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A 1hesls aper
resenLed Lo Lhe
MarkeLlng ManagemenL ueparLmenL
8amon v. del 8osarlo College of 8uslness
ue La Salle unlverslLy




ln arLlal lulflllmenL
Cf Lhe Course 8equlremenLs of Lhe uegree
MasLers of Sclence ln MarkeLlng




SubmlLLed by:

!osef karlo v. rado


1hesls Advlser: Mr. 8enlson ?. Cu, CM


AugusL 2013




1


APPROVAL SHEET


This thesis hereto entitled:

The Relationships Between Brand Equity, Brand Preference and Purchase Intent
of Premium Residential Condominium Units


prepared and submitted by Josef Karlo V. Prado in partial fulfillment of the
requirements for the degree of Master of Science in Marketing has been examined
and is recommended for acceptance and approval for MSM Final Thesis Defense/
Oral Examination.



Mr. Benison Y. Cu, CPM
Adviser


Approved by the Committee on Oral Examination with a grade of PASSED on August
17, 2013.


Ms. Marie Julie B. Taada
Chair




Dr. Luz T. Suplico-Jeong Ms. Carmelita M. Walton
Member Member


Accepted in partial fulfillment of the requirements for the degree of Master of Science
in Marketing



Dr. Maria Andrea L. Santiago
Dean, College of Business



2


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4


ABSTRACT

This study attempts to establish relationships between brand equity, brand
preference, and purchase intent in the increasingly competitive premium residential
condominium market in Metro Manila.
Brand equity was measured using scales derived from David Aakers customer-
based brand equity model, and then compared with corresponding survey results
regarding brand preference and purchase intent. The collected data was then subjected to
linear regression analysis to validate any possible correlations. The effects of each
dimension of brand equity as defined by Aaker (loyalty, awareness, associations, and
perceived quality) were also explored. To establish a cross-section of the entire industry,
data was collected in reference to five major real estate brands (Ayala Land Premier,
Shang Properties, Robinsons Luxuria, Century Properties, and Rockwell Land
Corporation).
Research scope was limited to premium residential condominium units (those
priced at about Php 120,000 170,000 per square meter). Furthermore, this study focuses
on a psychographic profile herein referred to as the value seeker.
Significant and positive correlations were found between brand equity, brand
preference, and purchase intent, as supported by a variety of studies that have reported
similar findings. Analysis of brand equity dimensions and suggested avenues for further
research conclude the paper.


5


CHAPTER 1
INTRODUCTION

1.1. Background of the Study

In contrast to the unfavorable outlook in other international real estate markets,
economic indicators related to the Philippine real estate market have shown highly
promising growth prospects.
For 2011, Colliers International reported an annual growth rate of 17% throughout
the real estate sub-sector, a figure that far exceeds the countrys GDP growth of 3.7%.
Similar growth rates were also reported for the first three quarters of 2012 (Colliers
Market Report, 2012).
Evidence also suggests that this growth is significantly buoyed by the high-rise
residential segment. HLURB license issuances for high-rise residential projects increased
by 31.7% from 2010 to 2011 (Table 1), a substantial figure considering the number of
projects involved as well as the capital-intensive nature of condominium development.
Based on forecasted residential supply figures, it is reasonable to expect the market to
maintain this growth trend for now, and until at least 2014 (Table 2).
The rapid growth in the local real estate sector is a potential opportunity for
significant shifts in market share, and for current leaders to further distance themselves
from the rest of the industry. For investors, this growth along with generally improving

6


economic fundamentals in the country makes real estate an increasingly promising value
proposition.

Table 1: HLURB License Issuances (adopted from Colliers Market Report, retrieved January 20,
2013 from http://www.colliers.com/en-GB/Philippines/Insights)

Table 2: Forecasted Residential Supply until year 2014 (adopted from Colliers Market Report,
retrieved January 20, 2013 from http://www.colliers.com/en-GB/Philippines/Insights)



7


Conducting a brand equity study may yield important insights regarding the
current state of the market and help predict customer purchase inclinations during this
critical growth period. This kind of study can also reveal important success factors that
real estate companies could focus on to improve overall brand performance.

1.2. Operational Definition of Terms

The following definitions will be used for purposes of this study:

Brand associations
The ability for consumers to identify characteristics of a developer as a premium
residential condominium brand. This also includes consumer association of its
projects specifically as premium brands.

Brand awareness
The ability to easily recall and recognize a developer as a premium residential
condominium brand. This involves both general awareness and top-of-mind
awareness.




8


Brand equity
The combined effect of all four dimensions of brand equity. This is assumed to be
the representation of a condominiums brand value to the consumer in the
premium residential condo market.

Brand loyalty
The general level of attachment and commitment a customer has towards a
particular brand in the premium residential condominium market.

Brand preference
The extent to which a customer favors a particular brand over any other as a
premium condominium brand.

Premium residential condominium units
Residential condominium units specifically designed for upscale (class AB)
customers, characterized by branded finishes and fixtures, spacious layouts (abour
50 square meters), and high-value locations inside business districts or key
lifestyle hubs. Correspondingly, these units command a high price, commonly
about Php120,000 P170,000 per square meter.



9


This study limits its focus on the following premium residential condominium
projects:
One Serendra (Ayala Land Premiere)
The Residences at Greenbelt (Ayala Land Premiere)
Sonata Private Residences (Robinsons Luxuria)
The Gramercy Residences (Century Properties)
One Rockwell (Rockwell Land Corporation)
Joya Lofts and Towers (Rockwell Land Corporation)
St. Francis Shangrila Place (Shang Properties)
Shang Grand Tower (Shang Properties)

Perceived quality
The customers assessment of the condominium products quality, both in terms
of the actual finished product and its expected rate of return on investment (for
investors).

Purchase intention
The expressed desire of a customer to actually buy a condominium unit, taking
into account his or her present situation and market factors.







10


1.3. Theoretical Framework

The importance of branding from a marketing standpoint is something that cannot
be overstated. Brand management allows a companys products to have unique identities
as well as distinct value associations in the minds of consumers. Without a recognizable
brand, companies would be unable to distinguish themselves among similar product
offerings. Branding is thus an indispensible part of creating customer loyalty, and it is for
this reason that brand management should be one of the primary marketing activities in
any commercial firm.
Moreover, branding is especially important in the condominium market due to its
role in alleviating possible purchase risks. A quality brand signals a certain level of
quality so that satisfied buyers can easily choose the product again (Kotler, 2012).
Buying from a well-established brand helps assure customers that they will receive a
product of a certain level of quality. And it is important to establish these expectations
because of the prevalence of the pre-selling model, wherein condominium units are sold
to buyers before the actual construction of the building. In these circumstances,
customers cannot see or personally inspect the quality of the unit being purchased. They
are shown only upgraded and dressed-up model units that are rarely an accurate
representation of the actual delivered product. This, along with the fact that real-estate
purchases are among the highest-value expenditures for any consumer, means that real


11


estate developers need to inspire a great deal of trust in consumers for them to close a
transaction.
Various methods to measure brand equity have been proposed. One approach is
conjoint analysis, which measures customer assessments of each relevant brand attribute
in order to arrive at an overall assessment of the entire brand. Such an approach is
infeasible in this study due to the sheer number of product attributes that have to be
evaluated in the purchase of condominium units
Other brand equity measurement models instead attempt to derive brand equity
from market information such as price premiums and/or market shares. Thus approach
could also be problematic at present due to the fast-changing conditions in the
condominium market. Both market share and general price levels are very likely to
change significantly within the next few months.
Brand equity can also be measured by breaking it down into several components
and measuring each component individually. Noted models that use this approach include
Young and Rubicams Brand Asset Valuator, David Aakers dimensions of Brand
Equity, and Millward Browns BrandZ model of brand strength. Aakers model has
particular relevance in this study due to the abundance of literature utilizing his model for
similar purposes. For this reason as well as those mentioned earlier, this research uses
survey scales based on the Aaker framework.
According to Aakers definition of brand equity, brand equity is composed of four
distinct dimensions, namely brand loyalty, perceived quality, brand awareness, and brand

12


associations. By measuring relative brand performance in terms of these entities, we can
theoretically assess how valuable of an asset a brand name is, and predict its ability to
add value for both the firm and its consumers (Figure 1). A fifth dimension, other
proprietary brand assets, can also be considered. These include patents, trademarks,
channel control and other such advantages specific to a brand. However, since the effect
on proprietary brand assets cannot be generalized, it is not considered in this research.


Figure 1: Theoretical Framework: Brand Equity and Value Generation (Aaker p. 9, 1996)

13


1.4. Conceptual Framework

To better understand how brand equity directly affects both preferences, and
purchase intentions, this study refers to a framework developed by Cobb-Walgren et al in
their research Brand Equity, Brand Preference, and Purchase Intent (1995). Their
framework effectively describes both sources and potential benefits of brand equity.
The framework states that information about a brands psychological and physical
features is made available to the consumer via direct marketing communications and
other channels, which influences his or her various impressions about a brand. These
perceptions in turn create brand equity and become a strong factor that influences both
preferences and purchase intentions, ultimately resulting in product choice. The
researchers summarized these interactions using the following diagram:










14


Figure 2: Conceptual Framework: Antecedents and Consequences of Brand Equity (adopted
from Brand Equity, Brand Preference and Purchase Intent p. 29 by Cobb-Walgren et al, 1995)















It is important to note the importance of measuring both brand preference and
purchase intent as predictors of general brand attractiveness. Purchase intent is
theoretically more likely to translate to actual sales, since this measure indicates actual
expressed desire to buy a product. However, purchase intent is also dependent on
extraneous situational factors such as availability, which may make brand preference a
more appropriate measure of brand strength in some cases.

15


1.5. Operational Framework

The operational framework used in this study is a derivation of that used in a
recent research work by Chen and Chang (Figure 3), essentially a streamlined
interpretation of the conceptual framework shown in Figure 2.

Figure 3: Relationship Between Brand Equity Brand Preference and Purchase Intent (adopted
from Brand Equity, Brand Preference, and Purchase Intent in Airlines p. 41 by Chen and Chang
(2008).










As depicted by the diagram, this framework also proposes that there are
relationships between brand equity, brand preference, and purchase intent. A similar
operational model is incorporated for this study, although the moderating effect of
switching costs need not be explored for our purposes.

16


The framework was also modified to reflect the research approach of expressing
brand equity as an average of all four of Aakers brand equity dimensions. The resulting
framework is as follows:

Figure 4: Operational Framework of the Study


Brand Preference is both an independent and dependent variable. This is because
the study explores both the relationship of brand equity on brand preference (where brand
preference is a dependent variable) as well as the effect of brand preference on purchase
intent (where brand preference is an independent variable).




17


1.6. Statement of the Problem

The general objectives of the study are summarized in the following problem
statement.


What are the relationships among brand equity dimensions, brand preference,
and purchase intent?

Following the operational framework, the problem can be broken down into three
main components:

1) What is the relationship between brand equity and brand preference?

2) What is the relationship between brand equity and purchase intent?

