Equity Construct Research Articles

Equity Construction in Progress: Problems of Theory and Practice

Equity Construction in Progress: Problems of Theory and Practice

Students’ perceived risk and investment intention: the effect of brand equity

Abstract Emerging markets bring out the question of motivation to include of new investors in the market for financial securities often arises. The purpose of this study is to analyze how brands influence the investment intention of young potential investors. Specifically, the relationship between consumer based brand equity - according to Aaker’s multidimensional conceptualization - and investment intention, mediated by perceived risk, is analyzed. The study contributes to the literature in two ways: (1) based on the revision made, no study has analyzed Aaker’s brand equity construct in investment decisions; (2) studies linking brand aspects to investment decisions have not examined the mediating role of perceived risk. Through an experiment, where perceived risk and investment intention in a famous brand were measured as differences from fictitious brands, the following results were found: (1) the investment intention in a famous brand is higher than in a non-famous one, once controlled for risk and return; (2) the higher the brand equity, the lesser the perceived risk of investing in the famous brand, and the higher the investment intention; (3) the perceived quality of a brand’s products was the dimension by which the effect of brand equity is transmitted. Involvement with the investment task and cognitive ability, at an individual level, the relative size of comparable firms, and the risk and return of investment alternatives were introduced as control variables.

Default Option and the Cross-Section of Stock Returns

We argue that default option is important for equity valuation and construct a model that explicitly prices the option to default or abandon the firm. An investment strategy that buys stocks that are classified as undervalued by our model and shorts overvalued stocks generates an annual 4-factor alpha of about 11% for U.S. stocks. The model’s performance is stronger for stocks with higher value of default option, such as distressed or highly volatile stocks. We construct a similar strategy in a sample of nine most highly capitalized developed markets and find consistent results. Our findings suggest that investors do not properly incorporate the value of default options in stock prices.

Brand Equity Perceptual Mapping: Competitive Landscapes and Consumer Segments in Brand Equity Space

This study advanced a technique to map brand metrics and theoretically derived diagnostics that depict the relative positions of competitive brand sets and audience segments in a perceptual consumer-based brand equity space. Survey research collected brand equity ratings for two sets of competitive brands (Nike, Converse, Reebok and Toyota, Nissan, Pontiac), used to construct a pair of twodimensional maps that illustrate the brands’ position on brand equity dimensions relative to competitors and demographic-based segments. Paired brand equity indicators resulted in eight map quadrant areas that characterize a brand positioned in that space. The mapping techniques facilitate the strategic application of multidimensional brand equity constructs and their use as brand valuation tools.

Effect of Experiential Value on Consumer-Based Brand Equity: An Interactive Device Perspective

With every product we buy, there is an associated experience. The better the experiences, the better a user feels about his/her decision to buy and use the product; and the feelings do not stay with the product. They are indeed transferred as brand associations and imagery with the brand of the product, defined as brand equity in the marketing literature. Positive brand equity is critical for the success of a brand as it creates repeat transaction of the user with the manufacturer. It is in this context that this study attempts to understand the relation between different components of user experience and brand equity. Intrinsic and extrinsic values have been taken as components of user experience while association, perceived quality, perceived value, trust and loyalty are elements of brand equity. All the relationships between the different constructs of experience and brand equity were found significant. We also found significant evidence for the hierarchical formation of both user experience and brand equity. The study contributes to the literature of brand experience and how it is critical for brand equity and for the consumer. For marketers, we establish how important it is for them to provide a positive user experiences for their brands to be successful. A proper mix of intrinsic and extrinsic consumption values to the consumer will go every length to convince him/her to stay with the brand.

