An executive summary for
managers and executive
readers can be found at the
end of this article
Role of brand equity in
marketing of services has
not been explored in any
detail
328 JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001, pp. 328-342, # MCB UNIVERSITY PRESS, 0887-6045
Brand equity: is it more
important in services?
Balaji C. Krishnan
Assistant Professor of Marketing, Fogelman College of Business and
Economics, The University of Memphis, Memphis, Tennessee, USA
Michael D. Hartline
Associate Professor of Marketing, School of Business,
Samford University, Birmingham, Alabama, USA
Keywords Brand equity, Brands, Services marketing
Abstract While the brand equity associated with tangible goods has received a great deal
of attention in the literature, a basic understanding of the nature of brand equity for
services has yet to emerge. Most of what is known about brand equity for services is based
on theoretical or anecdotal evidence. In addition, the presumed differences in brand
equity associated with search-dominant , experience-dominant , and credence-dominan t
services has yet to be empirically examined. The objectives of this study are threefold: to
empirically test whether brand equity is more important for services than for tangible
goods, to test whether the presumed differences in brand equity for search-, experience-,
and credence-dominan t services can be confirmed in an empirical examination, and to
assess whether consumer knowledge of a product category has an effect on the
importance of brand equity across product types. Contrary to suppositions in the
literature, the results indicate that brand equity is more important for tangible goods than
for services. In addition, the results do not support the presumed differences between
service types as brand equity for search-dominan t services is more important than for
both experience- and credence-dominan t services. The same pattern of results is achieved
when consumer knowledge of each product category is included as a covariate.
Introduction
Brand equity has gained renewed attention in recent years (cf. Van Osselaer
and Alba, 2000; Yoo et al., 2000). While many definitions of brand equity
exist, one of the most widely accepted definitions states that brand equity is
the ``added value endowed by the brand to the product’’ (Farquhar 1989,
p. 47). Brand equity is important due to the quality-laden informational
content that it provides when consumers process information about a
particular product. The importance of brand equity has led to many published
studies that explore the importance of brand equity in marketing (Aaker,
1991; Keller, 1993).
However, despite its importance, the role of brand equity in the marketing of
services has not been explored in any detail. This lack of research is
troubling given the fact that services now account for the vast majority of
GNP and total employment in the US economy. Due to the inherent
differences between goods and services (Zeithaml et al., 1985), the concept
of brand equity may require some adaptation for extension into the context of
services marketing. Consequently, our limited understanding of brand equity
in services begs for more research on brand equity effects and whether these
effects differ between goods and services. This is important as researchers
are finding differences between services marketing and goods marketing in
other areas, but the results are often inconclusive and conflicting (Langford
and Cosenza, 1998).
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 Meaningful implications for
services marketing
management
Direct and indirect
measures of brand equity
JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001
The objective of this research is to assess brand equity in the context of
services marketing and to compare it to brand equity for goods. The end
results of this research should lead to a deeper understanding of brand equity
effects for services, as well as some meaningful implications for services
marketing management. In the sections that follow, an overview of the
relevant literature in brand equity for both goods and services is presented.
Next, several research questions are developed based on this review. The
results of an empirical study are described, along with the implications that
can be derived from the study.
Conceptual background
Branding and brand equity have been topics of interest to marketing
researchers for many years. A brand can be defined as ``a name, term, sign,
symbol, or design, or combination of them which is intended to identify the
goods and services of one seller or group of sellers and to differentiate them
from those of competitors’’ (Kotler, 1991, p. 442). The brand becomes an
important tool for the marketer as the consumer uses it as a cue to infer
certain product attributes, like quality.
Brand equity pertaining to goods has been well researched in the marketing
literature. Aaker (1991) and Keller (1993) have both provided conceptual
schemes that link brand equity with various consumer response variables.
Specifically, Aaker (1991) identified four major consumer-related bases of
brand equity:
(1) brand loyalty;
(2) name awareness;
(3) perceived quality; and
(4) other brand associations.
Keller (1993) proposed a knowledge-based framework for creating brand
equity based on two dimensions:
(1) brand awareness; and
(2) brand image.
Similarly, Alba and Hutchinson (1987) proposed that knowledge has two
subdimensions of experience and familiarity. The effects of experience and
familiarity on consumers’ brand equity perceptions occur at two levels:
(1) brand; and
(2) product category.
While knowledge about a brand may directly influence the brand equity
associated with a particular brand, the knowledge about a product category
will influence the brand equity associated with all brands in the product
category.
The measurement of brand equity has also been a fruitful area of study
(Cobb-Walgren et al., 1995; Keller, 1993; Lassar et al., 1995; Park and
Srinivasan, 1994). In general, there are direct and indirect measures of brand
equity. In the direct approach, an attempt is made to assess the value added
by the brand to the product (Farquhar, 1989; Keller, 1993). This approach is
closely linked to the accepted definition of brand equity. The indirect
approach focuses on the identification of the potential sources of brand
equity (Aaker, 1991; Keller, 1993). For example, Aaker (1991) developed a
329