3) What is the relationship between brand preference and purchase intent?





18


1.7. Objectives of the Study

1.7.1. General Objective

To establish the relationships between brand equity, brand preference and
purchase intent.

1.7.2. Specific Objectives

1) To gain insight into key success factors in the market by looking at the
effects of the dimensions of brand equity

2) To increase understanding of how brand equity affects the premium
condominium market

3) To empirically confirm theoretical relationships between study
variables

1.8. Research Hypotheses

H1) Brand equity positively influences brand preference.

19


H2) Brand equity positively influences purchase intent.

H3) Brand preference positively influences purchase intent.

These relationships were observed in multiple studies, as identified in the review
of related literature. However, while there is a wide variety of literature pertaining to the
effect of brand equity on both brand preference and purchase intent, none of these studies
specifically involve the premium condominium market. As mentioned earlier, the
industry possesses some unique characteristics that may change the traditional role of
brand equity (pre-selling, high inherent risk). As such, the lack of material concerning
luxury condominiums represents a notable research gap that this study aims to address.
With the increasing prevalence of condominium living in Metro Manila, this information
could prove very valuable to industry marketers.

1.9. Assumptions of the Study

Survey respondents were limited to Metro Manila residents belonging to the
socioeconomic classes A and B, aged 40-60 years. This is the assumed target market of
premium condominium developments, mostly due to purchasing power. High-end
condominium units are characterized by spacious layouts, premium finishes, as well as
excellent ancillary services in most cases. These features substantially increase

20


development costs to the point where the corresponding sale prices are accessible only to
Class AB buyers. For this same reason, the study was limited to Metro Manila, where
relative income levels are highest, a situation that is likely to remain for the foreseeable
future. The 40-60 age group was targeted in particular since they are the most frequent
buyers of premium condominiums, as supported by an actual sales report from one of the
most reputable real estate companies in the country (name of company withheld as per
request).
All study data was derived almost entirely from survey questionnaires, since it is
mostly concerned with general consumer perceptions and evaluations. Interviews with
real estate developers and personal experience provided additional depth in the analysis.
A linear correlation is assumed among the study variables. This kind of
relationship can be reasonably expected given the nature of the relationships of each
entity. As such, the simplifying assumption was made to limit statistical treatment.
Moreover, pre-test data showed high degrees of significance and correlation strength for
linear regression, lending credence to this assumption. It should also be noted that since
brand preference and purchase intent are expressed as averages of multi-item scales, they
cannot be characterized as fixed-interval variables. Therefore, linear regression is more
appropriately applied as opposed to logistic regression, a technique that is appropriately
used when dependent variables are discrete or categorical.
Finally, in arriving at a total brand equity measure, it is assumed that each
dimension of Aakers model has equal relevance. Other studies have proposed

21


methodologies for deriving the relative importance of each dimension, however these
require specialized software (EQS, LISREL, AMOS for SPSS). Instead, brand equity was
calculated as a simple average of all four dimensions, similar to the assumption made by
Cobb-Walgren et al (1995). In practice this does not prove to be a significant hindrance to
the study, since all four dimensions are expected to have the same directional relationship
with both brand preference and purchase intent. To be cautious however, this limitation
was taken into account during data analysis.

1.10. Scope and Limitation of the Study

In addition to targeting only a specific demographic profile, the study also limited
its focus on a specific psychographic profile, hereafter referred to as the value seeker.
Unlike other market segments that may prioritize prestige, exclusivity, or other non-
tangible benefits, value seekers only purchase what they believe to be the best package of
practical benefits at a certain price. For example, the value seeker may consider a project
such as Trump Tower Manila to be overpriced since the Trump name may be perceived
to artificially inflate sales prices while offering no additional benefits aside from prestige.
As suggested by their behavior, value seekers are pragmatic and highly rational. Those
who purchase condominiums purely as investment vehicles are also considered value
seekers, since they are concerned solely with financial return.


22


Based on both pre-test data and anecdotal evidence, the value seeker seems to be
the most common psychographic profile in the target demographic. This is to be expected
since the market is comprised mostly of highly successful executives and entrepreneurs,
who tend to be very discerning, demanding, and investment-savvy.
To approximate the behavior of the entire industry, five brands were selected
which are assumed to represent a reasonable cross-section of the premium condominium
market. Brands with varying profiles were intentionally chosen to ensure that relationship
trends occur industry-wide, rather than as a result of brand-specific behavior. The chosen
brands are all well known yet have significantly different strengths and weaknesses, thus
making them appropriate for study purposes.




Ayala Land Premiere is known is one of the oldest and most reliable brands in the
industry. Given its extensive track record for producing quality high-end projects, it has
earned its reputation as a trusted, quality developer. Ayala Land also is known as the
market leader in high-end commercial mall development, a likely source of positive
brand associations.



23







Century Properties is relatively new as a major player in the premium
condominium industry. Of late, it has succeeding in creating mainstream awareness of its
projects through partnerships with highly influential international names such as Versace
Home, Trump Properties, and endorser Paris Hilton. Unlike other developers though, its
portfolio of completed high-end projects is very limited, which could affect general
perceptions of product quality.




Shang Properties is the local subsidiary of the Kuok Limited, a renowned
premium developer with projects in Malaysia, Singapore, Hong Kong, Thailand, the
Philippines, China, Canada, and Australia. The company has the distinction of being the
only major player with an internationally established brand name. The Shangrila name is
also known for its highly successful upscale mall and hotels, likely improving its brand
association and image.

24







Robinsons Luxuria is the premium condominium brand of Robinsons Lard
Corporation, one of the oldest and most well known brands in Philippine real estate.
However, the brand is a fairly recent entry into the premium segment and is likely better
known as a mid-end developer. Additionally, Robinsons Land Corporation also operates
one of the countrys largest and most popular mid-end mall chains, which could also have
implications regarding its acceptance as a premium brand.






Rockwell Land Corporation is another very prominent name in the premium
condominium industry. The brand enjoys strong mindshare and image perceptions due to
its exceptionally designed pocket community in Makati City, which include properties


25



that currently command some of the highest rental rates in Metro Manila. However, the
companys premium projects are isolated in this one area, so its portfolio is rather limited.

For better cross-brand comparability, this study focused only on projects with
relatively similar characteristics. Projects were chosen to be as similar as possible with
regard to price per square meter and relative unit sizes (measured using 1BR units, since
this is the most common unit type). Completed projects were chosen instead of pre-
selling projects, as those are the ones can be properly evaluated in terms of quality.
Moreover, older projects (more than 5 years old) were not included to avoid overly
distorting price comparisons.
The selected projects are all expected to have some appeal for the target market of
value seekers. Serendra and The Residences at Greenbelt are both high-profile projects in
two of the most sought-after locations in Metro Manila, insulating their value from a
possible real estate market crash. Sonata Private Residences is another appealing value
purchase, as it offers a reasonable price given its location, which is possibly the best spot
in Ortigas to construct a residential condominium. Similarly, The Gramercy likewise
offers good value in an excellent location, and its value will likely appreciate further due
to its proximity to the future Trump Tower Manila, and the Versace-designed Milano
Residences. The entire Rockwell Center is an exceptionally designed pocket community,
making it appealing for both residents and investors alike. Finally, the Shangrila projects,

26



while they definitely command price premiums, are both sound investments as well due
to strong sustained demand and international brand presence.
The following table summarizes each chosen projects main characteristics:

Table 3: Projects Included in the Study
Project Name Brand Price per
sqm*
Ave 1BR unit
size*
Number of
Units*
Location
One Serendra

Ayala Land
Premiere
~140,000 ~60 sqm 744
Bonifacio
Global City
The Residences
at Greenbelt
Ayala Land
Premiere
~160,000 ~65 sqm 1300 Makati
Sonata Private
Residences
Robinsons
Luxuria
~130,000 ~45 sqm 758 Ortigas
The Gramercy
Residences
Century
Properties
~140,000 ~45 sqm 950 Makati
One Rockwell

Rockwell Land
Corporation
~150,000 ~60 sqm 900 Makati
Joya Lofts and
Towers
Rockwell Land
Corporation
~140,000 ~50 sqm 400 Makati
St. Francis
Shangrila Place
Shang
Properties
~140,000 ~60 sqm 700 Ortigas
Shang Grand
Tower
Shang
Properties
~170,000 ~60 sqm 250 Makati
* Approximated based on online advertisements and informal inquiries from sellers


Respondents were similarly limited only to those who actually own one or more
units from these selected projects, since their prior experience with the brand enables
them to make informed judgments about it. Broker networks and/or company sales agents
were tapped in order to contact existing unit owners and request their participation in the
survey.

27


Survey respondents were asked to rate their perceptions of each brand with
respect to consumer attitude perception scales measuring brand equity, preference, and
purchase intent.
The scale used for measuring brand equity was adopted from a study conducted
by Yoo/Donthu (2001), modified to specifically mention characteristics of the premium
condominium market as well as to eliminate the redundancy of some of the original scale
items. Given the objectives of the study, the aforementioned researchers proposed 10-
item model, which measures each dimension separately, proved to more appropriate for
its purposes compared to their proposed 4-item model that attempts to measure brand
equity as a whole. While Yoo/Donthu recommend combining brand awareness and brand
associations into a single construct, these dimensions were analyzed separately in this
study in order to isolate the unique effects of each dimension. Also, due to limitations
discussed earlier, total brand equity measures were derived by getting the simple average
of all four dimensions.
A potential source of confusion in answering the survey was that some of the
brands involved in the study have sister brands targeting other segments. This was
addressed by further modifying the scales to reflect the focus on only the premium
condominium market. The revised questions are as follows:




28


*X refers to specific real estate brands

Brand Loyalty
1) I consider myself loyal to X in the premium condominium market.
2) X would be my first choice for premium condominium units.
3) I would not buy other brands of premium condominiums if X were available.

Perceived Quality
1) The likelihood of quality of X is extremely high for their premium
condominiums.
2) The likelihood that the premium condominium units of X would greatly
appreciate in value is very high.

Brand Awareness
1) I can recognize X among other brands in the premium condominium segment.
2) X is the first brand that comes to mind when I think of premium
condominiums.

Brand Associations
1) Some characteristics of X as a premium condominium brand come to mind
quickly.

29


2) I can quickly recall several projects developed by X.
3) I have difficulty in imagining X in my mind as a premium condominium
developer.

Measures of brand preference and purchase intent were taken from a study
conducted by Chen/Chang (2008). The following four-item scale was used to evaluate
brand perception, again modified to specifically indicate the premium condominium
market and eliminate redundancy:

Brand Preference
1) I feel that X is an appealing brand for premium condominiums.
2) For me, X is the best premium condominium brand in the market.
3) If I were to purchase a premium condominium unit, I would prefer X if
everything was equal.

A straightforward two-item scale was also appropriated and modified from
Chen/Changs study (2008) to measure purchase intent:

Purchase Intent
1) I am willing to recommend others to buy premium condominium units from
X.

