An Examination and Theorisation of Consumer-Brand Relationship and its Link to Customer-Based Brand Equity by Naser Pourazad Thesis Submitted to Flinders University for the degree of Doctor of Philosophy College of Business, Government and Law 5th of October, 2018 1 I certify that this thesis does not incorporate without acknowledgment any material previously submitted for a degree or diploma in any university; and that to the best of my knowledge and belief it does not contain any material previously published or written by another person except where due reference is made in the text. Naser Pourazad 2 Abstract Over the past decades, scholars have shown great interest in understanding the way consumers develop personal connections with brands. In fact, consumer-brand relationship has been a topical focus of published works in branding and consumer research. In addition, managers of many globally known brands have incorporated strategies to nurture strong bonds with their consumers. However, it is still not clear how brand relationships unfold. In particular, there is a need for research to understand how to strike a balance between the emotional and cognitive factors, which drive consumer-brand relationships. Therefore, the primary goal of this thesis is to improve understanding of consumer-brand relationships, with a particular focus on the role of emotions as a key contributing facet, in addition to the cognitive elements as crucial drivers. In doing so, the thesis draws upon the literature on consumer-brand relationships and relational concepts as well as the seminal studies on the customer-based brand equity (CBBE) to conceptualise and test relevant frameworks. In more detail, the primary objectives of this thesis are (i) to identify and critically review the existing conceptualisation of consumer-brand relationships (i.e., relational concepts); (ii) to outline and test a parsimonious framework for consumer-brand relationship; (iii) to extend the conceptualised consumer-brand relationship framework with respect to its effects on brand- related outcomes; and (iv) to investigate the synergy between consumer-brand relationship and customer-based brand equity (CBBE). These objectives address prominent issues in the literature, as follows. First, there is no agreement on the dimensionality of the consumer- brand relationship. That is, some researchers have conceptualised consumer-brand relationship using brand satisfaction and brand trust (Esch, Langner, Schmitt, & Geus, 2006); while others have used interdependence, intimacy, self-connection, love/passion, partner quality/trust and commitment (Fournier, 1998; Francisco-Maffezzolli, Semprebon, & Prado, 2014); or emotional connection and the strength of the intended communication with the brand (Veloutsou, 2015). Accordingly, there is a need for a critical revision of the concepts related to the theorisation of consumer-brand relationship. Second, while studies (e.g., Albert, Merunka, & Valette-Florence, 2013; Langner, Schmidt, & Fischer, 2015) have confirmed some implications of consumer-brand relationship, other outcomes that go beyond transactional purposes (e.g., brand advocacy) require further investigations. Third, while recent research has highlighted that the interactions between brand equity dimensions 3 could be used to explain the process of building strong brands (Chatzipanagiotou, Veloutsou, & Christodoulides, 2016; Christodoulides, Cadogan, & Veloutsou, 2015; Stocchi & Fuller, 2017), there is still a wider scope for examination with respect to the overall effects of CBBE (and its components) on the development of consumer-brand relationships. In fact, the existing works did not incorporate a wide range of dimensions into the conceptualisation of CBBE (e.g., So, Parsons, & Yap, 2013; Loureiro & Kaufmann, 2012; Vlachos & Vrechopoulos, 2012). This is an issue because it limits the generalisability of the results due to failing to include brand associations that are triggered by brand characteristics with a strong bearing on consumer-brand relationships. In addition, the majority of published studies do not include comprehensive conceptualisations of brand relationships concepts (Japutra, Ekinci, & Simkin, 2016; Veloutsou, 2015). Addressing these issues is important as it allows designing strategies that help develop, sustain and leverage consumer-brand relationships and drive positive brand implications. The thesis addresses the above objectives via three empirical quantitative studies using sports apparel brands and luxury brands as gauging contexts, by means of primary online and face- to-face survey data from Iran and Australia. The data are analysed using structural equation modelling (including Covariance-based and Variance-based approaches). In