THE EFFECTS OF ADVERTISING AND SALES PROMOTION ON BRAND AWARENESS FOR A FOOD PRODUCT BRAND IN WHOLESALE SHOPS, BANGKOK AND METROPOLITAN AREAS Chamaiporn Daosue* and Sawat Wanarat** Abstract Marketing communication tools may provide the means for developing strong customer based brand equity. Among marketing communication tools, advertising and sales promotions have always played a pivotal role. Prior research suggested that consumer search behavior is likely to be different across product categories. Hence, this paper examined the effect of perceived advertising spend and price promotions on brand equity across experience goods and services. The objectives of the study are to verify the relationship between the IMC (Advertising and Sales Promotion) and brand awareness, and to investigate how the IMC (Advertising and Sales Promotion) influences brand awareness regarding food products in wholesale shops, using questionnaires containing closed questions, and a sample of 500 regular customers of the wholesale shops. The validity and reliability of the questionnaire was preliminarily tested using a sample of 50 customers. Research was based on a five point Likert- type scale with an empirical study analysis using a Confirmatory Factor Analysis. The findings revealed that brand awareness was affected by two key factors, with the greatest affect being from advertising and sales promotion. The research model was considered an acceptable fit with the Goodness-of-Fit indices / = 2.553, GFI = 0.939, RFI = 0.935, IFI = 0.970, TLI = 0.960, CFI = 0.9629 and RMSA = 0.056. Keywords: Brand Awareness, Advertising and Sale Promotion *Ms. Chamaiporn Daosue obtains a Master’s degree in Development Communication from Kasetsart University, Thailand. Currently, she is working as Senior Export Marketing Manager in Betagro Group, Bangkok, Thailand. She is a Ph.D. candidate in the Department of Business Administration, Kasetsart University, Thailand. **Dr. Sawat Wanarat is senior lecturer in the Department of Operations Management, Faculty of Business Administration, Kasetsart University, Thailand. He holds a Doctor of Business Administration from Southern Cross University, Australia. He has published in both international and national journals such as International Journal of Innovation Management, Journal of Information and Knowledge Management. His research interests include Operations Management, Supply Chain Management, Logistics Management, Lean Production, Product Innovation and Service Quality. He is a peer review for several annual conferences. ABAC Journal Vol.39 No.1 (January-March, 2019 pp 57-75) Chamaiporn Daosue and Sawat Wanarat INTRODUCTION Following this growth in the food industry, there was an associated The food industry in Thailand increase in retail and wholesale, has grown rapidly over the years which put emphasis on price factors, owing to an increasing demand in the such as value for money. Many consumer market, both domestically modernized retail sectors utilize the and internationally. In order to meet cost leader and private label products an escalating trade in processed food or house brand to motivate and products, the Thai Government has influence their consumers. Brands set to transform Thailand into Asia’s also play an important role in the largest food trade and distribution decision-making processes of center. Today, Thailand is one of the business customers (Bendixen et al., world’s top ten producers and 2004), acting as a tool for achieving exporters of processed food products, organizational consensus among the with the Thai food industry contribu- many actors involved in the buying ting about 23% to the country’s Gross process (Webster and Keller, 2004). Domestic Product (GDP) in 2015. In Often it is a manufacturer’s 2016, Thailand rose up by two ranks reputation, combined with the from the previous year, to become the buyer’s own level of awareness, and world’s 13th leading food exporter. degree of loyalty shown to the Given these positive signs, manufacturer, that are important supportive government policies and considerations in purchase decisions the recovering global economy, (Cretu and Brodie, 2007; Mudambi, Thailand’s food industry is more than 2002). Branding in the food industry ready to experience an impressive has been a major concern among food growth rate in 2017, inviting new suppliers. During the past few years, players to join its growing food there has been strong competition industry. In the meantime, Thailand’s among business developers to GDP also expanded 3.3 percent from increase their market share by a year earlier in the March quarter of increasing the value of their brand, 2017, following a 3.0 percent growth Hosseinzadeh A. et al (2014). in the fourth quarter of 2016 and