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2) If I eventually find myself in the market for premium condominium units, I
would be willing to purchase from X.

1.11. Significance of the Study

Value to the Industry

The value of this study is probably greatest for the local condominium industry.
As of this writing, there does not seem to be any well-known brand equity studies that
focus on the high-rise residential market, and there are some unique characteristics in the
condominium industry that may influence how brand equity relates to both brand
preference and purchase intent. First, condominium purchases occur very infrequently in
a customers lifetime, so each customer tends to have a very narrow range of first-hand
experiences regarding each brands products. This potentially affects the usual role of
brand loyalty, which normally involves multiple repeat purchases from the same brand.
As mentioned earlier, the prevalence of the condominium pre-selling model could
increase customer reliance on brand equity, perhaps across all four of Aakers
dimensions. Furthermore, condominium units are extremely high-involvement purchases,
requiring extensive thought and evaluation prior to the actual purchase decision.
Customer perceptions may therefore play a much greater role than they would for
impulse purchases or other low-involvement items.

31


Knowing the importance of each dimension of brand equity will enable real estate
developers and salespeople to adjust their marketing activities accordingly. Competitive
advantages may be generated with proper focus towards the most important dimensions
of brand equity.

Value to the Academe and Future Researchers

This study can help address the dearth of studies specifically related to the rapidly
growing condominium segment. Condominium living is becoming an increasingly
common occurrence in Metro Manila, and it thus becomes increasingly more important to
understand market characteristics as best as possible.
In general, this study could also further reinforce the all-important relationships
between the three main study variables, as well as the scales used to measure them. The
importance of brand equity is easily appreciated when seen as a powerful influencer of
specific attitudes and behavior towards a brand. Thus, confirmation of the proposed
hypotheses would further support the importance of brand equity management.
Finally, this study also contributes to the universitys library of research works,
hopefully providing both students and faculty with possible areas of further research
involving these important topics. Methodologies and statistical methods employed in this
study could also be appropriated for related studies.


32



CHAPTER 2
REVIEW OF RELATED LITERATURE

2.1. Relationships Between Brand Equity, Brand Preference, and Purchase Intent

A wide variety of sources are available supporting the proposed relationships.
One of the most influential is the work of Cobb-Walgren et al (1995) entitled Brand
Equity, Brand Preference, and Purchase Intent. Unlike what is proposed in this research,
the study conducted by Cobb-Walgren et al explored two separate industries (value hotels
chains and bathroom cleansers) and found that brand equity has a significant effect on
both. By doing so, the researchers were able to establish that strong brand equities
translated to improved market performance in both goods and service industries. Another
key difference in methodology is the use of conjoint analysis in establishing the
relationship between brand equity and brand preference. This can be effective in studying
hotel chains or bathroom cleansers, industries wherein a single brands products share
very similar characteristics. However, an attribute-based evaluation method such as
conjoint analysis is not necessarily the most suitable method for studying condominium
brands because one projects attributes can differ substantially from another project of the
same brand.


33


Cobb-Walgren et al utilized a unique method of selecting brands to research.
Using consumer reports, two brands were chosen from each industry that had nearly
identical scores in terms of objectively measured attributes, but varied dramatically in
terms of advertising support. In both industries studied, the brand with greater advertising
support scored much higher brand equity ratings, as well as far better scores in both brand
preference and purchase intent.
It is important to note that Cobb-Walgren et al chose to calculate brand equity as a
simple average of all four dimensions, rather than using a weighted average as
recommended by Aaker. The researchers speculated that any proposed weighting scheme
would vary from brand to brand, and lacking an established method for deriving these
weights, decided to apply uniform weights instead. It is pointed out however that
regardless of weighting, the end conclusions would remain unchanged since the better-
rated brands scored higher in each individual dimension of brand equity.

Other studies introduced moderating effects in the framework. Moderating effects
are those that have an influencing role in the relationships of the variables being studied.
As mentioned earlier, Chen/Chang (2008) discovered that switching costs had a
moderating role in the effect of brand equity on both preference and purchase intent in
the Taiwanese airline industry.
Unfortunately, no information was provided regarding the actual scales used for
measurement of brand equity, other than stating that the instrument used included all four

34


of Aakers dimensions. Data was collected from a convenience sample and is therefore
not completely random, but given the nature of the study, this was not expected to
significantly distort the end results.
Statistical analysis was performed by using structural equation modeling and
evaluating the corresponding statistical metrics (goodness-of-fit index, comparative-fit
index, and root-mean-square error approximation). All relationships pertaining to the
effect of brand equity on both purchase intent and brand preference were shown to be
significant by all measures.

A similar study conducted by Moradi/Zarei (2011) found that a cellphones
country of origin image (the image of the country where the phone was manufactured)
had a moderating role on the effect of brand equity on preference and purchase intent in
the Iranian market.
The study closely followed the methodology proposed by Chen/Chang (2008),
slightly modified to reflect the difference in market focus as well as the moderating effect
being explored. Brand equity measures were adopted from a combination of studies,
although once again the specific items that were adopted were not identified. Similar to
the Chen/Chang study though, all four dimensions of Aakers brand equity framework
were included.
The researchers used LISREL 8.54 for structural equation modeling to test its
hypotheses, and the expected results were all supported by the collected survey data. In

35


line with previously cited studies, brand equity measures were shown to be significantly
and positively related to both brand preference and brand equity.
Studies across several product categories and cultural settings have concluded that
both brand preference and purchase intent increase as brand equity increases. Similarly,
purchase intent was also shown to increase as brand preference increases. These studies
therefore form the bases for the research hypotheses presented in pages 18-19.


2.2. Other Brand Equity Studies

Another brand equity study explored the effects of both brand attitudes and brand
image as expected antecedents of brand equity. This research work, The Antecedents
and Consequences of Brand Equity in Service Markets by Chang et al (2008), also
statistically established the positive effect of brand equity on both brand preference and
purchase intent.
The researchers included three service categories in their study, namely mobile
telecommunications, Internet (ADSL) services, and bank credit cards. These industries
were chosen because they represent certain important characteristics of service industries,
such as intangibility and high relevance of employee-customer interactions. Six brands
per category were used in the study, presumably to create a satisfactory cross-section of
each.

36


Chang et al deviated significantly from the previously cited material in terms of
statistical treatment. Instead of using conjoint analysis, they used the multidimensional
brand equity scale developed by Yoo/Donthu (2001) as a means of measuring brand
equity. The validating study of Washburn/Plank (2002) was cited as support. Like
Yoo/Donthu, the researchers found than the scale items used to measure
awareness/associations were essentially inseparable, and are thus better treated as a single
entity. Subsequent testing of internal reliability using Cronbachs alpha supported this
setup of survey parameters. Validity of correlations was tested using LISREL software
(version 8.52, 2002), and subjecting each resulting path coefficient to t-tests.
These findings are of particular interest because of the concentration on service
industries. Citing previous research by Zeithaml et al (1985) and Laroche et al (2003,
2004), the researchers pointed out how intangibility in service industries makes it more
difficult for customers to evaluate product attributes, thus increasing customer reliance on
brand reputation in making purchase decisions. Service industries also tend to have
higher switching costs due to a greater need for time-consuming information search prior
to purchase. As such, satisfied customers can be theoretically easier to retain.

A more detailed approach in assessing relationships between the dimensions of
brand equity and its effect on both brand preference and purchase intention was that of
Hellier et al, in their study Customer Repurchase Intention: A general structural
equation model (2003). While this research does not specifically refer to brand equity,

37


both perceived quality and customer loyalty are identified as antecedents of brand
preference and repurchase intent.
The study made use of the following framework in an attempt to gain a more
precise understanding about what drives brand preference:



Figure 5: Antecedents of Repurchase Intent (adopted from Customer Repurchase
Intention: A General Structural Equation Model by Hellier et al p. 1765, 2003)





38


As seen in the diagram, the study included many other factors that influence
preference and intent. Despite this significant shift in focus, the researchers hypotheses
remained consistent with earlier findings: components of brand equity were expected to
positively influence both preference and purchase intention, whether directly or
indirectly.
Another big difference between the study of Hellier et al compared to those
previously cited is that it did not account for either brand awareness or brand
associations. Also, it focused on repurchase intentions of customers who have had
significant exposure and experience with the brand. Since condominium purchases are
not regular purchases, results potentially may vary from those presented in the study.
Statistical treatment also deviated from previously cited works; the researchers used EQS
software for structural equation modeling.

In another study, Stahl et al (2012) attempted to establish the importance of brand
equity by examining its effect on hard measures such as customer acquisition, retention,
and profit margin (the aggregate effect of these is referred to as CLV or customer lifetime
value). Unlike the literature mentioned earlier, this research utilized Young and
Rubicams Brand Asset Valuator, a model that describes brand equity in terms of four
entirely different components (differentiation, relevance, knowledge, and esteem).
It was suggested that relevance, knowledge, and esteem all significantly and
positively affect CLV for various reasons. However researchers proposed that

39


differentiation actually has an adverse effect on both customer acquisition and retention
the more unique a product is, the more unique its target market gets. On the other hand,
this kind of focus strategy would generally lead to an increase in margins, as target
customers would theoretically see more value in the differentiated product. Regression
analysis was used to test the various hypotheses, and statistical results were all in line
with expected findings.
The study focused only on the US automotive industry, which is very similar to
the condominium industry considering that both are very high-involvement products with
a multitude of attributes that need to be evaluated in order to make an informed decision.
As such, there is a strong likelihood that this study will yield results in line with those
presented by Stahl et al, assuming that the Brand Asset Valuator and the Aaker brand
equity model do indeed measure the same underlying construct.

Focusing on one of the broader dimensions of brand equity, OCass and Lim
(2001) created their study The Influence of Brand Associations on Brand Preference and
Purchase Intention: An Asian Perspective on Brand Associations. The researchers
focused particularly on non-product-related associations as defined by Keller in his book
Strategic Brand Management (1998). These are categorized into four: price associations,
user and usage imagery, brand personality, and feelings and experiences.
For Keller, price associations can be considered non-product-related attributes
insofar as they do not necessarily contribute to product quality or function. Price levels

40


merely provide signals to consumers as to what kind of quality can be expected out of the
product. User and usage imagery refer to generalized images of brand users and usage
scenarios, usually formed through exposure to advertising communications and past
experiences with actual brand users. Feelings and experiences are simply the actual
emotions and knowledge a customer has in relation to a particular brand. Finally, brand
personality involves ascribing human-like qualities to a brand in line with pervading
perceptions or imagery attached to it. The following framework was adopted from Aaker
(Dimensions of Brand Personality, 1997) to measure brand personality:


Figure 6: Brand Personality Framework (adopted from Dimensions of Brand Personality by D.
Aaker, 1997)



OCass and Lim suggested that, even without referring to tangible product
attributes, branding activities can still provide a source of sustainable competitive
advantage for a firm. To support this assertion, Singaporean students were surveyed and
asked to evaluate fashion apparel brands in terms of the aforementioned non-product-

41


related attributes, brand preference, and purchase intention. Using regression analysis, it
was discovered that the brands with positive associations and imagery congruent to the
users self-image turned out to be the users preferred brands. Purchase intent is similarly
correlated to brand associations as well.

