Dissertation Report

DISSERTATION PROJECT REPORT
AN EMPIRICAL STUDY ON HEDONIC BRANDS IN INDIA

In partial fulfilment of the requirements of the course for MBA FT- I
Submitted to: Prof. Tripura Joshi
Submitted by: Shradha Mantri (091145)
An Empirical Study of Hedonic Brands
Institute of Management, Nirma University

MBA (Full-Time)II (2009-11 Batch)
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CONTENTS
ACKNOWLEDGEMENT ......................................................................... 3 INTRODUCTION TO THE PROJECT ....................................................... 4 LITERATURE REVIEW ........................................................................... 7 HEDONIC VALUE AND BRAND LOYALTY ............................................ 11 RESEARCH PROBLEM & OBJECTIVES ................................................. 15 SURVEY RESULTS AND ANALYSIS....................................................... 19 RESEARCH IMPLICATIONS ................................................................. 28 LIMITATIONS OF THE RESEARCH ....................................................... 30 REFERENCES ...................................................................................... 31 APPENDIX .......................................................................................... 33
ACKNOWLEDGEMENT
I would like to take this opportunity to thank all those who have helped, guided and supported me for this project. It is with immense pleasure, that I express special and sincere thanks to my Faculty Guide Prof. Tripura Joshi for her invaluable time, guidance, feedback and encouragement throughout the course of this project. I would like to express a deep sense of gratitude towards her inputs and for building my interest in the area of brand research. I would like to thank all the respondents who graciously spared a few minutes of their time to take my survey. I would also like to make a special mention of my classmates who helped me run the SPSS and MS Excel tools during data analysis. Last but not the least, I wish to thank all those who directly and indirectly contributed to the successful completion of my dissertation project. I am filled with gratitude towards Nirma Institute, for giving me this wonderful opportunity to learn and imbue the value of knowledge and hard work.
INTRODUCTION TO THE PROJECT

