Influence of Brand Loyalty on Price Premium: A Case of Chinese Snack Food Products
Keywords:
Brand equity, brand loyalty, price premium, snack food productsAbstract
This study aims to study the influence of brand equity on customers’ willingness to pay a price premium for snack products. Its study is based on Cognitive Psychology Theory as well as Brand Value Chain Theory. The study focuses on a systematic analysis of brand equity drivers and composition dimensions; it was a quantitative research design using a structured survey questionnaire to collect data from 480 snack food product consumers in Yunnan province, China, who have experience purchased and consumed snack foods. The study employed Structural Equation Modeling (SEM) to analyze the data variables and test hypotheses.
The findings found that products and places were found to have a considerable positive correlation with brand equity enhancement in the snack product industry. Furthermore, it also revealed that brand utility had positive impacts on both brand equity dimensions and brand loyalty. Brand utility acted as an intermediary for the relationships between product, distribution channels and brand loyalty. Finally, the results from the study confirmed that both brand equity dimensions and brand equity enhancement had positive influence on customers' willingness to pay a price premium for snack food products.
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