In contrast to most of the studies cited herein, Mizik and Jacobson (2008)
explored the value of brand equity from the firms perspective. In particular, the authors
studied the correlation between brand assets (as measured by Young and Rubicams
Brand Asset Valuator), and corporate financial metrics such as sales growth,
unanticipated return on assets, and stock returns.
`Their research used information obtained directly from the Young and Rubicam
database, as well as audited financial data spanning 11 years. It included several well-
known brands across various unrelated industries, namely Starbucks, IBM, AOL, Yahoo,
Martha Stewart, and Wal-Mart.
The end results, analyzed using Pearson coefficients, were mixed. While some of
the results showed the expected positive correlations, Differentiation for instance was
shown to be statistically unrelated to any financial measure. Furthermore, the data
indicated that neither knowledge nor relevance significantly affected unanticipated return
on assets.
The researchers noted that there are several mitigating variables that may have
affected the analysis (such as delay of market information, the nature of the measures in

42


general, etc.). Macroeconomic and operational factors were also likely to affect the
results. Lacking a better framework in place to isolate the effect of brand assets on
company financial performance, direct correlation analysis may prove inconclusive.

2.3. Measurement Models

Other researchers proposed different measures of brand equity and assessed their
validity. The most important in the context of this study is Yoo/Donthus study entitled
Developing and Validating a Multidimensional Consumer-Based Brand Equity Scale
(2001), since the brand equity measures used herein were appropriated from this research.
Yoo/Donthu attempted to establish a single brand equity scale that could be
standardized across cultures and product categories, based on the Aakers conceptual
model of brand equity. The researchers wanted the measure to be valid, reliable, and
generalizable. To test the developed scales under these criteria, statistical results of brand
equity measures were compared using data from three distinct product groups (athletic
shoes, film, color television sets) and three different cultural groups (Americans, Korean
Americans, and Koreans).
Using LISREL modeling and other correlation measures, the researchers found
that there was no significant variance attributable to cultural or product category
influences when the proposed scales were used. This indicates that they can be
appropriately applied to any cultural or product group. However Yoo/Donthu also

43


discovered that the relative importance of each dimension of brand equity would differ
depending on context. And since the four dimensions affect brand equity to varying
degrees, a single brand equity score could not be derived by simply adding up the scores
of each individual dimension. Yoo/Donthu instead proposed weighting each dimension
according to their respective path coefficients as derived from LISREL.
Additionally, the collected results did not reflect brand awareness and brand
associations as two distinct dimensions. Variance comparison tests showed that the two
dimensions showed are essentially inseparable from a statistical standpoint. As such,
researchers combined the two dimensions into a single measure.
Primarily due its proven validity across product categories and different cultures,
this researcher believes that this is the most appropriate reference scale that can be
applied in this study.

Another approach to brand equity measurement was suggested by Park/Srinivasan
in their study A Survey-Based Method for Measuring and Understanding Brand Equity
and Its Extendibility (1994). The aim of their study was to isolate the effects of the
brand name itself in adding value to a product. In this context, brand equity was defined
as the difference between an individual consumer's overall brand preference and his or
her multiattributed preference based on objectively measured attribute levels (Park &
Srinivasan, 1994). For instance, if there are two brands with exactly the same objectively
measured attributes but with significantly different levels of market acceptance, the

44


better-accepted brand is considered the one with better brand equity.
Park/Srinivasan came up with a model that broke down brand equity into two
parts: the effect of brand equity in influencing customer perceptions (the difference
between subjective evaluation of product attributes versus actual or objective measures),
and the value of non-attribute-based components of brand equity, such as image. Various
statistical measures supported this models validity and predictive power in both the US
toothpaste and mouthwash categories.
Despite the potential diagnostic value of such an approach, it was not adopted in
this study due to the aforementioned difficulties in applying multi-attribute models to the
condominium industry, wherein products are composed of dozens of relevant attributes
that vary significantly even within the same brand.

2.4. Real Estate Studies

Branding studies specific to the real estate industry proved more difficult to find.
Gulas et al conducted one of the more significant research works, Brand and Message
Recall: The Effects of Situational Involvement and Brand Symbols in the Marketing of
Real Estate Services (2009). Gulas et al proposed that brand recall in the real estate
industry is positively influenced by both a customers intention to purchase real estate in
the near future (situational involvement), as well as the use of tangible imagery in
marketing communications.

45


Using a combination of descriptive statistics and chi-squared testing, researchers
found a significant relationship between brand recall and use of tangible imagery.
However, it was also discovered that situational involvement had no meaningful effect on
brand recall of the top five US real estate brands, despite it having a significant impact on
brand recall of the less-popular brands. Researchers explained this by pointing out that
larger brands generally have more extensive marketing communication campaigns, which
helps them attract attention even from those who are not immediately considering a real
estate purchase. These findings suggest that in real estate branding research, the use of a
random sample, as opposed to a sample of consisting of buyers actively searching for a
condominium unit, can be rightfully justified.

A Finnish study proposed a benchmarking tool for analysis of real estate brand
value. It focused on brand value specifically for occupiers of commercial properties. This
research, entitled Brand in the Real Estate Business Concept, Idea, Value, considers
four main sources of real estate value: location, image, performance, and services (Figure
7).






46



Figure 7: Structure of Brand Concept (taken from Brand in the Real Estate Business
Concept, Idea, Value by Viitanen, 2004)

Location is of course probably the single most important driver of real estate
value. The researcher considers accessibility, parking, infrastructure, and surroundings to
be the key determinants of a good location.
Performance is a measure of both building safety and functionality. A commercial
leasing operation that performs well has to comply with all applicable safety regulations,
and have equipment in good working order. Additionally, it should also be flexible and
adaptable to possible changes in tenant space requirements.



47


Services refer to additional value-added benefits provided by building
administrators. This includes high-quality telecommunication amenities and a pleasant
environment for its tenants.
Finally, image involves positive images and associations for the building. This is
important in the industry because the image of the occupier is invariably linked to the
image of the premises.
By using a specialized benchmarking tool, Viitanen confirmed that developing
real estate brands could lead to meaningful differentiation and positive value for the
company. He pointed out that effective commercial concepts can potentially result in
both higher rental rates and occupancy compared to similarly located projects.
Another important insight provided by the study is that each commercial building
forms a part of the brand character and that a building as a product may form an
individual brand. In other words, because buildings have distinct characteristics and
value associations, each building can almost be treated as an entirely distinct brand.
While presenting a completely different approach, the study does provide
additional evidence regarding the positive value of brand in a real estate context.

Another interesting study that has implications on real estate branding is
Perceived Risk, Anticipated Regret and Post-Purchase Experience in the Real Estate
Market: The Case of China by Chen et al (2011).


48


The basic premise of this study is that since home purchases are inherently risky,
there is a large degree of anticipated regret that actually reduces post-purchase
satisfaction.
Perceived risk is caused by importance, irreversibility, and difficulty in making
housing purchases. This risk exerts a lot of pressure on buyers, making it a significant
source of anticipated regret. And that feeling becomes so prevalent on consumers minds
that it becomes a self-fulfilling prophecy, causing them to believe perceptions that are not
necessarily based on reality (a phenomenon Chen et al refer to as CFT or counterfactual
thinking). With these negative perceptions then come feelings of actual or experienced
regret, ultimately resulting in dissatisfaction. This conceptual model is summarized in
Figure 8.
Figure 8: A Model of Anticipated Regret and Post-purchase Experience in Home
Purchase (from Perceived Risk, Anticipated Regret, and Post-Purchase Experience in the
Real Estate Market: The Case of China by Chen et al, 2011)



49


Structural Equation Modeling, together with the associated goodness-of-fit
indices, confirmed these relationships in the Chinese market. Since the underlying
concepts also apply to condominium purchases, there is also good reason to believe the
same holds true in that industry as well.
In theory, the implication here is that since pre-purchase perceived risks play a
significant role in reducing post-purchase satisfaction, effective brand marketing can
increase satisfaction because of its ability to alleviate purchase risks. By buying from a
trusted developer of known quality, the inherent risks in purchasing a house can be
somewhat mitigated, thus lessening the possible dissatisfaction.

2.5. Studies on Service Industries

Other studies on the characteristics of service industries also provide useful
insights regarding the proposed research. Berry (2000) wrote an insightful article entitled
Cultivating Service Brand Equity. This piece discussed several ways in which
successful branding initiatives aids in marketing.
First and foremost, branding increases customer trust of invisible products while
helping them to better understand and visualize what they are buying (Berry, 2000). As
mentioned earlier, this kind of intangibility is apparent in the condominium market due to
the prevalence of pre-selling. Developers that do a better job of inspiring trust in their
consumers will also do a better job in mitigating uncertainty concerns.

50


Branding also enables a company to effectively communicate their reason-for-
being, strengthen emotional connections to customers, and provide clear directions for
service employees on how to conduct themselves. All these things contribute positively
towards delivering a differentiated and meaningful value to customers and could be a
definite anchor for sustained competitive advantage.
Berrys service-branding model also provides additional evidence regarding the
importance of brand awareness. This model defined brand equity as the synergy between
brand awareness and brand meaning.

Similar findings were concluded by Laroche et al in Exploring How Intangibility
Affects Perceived Risk (2004). This research showed that the characteristics of service
industries (intangibility and generality) have an influence on the five dimensions of
perceived risk (financial risk, time risk, performance risk, social risk, psychological risk).
Both mental intangibility and physical intangibility were confirmed to have an
effect on dimensions of perceived risk, with mental intangibility having a stronger effect
than physical intangibility. This means that if a consumer is unable to mentally
understand and/or physically assess product benefits, he or she feels more associated risk
with the purchase. More importantly, Laroche et al discovered that branding helps to
diminish the usual role of intangibility on perceived risk.
Theoretically, this means that the specific brand messages communicated to
costumers allows them to have a better idea of what exactly it is they can expect out of a

51


service product and what benefits the product can bring. This gives consumers some
added security that partially offsets the concerns of buying a product that cannot be
physically interacted with and/or mentally visualized.

2.6. Studies on Luxury Brands

Other important insights were also obtained by referencing studies on luxury
brands. One example is Developing Experience-Based Luxury Brand Equity in the
Luxury Resorts Hotel Industry by Hung et al (2012).
While this study partially employs the Aaker model in its measurement of brand
equity, Hung et al also suggest that brand equity in the luxury market is more strongly
influenced by what they call extended implicit value (EIV). EIV includes elements
such as perceived luxury, experience value, and product uniqueness. The premise of the
study is that the appeal of luxury hotels is defined largely by image and expectations, as
opposed to other markets wherein Aakers original brand equity dimensions (referred to
as FEV or fundamental explicit value) would be more highly valued.
Actual results however, were mixed. Taiwanese consumers tended to favor FEV
while customers in Macau prioritized EIV. Hung et al speculate that this dichotomy in
consumer preferences is mostly due to the differences in the general market; Taiwanese
customers tend to be mostly locals while Macau customers are mostly international
tourists.