Over the years, retailers have been buffeted by a number of macro-environmental forces that have changed the landscape of the industry. These include the spread of mass discounters, the proliferation of suburban power centres and lifestyle retailing formats, and the recent arrival of the Internet as an alternative retail platform offering consumers unparalleled convenience. Researchers continually seek a richer understanding of consumer attitudes. Investigation of the hedonic and utilitarian components of attitude has been suggested in such diverse disciplines as sociology, psychology, and economics. In this environment it is no longer enough for a retailer to operate in a conventional manner by enticing customers with broad assortments, low pricing, and extended store hours. The entertainment aspect of retailing, or entertailing, is increasingly being recognized as a key competitive tool. Many retailers are responding to the threat of Internet-based shopping by leveraging the brick-and-mortar advantages that virtual retailers cannot match: higher levels of service, highly trained staff, and an entertaining and fun retail environment. Retailers from supermarkets to video stores are sporting new and exciting ideas, such as animatronic farm animals, butter churning contests, and roaming face painters and childrens performers. In fact, in this evolving retail landscape the hedonic experiences that a customer can now obtain are virtually endless: from rock-climbing walls in shoe stores, to singles nights in grocery stores, to off-road test tracks in Land Rover. Organizations can increase the number of brand loyal customers through high growth rates and increased market share. Although it is expensive to acquire new customers due to stiff competition between service providers, high costs incurred through start-up operations, advertising and promotion. Last decades, researchers have studied the shopping experience both in utilitarian and hedonic perspectives. Utilitarian consumer behaviour can be described as a rational approach involving a purchase that is efficiently made, even if the shopping itself may not provide any fun. In this context, a shopping experience can be evaluated by consumers as an
An Empirical Study of Hedonic Brands achievement of an intended goal. On the other hand, following the line of initial studies the concept of Hedonic consumption that involves multi-sensory and emotive aspects of the consumers experiences with products was introduced. Hedonic shopping is related with the satisfaction of a persons desires and it is an expression of experiential consumption. From this viewpoint, thrift and treat would exist in opposition to each other. Nevertheless, shopping process can be both economic and hedonic. There exist two kinds of consumer evaluation, in which a consumption object is cognitively placed on both a utilitarian dimension of instrumentality (e.g., how useful or beneficial the object is), and on an hedonic dimension measuring the experiential affect associated with the object (e.g., how pleasant and agreeable those associated feelings are). Both of these types of benefits contribute, in differing degrees, to the overall goodness of a consumer good or behavior. These hedonic and utilitarian reasons or motivations for consumption need not be (and usually are not) mutually exclusive: toothpaste may both prevent cavities and provide pleasure from its taste. Nor need these two motivations be evaluatively consistent: a consumption activity that gives me pleasure now may in fact be bad for me in an instrumental sense (e.g., smoking), while another that gives me no pleasure may in fact be instrumentally valuable (e.g., going to the dentist). Further, these two bases of evaluation may not be equally salient; some product categories, brands and behaviors may be more positively evaluated on one dimension than another, and different objects should differ predictably in the extent to which overall attitudes towards them are hedonic or utilitarian. A behavior performed for hedonic or fun reasons, for example, should have its overall attitudinal evaluation based relatively more on that antecedent. While retailers are focusing more on entertainment, academic research is lagging in investigating the hedonic reasons people buy brands and why they have preference towards a particular brand. Recent retail research is beginning to focus on the hedonic aspects of the in-store experience, such as the affective response of excitement. However, no recent research has investigated, in a comprehensive manner, the multiple and varied hedonic reasons, or motivations, that people are brand loyal. Therefore, given the current focus by retailers on the hedonic aspects of shopping and the general lack of academic activity in this area, there is clearly a need for research on this issue.
An Empirical Study of Hedonic Brands Representing one of the most important factors believed to explain consumer brand choices, it is no surprise that the concept of brand loyalty has aroused an enormous interest among academics as well as practitioners within the field of marketing and consumer behaviour. Firms with large groups of loyal customers have been shown to have large market shares, and market share, in turn, has been shown to be associated with higher rates of return on investment. Brand loyalty favours positive worth of mouth and greater resistance among loyal customers to competitive strategies. Such findings encourage marketers to build and maintain brand loyalty among customers. When striving for such goals, information on factors determining the creation of brand loyalty among customers becomes an important matter. This research investigates the importance of the relative attitude to the determination of brand loyalty.
LITERATURE REVIEW
A. Hedonic and Utilitarian Dimensions of Consumer AttitudeBatra and Ahtola state, consumers purchase goods and services and perform consumption behaviors for two basic reasons: (1) Consummatory affective (hedonic) gratification (from sensory attributes) (2) Instrumental, utilitarian reasons We adopt this two-dimensional conceptualization of consumer attitudes: The first dimension is a hedonic dimension resulting from sensations derived from the experience of using products, and the second is a utilitarian dimension derived from functions performed by products. Measurement of these attitudinal dimensions can provide researchers and managers with fresh approaches to modelling marketing problems. Measures of attitudinal dimensions provide building blocks for researchers attempting to develop models that explain a greater proportion of the variance in consumer behavior. Measures of the hedonic and utilitarian dimensions of attitude enable marketers to test the effectiveness of advertising campaigns that stress experiential or functional positioning strategies. Then, too, these measures can reveal brand differences/positions that may not be apparent when a single dimension attitude measure is used. Previous research has suggested that products/brands that are highly valued on the hedonic dimension rather than the utilitarian dimension are better able to charge a price premium or engage in sales promotions. Thus, measures of these two dimensions may serve as input into pricing and sales promotion decisions. Relatedly, because owners of hedonic items keep them for longer periods and because ownership is a recommended segmentation criterion, measuring attitude dimensions is a basis for segmenting markets. There exist two kinds of consumer evaluation, in which a consumption object is cognitively placed on both a utilitarian dimension of instrumentality (e.g., how useful or beneficial the object is), and on a hedonic dimension measuring the experiential affect associated with the
An Empirical Study of Hedonic Brands object (e.g., how pleasant and agreeable those associated feelings are). Both of these types of benefits contribute, in differing degrees, to the overall goodness of a consumer good or behavior. These hedonic and utilitarian reasons or motivations for consumption need not be (and usually are not) mutually exclusive: toothpaste may both prevent cavities and provide pleasure from its taste. Nor need these two motivations be evaluatively consistent: a consumption activity that gives me pleasure now may in fact be bad for me in an instrumental sense (e.g., smoking), while another that gives me no pleasure may in fact be instrumentally valuable (e.g., going to the dentist). Further, these two bases of evaluation may not be equally salient; some product categories, brands and behaviors may be more positively evaluated on one dimension than another, and different objects should differ predictably in the extent to which overall attitudes towards them are hedonic or utilitarian. A behavior performed for hedonic or fun reasons, for example, should have its overall attitudinal evaluation based relatively more on that antecedent. In the terminology we will use here, the hedonic determinant of overall evaluations is presumed to be based on the consumer's assessment of how much pleasure he gets; his utilitarian determinant is based on his assessment about the instrumental value of the brand's functional attributes. For convenience, both kinds of assessments will be modelled here in the traditional AI framework; this is not meant to be a representation of the actual information processing steps involved. Since the establishment of the Personal Shopping Value scale approximately a decade ago (Babin et al., 1994), research has focused almost exclusively on antecedents to both hedonic and utilitarian value (cf. Babin et al., 1994; Babin and Darden, 1995; Griffin et al., 2000; Babin and Attaway, 2000; Babin and Babin, 2001; Stoel et al., 2004; Babin et al., 2005). Interestingly, in much of this published research, calls have been made to further explore the important relationships with retail outcome variables. To date, only a few studies have attempted to correlate shopping value to retail variables such as repatronage intentions (Stoel et al., 2004). However, none of these studies have as their central focus the complex interrelationship between shopping value and retail variables, even though such relationships would seem to be particularly important given the tremendous amount of resources and expenses that retailers are devoting to create satisfied and loyal customers.
An Empirical Study of Hedonic Brands The purpose of the research presented here is to investigate how hedonic and utilitarian values differ in their relationships with several important retail outcome variables.
B. Customer Decision-makingWhile it is difficult to determine specific issues responsible for product choice in any product category given the contingent nature of decision making, it is particularly the case for products consumed primarily of a hedonic consumption utility. By definition, hedonic consumption states that many consumers enjoy the journey and the intangibles of the purchase experience and consumption, not just the product purchased. Usage of hedonic brands involves multisensory, fantasy and emotive aspects, and senses such as visual imagery. It induces a sensation that can lead to fantasy imagery and transport the consumer to a state of being void of daily pressures. The usage of these brands is related to lifestyle. Lifestyle can be defined as the consistent patterns that people follow in their lives, including how they spend their time and money, and are identified through peoples activities, interests and opinions of themselves and the world around them. Lifestyle choices made by consumers, not lifestyle stages, are the more important determinant of whether they adopt hedonic brands on a regular basis. The use of price as an indicator of quality logically should vary between consumers who perceive themselves as experts on certain products compared with those who consider themselves mere novices. Consumers who lack knowledge about certain product categories often rely on extrinsic cues such as price to determine quality while consumers with more knowledge will rely on intrinsic cues such as color, performance, design, etc.
C. Loyalty and Repatronage Intentions:

