Creating consumer‐based brand equity for young Iranian consumers via country of origin sub‐components effects

Abstract

PurposeThe main purpose of this study is to decompose the concept of country of origin (COO) and to investigate the influence of country of brand (COB) and country of manufacture (COM) on brand equity formation. Moreover, the secondary aim of this research is to examine the moderating role of product involvement.Design/methodology/approachTo accomplish this, a conceptual framework was designed and relationships between its constructs (COB image, COM image, brand equity dimensions, overall brand equity) were hypothesized. Data were collected from Iranian students who were the owners of selected brands of laptops and mobile phones. All hypotheses were tested using structural equation modeling (SEM) in LISREL.FindingsAs a result of exploratory factor analysis, three factors, namely brand loyalty, perceived quality and brand association/awareness were introduced for the brand equity dimensions. Results indicated that unlike COM, COB has a direct and significant effect on brand loyalty and COB positively influences perceived quality and brand awareness or association. Brand loyalty has a positive and direct effect on the overall brand equity. The results also indicate the moderating effect of product involvement on relationships between COB and brand equity dimensions.Research limitations/implicationsThis study only investigates in the country of origin of the product. The effect of laptops and mobile phones from a student's point of view were not taken into consideration, which includes other controlled variables (e.g. income, gender) and moderating factors (e.g. product familiarity).Originality/valueThis paper is important in order to identify the effect of brand equity formation from the point of view of young Iranian consumers. Product involvement effect is another important case in this research.