52


It should therefore be noted that results obtained from this study are expected to
hold true only in the context of the specific markets that were researched. Also, while this
study presumes that EIV is not a key determinant of brand equity for the target market of
value seekers, future studies may have to consider the effect of EIV in other brand equity
studies involving high-value products.

Another reference regarding branding for luxury products is Kellers Managing
the Growth Tradeoff: Challenges and Opportunities in Luxury Branding (2009). Keller
proposes 10 basic characteristics that define luxury brands. These are enumerated in
Figure 9.
At first glance, Kellers characteristics seem to imply that luxury branding places
a more prominent role on brand associations compared to the other dimensions. Items 1,
2, 4, 5, 7, and 8 are all mostly related to brands associations, while the other dimensions
are not given much mention, if at all. However upon further analysis, this may not
necessarily be the case. For instance, creation of brand associations is contingent upon
creating a certain level of brand awareness. Associations and brand image could also
conceivably be antecedents of brand loyalty. Because of these intrinsic relationships, the
importance of the other brand equity dimensions may not be dismissed. It is however,
possible that brand associations may have a relatively more important role in brand
equity for high-value products as opposed to lower-value products, and this will be taken
into account during data analysis.

53






Figure 9: Characteristics of Luxury Brands (adopted from Managing the Growth
Tradeoff: Challenges and Opportunities in Luxury Branding by Keller, 2009)






















54




2.7. Synthesis and Commentary on Reviewed Literature

In summary, the references and studies cited are almost unanimously consistent
with the idea that brand preference and purchase intent will increase as brand equity
increases. This relationship is in line with every conceptual framework discussed, and is
concretely supported by data gathered across many different product types, service
categories, and even cultural settings. Similarly, many different sources have agreed that
each dimension of brand equity contributes to this relationship to some degree. This
suggests a strong likelihood that the same correlations will hold true even in the relatively
unique condominium industry.
Furthermore, research methodologies have been refined over a period of many
years and are consequently well developed. Resulting data has been subjected to multiple
testing using a variety of statistical tools, and have been found to be both valid and
appropriate for the study objectives. For these reasons, the methodology proposed herein
borrows heavily from these past works, with only slight deviations to reflect the
difference in market focus and to generally go into greater detail about the findings.
Table 4 summarizes all related literature cited in this study:





55



Table 4: Summary of Related Literature

Subject Author (Year) Title Page
Framework
Studies
Cobb-Walgren
et al (1995)
Brand Equity, Brand Preference and
Purchase Intent
32
Chen & Chang
(2008)
Airline Brand Equity, Brand
Preference and Purchase Intentions:
The Moderating Effects of
Switching Costs
33
Moradi & Zarei
(2011)
The Impact of Brand Equity on
Purchase Intention and Brand
Preference The Moderating
Effects of Country of Origin Image
34
Other Brand
Equity Studies
Chang et al
(2008)
The Antecedents and Consequences
of Brand Equity in Service Markets
35
Hellier et al
(2003)
Customer Repurchase Intention: A
General Structural Equation Model
36
Stahl et al
(2012)
The Impact of Brand Equity on
Customer Acquisition, Retention
and Profit Margin
38
OCass & Lim
(2001)
The Influence of Brand
Associations on Brand Preference
and Purchase Intent: An Asian
Perspective on Brand Associations
39
Mizik &
Jacobson
(2008)
The Financial Value Impact of
Perceptual Brand Attributes
41
Measurement
Models
Yoo & Donthu
(2001)
Developing and Validating a
Multidimensional Customer-Based
Brand Equity Scale
42
Park &
Srinivasan
(1994)
A Survey-Based Method for
Measuring and Understanding
Brand Equity and its Extendibility
43

56



Table 4 (continued): Summary of Related Literature













Subject Author (Year) Title Page
Real Estate
Studies
Gulas et al
(2009)
Brand and Message Recall: The
Effects of Situational Involvement
and Brand Symbols in the
Marketing of Real Estate Services
44
Viitanen (2004)
Brand in The Real Estate Business
Concept, Idea, Value
45
Chen et al
(2011)
Perceived Risk, Anticipated Regret
and Post-Purchase Experience in
The Real Estate Market: The Case
of China
47
Studies on
Service
Industries
Berry (2000) Cultivating Service Equity 49
Laroche et al
(2004)
Exploring How Intangibility
Affects Perceived Risk
50
Studies on
Luxury Brands
Hung et al
(2012)
Developing Experience-Based
Luxury Brand Equity in the Luxury
Resorts Hotel Industry
51
Keller (2009)
Managing the Growth Tradeoff:
Challenges and Opportunities in
Luxury Branding
52

57


CHAPTER 3
METHODOLOGY

3.1. Research Design

This study utilizes a descriptive and relational approach in analyzing the study
variables. It aims to identify the kind of relationships that exists between them and assess
how strong and how significant these relationships are. Given this approach, simple linear
regression analysis is sufficient to reach a valid conclusion. The set-up of independent
and dependent variables is illustrated in the Operational Framework. In simple tabular
form, the study variables and corresponding hypotheses are as follows:

Table 5: Independent and Dependent Variables
Hypothesis Independent
Variable
Dependent Variable
H1 Brand Equity Brand Preference
H2 Brand Equity Purchase Intent
H3 Brand Preference Purchase Intent


Nearly all data was collected using a survey instrument, which contains both
demographic/psychographic information as well as perceptions regarding brand equity
dimensions, brand preference, and purchase intent. Personal insights and exploratory

58


interviews with real estate brokers and/or executives supplemented the collected data as
the required by the analysis.

3.2. Population and Sample Sizes

The total number of units for all projects included in the scope of this study is
6,002. Based on a sales report by a reputable real estate company (name withheld per
request), about 50% of this population is expected to fall within the target age range of
40-60 years old. Furthermore, based on informal interviews with real estate brokers, it is
estimated that about 50% of the market is composed of value seekers. Taking all these
figures together, the estimated population size is about 1,500 people.

Sample size was derived based on tolerable margin of error and population size
using this formula:

n = ___ N___
(1+N*E
2
)


Where:
N = population size
E
2
= square of desired margin of error


Given 9% margin of error and a population size of 1500, a resultant sample size
of 115 respondents was derived. The required number of respondents per project was

59


computed based the relative number of units for each. For example, One Serendra
comprises roughly 12.4% of the study population (744 units in One Serendra / 6002 total
units). As such, 12.4% of the sample (115 * .124 = 15 respondents) is composed of One
Serendra unit owners. The same computation was applied to each project, and the
resultant figures are summarized in Table 6.

Table 6: Required Respondents per Project
Project Name Brand Number of
Units
% of
Population
Required
Respondents
One Serendra

Ayala Land
Premiere
744 12.4% 14
The Residences
at Greenbelt
Ayala Land
Premiere
1300 21.7% 25
Sonata Private
Residences
Robinsons
Luxuria
758 12.6% 15
The Gramercy
Residences
Century
Properties
950 15.8% 18
One Rockwell

Rockwell Land
Corporation
900 15.0% 17
Joya Lofts and
Towers
Rockwell Land
Corporation
400 6.7% 8
St. Francis
Shangrila Place
Shang
Properties
700 11.7% 13
Shang Grand
Tower
Shang
Properties
250 4.2% 5



3.3. Sampling Method

A random sampling method was utilized to select respondents. As indicated
earlier, respondents were limited to those in the selected demographic (class AB, 40-60,

60


Metro Manila resident) owning a premium condominium unit among those identified in
Table 4. In line with the findings of Gulas et al (2009), the sample need not be limited to
those actively searching a condominium unit, since situational involvement was shown
not to affect consumer understanding or recall of real estate brand messages.
Systematic sampling was performed. Respondents were sought out and contacted
through several brokers and sales agents who have sold units in the specified projects.
These brokers and sales agents consulted their databases in order to contact all eligible
respondents in alphabetical order and request their participation in the study. This process
went on until a sufficient number of respondents had been reached.

3.4. Survey Instrument

Demographic, Psychographic and Behavioral Information

The first part of the survey instrument includes demographic and psychographic
profiling information, as well as a few other behavioral items that aided in data analysis.
Most of this was used to validate respondent eligibility. Screening items include age,
income level, condo brands owned, and psychographic profiling statements.
For reference and further analysis, respondents were also asked to indicate which
income range they belong to, by choosing from a set of arbitrarily defined ranges. These
ranges are intentionally large since it was expected that respondents might not wish to

61


divulge specific information regarding their income. Despite this, it might have proven
useful to consider the differences between say, respondents with an income greater than
Php1,000,000 as opposed to those having an income of less than Php 180,000.
A simple approach to psychographic profiling was utilized. This involves having
respondents choose and rank statements that best describe their condominium purchase
priorities. Value seekers, as opposed to those who value prestige, exclusivity, or lifestyle
considerations, should choose the statements which indicate that they prefer product
value above everything else.
Other behavioral information that was requested consists of future purchase
consideration (whether or not respondents are thinking of purchasing another condo), the
number of condo units owned, as well primary use (whether residential or investment).
This information could also potentially aid in analysis, and did at least provide
descriptive insights regarding the target market.

Perceptions on Brand Equity, Brand Preference, and Purchase Intentions

The scales mentioned earlier (pp. 28-30) were used to measure each respondents
perceptions regarding the study variables. Respondents were asked to evaluate those
brands they actually own. Assessments were made using a five-point Likert scale ranging
from 5 (strongly agree) to 1 (strongly disagree). The Likert scale was chosen due to its
various applications in measuring attitudes and perceptions. Likert scales were also used

62


in the reference studies by Yoo/Donthu (2001) and Chen/Chang (2008) from which this
studys measures are based on.

Pre-testing

Since the reference scales were modified to suit the condominium industry, the
instrument was pre-tested by administering it to six respondents in this researchers
family; each respondent being a condominium unit owner with the intended target
demographic and psychographic profile. This ensured both understandability of survey
items and provided initial information regarding scale reliability.

3.5. Statistical Treatment of Data

A respondent profile was established through descriptive information, as derived
from frequency counts.
The direction and strength of all correlations were evaluated using the Pearson
coefficient (r). Each hypothesized relationship was analyzed using separate linear
regression models. As a result, the study yielded eleven different Pearson coefficients
(Table 7), three for the specified research hypotheses, and eight more to determine the
effect of each individual brand equity dimension on brand preference and purchase intent.
Levin el al (2009) provide rough guidelines regarding the interpretation of the Pearson
coefficient (Table 8).