Branding is more critical for
services than for goods
Search, experience and
credence
330
method to measure consumer-based brand equity based on the four
dimensions of:
(1) loyalty;
(2) perceived quality;
(3) associations; and
(4) awareness.
While both approaches have merit, Keller (1993) argues that the direct and
indirect approaches are complementary and should be used together.
Brand equity research in services
There has been little research (comparatively) in the area of branding in
services. The literature in this area has been slow to develop and is primarily
conceptual in nature. For example, there is a debate on the type of branding
strategy that should be followed for services. Berry et al. (1988) suggest that
service brands should have distinctiveness, relevance, memorability, and
flexibility. Moreover they argue that ``service brands should be the firm’s
name and should not be individualized’’ (Berry et al., 1988, p. 28). Onkvisit
and Shaw (1989) take issue with Berry et al. (1988) and recommend the
branding of services on an individualized basis. In a more recent study, Berry
(1999) found brand cultivation to be a principal success driver in a study of
14 mature, high-performance service companies in a variety of industries.
Some researchers have also argued that branding is more critical for services
than for goods. For example, Onkvisit and Shaw (1989) argue that branding
is critical in services because many services are seen as commodities by
consumers. Further, the intangible nature of services makes it difficult for
consumers to evaluate their quality. Branding a service can help consumers
by helping to assure them of a uniform level of service quality (Berry, 2000).
Branding also aids the service provider by elevating the service above the
commodity level to differentiate the service relative to competing brands.
Bharadwaj et al. (1993) have also argued that branding may be more
important for services than goods due to the complexity faced by consumers
in the purchase of services. Due to the unique characteristics of services,
consumers have a difficult time evaluating the content and quality of a
service prior to, during, and after the consumption of the service (Darby and
Karni, 1973; Nelson, 1970). As a result, brand names can help to reduce the
risks associated with the purchase and consumption of many services
(Bharadwaj et al., 1993).
Brand equity by type of service
All products, whether goods or services, possess search, experience, and
credence attributes (Darby and Karni, 1973; Nelson, 1970). Search attributes,
such as brand name and price, include product characteristics that consumers
can determine and evaluate prior to purchase. Experience attributes, such as
fun, emotion, or entertainment value, are those product characteristics that
can be discerned and evaluated only after purchase or during consumption.
Credence attributes include any product characteristics that consumers
cannot determine or evaluate even after purchase or consumption (Darby and
Karni, 1973). While most goods are high on search and experience attributes,
most services are high on experience and credence attributes. Consequently,
consumers are able to determine and evaluate most service characteristics
only during or after consumption, if they can be discerned at all. Very few
services are dominated by search attributes, though dry cleaning is often
JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001