Loyalty and repatronage intentions Repatronage intentions reflect the likelihood that a customer will shop at a retail store again, while loyalty is a deeply held commitment to a specific brand or a particular retailer (Oliver, 1999). Prior research suggests a link between
An Empirical Study of Hedonic Brands hedonic and utilitarian value, loyalty, and repatronage intentions. Hedonic value should be related to loyalty because attitude theory suggests a number of affective antecedents including emotions, moods, and primary affects (e.g., Dick and Basu, 1994). People are thought to form positive attitudes toward experiences which provide psychological rewards (Katz, 1960), such as those which may be found in a pleasant shopping experience. Hedonic value should be related to repatronage intentions as well because studies in environmental psychology have shown that affective experiences in the store can be important antecedents of approach or avoidance motivations, such as repatronage intentions (Donovan and Rossiter, 1982). Retail research has provided empirical support for this (Wakefield and Barnes, 1996). Therefore, we should expect hedonic value to be related to both loyalty and repeat patronage. Utilitarian value should also be related to both loyalty and repatronage intentions. Consumers perceiving utilitarian value from their shopping experience are likely to have accomplished the shopping task of product acquisition (Babin et al., 1994). Hence, these consumers will perceive higher quality from various aspects of the experience and be more likely to exhibit stronger repatronage intentions (Babin and Babin, 2001; Swinyard, 1993; Zeithaml, 1988) and loyalty attitudes (Cronin et al., 2000; Dick and Basu, 1994).
HEDONIC VALUE AND BRAND LOYALTY