The discursive construction of knowledge and equity in classroom interactions

Given the established relationship between student participation and learning, an equitable distribution of turns at talk is critically important. This paper examines the discursive strategies teachers use in allocating such turns during teacher-fronted lessons, demonstrating that the predominant strategy in many classrooms—one in which teachers avoid dispreferred (incorrect or inappropriate) responses by soliciting volunteers and nominating only those students who actively seek the floor—is inconducive to the goal of equity insofar as it allocates fewer turns to students who (due to culture, personality, etc.) volunteer less often. It is shown that the advantage of this strategy stems from teachers’ use of monologic recitation scripts. Consequently, abandoning such scripts in favor of more dialogic classroom discourse—as has long been recommended—would reduce the desirability of volunteer-based turn allocation, thus freeing teachers to promote an equitable distribution of opportunities for student participation by nominating students regardless of whether they seek the floor.

Antecedents and consequences of strategic green marketing orientation

Purpose– The study aims to propose four novel constructs of green satisfaction, green loyalty, green trust and green brand equity. It identifies the role of social marketing, relationship marketing, marketing orientation, general strategies, green marketing and marketing mix elements in enhancing financial and non-financial performance and ultimately the green brand equity. Green marketing strategies are gaining significant attention in the literature to support societal marketing conceptvis-à-visto enhance brand equity in the present competitive era. The present study conceptualizes a novel strategic green marketing orientation (SGMO) concept.Design/methodology/approach– The paper draws upon the extant literature to present a series of research propositions relating to SGMO.Findings– The study provides new insight to marketing management by highlighting the factors such as social marketing, relationship marketing and marketing orientation as the constituent elements which facilitate the development of SGMO in an organization. Further, the study has put emphasis on SGMO- performance relationship which is mediated by green trust, green satisfaction and green loyalty. Finally, it advances an understanding in enhancing green brand equity of the organization.Research limitations– Being conceptual in nature, the paper needs to be empirically tested across manufacturing and service sectors. Further, lack of generalization of the scale items in various sectors needs to be researched in the future research.Originality/value– This paper can help managers in identifying the three perspectives of SGMO, which include strategies (general), green marketing and marketing mix elements.

Linking user experience and consumer-based brand equity: the moderating role of consumer expertise and lifestyle

Purpose– The study aims to explore the buildup of consumer-based brand equity (CBBE) from positive derived experiences. Rewarding experiences with products make a user feel good about their decision to buy and use them. Those feelings get accrued as strong consumer–brand relationship, measured comprehensively by CBBE in marketing literature.Design/methodology/approach– The study is conducted in two phases – exploratory and validation. The exploratory phase involved conceiving a theoretical framework from in-depth literature review. The framework is then validated through a survey-based empirical phase. Smartphones form the context of the work.Findings– The three consumption values used in the study are usability, social value and pleasure in use. Brand equity has been conceptualized and measured as brand association, perceived value, brand trust and brand loyalty. The moderating role of user expertise, as well as lifestyle, was also tested on pleasure derived. Most of the hypothesized relationships between different constructs of experience and brand equity were found significant. Significant evidence for hierarchical formation of brand equity was also established.Research limitations/implications– Lack of evidence of moderation of lifestyle may be ascribed to the validity of the scale used to measure it in the current context and needs to be updated. The study contributes by conceiving experience as a multidimensional framework based on Holbrook’s typology, besides validating its relationship to CBBE. Hierarchical formation of brand equity is also a novel contribution.Practical implications– This study provides an indicative guide to marketers with design cues that can provide relevant consumption values in the quest for a positive brand impression. It also provides directions for segmenting the smartphone market based on user expertise for better branding.Originality/value– The study is innovative by relating experience, conceptualized with Holbrook’s framework and CBBE – something yet to be seen in the literature.

The Impacts of Electronic Word of Mouth on Brand Equity in the Context of Social Media

Social media has become the driving force which transforms the web into an interactive information andcommunications technology device. Social media has a significant role in influencing customer’s choice inselecting products and services based on the customers’ feedbacks that appeared in the weblogs, web sites,online boards and other kinds of user-generated content (Raman, 2009). It is indeed important to remember thatbrand equity is no longer valued by large sums of money that companies invest; instead customers are dictatingthe value of brand equity by what they are saying to each other. Therefore, this study will focus on evaluating theroles of various brand equity constructs (including brand loyalty, brand association, brand awareness and brandimage) in mediating the interrelation among electronic word of mouth and the dimensions of brand equity in thecontext of social media. There were total of 300 usable questionnaires were collected in this research. Thefinding revealed that there is an indirect inter-relationship between electronic word of mouth and the dimensionof brand equity, mediated by the respective various brand equity constructs.