Presence of search
attributes helps make the
purchase less risky
Evaluation of products prior
to purchase
JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001
mentioned as an example in the literature. Examples of experience-dominant
services cited in the literature include vacations, theme parks, and hotels.
Credence-dominant services are thought to include auto repair, medical
procedures, and legal representation.
It has been suggested that the importance of brand equity for services will
vary depending on whether the service is dominated by search, experience,
or credence attributes. For example, Bharadwaj et al. (1993) proposed that
brand equity is more important for services that are dominated by experience
and credence attributes. The presence of search attributes helps to tangibilize
the service, thereby making the purchase less risky for the consumer
(Gausseman, 1981; Murray and Schlacter, 1990). The relative lack of search
attributes in the vast majority of services makes the purchase task more
complex and riskier than for goods. Moreover, in contrast to goods, many
services involve costs that cannot be fully determined by the consumer in
advance of the purchase decision (e.g. legal services). This contributes to the
uncertainty of the service outcome and, at the very least, a heightened degree
of potential financial loss to the consumer. For most tangible goods, price is
established prior to purchase and consumption. For services, however, this is
not always possible as many services are associated with variable completion
times and/or component elements that are not completely identifiable in
advance of purchase or consumption.
Consumers typically use a risk-reduction technique in purchasing products.
However, the lack of search attributes, along with the heterogeneity of
service quality, can make the service-buying decision more difficult for the
consumer (Zeithaml et al., 1985). Thus, the perceived risk in purchasing a
service is higher than the perceived risk in purchasing a good (Gausseman,
1981; Murray and Schlacter, 1990)[1]. Moreover, among the types of
services, consumers perceive the highest risk in purchasing services
dominated by credence attributes and the lowest risk in purchasing services
dominated by search attributes (Mitra et al., 1999). On the other hand,
consumers tend to optimize their cognitive effort through some manner of
simplified cognitive processing. This process is often accomplished through
associations with familiar brand names and schematic structures in memory
(Myers-Levy and Tybout, 1989). Similarly, Levitt (1981) and Berry (1986)
recommend that ``tangibilizing the intangible’’ holds the key to success in
services marketing. One way to increase the tangible nature of a service (and
increase the number of search attributes) is to use an extrinsic cue like a
brand name. Thus, the use of brand names in services marketing can help to
reduce consumers’ purchase risk and optimize their cognitive processing
abilities (Onkvisit and Shaw, 1989).
Consumers rely heavily on extrinsic cues, such as brand names, in their
evaluation of products prior to purchase (Olson, 1977; Olson and Jacoby,
1972). This reliance on extrinsic cues occurs because the expected costs of
search to determine relative quality levels of competing brands exceed the
expected gains from search (Nelson, 1974; 1978; Zeithaml, 1988). Hence,
when intrinsic cues are difficult to discern, or the cost of the search is high,
consumers will rely on external cues. This tendency is likely to be more
pronounced when products ± like most services ± are dominated by
experience or credence attributes.
When credence attributes dominate the service offering, consumers are even
more likely to rely upon external cues, such as brand name, to aid in their
buying task. This occurs because consumers cannot judge the performance of
credence-dominant services even after consumption. As a result, it is
331
 expected that branding would be more important in services dominated by
credence attributes than those dominated by search or experience attributes.
For similar reasons, it is expected that consumers are more likely to rely on
brand names for services that are high on experience attributes than those
that are high on search attributes.

Research questions
Several questions are Based on extant literature, several questions are offered for examination.
offered for examination First, researchers have proposed that branding is more important for services
than for goods (Bharadwaj et al., 1993). However, this proposition has not
been tested empirically. Second, researchers have implied that brand equity
is more important for services that are dominated by credence attributes than
those dominated by experience attributes (Berry, 1995; Bharadwaj et al.,
1993). Similarly, brand equity is thought to be more important for
experience-dominant services than for search-dominant services. Finally,
based on the research of Alba and Hutchinson (1987) and Keller (1993), it is
expected that consumer knowledge about a product category will affect the
brand equity of all the brands in that category, while consumer knowledge
about a particular brand is likely to increase brand equity for that particular
brand. Based on previous research and the preceding discussion, the
following research questions are proposed:
Q1. Is brand equity more important for services than for goods?
Q2. Does the importance of brand equity differ among credence-dominant,
experience-dominant, and search-dominant services?
Q3. As espoused in the literature, is brand equity more important for
credence-dominant services than for experience-dominant services?
Q4. As espoused in the literature, is brand equity more important for
experience-dominant services than for search-dominant services?
Q5. Irrespective of product type (good or service), does knowledge about
the product category affect the importance of brand equity in that
category?