I. Measuring the Hedonic Value of Brands:
Measurement of the hedonic and utilitarian dimensions of brands can provide researchers and managers with fresh approaches to modelling marketing problems. Measures of attitudinal dimensions provide building blocks for researchers attempting to develop models that explain a greater proportion of the variance in consumer behavior. It has been suggested theoretically that consumer attitudes have distinct hedonic and utilitarian components, and that product categories differ in the extent to which their overall attitudes are derived from these two components. Overall consumer attitudes toward brands and consumption behaviors have typically been measured on a single evaluative dimension often scaled using evaluative semantic differential (SD) scales. Sixteen 5-point evaluative SD items from the battery used by Osgood, Suci, and Tannenbaum (1957) were used in this study, selected judgmentally to ensure adequate coverage of the hedonic and utilitarian domains. 20 respondents rated 3 arbitrarily-selected brands (Colgate, Tommy Hilfiger and Mercedes) on each item. Initial analysis consisted of (exploratory) common factor analysis for the four brands (a) individually and (b) pooled together (for generality). In almost all cases, a two-factor structure emerged: one factor, labelled hedonic, loaded heavily on pleasant-unpleasant, agreeable-disagreeable, nice-awful, and similar items; the second factor, labelled utilitarian, loaded heavily on useful-useless, beneficial harmful, important-unimportant and similar items. However, in lieu of the objective of this study, only the Hedonic items were considered.
II.
Conceptual Model of Brand Loyalty:
Brand loyalty is an important concept in understanding consumer behavior. Brand loyalty has a well-known financial payoff. Loyal consumers only repurchase the same brand over
An Empirical Study of Hedonic Brands time even there is an alternative brand in the market, and eventually loyalty can be measured by the commitment to repurchase in terms of products and services. Furthermore, four categories of consumers can be distinguished according to brand loyalty: hard-core loyal consumers, brand switchers, new users, and non-users. Non-users tend not to be loyal to any brand and as for new users; they are not so familiar with any brand at all. These two categories are not to be the main focus in this study and therefore they will be excluded in this research study. Only hard- core consumers and brand switchers will be focused in this study. Marketers often pay attention to identify the characteristics of brandloyal consumers and the degree of brand loyalty of consumers so that they can directly and effectively focus their marketing and promotional strategies on these consumers who share similar characteristics among the large population. A consumer repeatedly purchases a particular brand regardless the premium price of that brand has charged, is considered as hard-core loyal consumers. This loyalty involves the last stage of purchase, in which consumers do not accept substitutes if they have approached the brand. Price variations for consumers favorite brand may only affect their purchase quantity but not their brand choice decision. They stick with the brand rather than switch. Thus, these loyal consumers do not need frequent advertising or price promotions to remind them.
a) Factors of Brand Loyalty:

A study conducted by NC State University on brand loyalty was particularly relevant to this study. To create brand loyal consumers and to retain them, it is essential to understand the major factors that influence brand loyalty among them. This study focuses on the six brand loyalty factors:
1. Brand Name Famous brand name can disseminate product benefit and lead to higher recall of an advertised benefit than a non-famous brand name. . Hard-core loyal consumers trust their favorite brand names and consistently repurchase these brands. Those prestigious brand names and their images attract consumers to purchase the brand.
An Empirical Study of Hedonic Brands 2. Product Quality Consumers may repeat purchase the single brand or switch around several brands due to the tangible quality of the product sold. The components of product quality of various brands depend on specific brand characteristics.
3. Price Price is probably the most important consideration for the average consumers. Price serves as the strongest loyalty driver. Consumers with high brand loyalty are less price sensitive. Purchase intention of consumers cannot be easily affected by price if they have built brand loyalty into the brand. These consumers are willing to pay a premium price for their favored brand. In addition, they may have strong beliefs in price and value of their favorite brands so that they can compare and evaluate price with alternative brands.
4. Promotion Promotion is a component in marketing mix which is a kind of communication with
consumers. Promotion includes the use of advertising, sales promotions, personal selling and publicity. Advertising is a non-personal presentation of information in mass media about a product, brand, company or store. It greatly affects consumers images, beliefs, and attitudes towards products and brands, and in turn, influences their purchase behavior. It can help establishing ideas or perceptions into consumers minds, and differentiating products against other brands. Thus, good advertisements can attract brand switchers and create brand loyalty. Moreover, effective communication can persuade and motivate
consumers to think about and even take action to purchase the product the advertisement promoted.
An Empirical Study of Hedonic Brands 5. Physical Environment Retail stores are relatively closed environments. Positive attributes of the store, which include store location, store layout, and in-store stimuli, affect brand loyalty to some extent. Store location and number of outlets are crucial in altering consumer shopping and purchasing patterns. If consumers are highly accessible to stores during their shopping trip and are satisfied with the stores assortment and services, these consumers may become loyal later. The stimuli in store, such as the characteristics of other shoppers and salespeople, store layout, noises, smells, temperature, shelf space and displays, signs, colors, and merchandise, affect consumers and serve as elements of store environment.
6. Service Quality Service quality is a kind of personal selling, and involves direct interactions between a salesperson and a potential buyer. Consumers shopped at specific stores because they like the service provided and they are assured of certain service privileges. Salesperson performances stimulate bonding through trust among sales representatives and consumers, and will affect consumers perception towards the brand. A self -administered questionnaire was directly distributed to 20 respondents aged from 18 to 40 years old. This age group represented the savvy customer population and seemed to be a reasonable surrogate of the population.
RESEARCH PROBLEM & OBJECTIVES

