A Study of Brand Equity Formation in the Fast Moving Consumer Goods Category

Abstract

Purpose:

To identify key relationships in building brand equity in the fast-moving consumer good (FMCG) category in the United Arab Emirates.

Design/methodology/approach:

It is postulated that marketing elements impact brand equity dimensions which in turn impact the brand equity construct. Five marketing mix elements were selected—price, distribution intensity, advertising, price promotions and non-price promotions, and four dimensions of brand awareness, brand loyalty, perceived quality and brand associations, finally to overall brand equity. Data were collected from a broad sample. Structural equation modeling was used to test the relationships among the 10 constructs.

Findings:

Brand loyalty and perceived quality have a significant impact on brand equity, whereas brand awareness and brand association were weak. Brand awareness has a significant influence on brand loyalty. Distribution intensity and non-price promotions have a positive relationship with all the brand equity dimensions, whereas weak support was determined for pricing and advertising.

Conclusion:

In the FMCG category building strong brand awareness combined with wide distribution and supported by non-price promotions are critical to building brand loyalty which in turn impacts brand equity.

Originality/value:

This study contributes to the general body of knowledge on branding and provides a starting point for further research in the region.