Effect of Brand Equity Dimension on Purchasing Behavior (Case Study: Aroma Bakery and Cake Shop in Medan)

Abstract

Many of the entrepreneurs of small enterprise continuously strive to overcome their difficulties to grow the business. Out of many entrepreneurs who run the small enterprise, only a few is capable of sustaining and successfully growing their business into medium or even large scale. One of the common pitfalls occur during their business is their incapability of building the brand equity as one of the most important capital to align with their business growth. This strategy, however, is perceived as important because a brand equity represents the value of customer’s trust toward the entrepreneurs and the company’s brands.Aroma Bakery and Cake Shop is taken as a case study of this research which known as a foremost brand of bakery and cake that has been successfully expanding the business from the micro scale to small and become medium and even large scale. They have impressively built their brand equity and strength in a brief time, thus widely accepted by their customers. From only first outlet opened in one of permanent store at a home store (rumah toko) in 2009 to successfully opened 30 outlets in 2015.This research analyzed the influences of the four dimensions of brand equity, which are brand awareness, brand association, perceived quality, and brand loyalty over the purchasing behavior. Moreover, 245 respondents’ data were analyzed by utilizing Structural Equation Modeling (SEM) program as an analytical tool for the sample of this research.This research will test ten hypothesis those have been contributed from the past researches. Eventually, the result of the research suggests that brand awareness significantly influenced brand association, perceived quality, brand loyalty and purchasing behavior. Thus, it is strengthened by the result that brand association has significant influence over the perceived quality and brand loyalty as well as brand loyalty influenced significantly the purchasing behavior. On the other side, consecutively, the research indicates that perceived quality have no influence over or negatively influenced the brand loyalty, and brand association have no influence over or negatively influenced purchasing behavior

Keywords: brand awareness, brand association, perceived quality, brand loyalty, purchasing behavior.