This study investigates the hedonic value attached by consumers to various brands. Based on qualitative and quantitative studies, there will be a link that is formed with this value and brand loyalty. Simply put, this will provide a foundation for future research investigating the interrelationships between hedonic motivations, in-store experiences, shopping outcomes (e.g., satisfaction), and specific shopping behaviours such as impulse buying. Further, retailers would have a tool that could be employed to examine current and potential patrons, thereby providing guidance for store design and marketing communications strategy. Therefore, the major objectives of this research are: 1. To establish a relationship between HEDONIC VALUE OF BRANDS and BRAND LOYALTY 2. To prove that brands that have a higher hedonic value are more likely to have loyalty than brands that are low on hedonic value
Discovering the Hedonic dimensions of Customer Attitude
Translating Hedonic dimenstions to Hedonic Value Bridging the gap between Hedonic Value and Brand Loyalty
b) Loyalty and repatronage intentionsHedonic value should be related to loyalty because attitude theory suggests a number of affective antecedents including emotions, moods, and primary affects. People are thought to form positive attitudes toward experiences which provide psychological rewards, such as those which may be found in a pleasant shopping experience. Hedonic value should be related to repatronage intentions as well because studies in environmental psychology have shown that affective experiences in the store can be important antecedents of approach or avoidance motivations, such as repatronage intentions. Retail research has provided empirical support for this. Therefore, we should expect hedonic value to be related to both loyalty and repeat patronage. Therefore, we should expect the following relationship:
H0. Hedonic value has no influence on brand loyalty. Ha. Hedonic value is positively correlated with brand loyalty.
However, hedonic value is likely to be a stronger influence on loyalty than will utilitarian value. A higher level of hedonic value is a reflection of shoppers who have experienced increasing levels of emotional worth from the shopping experience. People who experience positive consumption related emotions in a hedonic context are thought to form very strong forms of commitment. This is echoed in research on human relationships, which has shown that the two fundamental aspects of relationship commitment are affect and its hedonic sign, and is similar to that which occurs in brand relationships where emotional bonds are created which then play a substantial role in determining constructs such as commitment. It would also appear that the affect-commitment link is particularly likely in a consumption context characterized by the potential to elicit substantial emotional reaction. Therefore, it is reasonable to expect that hedonic shopping value will be a stronger driver of loyalty than utilitarian shopping value.
An Empirical Study of Hedonic Brands For this study, I have selected 3 random brands from the following list:
Apparel, Accessories, Perfumes Guess Giordano Tommy H
Jewellery
Tech brands Apple Sony Microsoft
Personal Care Products Colgate Body Shop Lux
Automobiles
Cartier Guess Swarovski Tanishq Nakshatra
Harley Davidson Volkswagen Honda Mercedes BMW
The 3 brands selected are:
Colgate, an oral hygiene product line and one of the namesake brands of the ColgatePalmolive Company, is a manufacturer of a wide range of toothpastes, toothbrushes, and mouthwashes.
Tommy Hilfiger Corporation is an American company which is incorporated in Hong Kong.
Mercedes-Benz is a German manufacturer of automobiles, buses, coaches, and trucks. Mercedes-Benz is a division of its parent company, Daimler AG. Mercedes-Benz is one of the most well-known and established automotive brands in the world, and is also the world's oldest automotive brand still in existence today. The 3 brands have been chosen from different product classes and categories in order to bring in a holistic view. The sample size for this study will be 20 respondents per brand, i.e. 60 respondents in all. Each set of respondents will be administered 2 separate questionnaires, one to measure Brand Loyalty and one to measure the Hedonic Value of the brand. The survey of hedonic value of brands comprised rating 3 brands based on a 5 point likert scale for 8 sets of attributes. The survey conducted to determine level of brand loyalty consisted of rating 5 major factors affecting brand loyalty and then averaging their scores.
SURVEY RESULTS AND ANALYSIS