Methodology
Pretest
A sample of 65 A pretest was conducted to determine whether consumers perceive
undergraduates differences in the search-, experience-, and credence-dominant
characteristics of services as suggested in the literature (Darby and Karni,
1973; Zeithaml, 1988). A convenience sample of 65 undergraduate students
at a major southeastern university was used. Study participants were supplied
with a list of 25 services (see Table I) and a short explanation about purchase
decisions that described how some services can be easily evaluated before
purchase, while others cannot be easily evaluated prior to purchase.
Participants were then asked to indicate their ability to judge the
performance of each service on the list before purchase using a nine-point
scale ranging from ``Not at all’’ to ``Very well.’’ Participants were then
provided with a second explanation about purchase decisions that described
how some services cannot be easily evaluated even after consumption. The
participants were then asked to indicate their ability to judge the performance
of each service after using it on the same nine-point scale. The mean scores
on both scales for each service are shown in Table I.
It was decided that services having a high score on both scales would be
viewed as search-dominant because their performance can be evaluated

332 JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001

 Ability to judge performance Ability to judge
before purchase performance after use
Standard Standard
Mean deviation Mean deviation
Education 6.65 1.79 6.80 1.57
Restaurants 6.34 1.82 8.17 1.05
Exercise clinics 6.22 1.75 7.26 1.64
Banking 6.06 1.85 6.82 1.68
Movie theaters 5.91 1.97 7.48 1.47
Telephone services 5.62 2.19 7.08 1.96
Fast food 5.60 2.16 7.45 1.82
Spectator sports 5.45 2.02 7.12 2.10
Insurance 5.31 2.08 5.92 2.14
Legal services 5.29 2.14 6.78 1.91
Mail services 5.29 2.10 6.75 2.07
Automobile association 5.23 2.27 5.78 2.38
Salons 5.15 2.22 7.75 1.33
Car rental 5.14 2.03 6.92 2.03
Securities trading 5.12 2.30 6.17 2.14
Dry cleaning 5.11 2.22 7.49 1.51
Hair cutting 5.02 2.04 7.68 1.72
Lawn mowing 4.78 2.19 7.62 1.38
Veterinary services 4.74 2.07 5.78 2.15
Electrical utilities 4.69 2.55 6.29 2.24
Utilities 4.68 2.48 6.25 2.31
Health care/surgery 4.64 2.26 6.97 1.84
Plumbing services 4.45 2.02 6.68 1.91
Pest control services 4.34 2.03 6.25 2.07
Taxi services 3.34 2.15 7.29 1.99

Table I. Pretest results: ability to judge service performance

Consumers’ perceptions
not entirely consistent with
suppositions
before purchase. Services having a low score on the first scale and a high
score on the second scale were classified as experience-dominant because
this relationship indicates that performance cannot be evaluated prior to
purchase, but that performance can be evaluated after consumption.
Similarly, services having low scores on both scales were viewed as
credence-dominant because consumers cannot evaluate performance after
consumption. The validity of the pretest was established based on the fact
that the respondents did not identify any service as being easy to evaluate
prior to purchase, but difficult to evaluate after consumption (i.e. a high
score/low score relationship).
Overall, the results of the pretest indicated that consumers’ perceptions of the
search-, experience-, and credence-dominant classifications were not entirely
consistent with suppositions expressed in the literature. Based on these
results, a focus group was conducted with four respondents and four
non-respondents to further examine the service classification issue. The
focus group participants were provided with types of services that are used
frequently as examples of search-, experience-, and credence-dominant
services, along with the definitions of search, experience, and credence
attributes. Overall, the respondents were in agreement with the literature that
dry cleaning is dominated by search attributes, while restaurants are
dominated by experience attributes. However, they did not agree that they
could not judge a doctor’s or dentist’s performance. Most focus group
participants felt that a doctor or dentist could be judged by the degree to

JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001 333


One service selected for
each category
Product and brand names
used in prior research were
used
334
which a patient’s pain had been relieved. Some participants felt that they
could judge a doctor’s performance the moment they enter the office using
surrogates such as cleanliness, the doctor’s professionalism, or the way that
support staff treat them. Overall, the focus group helped to clarify the
inconsistency between consumers’ classification of services and the
examples provided in the literature. In keeping with our research objectives,
examples provided by focus group participants as being search-, experience-,
or credence-dominant services were used.
Three expert judges (two marketing faculty, one marketing doctoral
candidate) selected one service for each category from among the examples
provided by the focus group participants. The judges were asked to select
services that would have a high degree of familiarity among the student
respondents. All three judges chose the same three services for inclusion in
the study:
(1) movie theaters (search dominant);
(2) hair salons (experience dominant); and
(3) pest control (credence dominant).
Measures and subjects
Based on previous empirical and conceptual studies a consumer perception
approach was used to measure brand equity (Aaker, 1991; Agarwal and Rao,
1996; Keller, 1993; Lassar et al., 1995). Likewise, brand equity was
measured both directly and indirectly via the use of ``strong’’ and ``weak’’
brand names (Keller, 1993; Lassar et al., 1995). The same expert judges
were asked to choose a strong brand name and a weak brand name for each
of the three services from a randomly generated list of local service
providers. Two judges chose different brand names for one of the services.
These differences were resolved via discussions with the concerned judges.
To examine differences in brand equity between goods and services,
televisions (Sony and Goldstar) ± a product and brand names used in prior
research ± was used (cf. Lassar et al., 1995). The final list of product
categories and brand names is shown in Table II.
Many researchers measure brand equity using complex techniques such as
conjoint analysis, lengthy batteries of questions, or multi-attribute preference
models (cf. Green and Srinivasan, 1990; Park and Srinivasan, 1994; Winters,
1991). However, Agarwal and Rao (1996) found that it may not be necessary
Strong and weak Brand equity
Product category Service/good brand names scorea t-value
Search-dominan t service Movie theater Seigen Cinema 35.60 16.46*
Bon Marche 17.67
Experience-dominant Hair salon Lock Works 27.93 4.59 *
service Super Cuts 22.10
Credence-dominant Pest control Terminix 33.38 11.76 *
service Ventress Pest Control 21.58
Tangible good Television Sony 37.05 17.57 *
Goldstar 19.79
a
Total indirect brand equity measure. Since price premium is a relative measure of
brand equity, it could not be included in this score
*
All t-values indicate significant differences at p < 0.01
Table II. Product categories and brand names
JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001

Sample from a major
southeastern university
Seven-item brand equity
scale
JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001
to subject respondents to difficult questions in order to obtain accurate
measures of brand equity. Instead, they argue for a simpler approach using
single-item measures of brand equity. Based on their recommendations,
several single-item measures were used to both directly and indirectly assess
brand equity. A single price-premium question was used as a direct measure
of brand equity. This measure asked respondents to indicate how much extra
they would be willing to pay for the strong brand name good/service using a
scale ranging from zero to five, where the scale points reflected increasing
dollar amounts. The indirect measures of brand equity included six items that
asked respondents to rate, on a seven-point scale, the quality (individual and
relative), value, patronage motivation, trustworthiness, and familiarity of a
strong and weak brand in each good and service category. The brand equity
measures are provided in the appendix. Similar measures and questionnaires
were used for all products examined in the study.
A sample of 184 upper-level undergraduate and graduate business students at
a major southeastern university was enlisted to complete the questionnaire.
Because there were four total products (goods/services) and eight total brand
names that had to be evaluated, two different questionnaires were designed.
Subjects were randomly assigned to one of the two questionnaire groups
where they evaluated two products and four brand names[2].
Analysis
Before the brand equity score was calculated for each good/service category,
a manipulation check was performed to test for significant differences in the
ratings of the strong and weak brand in each product category. The results of
this analysis, shown in Table II, indicate that the ratings are different for each
strong/weak brand name pair. Consequently, it was concluded that the
respondents perceived the strong and weak brand names as intended.
The overall brand equity score for each product category was calculated
using a three-step process. First, difference scores for each of the six indirect
measures of brand equity were calculated for each strong/weak brand name
pair. Second, these scores were then combined with the price premium
question to arrive at a final seven-item brand equity scale for each product
category. The reliability estimates (coefficient alpha) for this scale were
acceptable across the four product categories:
(1) movie theaters (0.868);
(2) hair salons (0.919);
(3) pest control (0.868); and
(4) televisions (0.881).
The final brand equity score for each product category was calculated by
summing all seven items (to create a difference score) and dividing by the
rating for the weak brand in that category. This indexed measure reflects the
percentage increase in brand equity ascribed to the strong brand relative to
the weak brand. This procedure standardizes each respondent’s rating
relative to the lower level of brand equity ascribed to the weaker brand in
each product category. The brand equity index for services as an entire
category was calculated by averaging across all three service types.
Since each respondent evaluated two product categories using the same basic
measures, a within-subjects repeated measures design was used to test for
significant differences between the brand equity indices of movie theaters
(search-dominant service), hair salons (experience-dominant service), pest
335
 control (credence-dominant service), and televisions (tangible goods). These
differences were also examined with respect to the effects of knowledge of
the product category as a covariate in the design.