The role of organizational mindfulness in firms’ globalization and global market performance

Purpose– This research aims at contributing to international marketing literature by reconsidering the drivers of firms’ globalization and global market performance in the light of organizational mindfulness concept.Design/methodology/approach– Based on industrial organization theory, resource-based view and literature on organizational mindfulness, a conceptual framework is presented to characterize how organizational mindfulness impacts firms’ globalization process and global market performance. In total, 14 propositions are extracted.Findings– This paper proposes that organizational mindfulness plays a significant role in firms’ entry into foreign markets, global extension and global market performance. More specifically, organizational mindfulness positively moderates the relationships between external globalization drivers and the extent of firms’ globalization. In addition, organizational mindfulness is an antecedent to strategic processes, whereas it positively moderates the relationships between other internal drivers and firms’ globalization and global market performance. Furthermore, this paper suggests that country equity is a significant external globalization driver that also moderates the relationship between the extent of firms’ globalization and global market performance.Research limitations/implications– The proposed framework contributes to international marketing research by integrating organizational mindfulness concept into the drivers of firms’ globalization and global market performance, and highlights its crucial role in the pursuit of opportunities in the global marketplace. The paper suggests that firms should create mindful organizations to expand its activities into global markets and achieve desirable global market performance. In other words, they should improve collective mindfulness to survive in today’s hyper-competitive markets.Originality/value– The paper represents the first attempt that incorporates organizational mindfulness concept into firms’ globalization process. Highlighting the importance of developing mindful organizations, it reconsiders the drivers of firms’ global expansion and global market performance. Furthermore, it is the first attempt that introduces the country equity construct as an external driver of firms’ global extension and as a moderator between organizational reform measures and global market performance.

Effects of the Above the Influence Brand on Adolescent Drug Use Prevention Normative Beliefs

Health brands are based on the relations between individuals and health behaviors and lifestyles. Brands can be measured by the brand equity construct validated in previous studies. The National Youth Anti-Drug Media Campaign brands alternative, non–drug use behaviors as a behavior change strategy. This study goes beyond previous campaign evaluations, which did not include specific brand equity measurements. Using data from a nationally representative media tracking, this study examined the relation between antidrug campaign brand equity and adoption of targeted attitudes, beliefs, and behaviors. Data were gathered before the relaunch of the campaign, and follow-up data collected 3 months later. On the basis of factor analysis, the authors developed a higher order antidrug brand equity factor and regressed campaign outcomes on that factor in multivariable models. The authors observed significant effects of higher brand equity on higher levels of targeted antidrug attitudes and normative beliefs at follow-up. The authors also observed some counterintuitive relations (i.e., less positive attitudes at follow-up). They interpreted these results in light of the changing messages and campaign strategy. The authors conclude that antidrug brand equity is an important construct for understanding campaign effectiveness. The present campaign shows signs of changing targeted antidrug attitudes and beliefs among youth with brand equity.

The effect of content credibility on consumer-based brand equity: the case of Indian television channels

With the entry of foreign direct investment (FDI) the media industry has proliferated and multiple brands now vie for eyeballs in the television industry. Consequently content of the channels is no longer directed by fourth estate prerogatives. This is reflected in the proclivity of the news channels in resorting to sensationalism and constant ‘breaking news’. Thus the purpose of this article is to explore the influence of credible content and packaging on consumer-based brand equity of television channels. Here credibility measures have been taken from journalism content credibility constructs, on the other hand, Aaker’s (1991) dimensions of CBBE have been used to measure the brand equity construct. The study reveals that content credibility only explains 47% of the variance in brand equity. However, there are strong correlations between the constructs.