The results of both surveys have been arranged brand-wise, in order to facilitate the comparison between hedonic dimensions of customer attitude and the loyalty towards the brand. The scores of each of the respondents were then aggregated and have been presented below. 3 different analyses have been presented: Descriptive statistical analysis Correlation between the variables Hypothesis test
A. DESCRIPTIVE STASTICAL ANALYSIS 1. Tommy Hilfiger-
Hedonic Value Scores

5 4.4 4.4
4.3 4.3 4 3.9 3.5 3.1 3 3.6 3.5 4.0
4.3
Mean Rating
3.8
3.9
3.3 3.0 3.0
3.1
2.6
2.5 2.1
2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Respondents
Brand Loyalty Scores

5 4.5 4.3 4.3 4.0 3.8 3.3 3 2.3 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 3.2 3.3 3.5 3.1 3.8 3.4 2.8 3.5 4.5 4.5
Mean Rating
4 3.5 3.6
2.6
Respondents
2. Colgate:

5
4.0
4.0 3.8 3.8 3.3 3.0 2.6 2.1 2.5 3.0 2.6 2.4 3.4 3.1 3.0
Mean Rating
4 3.3 3 2.5 3.4 3.0 3.1
2
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Respondents

5
Mean Rating
4
3.4 3.0 3.0 3.0 3.1 2.8 2.6 3.4 3.1 2.9 3.1 2.7 2.7 2.7 2.9
3.9 3.5 3.3 3.2 2.7
2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Respondents
3. Mercedes:

5 4.5 4.0 4.0 3.8 3.5 3.6 3.5 3.3 3 3.3 4.0 4.4 4.0 3.8 4.8 4.6 4.6 4.5
Mean Rating
3.4
3.3
3.4
2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Respondent

