004) suggested that the relation between a
consumer spreading positive word-of-mouth and brand loyalty is that the consumer
has developed positive attitude towards the brands as a result of the received brand
value. However, Oliver (1999) claimed that sharing of the experience regarding the
brand may in fact provide the consumer with satisfaction which leads to brand loyalty
and not the brand itself. Referring to Pihlstrom and Brush (2008 J14), motivations to
engage in positive word-of-mouth behaviour differ among people, some do it for selfenhancement and others do it for achieving social status.

Singh (1988) referred to consumers complaining behaviour as manifestation of voice

responses such as seeking redress from the seller, private responses by taking part in
negative word-of-mouth communication or third-party responses by taking legal
action. Zeithaml, Leonard and Parasuraman (1996) claimed the necessity of taking
consumers complaining behaviour into consideration for measuring brand loyalty as
17

they believed that variables and linkages predicting positive outcomes may well be
asymmetrically related to those that predict customer disloyalty. Solnick and
Hemenway (1992) found that complaining consumers were four and one-half times
more likely to leave the company than non-complaining consumers. They suggested
that complaining consumers intend to be less loyal and more likely to switch to
another company. However, some researchers take the opposite view, Day (1984)
suggested that the majority of consumers with negative brand experience would rather
remain inactive and do not undertake any action at all. In addition, Bloemer, Ruyter
and Wetzels (1998) stated that a large extent of consumers behavioural intentions in
response to dissatisfaction is determined by personal and situational variables.

2.4 Theoretical background of proposed framework

Consumers perceived value is narrowly interpreted in terms of money paradigm, as
the ratio or trade-off between quality and price (e.g. Monroe, 1990; Mathwick, Naresh
and Rigdon, 2001). These authors focus solely on viewing the value-for-money
conceptualization while neglecting other possible value dimensions.
Zeithaml (1988) proposed that consumers perceived value for money can not be
measured simply by assessing the ratio or trade-off between a products quality and
price since some consumers perceive value when there is a low price while others
perceive value when there is a balance between quality and price. Some researchers
(e.g. Batra and Ahtola, 1990; Babin, Darden and Griffin, 1994) supported that both
utilitarian and hedonic components are important dimensions when it comes to
consumers perceived value.
Sheth, Newman and Gross (1991a) introduced a multi-dimensional framework of
perceived value which consist of five dimensions including functional, emotional,
social, epistemic and conditional value. Sweeney and Soutar (2001) introduced a
modified and refined perceived value scale called PERVAL. In the new model, they
decomposed the functional dimension of value to quality value and price value and
deleted the epistemic and conditional dimensions from the scale. Therefore, PERVAL
consists of four dimensions which include quality, price, emotional and social value.

Measurement of consumers perceived values with their behavioural intentions in

earlier times is often done by research operationalizes behavioural intentions in a
unidimensional way (e.g. Cronin and Taylor, 1992; Anderson and Sullivan, 1990). It
18

is argued by Zeithaml, Leonard and Parasuraman (1996) that consumers behavioural

intentions should be operationalize in a multi-dimensional way which includes both
favourable and unfavourable behavioural intentions.
Reichheld and Sasser (1990) referred loyal consumers to consumers who are willing
to purchase more frequently, try the firms new products or services, recommend
products and services to others and give companies suggestions. Zeithaml, Leonard
and Parasuraman (1996) proposed a comprehensive multi-dimensional framework to
measure consumer loyalty which consists of four dimensions of consumers
behavioural intentions. Those dimensions include purchase intention, price sensitivity,
word-of-mouth communications and complaining behaviour.
2.5 Measurement of perceived brand value on loyalty
Consumers perceived value is crucial to the success of buy-seller relationships
(Lemon, Rust and Zeithaml, 2001) which includes consumers brand loyalty. In
previous literature written by Sheth, Newman and Gross (1991a), each value
dimension has been conceptualized as having a direct influence on consumption
behaviour. In order to measure the influence of consumers perceived brand value on
brand loyalty, the conceptual model adopted in this report is based on the four
dimensional frameworks proposed by Sweeney and Soutar (2001) to measure
consumers perceived brand value and Zeithaml, Leonard and Parasuraman (1996) to
measure consumers brand loyalty.

2.5.1 Functional value (Quality/ Performance)

The functional value of a product refers to the utility derived from the perceived
quality and expected performance of the product (Sweeney and Soutar, 2001). It is the
perceived utility acquired from an objects capacity for functional, utilitarian or
physical performance (Larsen and Watson, 2001). The perceived quality of a product
is crucial to a brands perceived value in relation to the loyalty of its consumers since
it is proved to be the most important role of brand preference (Baltas and Argouslidis,
2007) and the major purchasing factor (Omar, 1994). Consumers are inclined to
expect fewer problems from the products they perceived as high quality (Sweeney and
Soutar, 2001). According to previous researches, the perceived quality of a product
has a positive relationship with consumers purchase intention (Woodside and Taylor
1978; Zeithaml et al.1990; Boulding et al. 1993; Bhaskaran and Sukumaran 2007),
19

word-of-mouth communication (Zeithaml, 1988; Boulding et al. 1993) while it has a

negative relationships with consumers price sensitivity (Bloemer, Ruyter and Wetzels
1998) as well as their complaining behaviour (Singh, 1991 and Kelley et al., 1993).
However, Cronin and Taylor (1992)s findings suggest that a products perceived
quality does not appear to have a significantly positive effect on consumers purchase
intention. Wang (2010)s research result also proved that the perceived quality of a
product does not have a direct positive impact on consumers purchase intention.
Table 2:

2.5.2 Functional value (Price/ Value for money)

The functional value of a product refers to the utility derived from the product due to
the reduction of its perceived short term and longer term costs (Sweeney and Soutar,
2001). It underlies object performance by means of a series of salient price attributes
(LeBlanc and Nguyen, 2001). Different researches show that a products perceived
value for money has a positive relationship with consumers purchase intention (Hui
and Zhou, 2002; Bhaskaran and Sukumaran, 2007; Pihlstrom and Brush, 2008) and
price insensitivity (Pihlstrom and Brush, 2008). Nevertheless, Pihlstrom and Brush
(2008)s research result shows that positive word-of-mouth intentions are not
influenced by the perceived monetary value of a product.

20

Table 3:

2.5.3 Emotional value

The perceived emotional value of a product refers to the utility derived from the
feelings or affective states that a product generates (Sweeney and Soutar, 2001). It is
defined as product power to trigger certain consumer emotions or change emotional
status (Sheth, Newman and Gross, 1991b). Previous study findings show that positive
emotional value perception of a product has a positive influence on consumers
purchase intention (Sweeney and Soutar, 2001; Pihlstrom and Brush, 2008; Wang
2010), price insensitivity (Pihlstrom and Brush, 2008) as well as word-of-mouth
communication (Pihlstrom and Brush, 2008). Positive emotions of a product also
increase loyalty to the offering (Sierra and McQuitty, 2005) while creating positive
senses that interact with the brand which leads to increase brand loyalty (Morrison
and Crane, 2007). Other than that, Pihlstrom and Brush (2008) suggested that the
driver of word-of-mouth communication may also depend on whether or not there is
an involvement of an emotional use experience.