Brand value is recognized as one slightly above the market of the top research priorities in the expectations of a 3.2 percent branding context (Allaway et al., expansion. For 2017, Thailand's 2011; Keller and Lehmann, 2006). economic planning agency (NESDB) The increasing interest in the value expected Southeast Asia's second- brands represent for firms, is evident biggest economy to grow between 3.3 in the merger and acquisition activity and 3.8 percent, a narrower range to since the late 1980s and early 1990s, the 3.0 to 4.0 percent range it forecast and in the large sums that have been previously (Asian Development paid for brands. A strong brand with Bank Outlook 2017). positive equity is considered to have 58 The Effects of Advertising and Sales Promotion on Brand Awareness for A Food Product Brand in Wholesale Shops, Bangkok and Metropolitan Areas high strategic value and major (Kotler and Armstrong, 2013). The advantages: higher margins, brand- attempt to define the relationship extension opportunities, insulation between customers and brands, against competitors, and more created the concept of “brand equity” effective communicative power, as in marketing literature (Wood, 2000). well as stronger consumer The concept of brand equity has preferences, purchase intentions and attracted lots of attention after being customer loyalty. It has thus become introduced in the business world and essential for brand managers to has been the basis of many studies. understand and measure brand equity Modern theories of marketing (Mackay, 2001). For the processed consider brand equity as a key asset meat market to grow gradually, each for companies. Probably this level of key player must maintain their brand equity desirability is key for its market share with both existing and strategic role in making managerial prospective new consumers. and marketing decisions and Importantly, brand awareness is the consequently allowing a company to fundamental building block of brand gain a competitive advantage. For loyalty, in order to retain customer Duncan (2002), marketing loyalty, positive performance and communication is the glue that maintain the brand’s market share in enables the connection between the the specific industry. firm’s efforts and customers’ favorable responses. Brand equity is LITERATURE REVIEW a key issue in marketing. On the other hand, the consumer perspective Brand Equity and Brand focuses the conceptualization and Awareness measurement of brand equity on individual consumers (Leone et al., Aaker (2001) defined brand 2006). Consumer-based brand equity equity as a set of assets and liabilities measures assess the awareness, linked to a brand. These include the attitudes, associations, attachments name and symbols that add to, or and loyalties, consumers have toward subtract from the value provided by a brand (Keller and Lehmann, 2006). product or services to a firm and/or to Besides, Aaker (2001) provided the that firm’s customers. When the meaning of name awareness as one of consumer based brand equity is taken the important factors to create the into consideration, definitions are brand value from the brand-name more consumer specific. The logo. If a consumer has a high consumers consider the brand as an perceived level or knows the brand- important part of every product, name logo, it is easier for them to therefore determining the brand can make their purchasing decision. A increase the value of every product higher level of product brand 59 Chamaiporn Daosue and Sawat Wanarat awareness, persuades a consumer to awareness and encourage customers choose that brand’s products as a to buy products, advertisers usually priority. In summary, brand apply various strategies, such as awareness is “the ability for a buyer placement marketing (Tsai, Liang, to recognize or recall that a brand is a and Liu, 2007). Henderson et al. member of a certain product (2003) stated that under the influence category”. Therefore, brand of brand awareness, many brand awareness consists of both brand choices are made with little recognition and recall. Brand processing of information. Thus, awareness is formed by brand recall brand awareness in this regard is a and brand recognition, as suggested cue to shape decision-making. Based by Yoo & Donthu (2001). on this, there is another work of Furthermore, MacDonald and Wang et al. (2012), who concluded Sharp (2000) concluded that brand that in the absence of product image, awareness plays a key role for a cognitive image encourages consumers facing a new decision. purchase intentions. On the other Repeated purchases must be regarded hand, it shows how advertising as new decisions in this respect, since awareness and brand awareness can the individual faces a problem or encourage