5 4.3 4.0 3.8 3.6 3.6 3.6 3.5 3.3 3.0 3 3.0 2.8 2.8 3.5 4.8 4.2 4.7 4.3 4.0 4.0 4.5
MeanRating
2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Respondents
An Empirical Study of Hedonic Brands The charts above have been segregated brand-wise and survey-wise. This facilitates an easy comparison between the customer responses and the nature of the relationship between the variables in consideration. In each of the above charts, the level of hedonic orientation of a brand has a direct relationship with how loyal the customers of the brand are. Below is a scatterplot, which helps to understand the direction of the relationship between the variables. The scatterplot tells us if there is a positive, negative or zero correlation. As we can see, there is a strong positive correlation between the two variables.
B. CORRELATION BETWEEN VARIABLES
HV Tommy H Colgate Mercedes 3.51875 3.131 3.8978
BL 3.58 3.050214 3.755
The above values are aggregates of hedonic value and brand loyalty scores. This shows us that the level of Hedonic value attached with brands having a higher utilitarian value (Colgate) is lower than those having a lower utilitarian value (Tommy and Mercedes).
Correlation between Variables Brand Loyalty Pearson Correlation Sig. (2-tailed) N 20 1 Hedonic Value .893** .000 20
The above tables present the correlation between Hedonic Value and Brand Loyalty. Pearsons correlation is close to 1, there is a strong relationship between the two variables. This means that changes in one variable are strongly correlated with changes in the second variable. The significance value, i.e. 0.000 tells us if there is a statistically significant correlation between the two variables. If the significance value is less than 0.05, then the two variables are correlated. It means that increases or decreases in one variable do significantly relate to increases or decreases in your second variable. We can see in our case that both the values point to the fact that the two variables are positively correlated to each other. Thus, a higher level of hedonic value of a product would translate to greater brand loyalty.
C. HYPOTHESIS TEST
I will be using the Paired Samples T Test, which compares the means of the two variables. It computes the difference between the two variables for each case, and tests to see if the average difference is significantly different from zero. The variables of interest, older and younger, are on a ratio scale, so a z-score test or a t-test might be appropriate. Because the population standard deviation is not known, the z-test would be inappropriate. Furthermore, the same respondents are answering both questionnaires; we have a withinsubjects design. Because of these factors, we will use the paired samples t-test. But first, we need to make sure both variables are normally distributed. Normal distribution has been checked with a Q-Q plot. It is shown under:
Thus we can see that the values are normally distributed. Special consideration is given to the null hypothesis. This is due to the fact that the null hypothesis relates to the statement being tested, whereas the alternative hypothesis relates to the statement to be accepted if and when the null is rejected. The final conclusion, once the test has been carried out, is always given in terms of the null hypothesis.
Paired Samples Statistics Std. Deviation .325695 .360847
Brand Loyalty Hedonic Value
Mean 3.46174 3.50577
N 20 20
Std. Error Mean .072828 .080688
Paired Samples Correlations Brand Loyalty & Hedonic Value N 20 Correlation .893 Sig. .000
Paired Samples Test 95% Confidence Interval of the Difference Lower Upper -.120178 .032121
Brand Loyalty Hedonic Value
Mean -.044029
Std. Deviation .162709
Std. Error Mean .036383
t -1.210
df 19
Sig. (2tailed) .024
Here, we know that if the significance value is above 0.05, we cannot reject the null hypothesis. We can see that the significance value is 0.024. Therefore, in this case, we reject the null hypothesis in favour of the alternative hypothesis. The results were not due to chance. This has proved that we can ACCEPT THE ALTERNATE HYPOTHESIS. Thus, Hedonic value is positively correlated with Brand Loyalty.
RESEARCH IMPLICATIONS
The research yielded an array of findings that bring to light the complex relationship between the two variables in consideration. The findings are presented below. 1. The survey analysis showed that the level of Hedonic value attached with brands having a higher utilitarian value is lower than those having a lower utilitarian value. Thus, a brand like Colgate, which is associated with toothpaste, has lower hedonic value compared to the other two brands which sell products with high symbolism. 2. This research provides insight into the complex interrelationship between Hedonic value and brand loyalty. A broader view of these results suggests an interrelationship between hedonic and utilitarian shopping value and purchase outcomes. While retailers have long focused on merchandise variety and assortment, convenience of location and store hours, and having competitively priced merchandise, the results here suggest that critical outcome variables like brand loyalty are influenced more by the non-product-related, hedonic aspects of products than traditional utilitarian orientations. 3. While speculative in nature, one perspective would suggest that shoppers' hedonic value is driven by a sense of the value of the product purchasedmost likely by obtaining sought-after goods or information. 4. Shoppers that associate high emotional value with the shopping task at a particular retailer and will remember their trip; they are more likely to think of this retailer and consider visiting again when similar shopping needs arise. Hence, it is reasonable then to connect judgments of hedonic value with a higher likelihood of loyalty in a retail environment, which is increasingly being characterized by rough parity in intangible elements. 5. Hedonic value represents the emotional worth of the shopping experience, and has been related to loyalty, significantly more so than utilitarian value. A higher level abstraction of the findings may suggest that certain types of outcomes are grounded more in the phenomenological experiences which govern everyday life, most of
An Empirical Study of Hedonic Brands which involves emotion and consumption. Emotion is the one key linking pin that holds together the entire consumption experience is thought that consumption is tied closely to imaginative constructions of reality, one in which we vicariously consume products we may or may not purchase, pretend we are other people in order to play out a desirable role, and imagine the outcomes of events and even our own levels of future satisfaction. It could well be that constructs which are thought to have an important affective component, such as brand loyalty, play a larger role in this constructed world, and may be more closely tied to indicators of the emotional experiences we have, such as hedonic value.
LIMITATIONS OF THE RESEARCH

