Brand Prestige and the Mediating Role of Word of Mouth in the Fast Food Industry

Abstract

The highly competitive business environment forces firms to differentiate themselves among their competitors in order to ensure their long-term survival and success. Therefore, building a strong brand has become a key priority for many successful firms. This article examines the effect of physical environment, food quality, price fairness and customer service on brand prestige in the restaurant industry. It also aims to provide a significant contribution to existing literature by examining the mediating effect of word of mouth (WOM) between the stated factors and brand prestige. The data in this study were collected using a survey instrument from customers at several international fast-food restaurant brands on the east coast of Malaysia. The collected data were analysed with SPSS using structural equation modelling (SEM). The findings indicated that physical environment, food quality and customer service have significant positive effects on brand prestige, but the effect of price fairness on brand prestige is insignificant. The outcomes also revealed that price fairness, physical environment and customer service have significant positive effects on WOM, whereas customer service is not significantly related to WOM. Finally, the findings reveal that WOM mediates the relationships between all of the stated factors and brand prestige.