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Table 7: Linear Regression Test Statistics
Hypothesis Test
Statistic
Independent
Variable
Dependent Variable
H1 r
1
Brand Equity Brand Preference
H1a r
1a
Brand Loyalty Brand Preference
H1b r
1b
Perceived Quality Brand Preference
H1c r
1c
Brand Awareness Brand Preference
H1d r
1d
Brand Associations Brand Preference
H2 r
2
Brand Equity Purchase Intent
H2a r
2a
Brand Loyalty Purchase Intent
H2b r
2b
Perceived Quality Purchase Intent
H2c r
2c
Brand Awareness Purchase Intent
H2d r
2d
Brand Associations Purchase Intent
H3 r
3
Brand Preference Purchase Intent


Table 8: Interpretation of Pearson Correlation Statistic (based on Elemetary Statistics for Social
Research by Levin et al, 2009)

Pearson Coefficient Strength of Correlation
+/- 1.00 Perfect
+/- .60 to +/- .99 Strong
+/- .30 to +/- .59 Moderate
+/- .10 - +/- .29 Weak
< +/- .10 None


The resulting coefficients for the slope of each linear model were then subjected
to F-tests at a 0.05 significance level, in order to prove the significance of each
correlation.
Finally, Cronbachs Alpha was used to test the reliability of each construct. All
study variables except Brand Equity (namely Brand Loyalty, Perceived Quality, Brand

64


Awareness, Brand Associations, Brand Preference, and Purchase Intent) were tested for
internal consistency. Brand Equity need not be tested because it is a figure derived from
other study variables.
In interpreting coefficient alpha, this study referred to guidelines proposed by
George and Mallery (Table 9).

Table 9: Interpretation of Cronbacha Alpha (based on SPSS for Windows Step by Step: A
Simple Guide and Reference, 11.0 update 4
th
Edition by George & Mallery, 2003)

Cronbachs Alpha Internal Consistency
> 0.9 Excellent
0.8 0.9 Good
0.7 0.8 Acceptable
0.6 0.7 Questionable
0.5 0.6 Poor
< 0.5 Unacceptable











65


CHAPTER 4
PRESENTATION AND DATA ANALYSIS

4.1. Profile of Respondents

4.1.1. Occupation
Respondents were categorized into four basic groups according to
occupation, namely working professionals, entrepreneurs, housewives, and
retirees. As expected of the target socioeconomic market, the sample is
comprised mostly of working professionals (81.7%) and entrepreneurs
(10.4%) (Figure 10).

Figure 10: Respondent Profile by Occupation





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A sample that is predominantly composed of working professionals rather
than entrepreneurs might be expected to more risk averse. As such, the
effect of brand loyalty could be disproportionately large, as respondents
could potentially favor known brands over potentially riskier unknown
brands.


4.1.2 Income

As can be expected, respondents mostly belong to the lower end of the
arbitrarily defined income groups, simply because there are fewer families
belonging to the higher income groups. Despite this, higher-income
families were still well-represented; about 34% of the sample have a
household monthly income of more than P450,000 (Figure 11).

Figure 11: Percentage of Respondents by Income Group










67



4.1.3 Condo Ownership

The vast majority of all survey respondents own only one condominium
unit. Only higher-income investors own multiple units (Figure 12).

Figure 12: Respondent Profile by Number of Units Owned




Figure 13 Respondent Profile by Purpose of Ownership



68



More than half of those surveyed answered that their condominiums will
be used either purely for investment, or both as a residence and an
investment (Figure 13). This could potentially influence brand equity
dynamics in two important ways. First, given their highly rational and
practical nature, investors are less likely to form emotional attachments
with a brand. Therefore, brand associations may not be as important to the
investor market as they would be in others. Conversely, quality
perceptions would tend to have a greater than average influence on value-
seekers, due to their objectivity.

Figure 14: Respondent Profile by Interest in Future Condo Purchases



69


Most respondents expressed some degree of interest in purchasing another
condominium unit, including a surprising number of those who purchased
their units for residential purposes. The numbers strongly suggest a very
high degree of satisfaction derived from the owners experiences with
their existing units. This, along with reported industry growth rates in
recent years, provide evidence that the countrys real estate developers are
doing very well in meeting the value expectations of what is traditionally a
very demanding and discerning market.

As proposed by Hellier et al (2003) in their previously cited study,
customer satisfaction is an important antecedent of both brand loyalty and
repurchase intent, and must therefore be considered in data analysis.

4.2. Internal Reliability of Measures

As interpreted using Table 9, Cronbachs Alpha values for the six applicable
study variables are all within what is considered as acceptable or good. These results are
unsurprising since the study survey scales borrow heavily from Yoo & Donthus
previously validated brand equity measurement model. The respective figures for each
variable are shown in Table 10:



70




Table 10: Internal Consistency of Study Variables

Variable Cronbachs Alpha Reliability
Loyalty .881 Good
Quality .804 Good
Associations .865 Good
Awareness .828 Good
Brand Preference .787 Acceptable
Purchase Intent .897 Good


The probable reason for the high/acceptable internal consistency of each variable
used was the inherent reliability of the source material borrowed from the aforementioned
study. The Yoo/Donthu brand equity scales were shown to be consistently reliable
measures of brand equity across all product and service categories, as well as across
different cultures. Brand preference and purchase intent scales appropriated from other
studies use similarly generalizable concepts. Since minimal changes were applied to the
source material, the results of this particular survey proved similarly reliable. These
statistics support the idea that the modified instrument properly measures each study
variable.

4.3. Relationship Between Brand Equity and Brand Preference

All regression models used in this study were processed using IBM SPSS
Statistics version 20. When testing the relationship between brand equity and brand
preference, the program yielded a Pearson coefficient of .879, consistent with earlier

71


studies that unanimously confirmed the existence of a significant relationship between
these two constructs. Theoretically, this means that about 87.9% of the difference in
brand preference among respondents can be attributed to its relationship to brand equity.
Under the guidelines proposed by Levin et al as summarized by Table 8, the correlation
between the two variables is considered strong, again confirming previous theoretical and
empirical evidence on the subject.
The regression model also passes the ANOVA F-test for significance, with a p-
value much less than the standard acceptable threshold of 0.05.

Table 11: Linear Regression Statistics: Brand Equity and Brand Preference













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As discussed earlier, brand equity is also important in the industry due to the
considerable risks involved; a reputable brand with a known track record proves to be a
safer, more attractive option in many cases, especially considering a population that is
expected to be risk-averse.
In general, brand equity affects brand preference by adding value, as Aakers
framework espouses. Additionally, the strong effects of brand equity in this context can
also be attributed to the nature of the premium condominium industry, wherein major
developers frequently utilize the pre-selling business model. In this case, customers
usually are not given the opportunity to personally inspect a unit before purchase.
Developers are therefore more reliant on its brands track record and brand promise to
assure its prospective buyers of the kind of quality they are capable of producing.
From the buyers perspective, brand equity plays a large part in reducing the
inherent risk involved in condominium purchase. As cited earlier (p. 47), Chen et al
showed that anticipated risk has a negative effect on post-purchase satisfaction, causing
buyers unnecessary feelings of regret. It can be inferred that reducing this anticipated risk
can potentially improve satisfaction, which will in turn influence brand preference. Brand
equity can potentially be valuable in this regard; it provides additional assurance to
buyers that their substantial investments will be well spent.
Other insights were also discovered when the effect of each individual dimension
of brand equity on brand preference was explored:


73


Table 12: Linear Regression Statistics: Brand Loyalty and Brand Preference






















Table 13: Linear Regression Statistics: Brand Quality and Brand Preference



















74




Table 14: Linear Regression Statistics: Brand Awareness and Brand Preference
























Table 15: Linear Regression Statistics: Brand Associations and Brand Preference




















75




All dimensions of brand equity pass the corresponding ANOVA F-tests for
significance, and each were shown to be strongly correlated with brand preference.
Results support Aakers views on the importance of each dimension of brand equity, and
how each dimension contributes towards positive evaluations of a brand.
Comparing the four dimensions, brand awareness is most strongly related to brand
preference (Table 16). This makes logical sense; developing the other dimensions of
brand equity is contingent upon building some level of brand awareness. Without brand
awareness, it would be impossible to form quality perceptions, develop positive brand
associations, or create any kind of brand loyalty.

Table 16: Relationship Between Brand Equity Dimensions and Brand Preference

Variable Pearson
Coefficient
Strength of
Relationship
Significance
Loyalty .784 Strong Significant
Quality .718 Strong Significant
Awareness .866 Strong Significant
Associations .762 Strong Significant
Brand Equity .879 Strong Significant


Contrary to this researchers expectations, brand quality proved to be least
correlated with brand preference. One possible explanation is that high quality does not
necessarily equate to high value. Value is usually thought of as a combination of
product/service, and price (Keller, p.10). Hypothetically, if two real estate brands have

76


the exact same level of perceived quality but differ significantly in price, value seekers
are expected to prefer the lower-priced alternative. As such, high quality perceptions
alone may not be adequate to ensure brand preference in an industry like the residential
condominium industry, wherein pricing and payment schemes are especially important.
Product quality relative to price may be the more important determinant of preference in
this context.
Brand loyalty is also strongly correlated with brand preference. As discussed
earlier, this is likely due to positive experiences unit owners have had with their current
units, as well as avoidance of unfamiliar brands by risk-averse condominium unit buyers.
If buyers are happy with their previously chosen brands, they would be less willing to
risk a multimillion-peso investment on another brand they have had no prior experience
with. This same relationship was also established in the study of Hellier et al (2003).
Finally, brand associations have a similarly high correlation with brand
preference. Despite the fact that value seekers seem less likely to develop emotional
attachments with a brand, the evidence suggests that the effect of brand associations is
still strong enough to positively influence brand preference. The results also suggest that
some of Kellers characteristics of luxury branding (p. 53), which mostly emphasize
brand associations, would also apply the value seeker market.




77


4.4. Relationship Between Brand Equity and Purchase Intent

The relationship between brand equity and purchase intent proved to be
statistically similar to the relationship between brand equity and brand preference. P-
value was again less than the acceptable threshold of 0.05, with a Pearson coefficient of
.890. Again, this means that this relationship is statistically significant, and that about
89% of the changes in respondents purchase intent can be attributed to its relationship
with brand equity.
In accordance with previous studies and theory, brand equity is shown to be a
very strong predictor of purchase intent. As indicated earlier, industry-specific
characteristics such as the large investment costs involved and prevalence of pre-selling
also make purchases inherently risky, thus making a brands track record potentially
more valuable to consumers.









78


Table 17: Linear Regression Statistics: Brand Equity and Purchase Intent


Testing the relationships between each of the individual dimensions of brand
equity versus purchase intent yields the following results:






79


Table 18: Linear Regression Statistics: Brand Loyalty and Purchase Intent












Table 19: Linear Regression Statistics: Brand Quality and Purchase Intent










80




Table 20: Linear Regression Statistics: Brand Awareness and Purchase Intent















Table 21: Linear Regression Statistics: Brand Associations and Purchase Intent









81



Once more, all of the four dimensions of brand equity show strong correlations
with purchase intent. P-values for all regression models are less than ! = 0.05, thus
validating their statistical significance. These findings further lend credence to the Aaker
model of brand equity, which asserts that all dimensions of brand equity positively
influence purchase intent.
Comparatively, brand awareness shows the strongest relationship with purchase
intent (Table 22). In their study of consideration sets, Elias and Spiegler (2011) note that
consumers should not be expected to be aware of each feasible alternative in a purchase
decision. And if a customer is unaware of a certain brands characteristics in the premium
residential condominium segment, then that customer will automatically disregard it from
his or her set of possible purchase alternatives, regardless of whatever objective value the
product may have.