21

Table 4:

2.5.4 Social value

The social value of a product refers to the utility derived from the products ability to
enhance social self-concept (Sweeney and Soutar, 2001). Consumers experience
social symbolism through the product and positive perceived social symbolism leads
to good brand impression (Rose et al., 1994) which as a result contributes to good
brand image. It is also reported that consumers interact with product categories that
visibly represent values about themselves may guide their product purchase
(Goldsmith, Frieden and Henderson, 1997). Their findings report that the perceived
social value of a product does not have direct effect on purchase intention while
Pihlstrom and Brush (2008)s research findings show that positively perceived social
value of a product has no positive influence on consumers purchase intention.
On the contrary, some previous research findings suggest that positively perceived
social value of a product has a positive influence on consumers purchase intention
(Vigneron and Johnson, 1999, Gill et al., 2007), price insensitivity and word-of-mouth
22

communication (Pihlstrom and Brush, 2008).

Table 5:

23

Figure 1:
The research framework

Functional value
H1
(Quality/ performance)
H2

Purchase
Intention

H3
H4

H5
Functional value
H6
(Price/ value for money)

Price insensitivity

H7
H8

H9
H10
Emotional value
H11

Word-of-mouth

H12
H13
H14

Social value

H15
H16

Complaining
behaviour

24

Chapter Three: Methodology

3.1 Introduction
In this section, research philosophy, approach, design and the adopted strategy will be
discussed. The chosen options are justified accordingly. Furthermore, the method of
primary data collection as well as the research limitations will also be mentioned.

3.2 Marketing research

3.2.1 Research philosophy
There are primarily four research philosophies which include positivism, realism,
interpretivism and pragmatism. Realism relates to scientific enquiry. Since this
research adopts a scientific approach, realism is the chosen research philosophy.
According to Saunders (2009), realism refers what the senses show us as reality as
truth where there is a reality quite independent of the mind. Also, critical realism says
that what people experience are sensations, the images of the things in the real world
but not the things directly (Saunders 2009). This research applies critical realisms
point of view towards Chinese consumers brand perceptions and brand loyalty.

3.2.2 Research approach

In this scientific research, deduction approach is adopted which involves the
development of a theory that is subjected to a rigorous test (Collis and Hussey 2003).
In another word, deduction approach emphasises on scientific principles, moving
from theory to data rather than vice versa as with induction approach (Suanders
2009). Since brand value and brand loyalty, is widely researched, there is a wealth of
research literature with affluent theories and frameworks from which a theoretical
framework can be produced. Besides, deductive approach relates to the limited
amount of time and resources available for completing this research. Thus, deduction
approach is more suitable for this research.

25

3.2.3 Research design

There are three types of research designs which include exploratory, descriptive and
explanatory research.
Figure 2:

This is an explanatory research that aims to study female Chinese consumers

perceived brand value and its cause-and-effect relationship with brand loyalty by
collecting raw data from target groups of respondents online.

3.2.4 Research strategy

This research adopts the survey strategy which is usually associated with the
deductive approach. Surveys are useful for the collection of a large amount of data
26

from a sizeable population in a highly economical way (Suanders 2009). Data

collected from questionnaires are standardized, allowing easy comparison. Since this
research is being done under time and resources limitations, survey strategy is a
practical and efficient way for data collection.
The survey strategy also allows researchers to collect quantitative data which can be
analysed quantitatively using descriptive and inferential statistics (Suanders 2009).
The adoption of the survey strategy and advanced statistics technology can help to
reduce time for data analysis as well. Questionnaires are useful for explanatory
research to examine and explain cause-and-effect relationship between variables
(Suanders 2009). Hence, the survey strategy is the most suitable option for this
research.

3.2.5 Primary and Secondary research

Primary data is data collected by the researcher specifically for the purpose of the
research (Hair et. al. 2002). Primary data collection is done by administering
standardized questionnaires to about two hundreds Chinese female consumers online.
Secondary data is data previously collected and assembled for some research problem
or opportunity situation other than the current situation (Hair et. al. 2002). Secondary
data used in this research includes written materials from organisations reports,
journals, books, industry statistics as well as regular surveys. Theoretical framework
and questionnaire are deduced from previous journals and literature.

3.2.6 Quantitative and Qualitative research

Qualitative research is research used in exploratory designs to gain preliminary
insights into decision problems and opportunities (Hair et. al. 2002). Quantitative
research is research that places heavy emphasis on using formalized standard
questions and predetermined response options in questionnaires or surveys
administered to large numbers of respondents (Hair et. al. 2002). This is a quantitative
research which collects data by administering standardized questionnaires to around
two hundred respondents. In this research, statistic techniques are used to examine
relationships between variables within the collected data and turn them into useful
information.
27

3.3 Primary data collection

Primary data collection will be done by conducting a survey research. Questionnaires
are used as a research instrument for collecting information. Information is collected
from a sample of around two hundreds female Chinese consumers who are between
the age of eighteen and fifty. The questionnaires were translated into Chinese in order
to reduce understanding problems caused by language unfamiliarity. Questionnaires
were sent to participants through different social groups, such as fans clubs, school
alumni and friend groups, from various online social networks, such as facebook,
msn, renren (Chinese facebook) and QQ (Chinese online messenger) or by e-mail.
Respondents then sent the completed questionnaires back online through
corresponding means.
3.3.1 Questionnaire design
Questionnaires are designed using Dillmans (2007) tailored design method by which
each respondent is asked to respond to the same set of questions in a predetermined
order. It is an efficient way of collecting responses from a large sample prior to
quantitative analysis.
In this research, existing frameworks and scales which have been tested and validated
are used as references for the design of a questionnaire. All items from Sweeney and
Soutar (2001)s scale, PERVAL, are used in the questionnaire to determine
consumers perceived brand value. Twelve out of thirteen items from Zeithaml,
Leonard and Parasuraman (1996)s framework is used to determine consumers brand
loyalty. One item is not included in the questionnaire due to its unclear nature to
predict brand loyalty.
3.3.2 Sampling
A defined target population refers to a specific group of people or objects for which
questions can be asked or observations made to develop required data structures and
information (Hair et. al. 2002). Since the sample is used to generalise about the total
population, it needs to be as representative and accurate as possible (Suanders 2009).
Hence, appropriate female Chinese consumers between the age of eighteen and fifty
are selected online. The research objectives are also addressed to each selected
28

respondents clearly online before participation.

3.3.3 Validity and Reliability

The validity and reliability of primary data collected from survey were tested by SPSS
tests. All negatively worded items were reversed before conducting the reliability test,
to ensure the accuracy of results produced.
In order to increase response rates, validity and reliability of this research, different
strategies are adopted such as careful design of individual questions by using existing
frameworks and scales which have been empirically tested and validated, clear and
pleasing layout of the questionnaire by adopting the Likert-style five-point rating
scale, lucid explanation of the research objectives and purpose, pilot testing by
distributing pilot questionnaire to ten Chinese females and modifying the
questionnaire accordingly afterwards as well as carefully planned and executed
administration of questionnaires to the target sample.
3.3.4 Research Limitations
There are several limitations exist in this research. Time and financial resources
available to complete this research are limited. There is also a geographic limitation in
terms of reaching the appropriate respondents. Since the respondents are located in
China, questionnaires are administered to them online. Delivery of questionnaires by
post or by hand is made unavailable due the above limitations. Other than that, the
researcher cannot verify the truthfulness of the responses which may affect the
validity of the results.

