Brand Attributes and Value Perceptions Among College Students

Pioneer Undergraduate Research Fellowship 2002 - 2003 Final Report Brand Attributes and Value Perceptions Among College Students Principal Investig...
Author: Colin Berry
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Pioneer Undergraduate Research Fellowship 2002 - 2003

Final Report

Brand Attributes and Value Perceptions Among College Students

Principal Investigator: Kelley J. Anderson Major: Agribusiness

Faculty Advisor: Dr. Avuthu Rami Reddy

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Title: Brand Attributes and Value Perceptions Among College Students Introduction: There are strong preferences among college students for the branded products and often they are the major target group of marketing campaigns of national products. Brands encourage customer loyalty and generate higher profits than non-branded products or generics. Brand loyalty is particularly evident when we examine the clothes, shoes, backpacks and foods that students consume. College students prefer branded products to non-branded products because of favorable perceptions towards the branded goods. Strong brands such as Gap, Tommy-Hillfiger, Starbucks, Pepsi, Coke, Gatorade, Nike, Adidas etc., had earned great share and respect of the customers and brand loyalty is very high among students for these branded products. Brand name had strong effect in forming tastes and expectations. Price had a marked effect in determining the perceptions of quality and reliability of ingredients. There are higher price and higher quality perceptions for branded products. Many generics or non-brands have low-price, low quality perceptions. But on value proposition the perceptions are mixed since both branded and non-branded products yield same level of value to different groups of customers. Some people prefer low price in lieu of quality. Consumers believe that this price discount is traded-off with product quality. A value may be defined as the difference between the perceived benefits and sacrifices that customer incur when buying and consuming a product. A high value product is one that offers greatest benefits to the consumer both functional as well as psychological. As shown in the value map (fig.1) perceived low price and high quality represent better value (see…happy face) where as high price and low quality represent worse value (see…thunderbolt). High price and high quality as well as low price and low quality may lead to certain degree to the same level of value perceptions (see…blue dots on the same plane in fig.1).

Market Perceived Price

Worse Value

Same Value

Better Value

Market Perceived Quality

Figure 1: Value Map 2

The processes of consumer perception and decision making remain relatively complex phenomena despite the depth of research undertaken in the area. But none of the research measured the brand preference strength. We will examine this issue by comparing the perceptions towards branded and un-branded product. An un-branded product is one, which is same as that of branded product except the label, logo or package i.e. the product will be stripped of all brand paraphernalia to look like a generic. An unbranded product is a branded product dressed or undressed as a generic. The research issue of interest therefore is how do consumers perceive the performance of a range of individual branded and un-branded products in terms of value, quality and price. Consistent with previous research results (Swait et al., 1993) we assume that the branded product will represent high quality and high price where as unbranded product or generic will represent low quality and low price. But the value perceptions are not clear. It is interesting to experiment how consumers will judge the branded versus un-branded product with regard to their value perceptions. Research Questions: This study addressed the following questions. 1. Do consumers perceive the same product differently if it is presented as branded as well as un-branded product? We expect strong perceptual differences if there is strong brand preference or image and small difference if the image is poor for the product. 2. How strong are these perceptions with regard to price, quality and overall value proposition for branded versus un-branded product? We formulated two testable hypotheses. First, the price and quality perception of branded product is high compared to un-branded product. Second one is that the value proposition of the same product should not differ significantly when presented as branded versus unbranded. Research Methodology: An experiment was designed to elicit the perceptions of brand versus un-branded products. Experiment was set up using well-known branded products in the categories of products that are familiar to college students. A rating form was developed for each product. Side by side evaluation of brands and un-branded products with regard to price, quality and value was done. The only visual cue allowed is the branded products package, logo or label. The subjective judgments with regard to several attributes of the products such as price, quality and value were assessed on a continuous scale. For example, the subjects will be asked to judge the quality of the branded versus un-branded product on a continuous scale of zero to ten. On this scale zero represents very poor and ten represents very high perceptions of a given attribute such as price, quality and value. Since both the un-branded and branded products are one and the same except the visual cues for the branded product the subjects should state their preferences equally. Any discrepancy in

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their preferences will be attributable to strong brand image and value perceptions of the brands. The stated hypotheses was tested by checking for the statistical significance of the difference in the mean ratings of the two products, branded and unbranded on various attributes. High price and high quality perception of branded product should yield better mean rating than low price and low quality perception of unbranded product. The strength of the perceptions can be measured as the difference of these scores. Since the products evaluated are same any difference between the scores will be attributable to strong brand perceptions or image. On the value perception both the branded and unbranded should yield statistically insignificant score if there are no significant differences in value perceptions. We used the simple Z-test statistic to see the mean differences between the two samples of the same branded product. The experiment was set up and conducted using the branded and unbranded products. Several volunteers were asked to rate the products displayed using a rating sheet. Respondents were asked to use continuous scale by which they can indicate their preference strength much more conveniently. Three food products and non-food products were tested. The names of the products and the brands used were given in Table. 1. Among the non-food products t-shirts, shorts and backpacks were used which are common items that majority of the college students are familiar with. Among food products, two types of cheese and one orange juice were used in the experiment. Respondents were encouraged to touch and examine the products thoroughly before giving their final ratings. They were allowed to experience the food products by consuming small samples of the products. There were a total of 32 respondents who took part in the experiment. Out of these 32 only 27 filled the rating sheets correctly. So we had 27 usable responses. The ratings were evaluated and tested for any significant differences and the results follow. Table 1: Product and the brand used in the experiment. PRODUCT 1) T-shirts 2) Shorts 3) Backpacks 4) Cheese type - 1 5) Cheese type - 2 6) Orange juice