Table 22: Relationship Between Brand Equity Dimensions and Purchase Intent

Variable Pearson
Coefficient
Strength of
Relationship
Significance
Loyalty .827 Strong Significant
Quality .757 Strong Significant
Awareness .855 Strong Significant
Associations .736 Strong Significant
Brand Equity .890 Strong Significant


The relationship between quality and purchase intent is notably stronger than that
of quality and brand preference. A possible explanation is that brand quality plays a

82


greater role in purchase intent because the choice of purchase directly affects the
residents quality of life or the investors return potential, whereas preference may not. In
making a large investment such as a condominium purchase, the buyer is thus forced to
be more objective, which makes perceived quality a relatively stronger choice criterion.
Conversely, the relationship of brand associations and purchase intent is weaker
than the previously discussed relationship of brand associations and brand preference. In
the same way that brand quality is a more objective value, associations offer more
subjective values for the consumer. Given the target market and industry, buyers are not
inclined to evaluate purchase decisions on the basis of brand associations that do not
necessarily add any functional value to the product.
Here is where the difference between brand preference and purchase intent
becomes most apparent. Brand preference is by nature more strongly linked to attitudes
and image than purchase intent. On the other hand, purchase intent is more influenced by
situational factors, most notably current spending power.
Brand loyalty is also strongly correlated with purchase intent. A condominium
purchase, whether as investment or as residence, is a large part of an owners life. It is
expected that owners form strong connections with their chosen condo brands, and that
these connections can become strong influencing factors in future purchase decisions.
The study by Hellier et al (2003) also underscores the importance of customer loyalty in
driving repurchase intent.


83


4.4. Relationship Between Brand Preference and Purchase Intent

The linear regression model also provides statistical evidence of a strong
relationship between brand preference and purchase intent (Table 23). The resultant P-
value is again less than the required threshold of 0.05, and can therefore be considered
significant.

Table 23: Linear Regression Statistics: Brand Preference and Purchase Intent



84


The existence of a strong positive relationship between brand preference and
purchase intent is corroborated by several studies, most notably those written by Cobb-
Walgren et al (1995), Moradi and Zarei (2011), and Hellier et al (2003). Customers have
shown the inclination to favor certain brands over others, and there is strong evidence to
suggest that the favored brands enjoy a significant advantage in terms of purchase
consideration.


















85




CHAPTER 5
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

5.1. Summary and Conclusions

This study was made in order to establish correlations between brand equity,
brand preference, and purchase intent in the premium condominium market. It was
further limited to include only respondents with the psychological profile referred to as
the value seeker, a more pragmatic market subsegment that includes investors and
owners who value price to benefit ratio above all other criteria. The intended result of the
study can be summarized by these objectives:

General Objective

To establish the relationships between brand equity, brand preference and
purchase intent.

Specific Objectives

1) To gain insight into key success factors in the market by looking at the effects
of the dimensions of brand equity

86


2) To increase understanding of how brand equity affects the premium
condominium market

3) To empirically confirm theoretical relationships between study variables

The studys conceptual framework mainly involves Aakers model of brand
equity, which characterizes brand equity as a combination of four distinct dimensions,
namely brand loyalty, perceived quality, brand awareness, and brand associations. The
Aaker model is the one most commonly adopted for research objectives similar to those
of this study. As such, the operational frameworks used herein were based on earlier
studies that also utilized the Aaker model (Chen/Chang 2008, Moradi/Zarei 2011), with
an additional emphasis on the effect of each individual dimension of brand equity.
The research survey instrument consists of profiling information and five-point
Likert scales that measure customer assessments of each dimension of brand equity, as
well as brand preference and purchase intent.
Survey respondents were limited to those owning pre-selected projects from five
of the countrys leading premium residential condominium developers. This helps ensure
that the resultant sample is representative of the overall market, and not just certain
brands. In order to facilitate cross-brand comparability, the projects selected were those
that are most similar in terms of quantifiable attributes such as unit size, price per square
meter, and location.

87


Survey questionnaires were sent to unit owners in all pre-selected projects, and
responses were screened using demographic and psychographic profiling questions to
ensure inclusion in the target market. The pool of valid surveys was then subjected to
systematic random sampling in order to select the 115 respondents that were used in the
study.
Internal consistency of each study variable was tested using Cronbachs Alpha.
Each linear relationship was tested using separate regression models, and analyzed using
ANOVA F-tests for signifance and Pearson coefficients for relationship strength.
Frequencies and percentages of descriptive data, interviews with real estate developers,
and personal insights were also utilized to supplement the analysis.
The relationships between brand equity, brand preference, and purchase intent
have been explored in various studies and theoretical works. All prior evidence seems to
indicate that there is indeed a strong link between the three variables, and this study
supports the existence of these relationships in the premium residential condominium
industry. Brands that are rated highly in terms of brand loyalty, perceived quality, brand
awareness, and brand associations have a very high likelihood of being the preferred
brands. Furthermore, results show that brand equity measures can serve as powerful
predictors of purchase intent, an important metric for assessing a products potential sales
performance.
While causal relationships cannot be empirically confirmed using regression
analysis, theory suggests that stronger brand equity should in fact lead to improved

88


preference and purchase intent. This can be explained in closer detail by looking at each
dimension of brand equity. Similarly, brand preference should also be expected to result
in a higher probability of purchase intent. It follows that a more favored brand would
generally be a more attractive purchase option for the consumer in normal circumstances.
The findings of this study adequately address its established objectives, as
detailed below:

General Objective

To establish the relationships between brand equity, brand preference and
purchase intent.

Strong empirical evidence supports both the significance and strength of each
relationship, as detailed in Table 24. The three main study variables have
statistically relevant linear correlations. Additionally, Pearson coefficients for
each linear model are all very high; further proof of the strength of the underlying
relationships between constructs.

Table 24: Testing of Research Hypotheses

Hypothesis Independent
Variable
Dependent
Variable
Pearson
Coefficient*
Accept or
Reject
H1 Brand Equity Brand Preference .879 Accept
H2 Brand Equity Purchase Intent .890 Accept
H3 Brand Preference Purchase Intent .886 Accept
*significant at ! = 0.05

89


Again, these findings are consistent with various works that have explored the
effects of brand equity on both brand preference and purchase intent. Across a
multitude of industries and cultural settings, various researchers have consistently
discovered that brand equity positively influences customer perceptions of
preference and their intent to purchase a product.

The results are also in line with Aakers well-renowned brand equity framework,
which advocates the message that a brands strength in terms of awareness,
associations, perceived quality, and loyalty is critical in acquisition and retention
of customers.

All in all, both theoretical and statistical methods yield substantial evidence in
support of the study hypotheses. As such, all three study hypothesis are accepted.
Brand equity significantly influences both brand preference and purchase intent,
and brand preference also significantly influences purchase intent.

Specific Objectives

To gain insight into key success factors in the market by looking at the effects
of the dimensions of brand equity



90


The statistical results and their theoretical underpinnings support the idea that all
four dimensions of brand equity must be properly developed in order to maximize
competitive potential in the market. Brand awareness and loyalty seem to be the
strongest predictors of brand preference and purchase intent, while brand
associations and perceived quality are also valuable to a certain extent.

It seems self-evident that awareness would be the most important dimension of
brand equity; the other three dimensions all require at least some level of brand
recognition and recall. As indicated by Hellier et al (p. 37), brand loyalty can be a
result of customer satisfaction from previous purchases, a powerful driver of
future repurchase intent. It stands to reason that the customer would be more
inclined to purchase from the same brand if he or she is generally satisfied with it.

Perceived quality and associations both add value to a brand, thus making it more
appealing both in terms of preference and purchase intent. The findings however,
indicate perceived quality affects purchase intent more than brand associations do.
Presumably, this is because the actual purchase decision forces customers to be
more objective, thus limiting the non-tangible value that brand associations add to
the product. On the other hand, the presented statistics show that brand
associations influence brand preference more strongly than perceived quality
does. This could be because of the nature of the non-tangible values of brand

91


associations, such as image. For example, most young males would probably
prefer a Ferrari to a Toyota largely due to image, but Toyota routinely sells many
more units than Ferrari. The image of Ferrari is a powerful driver of preference,
but is oftentimes not considered a practical purchase due the price premium its
brand commands. As such, those looking for the best possible quality at a certain
price point would probably opt for a Toyota. Similar arguments can be made for
the premium condominium industry.

To increase understanding of how brand equity affects the premium
condominium market

As indicated earlier, brand awareness proved to be important as it is basically a
requirement to be able to generate favorable assessments of a brand. Loyalty,
especially when rooted in past customer satisfaction, creates connections with
customers that influences positive attitudes and behavior towards a brand.
Perceived quality and associations improve the customer evaluations of a brands
value and benefits.

Other studies also provide insights into the effect of brand equity on brand
preference and purchase intent. The most notable example is the research of Chen
et al (p. 47), which shows that anticipated regret and expected risk in the pre-

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purchase phase indirectly correlates with post-purchase dissatisfaction. The study
applies to the housing market, but the concepts therein are transmissible to the
premium condominium market as well. In both cases, purchases are extremely
difficult due to their inherent risk, importance, and complexity. This causes a
great deal of anticipated regret even before the purchase, which influences buyers
into actual feelings of regret when the purchase occurs. Under this premise, it can
be reasoned that reducing anticipated risk should also have a positive effect on
satisfaction. One of the best ways to do so is to develop a well-established and
reputable brand. Customers can feel more secure about their investments if they
are assured of a certain level of quality typical of the brand in question.

Investments are even more difficult in the premium condominium market due to
the proliferation of the pre-selling method. It becomes much more important to
build a trusted brand, since there is literally no way to inspect the product to be
purchased. The act of pre-selling a condominium unit is tantamount to selling a
very expensive promise; and customers need to hear that promise from a
trustworthy source before they commit to the substantial investments involved.





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To empirically confirm theoretical relationships between study variables

As shown earlier, very high Pearson correlation coefficients as well as acceptable
p-values provide empirical evidence of a strong relationship between all three
main study variables. All Pearson coefficients are about .89, which statistically
means that about 90% of the changes in brand preference and purchase intent can
be attributed to changes in brand equity. This is of course a very strong indicator
that all three study variables are closely linked to each other.

P-values for each significance test were all less than 0.00, safely below the
threshold of 0.05 required to be considered significant. While we cannot
empirically confirm causality based on these findings alone, statistics show that
the relationships do exist for this particular market.

Moreoever, The positive slopes for each linear model also confirm the directional
relationships. As brand equity increases, brand preference and purchase intent
also increase. As brand preference increases, purchase intent increases as well.