3.4 Ethical consideration

This research is conducted under Brunel Universitys ethical guidelines. Participants
are well informed of the research objectives and nature before participation. They are
also protected by their right to withdraw, privacy and confidentiality. Since the
research is purely voluntary nature, no pressure is given to participants.

29

Chapter Four: Research Findings, Analysis and Discussion

4.1 Introduction
All collected data was tested through consistency test and reliability test. It was then
analysed statistically through the use of SPSS by correlation, regression and ANOVA
analysis. By analysing the result of research findings, the objectives of this research
were discussed accordingly.

4.2 Data consistency and reliability

Refer to Appendix 4, there were no reported missing values detected from the
collected data which implies no treatments for missing values are required.
However, any cases with standardised residual values above 3.0 or below -3.0 are
considered as unusual cases (Pallant, 2010). From the collected data, there is an
unusual case detected which is shown in the table titled Casewise Diagnostics in
Appendix7. According to Tabachnick and Fidell (2007), cases with values for Cooks
Distance larger than 1.0 are a potential problem and have to be either treated or
removed. Referring to Appendix 7, the maximum values for Cooks Distance of all
collected data is less than 1.0 which suggests that no major problems existed. Thus, it
is best to leave the data as it is.
Table 6:

30

In order to test the reliability of the research findings, reliability tests were conducted.
Referring to table 6, each construct has attained a Cronbachs Alpha value of above
0.7. Since the Cronbachs Alpha value of a reliable scale should be above 0.7
(DeVellis, 2003), the scales used in the research framework are proved to be reliable.
This suggests that the adopted scales have good internal consistency reliability.
4.3 Descriptive analysis
Data from this research was collected from a total number of 206 Chinese female
participants, 34% were from the age group of 18 to 30 years old, 33.5% were from
31-40 years old and 32.5% were from 41-50 years old. Participants monthly income
was divided into five groups, 10.2% were less than 3000, with exchange rate of 1
Chinese Yuan equals 0.10666 British Pound Sterling (The money converter, 2013) ,
14.6% were between 3000 and 5000, 13.1% were between 5000 and 10000,
34.0% were between 10000 and 20000 and 28.2% were more than 20000. The
category of last purchased cosmetic product was divided into four groups, hair care
products comprised of 28.2%, skin care products comprised of 45.1%, colour
cosmetics comprised of 18.0% and fragrance comprised of 8.7%. The unequal
distribution of participants monthly income and the category of their last purchased
cosmetic products were accepted since these factors were not under the researchers
control.
Table7:
31

Participants' Age
Frequency

Percent

Valid Percent

Cumulative
Percent

Valid

18-30

70

34.0

34.0

34.0

31-40

69

33.5

33.5

67.5

41-50

67

32.5

32.5

100.0

Total

206

100.0

100.0

Table8:
Participants' Monthly Income
Frequency

Percent

Valid Percent

Cumulative
Percent

Valid

< 3000

21

10.2

10.2

10.2

3000-5000

30

14.6

14.6

24.8

5000-10000

27

13.1

13.1

37.9

10000-20000

70

34.0

34.0

71.8

> 20000

58

28.2

28.2

100.0

Total

206

100.0

100.0

Table 9:

32

The category of last purchased cosmetics product

Frequency

Percent

Valid Percent

Cumulative
Percent

Valid

Hair care product

58

28.2

28.2

28.2

Skin care product

93

45.1

45.1

73.3

Colour cosmetics

37

18.0

18.0

91.3

Fragrances

18

8.7

8.7

100.0

Total

206

100.0

100.0

4.4 Statistical analysis results

4.4.1 Mean and standard deviation
The tables below summarise the mean and standard deviation score of each tested
item.
Table 10: Perceived brand values mean and standard deviation

33

Table 11: Brand loyaltys mean and standard deviation

34

4.4.2 ANOVA analysis result

SPSS outputs of ANOVA analysis are given in Appendix 6. The tables below
35

summarise the result of ANOVA analysis. The ANOVA test is used to compare the
mean scores of two or more groups on a continuous dependent variable (Pallant
2010).

Table 12:

Figure 3:

Table 12 and figure 3 display the result of ANOVA analysis between different age
groups and perceived brand value. The table shows that participants from the age
between 31 and 40 had the highest mean score of 3.57 and participants from the age
36

between 18 and 30 had the lowest mean score of 3.26 in terms of perceived social
value of a product (p<0.05).

Table 13:

Figure 4:

37

Table 13 and figure 4 display the testing of ANOVA analysis between different
monthly income and perceived brand value. The table shows that participants with
monthly income less than 3000 had the lowest mean score of 3.11whilst participants
with monthly income between 10000 and 20000 had the highest mean score of
3.67 in terms of perceived price value of a product (p< 0.05). This indicates that there
is perception difference in terms of price value of a product among Chinese females
with different monthly income levels. Participants with higher monthly income
inclined to perceive the product as more reasonably price, offer more value for money
as well as more economical.

Table

14:

38

Figure 5:

Table 14 and figure 5 display the result of ANOVA analysis between different product
categories and perceived brand value. Participants who assessed the perceived social
value of products which were colour cosmetics had the highest mean score of 3.86,
followed by those who assessed fragrances with mean score of 3.81, skin care
products with mean score of 3.38 and hair care product with mean score of 3.13 (p
<0.05). This finding indicates that a consumers perceived social value of a product is
highly influenced by the category of the product.

4.4.3 Correlation analysis result

As results obtained from correlation analysis do not give a strong contribution to
research objectives, this section is therefore moved to Appendix 8, for reference only.

39

4.4.4 Regression analysis result

SPSS outputs of regression analysis are given in Appendix 7. Tables below summarise
the result of multiple regression analysis. The regression test shows the predictive
ability of a set of independent variables on one continuous dependent variable (Pallant
2010).

Table 15:

40

Figure 6:
Perceived Quality
Value
0.81***
Perceived Price
-0.07
Value

Purchase
Intention

0.08
Perceived Emotional
Value
-0.07
Perceived Social
Value

Table 16:

Perceived Quality
Value
Perceived Price
Figure 7:Value

Price
Insensitivity

Perceived Emotional
Value
0.52***

Perceived Social
Value

41

0.24***

-0.05

0.17*

Table 17:

Perceived Quality
Value
Perceived Price
Value
Figure 8:

Word of mouth

Perceived Emotional
Value
42

Perceived Social
Value

0.61***
0.22**

0.00
0.02

Table 18:

Perceived Quality
Value
Perceived Price
Figure Value
9:

Complaining
Behaviour

Perceived Emotional
-0.68***
Value
43

Perceived Social
Value

-0.06

0.02

0.08

4.4.5 Testing of research hypothesis

Table 19:
Testing of research hypotheses

44

Functional value
(Quality/ performance)

Purchase
Intention

Functional value
(Price/ value for money)

Price insensitivity

Emotional value

Word-of-mouth

Figure 10:
Testing of research framework
Social value

Complaining
behaviour
45

0.81***
0.52***
0.61***
-0.68***

-0.07
0.24***
0.22**
-0.06

0.08
-0.05
0.00
0.02
-0.07
0.17*
0.02
0.08

***Regression is significant at 0.001 level (p< 0.001).

**Regression is significant at 0.01 level (p< 0.01).
*Regression is significant at 0.05 level (p< 0.05).

4.5 Research findings analysis and discussion

Table19 displays the testing of the researchs hypotheses, while Figure10 displays the
result of the research framework tested by multiple regression analysis.