Results
Search-dominant services The results, shown in Table III, indicate that there are significant differences
have the highest brand in brand equity indices among the product categories examined. However,
equity index these differences are not consistent with most propositions espoused in the
literature. For example, the brand equity index for televisions (tangible
goods) is significantly higher than the index for all services combined.
Hence, our results indicate that brand equity may not be more important for
services than for goods. Further, while our results do show that the
importance of brand equity differs among search-, experience-, and
credence-dominant services (Q2), these differences are not consistent with
current assumptions in the literature. Our findings indicate that search-
dominant services have the highest brand equity index, followed by
credence-dominant services. The brand equity indices for experience- and
credence-dominant services are not significantly different, indicating that
brand equity is equally important for both types of services. Likewise, our
results show that brand equity is equally important for search-dominant
services and tangible goods, as their indices are not significantly different.
Brand equity indices The brand equity indices for all product types were also examined for
differences after accounting for consumer knowledge about the product
category as a covariate (Q5). Our results, shown in Table IV, indicate that
knowledge of the product category has no effect on the relative differences in
brand equity indices. It was earlier presumed, based on Keller’s (1993)
research, that consumer knowledge about a product category would play an
important role in determining brand equity scores. While this may be true
within a product category (as hypothesized by Keller), results indicate that
consumer knowledge has no effect on relative brand equity scores across
product categories.

Discussion
In total, our results indicate that tangible goods and search-dominant services
are very similar in terms of brand equity indices and the importance of brand

Search- Experience- Credence-

dominant dominant dominant
Product categoryb service service service All services
mean score (166.06) (59.45) (80.15) (101.89)
Experience-dominant
service (59.45) 106.61 ***
Credence-dominant
service (80.15) 85.91 *** 20.69
Tangible good (130.33) 35.73 70.88 *** 50.18*** 28.44 **
Notes: ** p < 0.05; *** p < 0.01
a
Mean difference between brand equity index scores based on both direct and indirect
brand equity measures. The index represents the percentage increase in brand equity of
the strong brand relative to the weak brand in each product category. A Bonferroni
adjustment is made for multiple comparisons
b
Search-dominant service (movie theater), experience-dominan t service (hair salon),
credence-dominan t service (pest control), tangible good (television)
Table III. Differences in mean brand equity index scoresa