Segmentation policies using the customer equity model: a study in a Brazilian hypermarket

The objective of this study was to analyse the criteria of priority used to adopt the marketing strategies of quality, price, convenience, brand and relationship, and its adequacy towards the values that are perceived by the customers’ segments of a retailer, using the customer equity model. The methodological procedures consisted of a survey that was directed to the consumers and an analytic hierarchy process (AHP) was applied with the hypermarkets’ managers. The priority criteria for the adoption of marketing policies were based on the value equity, brand equity and retention equity constructs. The results have shown that these policies do not meet the expectations of most of the consumers, who value first the brand, followed by the retention and finally the value equity. In contrast, the managers that were interviewed still have their focus on the price as the main strategic action for the customers’ satisfaction, followed by brand and retention.

Retail brand equity: a model based on its dimensions and effects

Brand equity has been recognized as a key variable in both the academic and professional literature. This article aims to deepen the nature of the retailer equity construct and identify the variables that contribute to its formation, proposing an integrative model based on their dimensions and effects. From an empirical perspective, a survey is carried out with 300 consumers in three retailer categories, in order to analyze the relationships of the model. Due to the formative nature of two of the constructs, the analysis is developed through the partial least squares technique. From the analysis of the results, the importance of store image, perceived store value, and store awareness are seen as retailer equity dimensions. Additionally, this study confirms the relationship between retailer equity and the satisfaction–loyalty chain of effects.

Equity Manager Selection and Portfolio Formation: Interviews with Investment Staff

We interview professional institutional investors to learn how they choose between active and passive management, select active equity managers and construct multi-manager portfolios. We find that many of the aspects emphasized in the fund management literature, such as returns generated by the average manager and emphasis on past performance, play a relatively minor role in decisions. In contrast, judgment is found to play a central role, particularly the evaluation of people when selecting managers, the role of confidence in retaining managers, and self-perceptions about capability to identify skilled managers. Past performance is not taken at face value, but analyzed to understand underlying sources of returns. Stated reasons for preferring active management relate to whether a handful of skilled active managers can be identified and combined to generate a better expected portfolio outcome; and are only vaguely associated with the performance of the average manager.

Introduction: Corporate Reputation in Historical Perspective

“Corporate reputation” is a term that on the face of it hardly needs explanation. Historians have long used it in an unproblematic fashion to refer to the way a firm is perceived by others. Yet as with many such terms, corporate reputation can be theorized or at least formally defined. Scholars in the fields of marketing and organization increasingly are doing both; since the 1980s they have attempted to distinguish reputation from the related constructs of image, identity, status, legitimacy, celebrity, and brand equity. The project is ongoing, and a strong consensus has not yet been reached on how to define corporate reputation. Charles Fombrun, whose definitions have been perhaps the most widely used, suggests the following: “a collective assessment of a company's attractiveness to a specific group of stakeholders relative to a reference group of companies with which the company competes for resources.” Fombrun's definition contains three core ideas: firms have multiple reputations, depending on which stakeholders are being considered; corporate reputation is a comparative construct, because a firm is always judged in relation to something else—in this case, the firm's competitors; and firms' reputations are a source of competitive advantage or disadvantage.Historians, who for valid intellectual reasons rarely attempt the formal definition of terms, have not participated in the theorizing of corporate reputation. Yet the peculiar skills of historians are much needed; for if the study of corporate reputation has underemphasized the role of institutional phenomena such as rules, norms, processes, and structures, it has all but ignored historical context and historical processes.