46

4.5.1 Quality
Figure 11:

Figure 12:

These research findings are consistent with previous research studies which suggest
that the perceived quality of a product has a positive impact on consumers purchase
intention (Woodside and Taylor 1978; Zeithaml et al.1990 ; Boulding et al. 1993;
Bhaskaran and Sukumaran 2007), price insensitivity (Bloemer, Ruyter and Wetzels
1998), and word-of-mouth communication (Zeithaml, 1988 ; Boulding et al. 1993 ;
47

Taube and Heinberg, 2011) whilst it has a negative impact on consumers complaining
behaviour (Singh, 1991 and Kelley et al., 1993).
Nevertheless, the result of this research contradicts with Cronin and Taylor (1992)s
statement that the perceived quality of a product does not have significantly positive
effect on consumers purchase intention as well as Wang (2010)s statement that the
perceived quality of a product does not have a direct positive impact on consumers
purchase intention.
Regarding Cronin and Taylor (1992)s statement, one possible reason why there is a
difference between two research results may due to different cultural backgrounds of
participants, different industry being researched as well as research taken place during
completely different times. This indicates that the impact of perceived quality on
purchase intention can be enormously affected by these factors. The result of this
research shows that the perceived utilitarian aspect of a cosmetic product is a
powerful driver of Chinese consumers purchase intention. This may also be related to
their tradition of being outcome-oriented. Thus, the performance of the product is
highly valued which means the perceived quality of the product is highly valued.
As for Wang (2010)s statement, this research can only prove that the perceived
quality of a product has a significant positive impact on purchase intention but does
not suggest whether the impact is direct or indirect.

4.5.2 Price
Figure 13:

48

Figure 14:

The research result is consistent with Pihlstrom and Brush (2008)s finding that a
products perceived price value has a positive impact on consumers price
insensitivity. However, research result contradicts some other researches (Hui and
Zhou, 2002; Bhaskaran and Sukumaran, 2007; Pihlstrom and Brush, 2008) findings
which state that the perceived price value of a product has a positive relationship with
consumers purchase intention. A likely reason for this result is the impact of
perceived price value of a product on consumers purchase intention may be affected
by different factors, such as brand image, consumers personal values, needs and
financial ability.
49

According to Taube and Heinberg (2011), well established brands with a clear market
position and good image are more favourably interpreted by Chinese consumers,
hence reasonable or attractive prices have a positive effect on purchase intention. This
implies that brands with a blurred market position and plain brand image, good
perceived price value of a product may not have a positive impact on Chinese
consumers purchase intention. Other than that, if the perceived monetary value of a
product does not match with a consumers personal value and needs, there may be no
positive effect on purchase intention. For example, a consumer with strong financial
ability who enjoys pursuing for fine products with the highest quality may not
repurchase a product simply because it is the most economical.

The research result also shows contradiction to Pihlstrom and Brush (2008)s claim
that positive word-of-mouth intentions are not influenced by the perceived price value
of a product. Since consumers word-of-mouth communication can be determined by
various personal and situational factors, researches conducted on participants with
different cultural backgrounds and studied different topics may lead to very different
result findings. One possible reason may be due to the fact that by recommending
products which offers good value for money to others, helps consumers gain a sense
of satisfaction and self-enhancement. This may be related to Chinese value for
deepening their personal relationship throughout the process of recommending others
something they perceived as good value for money as a way of giving benefits to
others. Thus, good perceived price value of a product triggers Chinese consumers
urge to recommend the product to others.

4.5.3 Emotional

50

Figure 15:

Figure 16:

Findings from this research suggest that the perceived emotional value of a product
does not have a positive impact on either favourable or unfavourable behavioural
intentions. The result of this research shows contradictions to the results of prior
research studies which claim that the perceived emotional value of a product has a
positive influence on consumers purchase intention (Sweeney and Soutar, 2001,
Pihlstrom and Brush, 2008; Wang 2010), price insensitivity (Pihlstrom and Brush,
2008) and word-of-mouth communication (Pihlstrom and Brush, 2008).
A possible reason behind the result differences may be that Chinese consumers are
51

more focused on the utilitarian components rather than the hedonic components of a
product. In other words, this research result shows that most Chinese consumers
evaluate cosmetic products from a utilitarian perspective rather than from a hedonic
perspective which may explain why the positive impact of a products perceived
emotional value on a Chinese consumers behavioural intentions is insignificant.
Another possible reason may be related to the fact that Chinese consumers are not
able to connect to brand concepts that advocates emotional value as branding is still a
fairly new concept in the Chinese culture (Bruce, 2010). Thus, their behavioural
intentions are less likely to be influenced by those hedonic components of a product.

4.5.4 Social
Figure 17:

Figure 18:

52

The result of this research is consistent with previous researches which proved that
the perceived social value of a product does not have any positive impact on a
consumers purchase intention (Goldsmith, Frieden and Henderson, 1997;Pihlstrom
and Brush, 2008) while it has a positive impact on a consumers price insensitivity
(Pihlstrom and Brush, 2008).

Nevertheless, the research findings contradict some research studies which suggest a
products perceived social value has positive impacts on consumers purchase
intention (Vigneron and Johnson, 1999; Gill et al., 2007) as well as their word-ofmouth communication (Pihlstrom and Brush, 2008).
A possible reason for this research finding may be that the effects of some cosmetic
products such as skin care or hair care products may not be very prominent and
improvements may take time. Thus, these cosmetic products may not be able to
perform their function as a superior vehicle to deliver social recognition and approval
to consumers instantly. Also, the brand name of cosmetic products can not be flaunted
to others throughout consumption, unlike other products such as clothes and
accessories for which brand logos can be recognised by others during consumption.
Hence, the overall social value of cosmetic products perceived by Chinese female
consumers is not powerful enough to trigger purchase intention and word-of-mouth
communication.

4.5.5 Behavioural intentions

-Purchase intention
Hypotheses H1, H5, H9 and H13 respectively state that a products perceived quality,
price, emotional and social value each has a positive impact on a consumers purchase
intention. The positive effect of a products perceived quality value (H1: = 0.81, p<
0.001) on purchase intention proved to be significant while a products perceived
price value (H5: = -0.07, p> 0.05), emotional value (H9: = 0.08, p> 0.05) and
social value (H13: = -0.07, p> 0.05) proved to be insignificant. This shows that
research findings only support for hypothesis H1 but not hypotheses H5, H9 or H13.
Thus, a products perceived quality value is the best predictor of a consumers
53

purchase intention. This implies that the most efficient way to increase consumers
purchase intention is by increasing the quality value of a product.