BRAND 1) Hanes 2) Lee Dungree 3) Nike 4) Kraft Sharp Cheddar 5) Sargento Mozzarella 6) Minute Maid Premium

Results: Tables 2 provide the mean ratings, the range and the Z-test statistic along with its p-value for three attributes such quality, price and value for all the six products. For most of the products the branded products received higher mean rating with regard to all the attributes. From the results it is evident that for most of the products the difference between the branded and unbranded products is not significant except for Kraft brand of

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cheddar type cheese. For this product the mean difference between branded and unbranded products is different at a significance level of 0.05. The Z-statistic is significant indicating that the two samples are from two different populations. This is strong evidence the respondents exhibited perceptual difference toward this branded product. Table 2: Product Attributes and the mean scores. PRODUCT

ATTRIBUTE

BRANDED

UNBRANDED

1) Hanes T-shirt

a) Quality

8.25 (range 5 – 10)

b) Price

6.66 (range 2.3 – 10)

c) Value

7.76 (range 5 – 10)

a) Quality

8.13 (range 5 – 10)

b) Price

7.21 (range 2.1 – 10)

c) Value

7.39 (range 1.5 – 10)

a) Quality

7.35 (range 4 – 10)

b) Price

7.41 (range 2.3 – 10)

c) Value

7.07 (range 3 – 10)

a) Quality

7.35 (range 4 – 10)

b) Price

7.41 (range 3 – 10)

8.13 (range 5 – 9.35) Z-score: 0.36 P-value: 0.72 6.28 (range 2.3 – 9.4) Z-score: 0.68 P-value: 0.49 7.78 (range 4.5 – 10) Z-score: -0.053 P-value: 0.95 7.86 (range 4-10) Z-score: 0.72 P-value: 0.47 6.98 (range 2.1 – 10) Z-score: 0.43 P-value: 0.66 7.01 (range 1.5 – 10) Z-score: 0.74 P-value: 0.45 6.99 (range 3.5 – 9) Z-score: 0.81 P-value: 0.42 7.25 (range 2.3 – 9.4) Z-score: 0.25 P-value: 0.80 6.88 (range 3 – 9) Z-score: 0.25 P-value: 0.80 5.99 (range 3 – 10) Z-score: 3.03 P-value: 0.002** 7.25 (range 4 – 10) Z-score: 0.34 P-value: 0.74

c) Value

7.01 (range 3 – 10)

a) Quality

7.77 (range 3 – 10)

b) Price

6.82 (range 2 – 10)

2) Lee Dungree Shorts

3) Nike backpacks

4) Kraft Sharp Cheddar Cheese

5) Sargento Mozzarella Cheese

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5.88 (range 2 – 8) Z-score: 2.38 P-value: 0.017** 7.79 (range 3 – 10) Z-score: -0.04 P-value: 0.96 6.39 (range 2 – 10) Z-score: 0.36 P-value: 0.72

7.03 (range 2 – 10)

7.23 (range 2 - 10) Z-score: -0.35 P-value: 0.72 7.85 (range 5 – 10) 7.51 (range 4.5 – 9.5) 6) Minute Maid a) Quality Z-score: 0.81 Premium Orange Juice P-value: 0.41 6.8 (range 4 – 10) 7.25 (range 5 – 10) b) Price Z-score: -1.22 P-value: 0.22 7.63 (range 5 – 10) 7.30 (range 4.5 – 9.5) c) Value Z-score: 0.70 P-value: 0.48 Note: ** indicates significant at 0.05 significance level or 95% of confidence level. c) Value

Conclusions: For non-food products price, quality and value perceptions are not different for branded and un-branded products. Where as in the food products group there were strong brand perceptions with regard to the attributes in the case of cheddar cheese (Kraft brand). For this branded product the quality and value perceptions were significantly different for branded and un-branded product. The branded product was perceived superior to the un-branded product. The mean price difference was not significant. Respondents did not indicate any price difference among the products. Probably, they lack knowledge or unable to judge the products based on this attribute. Respondents failed to identify the two products to be the same brand. This case clearly shows influence that a strong brand will have on the perceptions and failure of the subjects to identify them in the test. This proves the earlier hypothesis that the quality perception of branded product is high compared to un-branded product. We fail to prove the second hypothesis that the value proposition of the same product should not differ significantly when presented as branded versus unbranded in the case of Kraft cheddar cheese. The value of strong brand is perceived to be greater than that of unbranded products. Familiarity with the Kraft branded cheese among the respondents and strong brand image are the reasons for perceptual differences with regard to quality and value propositions. We conclude that there are strong perceptual differences with regard to certain attributes when the brand had strong image or familiar. These perceptual differences that exist for strong brands needs further research to develop effective marketing campaigns and refine the marketing strategies. This study points out that the perceptual differences exist for strong brands and people recognize differently, the branded and unbranded product. There are certain limitations to our study. The respondents are of the same age group, college students and we tested only few products in the experiment. We can extend similar study to several other products and the experiment should be conducted in the real world to test for the major hypothesis stated in the study.

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References: 1) Swait, J., Erdem, t., Louviere, J. and Dubelaar, C. (1993), “The equalization price: a measure of consumer-perceived brand equity”, International Journal of Research in Marketing. Vol. 10, March, pp. 23-45. 2) Daniel W. Wayne, Terrell C.James. “Business Statistics: For management and Economics” 7th edition, Houghton-Mifflin.

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