Candidate Brand Equity Valuation: A Comparison of U.S. Presidential Candidates During the 2008 Primary Election Campaign

This study employed a multidimensional brand equity construct (i.e., brand awareness, associations, perceived quality, and loyalty) to compare the brand name strength of four U.S. presidential candidates (i.e., Clinton, Obama, McCain, and Huckabee) with registered voter segments during the weeks preceding the 2008 primary election and nearly a year before the general election. The level of candidate brand equity was significantly related to respondents' future voting intentions, and party bias resulted in significant differences in brand equity valuation, mainly due to differences in perceived quality and candidate loyalty ratings. Results mirrored polling data and election results. Candidates with the highest within-party brand equity won the state primary election (i.e., McCain and Clinton), while the strongest candidate brand with voters opposite their party electorate and with Independent voters won the U.S. presidential election (i.e., Obama). Discussed are suggestions for studies to advance the present findings, particularly the inclusion of brand image constructs into the employed framework.

Constructs of power and equity and their association with contraceptive use among men and women in rural Ethiopia and Kenya

Using samples of reproductive aged men and women from rural Ethiopia and Kenya, this study examines the associations between two scales measuring balances of power and equitable attitudes within relationships and modern contraceptive use. The scales are developed from the Sexual and Reproductive Power Scale (SRPS) and Gender Equitable Male (GEM) scale, which were originally developed to measure relationship power (SRPS) among women and gender equitable attitudes (GEM) among men. With the exception of Ethiopian women, a higher score on the balance of power scale was associated with significantly higher odds of reporting modern contraceptive use. For men and women in both countries, a higher score on the equitable attitudes scale was associated with significantly higher odds of reporting modern contraceptive use. However, only the highest categories of the scales are associated with contraceptive use, suggesting a threshold effect in the relationships between power, equity and contraceptive use. The results presented here demonstrate how elements of the GEM and SRPS scales can be used to create scales measuring balances of power and equitable attitudes within relationships that are associated with self-reporting of modern contraceptive use in two resource-poor settings. However, further work with larger sample sizes is needed to confirm these findings, and to examine the extent to which these scales can be applied to other social and cultural contexts.

On Cross-Currency Models with Stochastic Volatility and Correlated Interest Rates

We construct multi-currency models with stochastic volatility (SV) and correlated stochastic interest rates with a full matrix of correlations. We first deal with a foreign exchange (FX) model of Heston-type, in which the domestic and foreign interest rates are generated by the short-rate process of Hull–White (Hull, J. and White, A. [1990] Pricing interest-rate derivative securities, Review of Financial Studies, 3, pp. 573–592). We then extend the framework by modelling the interest rate by an SV displaced-diffusion (DD) Libor Market Model (Andersen, L. B. G. and Andreasen, J. [2000] Volatility skews and extensions of the libor market model, Applied Mathematics Finance, 1[7], pp. 1–32), which can model an interest rate smile. We provide semi-closed form approximations which lead to efficient calibration of the multi-currency models. Finally, we add a correlated stock to the framework and discuss the construction, model calibration and pricing of equity–FX–interest rate hybrid pay-offs.

Critical Factors for Developing Brand Equity: An Empirical Investigation In Malaysia

The power of branding is most often powerful than the product itself. Renowned brands like Procter and Gamble paid Richardson-Vicks 2.6 times of its book value. Nabisco was sold for 3.2 times of its book value and General Motors was sold for 3.5 times its book value. Whilst these corporations succeeded in using their brand as a source for their company's worth, others lagged behind, trying to comprehend the real value of branding. This study draws upon past literatures in branding and proposes the use the brand equity concept towards formulating a meaningful plat for a Malaysian Internet service called TMnet, Jaring and Maxis to nest. This study develops a brand equity construct which nestles upon brand concept of functionality, image, perceived quality and brand loyalty. Developing brand equity is not an easy task. Therefore, this study tries to identify the important factors for creating brand equity. Results of this study shows that perceived quality is the most important factor for developing brand equity. The results of this study confirm the significant influence of these four utmost important factors on brand equity. In conclusion, practitioners can derive a better understanding of the activities that are undertaken by these organizations and how the way these activities are being dealt with. Keywords: Functionality, image of brand, perceived quality of brand and brand loyalty