Investigating the impact of advertising spending on brand equity dimensions in Kosovo: A comprehensive market analysis

Abstract

This research paper examines the impact of advertising spending on three crucial aspects of brand equity—brand awareness, perceived quality, and consumer purchase intention—in Kosovo's unique market environment. The study aims to offer a detailed analysis of both the actual advertising expenditures and consumers' perceptions of these expenditures, exploring their influence on brand-related metrics. This approach not only fills a significant gap in the literature concerning advertising spending in Kosovo—a developing economy facing substantial economic challenges—but also provides practical insights for businesses to optimize their advertising strategies even in times of economic downturns. The research encompasses a diverse array of 24 brands from sectors such as banking, microfinance, insurance, furniture retail, and supermarkets, thus presenting a comprehensive view of advertising's role in shaping consumer behavior. Employing a robust quantitative framework, the study integrates both secondary and primary data through statistical models like ordinary least squares and Probit, highlighting the strategic value of advertising investments and offering a contextually rich perspective on its effectiveness in enhancing brand equity elements within a challenging economic landscape.