-Price insensitivity
Hypotheses H2, H6, H10 and H14 respectively suggest that a products perceived
quality, emotional and social value each has a positive influence on a consumers
price insensitivity. The positive impacts of a products perceived quality value (H2:
= 0.52, p< 0.001), price value (H6: = 0.24, p< 0.001) as well as its social value
(H14: = 0.17, p< 0.05) on price insensitivity, tested to be significant while that of a
products emotional value (H10: = -0.05, p> 0.05) on price insensitivity, tested to be
insignificant. The findings support for hypotheses H2, H6 as well as H14 but not
hypothesis H10. Hence, a products perceived quality value is the best predictor of a
consumers price insensitivity, followed by perceived price value and social value.
This result indicates that consumers price insensitivity can be increased by increasing
the quality, price and social value of a product.

-Word-of-mouth communication
Hypotheses H3, H7, H11 and H15 respectively state that a products perceived
quality, emotional and social value each has a positive influence on a consumers
word-of-mouth communication. The positive impacts of a products perceived quality
value (H3: = 0.61, p< 0.001) and price value (H7: = 0.22, p< 0.01) on word-ofmouth communication proved significant while that of a products perceived
emotional value (H11: = 0.00, p> 0.05) and social value (H15: =0.02, p> 0.05)
proved insignificant. Hypotheses H3 and H7 are supported by research findings whilst
hypotheses H11 and H15 are not. Therefore, a products perceived quality value is the
best predictor of a consumers word-of-mouth communication, followed by perceived
price value. This indicates that the best way to increase consumers positive word-ofmouth communication is by increasing the quality as well as the price value of a
product.

-Complaining behaviour
Hypotheses H4, H8, H12 and H16 respectively claim that a products perceived
quality, emotional and social value each has a negative influence on a consumers
complaining behaviour. The negative effects of a products perceived quality value
(H4: = -0.68, p< 0.001) on complaining behaviour tested to be significant while that
54

of a products perceived price value (H8: = -0.06, p> 0.05), emotional value (H12:
= 0.02, p> 0.05) and social value (H16: = 0.08, p> 0.05) tested to be insignificant.
The research findings only support for Hypothesis H4. However, the findings did not
find support for hypotheses H8, H12 and H16. Thus, a products perceived quality
value is the best predictor of a consumers complaining behaviour. This implies that
the best way to decrease consumers complaining behaviour is by increasing the
quality of a product.

Chapter Five: Conclusion

5.1 Conclusion
Research findings show that consumers perceived brand value can be influenced by
different factors. For example, consumers perceived price value of a product is
heavily affected by their monthly income. Those with higher monthly income inclined
to perceive a product as offer more value for money. On the other hand, consumers
perceived social value of a product is found to be highly affected by the category of a
product. Cosmetic products such as colour cosmetics and fragrances are found to be
perceived as having more social value than skin care products and hair care products.
55

Among all brand value dimensions, the perceived quality value of a cosmetic product
is found to be the strongest predictor of consumers behavioural intentions. Other than
the perceived quality value of a product, the perceived price value of a cosmetic
product was also found to have a significant positive impact on consumers price
insensitivity and word-of-mouth intentions while the perceived social value of a
cosmetic product was found to have a significant positive impact on consumers price
insensitivity. However, the perceived emotional value of a cosmetic product was
found to have no significant impact on consumers behavioural intentions.

5.2 Marketing Implications

In order to strive in Chinas cosmetic market, it is crucial for companies to maintain
consumers brand loyalty. This research study offers some marketing insights in terms
of how to increase consumers brand loyalty by catering to consumers perceived
brand value.
Research findings suggest that in order to increase consumers purchase intention and
word-of-mouth communication, marketers should mainly focus on increasing the
quality value of a cosmetic product. For example, when designing an advertisement
for a cosmetic product, it should focus on emphasizing the quality value instead of the
emotional value of the product. To cater for Chinese female consumers perceived
brand value, cosmetic companies should position themselves in the market clearly
while achieving a brand concept that focus on the utilitarian component of a product,
such as excellent product quality, consistent product quality and performance, instead
of the hedonic component of a product, such as brand concept that advocates a
distinct personality, a sense of fun and exuberance. Since Chinese consumers brand
perceptions and brand choice are highly connected to their self-concept (Ye, Bose and
Pelton, 2011), it is crucial for companies to build brand concepts that are consistent to
their target consumers self-concept and needs.
To cater for Chinese consumers needs for good quality value, cosmetic companies
may also focus more on using advanced technology to produce products with high
quality value such as products made from all natural ingredients, products with good
skin preserving qualities or products suitable for sensitive skin condition. It is also
important for cosmetics companies to maintain good standard of product quality at all
time and ensure that their products perform consistently, to avoid consumers
56

complaining or switching behaviour.

As for increasing consumers price insensitivity, marketers should try to promote

quality, price and social value of a cosmetic product. Marketers can design
promotional campaigns which send out a message that the product is of very good
quality, at a reasonable price and can help consumers gain social approval. For
promoting colour cosmetics and fragrances, marketers may stress on the social value
of the product while promoting other cosmetic products, social value is less important.

5.3 Academic implications

This research provides a substantive insight of Chinese female consumers perceived
brand value and its influences on behavioural intentions which intends to add on to
the previous literature. Theoretical contributions produced from the research findings
also include how age, monthly income and product category affect Chinese female
consumers perceived brand value of a cosmetic product. This implies that consumers
perceived brand value can be influenced by various personal, conditional and
situational factors. Thus, future researches on this topic are highly recommended to
investigate in those factors.

5.4 Research limitations and Future Research

In this research, the perceived brand value of Chinese consumers and its influence on
brand loyalty is being studied. Despite various constructive findings gained from the
research, some limitations existed in this research study. The selected sample only
included about two hundred Chinese female participants between the age of eighteen
and fifty. Future research can be done with participants from more different age
groups and on a larger sample size. Other than that, this research only studied how
participants age, monthly income and chosen product category influence their
perceived brand value of a product. Hence, it is recommended that future research
study can include more other factors into the study, such as education level,
57

occupation and geographic factors, while adopting the same framework.

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Appendices
Appendix 1: Questionnaire
Questionnaire
Section One -Participants information
1. Age
a. 18-30 b. 31-40 c. 41-50
2. Monthly income
a. < 3000 b. 3000-5000 c. 5000-10000 d. 10000-20000 e. > 20000
3. The category of last purchased cosmetics product
a. Hair care product b. Skin care product c. Colour cosmetics d. Fragrances

65

Section Two -Perceived brand value (PBV)

Please think of your last purchased cosmetics product and rate the following
statement. (Circle one of the following options that matches each question)
Item

Strongl

Disagree

Neutral

Agree

Strongly
agree

disagree
1. This product has consistent quality.

2. This product is well made.

3. This product has a good standard of

4. This product would perform consistently.

5. This product is one that I would enjoy.

6. This product is one that would make me

8. This product would make me feel good.

9. This product would give me pleasure.

10. This product is reasonably priced.

11. This product offers value for money.

12. This product would be economical.

13. This product would help me feel

quality.

want to use it.

7. This product is one that I would feel
relaxed about using.

acceptable.
14. This product would improve the way I am
perceived.
15. This product would make a good
impression on other people.
16. This product would give me social
approval.