more detail, Study 1 primarily focuses on a key concept in the literature of consumer-brand relationship (i.e., brand passion) and investigates the mechanisms through which passionate bonds can be channelled into attitudinal loyalty and subsequently into brand-related outcomes. Study 2 incorporates four key concepts (i.e., brand love, brand attachment, brand passion and brand identification) towards the conceptualisation of emotional consumer-brand relationship and testes the effects of a range of brand associations (i.e., brand image, hedonic attributes, prestigious values and uniqueness) on emotional consumer-brand relationship. It also examines the predicting power of emotional consumer-brand relationship on consumer evaluation of brand extensions. Study 3 focuses on both emotional and cognitive aspects of brand relationships, through examining the synergy between CBBE and consumer-brand relationship. It also investigates the influence of consumer-brand relationship on price insensitivity, purchase intentions, and positive word-of-mouth (WOM). 4 Accordingly, the thesis offers important theoretical contributions. First, it explains the theoretical link between the components of CBBE and consumer-brand relationship and confirms that key concepts such as brand knowledge, perceived quality and hedonic attributes act as the force behind the establishment of consumer-brand relationships. Specifically, the thesis provides insights for the theoretical advancement of two inter-related areas of existing research: consumer-brand relationship and CBBE. The link between these areas reflect a crucial stage of the process of building strong brands (Keller, 2001, 2009; Chatzipanagiotou et al., 2016; Christodoulides et al., 2015). Second, the thesis confirms that consumer-brand relationships have the power to become an important part of consumers’ lives (Schmitt, Joško Brakus, & Zarantonello, 2015; Kessous, Roux, & Chandon, 2015). This yields implications that extend beyond transactional goals and include relational aspects such as attitudinal loyalty, brand advocacy and WOM, sense of community, price insensitivity, social media support and alternative devaluation. Third, the thesis validates two new frameworks for consumer-brand relationship (i.e., emotional consumer-brand relationship in Study 2 and consumer-brand relationship in Study 3), incorporating established concepts of brand relationship literature. The thesis also offers valuable insights for brand managers. First, the thesis posits that strengthening consumer-brand relationships offers a fundamental managerial benefit, and a sustainable and strategic competitive advantage (Muniz & O’Guinn, 2001; Webster Jr, 1992). Specifically, the thesis offers recommendations regarding how managers can leverage relational aspects such as self-identification, love, passion, attachment and hedonic values to create positive relationships with their consumers. Second, the findings of the empirical studies offer specific implications for the managers of sports apparel brands. Accordingly, the outcomes of the thesis imply that managers should profile and identify passionate and emotionally connected consumers; build strategies to leverage passion to encourage pro- brand attitudes and intentions; and devise strategies that strengthen consumers’ interest in the brand’s social community. Third, the findings of the thesis leads to the recommendation that recommends luxury brand managers should leverage consumer-brand relationship by focusing on specific characteristics of the brand (e.g., hedonic and symbolic benefits, uniqueness and image) to strengthen the presence of the brand in the minds of consumers. 5 Acknowledgements Firstly, I am forever thankful to Flinders University for granting me the opportunity to pursue my PhD aspirations and generously offering the Flinders International Postgraduate Research Scholarship to fund my studies in Australia. This thesis would not have existed without their support and sponsorship. I would also like to express my sincere gratitude to my supervisors Dr Vipul Pare and Dr Lara Stocchi for their continuous support throughout my PhD, and for their patience, motivation, enthusiasm, and immense knowledge. Their guidance assisted me greatly in my research and writing of this thesis. In addition to my supervisors, I would like to thank my examiners Professor Cleopatra Veoutsou and Associate Professor Polymeros Chrysochou for their encouragement, insightful comments, and constructive feedback. My sincere thanks also goes to Dr Maria Flutsch for her generous and kind assistance in editing my thesis. Last but not least, I would like to thank my lovely partner Sarah Randall-Smith for her patience and encouragement, and my family for supporting me spiritually