336 JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001


Consumers do not
understand the differences
implied by the search
Diversity among services
and service types
JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001
Search- Experience- Credence-
dominant dominant dominant
Product categoryb service service service All services
mean score (157.99) (61.58) (80.15) (99.91)
Experience-dominant
service (61.58) 96.41 ***
Credence-dominant
service (80.15) 77.84 *** 18.57
Tangible good (126.67) 31.32 65.09 *** 46.52*** 26.76**
Notes: ** p < 0.05; *** p < 0.01
a
Mean difference between brand equity index scores based on both direct and indirect
brand equity measures. The index represents the percentage increase in brand equity of
the strong brand relative to the weak brand in each product category. A Bonferroni
adjustment is made for multiple comparisons
b
Search-dominant service (movie theater), experience-dominan t service (hair salon),
credence-dominan t service (pest control), tangible good (television)
Table IV. Differences in mean brand equity index scoresa after accounting for
knowledge of each product category
equity. Both indices are higher than those for experience- and credence-
dominant services, while the brand equity index for tangible goods is higher
than that of all services combined. Though these findings are inconsistent
with assumptions found in the literature, they do make intuitive sense. By
their nature, search-dominant services are somewhat similar to tangible
goods in that both possess attributes that consumers can evaluate prior to
purchase and consumption. The lack of a significant difference between
experience- and credence-dominant services is also inconsistent with the
literature. However, since both types of service must be experienced before
an evaluation can take place (regardless of how difficult this evaluation may
be to the consumer), it seems reasonable that brand equity would be similar
for both service types.
Based on the results of the pretest and our analysis, it appears that consumers
do not perceive and understand the differences implied by the search,
experience and credence attributes of services as suggested in the extant
literature. This is particularly true with respect to the specific service
examples that have been used in the literature as they do not seem to match
consumers’ categorization schemas. While the results are dependent on the
types of services used in the study, it should be noted that the selection of
these services was based on a pretest where the respondents reported their
ability to evaluate these services before purchase and after use. Hence, this
study attempted to match specific service examples with the categorization
schemas employed by the respondents.
Limitations and future research
The differences in brand equity indices of the service types used in our study
point to the often found diversity among services and service types. Our
study is limited in the fact that only three types of services and one type of
tangible goods were examined. Thus, future research should attempt to
examine brand equity across many different product categories and product
examples. This type of examination is important if service research is to
move away from anecdotal evidence to a more empirically derived
classification of services and service types. The classification of services into
search-, experience-, and credence-dominant categories is a good example of
337
 how presumptions made in the literature may not adequately match
consumers’ classification schemas or evaluative processes.
Respondents did perceive Our results are limited by the choice of brand names used in the study. It is
the strong and weak brand possible that our results could change if different brand names were used for
names as intended each product category. However, it should be noted that the respondents did
perceive the strong and weak brand names as intended. Further, an attempt
was made to control for brand name effects by indexing the brand equity
differential score to the score for the weak brand. In effect, each brand equity
index reflects the percentage change in brand equity associated with the
strong brand relative to the weak brand.
As a future extension to our study, researchers could examine the relative
importance of search, experience, and credence attributes in the brand equity
for tangible goods. While all tangible goods possess searchable attributes,
many goods also possess attributes that consumers can evaluate only during
use. Further, some goods may possess attributes that cannot be easily
evaluated even after use. For example, automobiles possess many
experience-based (e.g. comfort, gas mileage, handling, suspension) and
credence-based attributes (e.g. anti-lock brakes, emission controls).
Experience-based attributes are also important in tangible goods such as
computers (e.g. speed, ease-of-use) and shoes (e.g. comfort, durability). In
short, experience- and credence-based attributes could play a different role in
the brand equity for tangible goods than they do in the brand equity for
services.
Many researchers do not approve of the use of student samples. While it is
possible that use of student samples could have affected the results, it should be
noted that students are viable consumers and useful for examining the concept of
brand equity. The pretest was designed to frame the study in terms of service
examples with which students were fairly familiar. Future research could
attempt to replicate and extend our research via the use of non-student samples.

Conclusion
Contentions in the Overall, the results of our study do not support the contentions in the literature
literature not supported that brand equity is more important for services than for goods. Further, our
results do not support the presumption that brand equity is more important for
credence-dominant services than either experience-dominant or search-
dominant services. Knowledge of the product category does not affect brand
equity differences across product categories. Our study highlights the
importance of empirically examining long-held presumptions in the literature
that are based on conceptual or anecdotal evidence. In addition, our study
supports the contentions of Agarwal and Rao (1996) that brand equity can be
measured using fewer items and simpler questions than in previous studies. This
type of data collection is easier to conduct as respondents are not subjected to
difficult questions that require a great deal of effort.

Notes
1. George et al. (1984; 1985), did not find reasonable evidence to state that services are
riskier to purchas e than goods. Murray and Schlacter (1990), however, take issue with the
experimenta l procedur e used by George et al.
2. One group was exposed to questions relating to movie theaters (search-dominan t services)
and hair salons (experience-dominan t services), while the second group was exposed to
questions relating to pest control services (credence-dominate d services) and televisions
(tangible goods). This procedur e was used to prevent respondent fatigue and random
marking of answers that could be associated with responding to the same questions eight
different times.

338 JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001

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Appendix. Brand equity measures

These examples are taken from the questionnair e for movie theaters. All other products and
brands were assessed using similar or identical measures.