Section Three - Brand loyalty (BL)

Please think of your last purchased cosmetics product and rate the following
statement. (Circle one of the following options that matches each question)
Item

Strongl
y

Disagree

Neutral

Agree

Strongly
agree

66

disagree
1. I would say positive things about this

product to other people.

2. I would recommend this product to
someone who seeks my advice.
3. I would encourage friends and relatives to
use this product.
4. I would consider this product my first
choice among other generic products.
5. I would purchase this product more often
in the future.
6. I would purchase this product less often in
the future.
7. I would switch to purchase generic
products from other brands that cost less.
8. I would continue to purchase generic
products from other brands that cost less.
9. I would pay a higher price for this product
than other brands charge for the benefits I
received.
10. I would switch to another brand if I
experience a problem with this product.
11. I would complain to other consumers if I
experience a problem with this product.
12. I would complain to external agencies if I
experience a problem with this product.

Appendix 2: Questionnaire (Chinese version)

Questionnaire (Chinese version)
-
()

67

1.
a. 18-30

b. 31-40

c. 41-50

2.
a. < 3000 b. 3000-5000 c. 5000-10000 d. 10000-20000 e. > 20000
3.
a. b. c. d.

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

68

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

Appendix 4: Consistency test output

69

Univariate Statistics
N

Mean

Std.

Missing

No. of Extremesa

Deviation

Count

Percent

Low

High

Q1

206

1.99

.817

.0

Q2

206

3.55

1.312

.0

PBV1

206

3.50

.936

.0

PBV2

206

3.51

.888

.0

PBV3

206

3.46

.830

.0

PBV4

206

3.42

.973

.0

PBV5

206

3.46

.859

.0

PBV6

206

3.28

.888

.0

PBV7

206

3.74

.887

.0

PBV8

206

3.58

.922

.0

PBV9

206

3.30

.902

.0

PBV10

206

3.55

.852

.0

PBV11

206

3.53

.859

.0

PBV12

206

3.30

.841

.0

PBV13

206

3.45

.841

.0

PBV14

206

3.56

.852

.0

PBV15

206

3.51

.876

.0

PBV16

206

3.23

.978

.0

10

BL1

206

3.37

1.026

.0

BL2

206

3.71

1.046

.0

BL3

206

3.31

.962

.0

BL4

206

3.42

.973

.0

BL5

206

3.15

.926

.0

BL6

206

2.53

.818

.0

BL7

206

2.88

1.076

.0

BL8

206

3.07

.908

.0

BL9

206

2.92

1.009

.0

BL10

206

3.55

.818

.0

BL11

206

3.18

.953

.0

BL12

206

2.86

.948

.0

12

RBL6

206

3.48

.813

.0

RBL7

206

3.13

1.084

.0

RBL8

206

2.94

.909

.0

Quality

206

3.4733

.75013

.0

14

Emotional

206

3.4728

.72606

.0

Price

206

3.4612

.76321

.0

70

Appendix 5: Reliability test output

Scale: Quality

71

Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.
Reliability Statistics
Cronbach's Alpha

N of Items

.845

Scale: Emotional
Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.

Reliability Statistics
Cronbach's Alpha

N of Items

.873

Scale: Price

72

Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.

Reliability Statistics
Cronbach's Alpha

N of Items

.879

Scale: Social
Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.
Reliability Statistics
Cronbach's Alpha

N of Items

.828

Scale: Word of mouth

Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.

73

Reliability Statistics
Cronbach's Alpha

N of Items

.869

Scale: Purchase intentions

Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.

Reliability Statistics
Cronbach's Alpha

N of Items

.768

Scale: Price insensitivity

Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.
Reliability Statistics
Cronbach's Alpha

N of Items

.869

74

Scale: Complaining behaviour

Case Processing Summary

Cases

Valid

206

100.0

Excludeda

.0

Total

206

100.0

a. Listwise deletion based on all variables in the

procedure.
Reliability Statistics
Cronbach's Alpha

N of Items

.769

Appendix 6: ANOVA analysis output

75

Different age groups and perceived brand value

Descriptives
N

Mean

Std.

Std. Error 95% Confidence Interval for Minimum Maximum

Deviation

Mean
Lower Bound Upper Bound

Quality

18-30 70

3.4429

.72002

.08606

3.2712

3.6145

1.50

4.50

31-40 69

3.4783

.75457

.09084

3.2970

3.6595

1.25

4.75

41-50 67

3.5000

.78576

.09600

3.3083

3.6917

1.50

4.75

Total

3.4733

.75013

.05226

3.3703

3.5763

1.25

4.75

Emotional 18-30 70

3.4200

.74767

.08936

3.2417

3.5983

1.00

4.80

31-40 69

3.5159

.75257

.09060

3.3352

3.6967

1.40

4.80

41-50 67

3.4836

.68149

.08326

3.3174

3.6498

1.80

4.80

Total

3.4728

.72606

.05059

3.3731

3.5726

1.00

4.80

18-30 70

3.4333

.76424

.09134

3.2511

3.6156

1.00

5.00

31-40 69

3.4879

.74224

.08935

3.3096

3.6662

1.67

5.00

41-50 67

3.4627

.79340

.09693

3.2692

3.6562

1.33

5.00

Total

3.4612

.76321

.05318

3.3563

3.5660

1.00

5.00

18-30 70

3.2571

.78709

.09408

3.0695

3.4448

1.00

4.50

31-40 69

3.5725

.64895

.07812

3.4166

3.7284

2.00

4.75

41-50 67

3.4813

.69265

.08462

3.3124

3.6503

1.25

4.75

Total

3.4357

.72148

.05027

3.3366

3.5348

1.00

4.75

Price

Social

206

206

206

206

Different age groups and perceived brand value

76

ANOVA

Quality

Emotional

Price

Social

Sum of Squares df

Mean Square

Sig.

Between Groups

.114

.057

.101

.904

Within Groups

115.239

203

.568

Total

115.353

205

Between Groups

.331

.166

.312

.732

Within Groups

107.736

203

.531

Total

108.068

205

Between Groups

.104

.052

.088

.916

Within Groups

119.308

203

.588

Total

119.412

205

Between Groups

3.662

1.831

3.607

.029

Within Groups

103.048

203

.508

Total

106.710

205

Different monthly income and perceived brand value

77

Descriptives
N

Mean

Std.

