Currently, around the world, corporations are being appealed to embrace their social obligations not only because it is the right thing towards shareholders, customers, employees, society and environment, but also because it strengthens their brands (Zaman, 2014). According to Li et al. (2013), brand image has been acknowledged as one of the most important concepts in marketing and it referred to the characteristic feature of a brand that reflected as brand associations held in public memory. In addition, several empirical findings have confirmed that a favorable brand image elevates the brand trust, brand equity and also the likelihood that consumers will purchase the brand. Furthermore, Fan (2005) states that consumers’ purchasing decisions is not only influenced by the perception of product, service quality or price, but also based on how ethical the company has fulfilled responsibility in producing its products or services.
2.2.3 Brand Loyalty High product sales can be explained in two different principles; the first concerned by many people buying the brand and the second concerned by that a few buying a lot. Ford (2005) referred the second principle to brand loyalty. A brand loyalty is a core factor in brand equity and should be taken in consideration when setting a value on a brand (Aaker, 1996). He continues saying that a highly loyal customer base is expected to bring in stabile sales and profit streams. When talking about loyal customer we can archive two important aspects – retain of customers and entry barrier.
If customers are loyal to brands then company can increase its productivity by offering brand’s further extension without the fear of failure (Reichheld and Sasser, 1990).The success of a firm depends mainly on its capability to attract consumers towards its brands. In particular, it is critical for the continued existence of a company to retain its current customers, and to make them loyal to the brand. To a large extent, the success of most businesses depends on their ability to create and maintain customer loyalty. In the first place, selling to brand loyal customers is far less costly than converting new customers. In addition, brand loyalty provides firms with great competitive weapons.
Lin and Chen (2006) in their studies found that brand image plays a pivotal role in deciding customers’ preference of purchase and recommendation. When brand image is positive or favorable then consumers will perceive a congruent corporate reputation and then increase the likelihood of maintaining their positive attitudes and behaviors. Schultz (2005) also found that loyal consumers more prefer to recommend a specific brand to other people and less likely influenced by competitors. Without a favorable and strong brand image, businesses cannot obtain a greater percentage of the market share, thus corporations always keep observing their branding strategies and practices (Schultz, 2005). According to Wu (2011), brand image has been acknowledged as a significant
The pricing strategy or pricing policy is one of the most important managers make for a product as it affects the profitable outcome and competitiveness that a product may make. (Toni, 2017). A business can use a variety of pricing strategies when selling a product or service. The price can be set to maximize profitability for each unit sold or from the market overall. It can also be used to defend an existing market from new entrants, to increase market share within a market or to enter a new market by dropping the price or offering more benefits with the device such as packages.
A consumer who prefers a particular brand basically agrees to select that brand over others based primarily on his or her perception of the brand and its value. The consumer will reward the brand owner with dollars, almost assuring future cash flows to the company, as long as his or her brand preference remains intact. Advertising and Consumer Behaviour Advertiser’s primary mission is to reach prospective customers and influence their awareness, attitudes and buying behaviour. They spend a lot of money to keep individuals (markets) interested in their products. To succeed, they need to understand what makes potential customers behave the way they do.
It is in the favor of the company to make their brand something that evokes positive perceptions in consumers. An example would be to ask yourself what is your perception of a certain brand, and as a consumer of that brand, how are you convinced that this is the brand for you? Thirdly, every brand makes a promise to consumers, and that is what the consumer expects. When a person spends their money on a brand, they are expecting something great. Consumer loyalty builds by making sure that the consumer gets what they paid for every time they spend on the brand, otherwise, they can leave the brand and turn to something
This would increase demand and increase customer loyalty, resulting in the increase of sales. Another strength of Ikea is that it is already a well-known brand, and that they are willing to improve based on customer needs. Also, costs would be cut down because Ikea would make the most of their work space in regard to being convenient as a workshop, being closer to customers to best serve them, and being closer to raw materials in order to hasten their services. Weaknesses should also be considered from both internal and external viewpoints. Questions like “what could I improve?” “What should I avoid?” “What factors lose sales?” should be asked.
Significance of Advertising in the Business World Irrespective of the nature of the business, advertising industry supports all other industries in their growth and promotion. It creates competition among businesses, makes the market more animated and customers more educated about top brands. Eventually, when a business doesn’t invest adequately in advertising it fails in competition; moves slowly in the market competitive and loses customers’ attention. Hence whatever be the economic scenario advertising will always remain essential for the success of brands. How GST is going to affect the Advertising Cost According to the latest report by Ernest & Young (EY), industries like FMCG, Automobile, and Consumer Durables will be able to advertise more due to GST at their current advertising budget because companies in these
(2006), it is observed that the concept of branding is one of the most important aspect of marketing and business strategy yet, business managers and advertisers are the one to understand its scope and role in grasping the business for a company from the market place. The most common understanding while identifying the role of branding is that it is the image and logo of the company that help the customers to recognise the company and other products and services (Blackwell, et al., 2006). However, Brodie, et al. (2013) determines that the role of branding is broader in regards of building an image and business of a specific product; it carries a message for customers to understand and then buy the product from the company (Brodie, et al., 2013). As indicated by Cai (2002), while overlooking branding as strategic viewpoint not just set of images, it can be said that brand play the role of centric approach that attract consumers towards the company, the formation of unique brand image include a logo, high-end product, price of the product as well as the location of its business range.