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5.2. Recommendations for Future Studies

While there were some useful findings derived from the study, a number of
improvements can be made to enhance their value. These include the following:

1. It would be highly useful to conduct studies on the causal effect of brand equity
on both brand preference and purchase intent. The weakness of the linear
regression model used in this scenario is that it cannot confirm that the increase in
the dependent variable is directly caused by the increase of the independent
variable. Although all evidence seems to indicate that there is a strong
relationship between brand equity, brand preference and purchase intent, current
methodologies cannot be used to empirically confirm causation. If such a
methodology could be developed, it would be invaluable to the study of brand
equity, and more effectively address the objectives of this particular research.

2. Studies on other subsegments of the real estate industry would also be useful.
Perhaps brand equity dynamics would differ if one considers the prestige-seeker
market, or value seekers in the mid-end/low-end market. Studying all segments of
the industry would enable researchers to draw industry-wide conclusions that
would prove useful to marketers. Differences between subsegments can also
provide very useful insights regarding the inner workings of the market. In

95



particular, the effects of both brand associations and perceived quality would
probably differ across socioeconomic market segments and psychographic
profiles. The extent to which these relationships differ is impossible to determine
without further research, and in this researchers opinion would be interesting to
discover.

3. The academe and future researchers could also consider the use of more advanced
methodologies, most notably structural equation modeling, that could reaffirm the
presented findings. This would eliminate some of the limitations of the study and
allows for further analysis that is not possible using only linear regression models.
These limitations include the inability to provide relative weights for each
dimension and the assumption of a linear relationship between variables. Both of
these can potentially vary significantly in reality and thus change the
corresponding analysis and conclusions. Further more, structural equation models
can also reveal the possible relationships the dimensions of brand equity have
with each other, thus adding an additional layer to the analysis that could further
improve understanding of how brand equity affects consumers.

4. Similarly, future researchers can also try using frameworks other than the Aaker
model, in order to further enrich understanding of the influence of brand equity on

96


brand preference and purchase intent. For example, Young and Rubicams Brand
Asset Valuator is a widely used brand equity model that deviates enough from
Aakers work to provide fresh insights for analysis, since it looks at the brand
equity construct from an entirely different perspective. The repurchase intention
framework proposed by Hellier et al (2003) is another interesting attempt at
understanding the different variables involved in purchase intent, and could
potentially help describe relationships between the individual brand equity
dimensions.

5.3. Marketing Recommendations

Results indicate that the dimensions of brand equity are powerful influencers of
possible brand acceptance and success. In light of this, the following strategic and tactical
marketing actions are highly recommended for real estate developers in the premium
residential condominium market targeting value seekers.

Product

As proposed earlier, customer satisfaction is potentially one of the most important
sources of brand loyalty in the market. It is therefore important that customers feel that
they are receiving excellent value for their investment. Use of durable unit materials and

97


branded fixtures would help achieve this, in conjunction with regular maintenance of the
buildings, common areas, and outdoor areas within the development. Ancillary services
can also provide additional value to consumers. Services such as reception, security, and
housekeeping are necessary and should of course be prioritized accordingly. In addition,
developers could benefit significantly by introducing various convenience amenities such
as accessible messengerial services or in-house laundry concessionaires. By going above
and beyond current service expectations, real estate developers can perhaps delight their
consumer base and inspire brand loyalty. Additionally, condominium dwellers typically
value convenience, and having these accessible amenities can prove very valuable to
them.

Price

Competitive pricing is another factor in achieving customer satisfaction. This is
especially true in a very competitive industry wherein there are a number of viable,
quality alternatives. Generally, brands that enjoy high levels of brand equity are expected
to command price premiums, but this may not be the case in an industry where there are a
number of strong players with their own relative strengths. There may not be a single
brand that significantly exceeds all the others in terms of brand equity. As such, a
competitive pricing method, wherein companies adjust their pricing based on similar
competitive offerings, may be the most appropriate in this market. By extension, payment

98


schemes must also be comparable to those offered by the major players. This is especially
important for the value seeker market, considering their highly objective personality
types. If a brands price premium cannot justify the tangible benefits the product offers, it
may prove unappealing for the discerning investor.

Placement

Real estate channels generally consist of mostly direct marketing by developer
sales agents and independent brokers. Some satellite sales offices and small stalls in high-
traffic locations such as shopping malls also complement the direct marketing efforts. By
doing this, developers can effectively target a wide audience while providing the one-on-
one correspondence necessary to deliver an adequate sales pitch. This current system
seems to be the ideal fit for the industry and need not be changed.

Promotion

Promotion of premium residential condominiums is also largely dependent on the
efforts of the individual sales agents and brokers selling these projects. Since ads
generally need to contain large amounts of information, print is the most common
medium used. Billboard ads are another very common way to generate awareness of
certain projects. These various advertising initiatives serve the important purpose of

99


educating the customer about a brand and its benefits, and should be maintained.
Additionally, another important function of promotion is to improve brand associations.
As such, developers should look into brand-building mass media campaigns apart from
the project-specific advertising that is generally characteristic of the industry. TVCs or
radio ads can be effective for this purpose. The continued use of celebrity endorsements,
a fairly recent industry trend, is also encouraged as it helps build positive brand
associations.
Of course, different brands have would have different promotional objectives
based on their brand personality and market position. Century Properties, a relatively new
major player in the industry, did an effective job conveying its position as a premium
developer through its strategic partnerships with Trump Properties, Versace Home, and
endorser Paris Hilton. These partnerships sent a strong message to consumers that
Century is not a small developer with few resources, but rather a serious player that is
well worth considering even in comparison with the more established firms.
On the other hand, a brand such as Ayala Land Premiere already has a very
established name with clear associations. It could therefore benefit from a promotional
campaign that highlights product quality instead of the lifestyle messages that developers
typically utilize in their advertisements. Both Rockwell Land and Shang Properties could
adopt a similar strategy as well. The focus on the products objective advantages sends a
compelling message suitable for value seekers.


100


The brand that could potentially benefit the most from improved brand
associations is Robinsons Luxuria, since its parent company is most well known as a
mid-end brand. However, its current campaign prominently features endorser Solenn
Heusaff, whose image and stature as an endorser would be more comparable with
low/mid-end condo brand endorsers (Anne Curtis, Angel Locsin), than Centurys lineup
of internationally renowned names. This unfavorable comparison reinforces the company
image as a mid-end brand, and potentially hinders its market acceptance. The use of
different endorsers, or other image-building lifestyle messages would be more
appropriate in this scenario.






















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APPENDIX A: RESEARCH SURVEY INSTRUMENT

Name (Optional):
Age:
Occupation:


Combined monthly household income:
Php 100,000 180,000
Php 180,000 450,000
Php 450,000 1,000,000
More than Php 1,000,000

I own a condo from the following brands (check all that apply):
Century
RLC
Shangrila
Ayala
Rockwell Land

I own this many condo units:
1 condo unit
2 condo units
3 condo units
more than 3 condo units


I own a condominium primarily for:
Residential use
Investment
Both (I have one of more units primarily for residence and others for investment)


How likely are you to purchase at least one more condo sometime in the future?
I expect to purchase another condo
I am strongly considering another condo purchase
I am somewhat considering another condo purchase
I am not considering another condo purchase

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Please choose one (1) statement that best describes you and mark it with an X

___ I would likely prefer or buy a condo that is associated with a well-known
international name (Trump, Raffles, Armani, Versace, etc.)

___ I would likely prefer or buy a condo that has prestigious features such as private
pools, designer branded fixtures, and a glassy building facade

___ I would likely prefer or buy a condo that offers the best price for same physical
unit specifications (materials, location, size, etc.)

___ I would likely prefer or buy a condo that, if all other things are equal, offers the
best price

___ I would likely prefer or buy a condo where all of my basic needs are within
walking distance, such as schools, offices, supermarkets, laundry, etc.

___ I would likely prefer or buy a condo that is gated, exclusive, quiet, and relatively
shielded from heavily populated areas

___ I would likely prefer or buy a condo that offers the greatest amount of amenities
possible, including a gym, swimming pools, function rooms, entertainment and
facilities, and others

___ I would likely prefer or buy a condo that is located near a trendy/hyped
commercial area such as Resorts World Manila, Bonifacio High Street and the
like



Please encircle one for each item:

Legend:
SA Strongly Agree
A Agree
N Neither Agree nor Disagree
D Disagree
SD Strongly Disagree


Please select one condo brand you own and indicate it here: ______________

107




1) I consider myself loyal to this brand in the premium condominium market

SA A N D SD


2) This brand would be my first choice for premium condominium units

SA A N D SD


3) I would not buy other brands of premium condominium units if this brand were
available.

SA A N D SD


4) The likelihood of quality of this brand is extremely high for their premium
condominiums

SA A N D SD



5) The likelihood that the premium condominium units of this brand would greatly
appreciate in value is very high.

SA A N D SD


6) I recognize this brand among other brands in the premium condominium
segment

SA A N D SD



7) This brand is the first brand that comes to mind when I think of premium
condominiums.

SA A N D SD



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8) Some characteristics of this brand as a premium condominium developer come to
mind very quickly.

SA A N D SD


9) I can quickly recall some of the projects/developments of this brand.

SA A N D SD


10) I have difficulty imagining this brand in my mind as a premium condominium
developer

SA A N D SD


11) I find that this is an appealing brand for premium condominiums.

SA A N D SD


12) This brand is the best brand for premium condominiums.

SA A N D SD


13) If I were to purchase a premium condominium unit, I would prefer this brand if
everything else were equal.

SA A N D SD



14) I am willing to recommend others to purchase premium condominium units
from this brand

SA A N D SD





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15) If I eventually find myself in the market for premium condominium units, I
would be willing to purchase from this brand.

SA A N D SD


















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APPENDIX B: DETAILED SAMPLE DEMOGRAPHIC
INFORMATION

Respondent Profile by Occupation
Occupation Frequency Percentage
Employee 94 81.7%
Entrepeneur 12 10.4%
Housewife 5 4.3%
Retired 4 3.5%
Total 115 100%

Respondent Profile by Income
Income Range Frequency Percentage
Php 100,000 180,000 35 30.4%
Php 180,000 450,000 41 35.7%
Php 450,000 1,000,000 18 15.7%
More than Php 1,000,000 21 18.3%
Total 115 100%

Respondent Profile by Number of Units Owned
Number of Condominium Units Frequency Percentage
1 unit 94 81.7%
2 units 16 13.9%
3 units 3 2.6%
4 or more units 2 1.7%
Total 115 100%

Respondent Profile by Purpose of Ownership
Purpose of Ownership Frequency Percentage
For Residence 54 47.0%
For Investment 38 33.0%
Both For Residence and Investment 23 20.0%
Total 115 100%


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Respondent Profile by Interest in Future Condo Purchases
Interest in Future Condo Purchase Frequency Percentage
Does not expect to purchase another unit 25 21.7%
Somewhat considering another purchase 45 39.1%
Strongly considering another purchase 30 26.1%
Expects to purchase 15 13.0%
Total 115 100%