Std. Error 95% Confidence Interval for Minimum Maximum

Deviation

Mean
Lower Bound Upper Bound

Quality

< 3000

21

3.2976

.62559

.13652

3.0129

3.5824

2.00

4.50

3000-5000

30

3.3083

.94842

.17316

2.9542

3.6625

1.50

4.75

5000-10000 27

3.6111

.68407

.13165

3.3405

3.8817

2.00

4.75

10000-20000 70

3.4393

.78185

.09345

3.2529

3.6257

1.25

4.75

> 20000

58

3.5991

.65047

.08541

3.4281

3.7702

1.75

4.75

Total

206

3.4733

.75013

.05226

3.3703

3.5763

1.25

4.75

21

3.2857

.67992

.14837

2.9762

3.5952

2.00

4.80

30

3.2933

.79608

.14534

2.9961

3.5906

1.80

4.60

5000-10000 27

3.5852

.63953

.12308

3.3322

3.8382

2.40

4.80

10000-20000 70

3.4486

.81893

.09788

3.2533

3.6438

1.00

4.60

> 20000

58

3.6103

.59757

.07846

3.4532

3.7675

2.20

4.80

Total

206

3.4728

.72606

.05059

3.3731

3.5726

1.00

4.80

< 3000

21

3.1111

.70185

.15316

2.7916

3.4306

1.67

4.00

3000-5000

30

3.1333

.84236

.15379

2.8188

3.4479

1.33

4.67

5000-10000 27

3.5185

.80773

.15545

3.1990

3.8380

2.00

5.00

10000-20000 70

3.5143

.78366

.09367

3.3274

3.7011

1.00

5.00

> 20000

58

3.6667

.60858

.07991

3.5066

3.8267

2.33

5.00

Total

206

3.4612

.76321

.05318

3.3563

3.5660

1.00

5.00

< 3000

21

3.1310

.83524

.18226

2.7508

3.5111

1.25

4.50

3000-5000

30

3.3333

.78327

.14300

3.0409

3.6258

1.50

4.75

5000-10000 27

3.5741

.57099

.10989

3.3482

3.8000

2.50

4.75

10000-20000 70

3.4464

.81304

.09718

3.2526

3.6403

1.00

4.75

> 20000

58

3.5216

.55663

.07309

3.3752

3.6679

2.25

4.75

Total

206

3.4357

.72148

.05027

3.3366

3.5348

1.00

4.75

Emotional < 3000

3000-5000

Price

Social

Different monthly income and perceived brand value

78

ANOVA

Quality

Emotional

Price

Social

Sum of Squares df

Mean Square

Sig.

Between Groups

2.977

.744

1.331

.260

Within Groups

112.376

201

.559

Total

115.353

205

Between Groups

3.181

.795

1.524

.197

Within Groups

104.887

201

.522

Total

108.068

205

Between Groups

8.533

2.133

3.867

.005

Within Groups

110.878

201

.552

Total

119.412

205

Between Groups

3.217

.804

1.562

.186

Within Groups

103.493

201

.515

Total

106.710

205

Different monthly income and perceived brand value

79

Descriptives
N

Mean

Std. Deviation

Std. Error

95%

Confidence Minimum

Maximum

Interval for Mean

Quality

Emotional

Price

Social

Lower

Upper

Bound

Bound

Hair care product

58

3.4957

.69694

.09151

3.3124

3.6789

1.50

4.75

Skin care product

93

3.4194

.74742

.07750

3.2654

3.5733

1.25

4.75

Colour cosmetics

37

3.5878

.89407

.14698

3.2897

3.8859

1.50

4.75

Fragrances

18

3.4444

.62753

.14791

3.1324

3.7565

2.50

4.75

Total

206

3.4733

.75013

.05226

3.3703

3.5763

1.25

4.75

Hair care product

58

3.3862

.69974

.09188

3.2022

3.5702

1.40

4.80

Skin care product

93

3.4624

.71016

.07364

3.3161

3.6086

1.40

4.80

Colour cosmetics

37

3.6162

.85424

.14044

3.3314

3.9010

1.00

4.80

Fragrances

18

3.5111

.60672

.14300

3.2094

3.8128

2.60

4.60

Total

206

3.4728

.72606

.05059

3.3731

3.5726

1.00

4.80

Hair care product

58

3.6264

.70387

.09242

3.4414

3.8115

1.33

5.00

Skin care product

93

3.4050

.77061

.07991

3.2463

3.5637

1.33

5.00

Colour cosmetics

37

3.4595

.86905

.14287

3.1697

3.7492

1.00

5.00

Fragrances

18

3.2222

.61570

.14512

2.9160

3.5284

2.33

4.33

Total

206

3.4612

.76321

.05318

3.3563

3.5660

1.00

5.00

Hair care product

58

3.1336

.70899

.09309

2.9472

3.3200

1.25

4.50

Skin care product

93

3.3817

.61854

.06414

3.2543

3.5091

1.25

4.75

Colour cosmetics

37

3.8649

.79406

.13054

3.6001

4.1296

1.00

4.75

Fragrances

18

3.8056

.55938

.13185

3.5274

4.0837

2.75

4.75

Total

206

3.4357

.72148

.05027

3.3366

3.5348

1.00

4.75

Different monthly income and perceived brand value

80

ANOVA

Quality

Emotional

Price

Social

Sum of Squares df

Mean Square

Sig.

Between Groups

.800

.267

.470

.703

Within Groups

114.553

202

.567

Total

115.353

205

Between Groups

1.232

.411

.777

.508

Within Groups

106.835

202

.529

Total

108.068

205

Between Groups

2.905

.968

1.679

.173

Within Groups

116.506

202

.577

Total

119.412

205

Between Groups

14.841

4.947

10.877

.000

Within Groups

91.870

202

.455

Total

106.710

205

Appendix 7: Regression analysis output

81

Purchase intention and perceived brand value

Coefficientsa
Model

Unstandardized

Standardiz t

Coefficients

ed

Sig.

Correlations

Collinearity
Statistics

Coefficient
s
B

Std. Error Beta

Zero-

Partial

Part

order
1

(Consta

.723

.178

.808

.131

Emotion .083

Toleran

VIF

ce

4.058

.000

.810

6.165

.000

.776

.399

.273

.114

8.810

.116

.081

.716

.475

.718

.050

.032

.154

6.503

nt)
Quality

al
Price

-.065

.077

-.066

-.845

.399

.622

-.059

-.037

.316

3.164

Social

-.072

.073

-.069

-.983

.327

.565

-.069

-.043

.397

2.518

a. Dependent Variable: Purchase_intentions

Residuals Statisticsa
Minimum

Maximum

Mean

Std. Deviation

Predicted Value

1.5544

4.4059

3.3479

.58316

206

Std. Predicted Value

-3.075

1.814

.000

1.000

206

.168

.071

.021

206

Standard

Error

of

Predicted .037

Value
Adjusted Predicted Value

1.5697

4.4305

3.3478

.58365

206

Residual

-1.13556

1.13369

.00000

.46977

206

Std. Residual

-2.394

2.390

.000

.990

206

Stud. Residual

-2.425

2.404

.000

1.003

206

Deleted Residual

-1.16702

1.14959

.00006

.48193

206

Stud. Deleted Residual

-2.455

2.433

.000

1.007

206

Mahal. Distance

.246

24.776

3.981

3.298

206

Cook's Distance

.000

.099

.005

.010

206

Centered Leverage Value

.001

.121

.019

.016

206

a. Dependent Variable: Purchase_intentions

82

Word-of-mouth and perceived brand value

Coefficientsa
Model

Unstandardized

Standardiz t

Coefficients

ed

Sig.