Price premium measure

Assume that a movie at (weak brand) costs $3.50. How much extra would you be willing to pay
for the same movie at (strong brand)?
(1) Up to 50 cents more
(2) Up to $1.00 more
(3) Up to $1.50 more
(4) Up to $2.00 more
(5) More than $2.00

Indirect brand equity measures

(1) Evaluate the quality of the two movie theaters using the following scale:
Inferior quality 1 2 3 4 5 6 7 High quality
Strong brand 1 2 3 4 5 6 7 Weak brand 1 2 3 4 5 6 7
(2) Evaluate the quality of the two theaters overall when compared to all other theaters in the
city. Use the following scale:
One of the worst 1 2 3 4 5 6 7 One of the best
Strong brand 1 2 3 4 5 6 7 Weak brand 1 2 3 4 5 6 7
Please tell us how much you agree or disagree with the following statements about the two
theaters. Evaluate each theater separately using the following scale:
Strongly disagree 1 2 3 4 5 6 7 Strongly agree

340 JOURNAL OF SERVICES MARKETING, VOL. 15 NO. 5 2001

 (3) This theater provides good value for the money.
Strong brand 1 2 3 4 5 6 7 Weak brand 1 2 3 4 5 6 7
(4) There are good reasons to go to this theater rather than other theaters.
Strong brand 1 2 3 4 5 6 7 Weak brand 1 2 3 4 5 6 7
(5) When it comes to theaters, this is the one I can trust.
Strong brand 1 2 3 4 5 6 7 Weak brand 1 2 3 4 5 6 7
(6) When it comes to theaters, this is the theater I am most familiar with.
Strong brand 1 2 3 4 5 6 7 Weak brand 1 2 3 4 5 6 7
&

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 This summary has been
provided to allow managers
and executives a rapid
appreciation of the content
of this article. Those with a
particular interest in the
topic covered may then read
the article in toto to take
advantage of the more
comprehensive description
of the research undertaken
and its results to get the full
benefit of the material
present
342
Executive summary and implications for managers and
executives
The concept of brand equity
A brand is a name, term, sign, symbol, design ± or combination of them ±
which helps consumers to identify the goods and services of one seller or
group of sellers, and to differentiate them from those of competitors. The
consumer uses the brand as a cue to infer certain product attributes, like
quality. The brand is therefore an important tool for marketers. Brand equity
is the added value given by the brand to the product.
Brand equity is usually seen as more important for services than for goods.
Because services are intangible, consumers have more difficulty evaluating
their quality. Branding a service can aid consumers by helping to assure
them of a uniform level of service quality.
Search, experience and credence attributes
All products, whether goods or services, possess search, experience and
credence attributes. Search attributes, such as brand name and price, include
product characteristics that consumers can determine and evaluate before
buying. Experience attributes, such as fun, emotion or entertainment value, can
be discerned and evaluated only after purchase or during consumption .
Credence attributes include any product characteristi cs that consumers cannot
determine or evaluate even after purchase or consumption . While most goods
are high on search and experience attributes, most services are high on
experience and credence attributes. Consequently, consumers are able to
determine and evaluate most service characteristics only during or after
consumption , if they can be discerned at all. Very few services are dominated by
search attributes, although dry cleaning is one. Vacations, theme parks and
hotels are examples of experience-dominant services. Credence-dominant
services include car repair, medical procedures and legal representation.
The traditional view of the importance of brand equity
Brand equity is generally thought to be more important for services that are
dominated by experience and credence attributes. The presence of search
attributes helps to make the service more tangible and so makes purchase
less risky for the consumer. The relative lack of search attributes in most
services makes the task of purchasing them more complex and riskier than
for goods. Moreover, the price of most goods is established before they are
bought, but the cost of services such as legal representation often cannot be
confirmed until after they have been provided.
Some surprising results from research
Research by Krishnan and Hartline reveals some surprising results. Brand
equity may not be more important for services than goods. Tangible goods
and search-dominant services are similar in terms of brand equity indices
and the importance of brand equity. Both indices are higher than those for
experience-dominant and credence-dominant services, while the brand
equity index for tangible goods is higher than that of all services combined.
The results can, however, be explained. Both search-dominant services and
tangible goods can be evaluated by consumers before being bought.
Similarly, since both experience-dominant and credence-dominant services
must be experienced before an evaluation can take place, regardless of how
difficult this evaluation may be to the consumer, it seems reasonable that
brand equity should be similar for both these service types.
(A preÂcis of the article ``Brand equity: is it more important in services?’’.
Supplied by Marketing Consultants for MCB University Press.)
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