1. A major impediment to this research is the difficulty of capturing the hedonic and utilitarian dimensions of brands with a reliable and valid measurement instrument. The most commonly used scale, used in this study as well, which Batra and Ahtola (1990) developed, has proved problematic in nearly all published reports of its use. 2. The literature lacks clarity regarding the relationship between involvement and the hedonic and utilitarian dimensions of attitude. 3. A prominent criticism of the scale used to measure Hedonic Value is its inability to account for relevant theoretical concepts within a nomological framework. 4. Before ascertaining the factors affecting brand loyalty, a pilot study using in- depth interviews was conducted with 20 respondents, who were aged from 18 to 40 years old. The assumption made here was that the population will belong majorly to this age group. 5. The survey administered to respondents using Colgate, to test the hedonic value of the brand was a two factor model. The utilitarian value of Colgate brand was higher because of the nature of the product. Toothpaste has higher utility value than hedonic value. 6. This study considers the influence of only one independent variable on the dependent variable. Brand loyalty is a product of the influence of several other factors other than the Hedonic Value of Brands.
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APPENDIX
I. FACTORS AFFECTING BRAND LOYALTY:
Please indicate your level of agreement with the statements that best describe your feeling toward your favorite brand by circling the number (Note: 1= Strongly disagree; 5= Strongly Agree).
A. LOREAL
Brand name: (Five-point Likert scale)
a) The brand is reputable. b) The prestigious brand name and image attract me to purchase from the brand. c) The brand name is selected regardless of price. d) The brand reflects my own personality. Product quality: (Five-point Likert scale)
a) The quantity of the products is sufficient. b) The ingredients used by the products are safe and reliable. c) The brand has sufficient variety I need. d) Products of the brand have good functional quality. Price: (Five-point Likert scale)
a) The increased price would not hinder my purchase intention. b) The brand provides good value for money. Style: (Five-point Likert scale)
a) The brand of products provide wide variety of styles for me to choose. b) Styles of the brand are suitable for me. c) Styles of the brand of have distinctive features.
An Empirical Study of Hedonic Brands d) Styles of the brand of are innovative and futuristic. Physical environment: (Five-point Likert scale)
a) The brand has good store locations and easy to access. b) The brand has sufficient outlets. Promotion: (Five-point Likert scale)
a) Advertisements of the brand are attractive. b) Advertisements of the brand attract me to purchase more frequently. Service quality: (Five-point Likert scale)
a) Salespersons of the stores that sell these products are well-trained and knowledgeable. b) Salespersons of the stores that sell the product are friendly and are willing to help me.
B. TOMMY HILFIGER
a) The brand is reputable. b) The prestigious brand name and image attract me to purchase from the brand. c) The brand name is selected regardless of price. d) The brand reflects my own personality. Product quality: (Five-point Likert scale)
a) The size measurement of the apparel fits me very much. b) The materials used by the brand are comfortable. c) The brand has sufficient colour choice I need. d) The clothes of the brand have good functional quality (e.g. breathable, odour-resistant, light weight).
An Empirical Study of Hedonic Brands Price: (Five-point Likert scale)
a) The brand provides wide variety of styles for me to choose. b) Styles of the brand are suitable for me. c) Styles of the brand have distinctive features. d) Styles of the brand are trendy and fashionable. Physical environment: (Five-point Likert scale)
a) The brand has good store locations and easy to access. b) The brand has sufficient outlets. c) The interior display of the brand is attractive. d) Color and music inside the stores are attractive and comfortable. Promotion: (Five-point Likert scale)
a) Advertisements of the brand are attractive. b) Advertisements of the brand attract me to purchase more frequently. c) Window displays of the stores are attractive. Service quality: (Five-point Likert scale)
a) Salespersons of the stores are well-trained and knowledgeable. b) Salespersons of the stores are friendly and willing to help me.
C. MERCEDES
a) The brand is reputable.
An Empirical Study of Hedonic Brands b) The prestigious brand name and image attract me to purchase from the brand. c) The brand name is selected regardless of price. d) The brand reflects my own personality. Product quality: (Five-point Likert scale)
a) The cars made by the brand are spacious and comfortable. b) The cars are sturdy and durable. c) The cars perform according to the promises made by the brand. Price: (Five-point Likert scale)
a) The brand provides wide variety of cars for me to choose. b) Models of the brand are suitable for me. c) Models of the brand have distinctive features. Physical environment: (Five-point Likert scale)
a) The showrooms have good locations and are easy to access. b) The brand has sufficient outlets. c) The interior display of the showrooms is attractive. d) Color and music inside the showrooms are attractive and comfortable. Promotion: (Five-point Likert scale)
a) Advertisements of the brand are attractive and memorable. b) Advertisements of the brand attract me to purchase more frequently. Service quality: (Five-point Likert scale)
a) Salespersons of the showrooms are well-trained and knowledgeable. b) Salespersons of the showrooms are friendly and willing to help me.
II.
FACTORS IDENTIFYING HEDONIC VALUE:
The following questions were asked across all 3 brands, given a 5-point likert scale:
1. Unpleasant- Pleasant 2. Disagreeable - Agreeable 3. Awful - Nice 4. Dissonant - Harmonious 5. Unsociable - Sociable 6. Negative - Positive 7. Dislike - Like 8. Bad- Good

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DISSERTATION PROJECT REPORT

AN EMPIRICAL STUDY ON HEDONIC BRANDS IN INDIA

Submitted to: Prof. Tripura Joshi

Submitted by: Shradha Mantri (091145)

An Empirical Study of Hedonic Brands

Institute of Management, Nirma University