Correlations

Collinearity
Statistics

Coefficient
s
B

Std. Error Beta

Zero-

Partial

Part

order
1

(Consta -.057

.199

-.289

.773

Toleran

VIF

ce

nt)
Quality

.727

.146

.605

4.971

.000

.804

.331

.204

.114

8.810

Emotion .002

.130

.001

.014

.989

.735

.001

.001

.154

6.503

al
Price

.257

.086

.217

2.979

.003

.733

.206

.122

.316

3.164

Social

.029

.081

.023

.361

.719

.612

.025

.015

.397

2.518

a. Dependent Variable: Word_of_mouth

Residuals Statisticsa
Minimum

Maximum

Mean

Std. Deviation

Predicted Value

1.3208

4.8183

3.4628

.73263

206

Std. Predicted Value

-2.924

1.850

.000

1.000

206

.188

.079

.024

206

Standard

Error

of

Predicted .041

Value
Adjusted Predicted Value

1.3194

4.8348

3.4630

.73320

206

Residual

-1.27714

1.36972

.00000

.52402

206

Std. Residual

-2.413

2.588

.000

.990

206

Stud. Residual

-2.441

2.612

.000

1.002

206

Deleted Residual

-1.30657

1.39525

-.00021

.53641

206

Stud. Deleted Residual

-2.472

2.651

-.001

1.006

206

Mahal. Distance

.246

24.776

3.981

3.298

206

Cook's Distance

.000

.042

.005

.007

206

Centered Leverage Value

.001

.121

.019

.016

206

a. Dependent Variable: Word_of_mouth

83

Price insensitivity and perceived brand value

Model

Unstandardized

Standardiz

Coefficients

ed

Sig.

Correlations

Collinearity
Statistics

Coefficients
B

Std. Error

Beta

Zero-

Partial

Part

order
1

(Constan -.653

.192

-3.400

.001

Toleranc VIF
e

t)
Quality

.620

.141

.521

4.385

.000

.806

.295

.176

.114

8.810

Emotion

-.055

.126

-.045

-.437

.663

.740

-.031

-.017

.154

6.503

Price

.284

.083

.243

3.407

.001

.739

.234

.136

.316

3.164

Social

.205

.079

.166

2.604

.010

.671

.181

.104

.397

2.518

al

a. Dependent Variable: Price_insensitivity

Casewise Diagnosticsa
Case Number

Std. Residual

Price_insensitivity

Predicted Value

Residual

40

5.123

3.33

.7109

2.62241

a. Dependent Variable: Price_insensitivity

84

Residuals Statisticsa
Minimum

Maximum

Mean

Std. Deviation

Predicted Value

.7109

4.4036

2.9968

.73476

206

Std. Predicted Value

-3.111

1.915

.000

1.000

206

.181

.076

.023

206

Standard

Error

of

Predicted .040

Value
Adjusted Predicted Value

.4209

4.4187

2.9965

.73791

206

Residual

-1.37550

2.62241

.00000

.50682

206

Std. Residual

-2.687

5.123

.000

.990

206

Stud. Residual

-2.720

5.399

.000

1.008

206

Deleted Residual

-1.40886

2.91245

.00028

.52517

206

Stud. Deleted Residual

-2.764

5.825

.002

1.023

206

Mahal. Distance

.246

24.776

3.981

3.298

206

Cook's Distance

.000

.645

.007

.045

206

Centered Leverage Value

.001

.121

.019

.016

206

a. Dependent Variable: Price_insensitivity

Complaining behaviour and perceived brand value

85

Coefficientsa
Model

Unstandardized

Standardiz t

Coefficients

ed

Sig.

Correlations

Collinearity
Statistics

Coefficient
s
B

Std. Error Beta

Zero-

Partial

Part

order
1

(Consta

Toleran

VIF

ce

5.401

.216

25.014 .000

-.684

.159

-.683

-4.304

.000

-.649

-.291

-.230

.114

8.810

.141

.023

.171

.865

-.583

.012

.009

.154

6.503

nt)
Quality

Emotion .024
al
Price

-.056

.094

-.057

-.600

.549

-.556

-.042

-.032

.316

3.164

Social

.082

.088

.079

.933

.352

-.453

.066

.050

.397

2.518

a. Dependent Variable: Complaining_behaviour

Casewise Diagnosticsa
Case Number

Std. Residual

Complaining_beha Predicted Value

Residual

viour
40

-4.217

2.00

4.4254

-2.42537

a. Dependent Variable: Complaining_behaviour

Residuals Statisticsa
Minimum

Maximum

Mean

Std. Deviation

Predicted Value

2.2858

4.6136

3.1974

.49020

206

Std. Predicted Value

-1.860

2.889

.000

1.000

206

.204

.086

.026

206

Standard

Error

of

Predicted .045

Value
Adjusted Predicted Value

2.2392

4.6936

3.1990

.49301

206

Residual

-2.42537

1.41375

.00000

.56951

206

Std. Residual

-4.217

2.458

.000

.990

206

Stud. Residual

-4.444

2.491

-.001

1.007

206

Deleted Residual

-2.69362

1.45161

-.00154

.58898

206

Stud. Deleted Residual

-4.668

2.524

-.002

1.015

206

Mahal. Distance

.246

24.776

3.981

3.298

206

Cook's Distance

.000

.437

.007

.031

206

Centered Leverage Value

.001

.121

.019

.016

206

a. Dependent Variable: Complaining_behaviour

86

Appendix 8: Correlation analysis

The tables below summarise the result of Pearson correlation analysis. The correlation
test shows that there is statistically significant correlation between each of the
independent variable and dependent variable. Correlation analysis is used to indicate
both the direction and the strenghth of the relationship (Pallant 2010).
Quality
Brand loyalty

Pearson correlation

Sig.

Purchase intention

0.776

0.000

Price insensitivity

0.806

0.000

Word-of-mouth

0.804

0.000

Complaining behaviour

-0.649

0.000

Pearson correlation

Sig.

Price
Brand loyalty

87

Purchase intention

0.622

0.000

Price insensitivity

0.739

0.000

Word-of-mouth

0.733

0.000

Complaining behaviour

-0.556

0.000

Brand loyalty

Pearson correlation

Sig.

Purchase intention

0.718

0.000

Price insensitivity

0.740

0.000

Word-of-mouth

0.735

0.000

Complaining behaviour

-0.583

0.000

Brand loyalty

Pearson correlation

Sig.

Purchase intention

0.565

0.000

Price insensitivity

0.671

0.000

Word-of-mouth

0.612

0.000

Complaining behaviour

-0.453

0.000

Emotional

Social

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

The correlation test shows that there is statistically significant correlation between
each of the independent variable (perceived brand value dimension) and dependent
variable (brand loyalty dimension). Each perceived brand value dimension shows the
strongest correlation with price insensitivity, followed by word-of-mouth
communication, purchase intention and complaining behaviour.
The perceived value of a products quality shows the strongest correlation with price
insensitivity (r = 0.81, p< 0.01), followed by word-of-mouth communication (r =
0.80, p< 0.01), purchase intention (r = 0.78, p< 0.01) and complaining behaviour (r =
-0.65, p< 0.01).
Each brand loyalty dimension shows the strongest correlation with the perceived
quality value of a product. This shows that among four perceived brand value
dimension, an increase in the perceived quality value of a product will lead to the
strongest correlated increase in consumers purchase intention, price insensitivity and
word-of-mouth communication while it will lead to the strongest correlated decrease
in consumers complaining behaviour.
88

89