Determinants of brand equity for credence goods: Consumers’ preference for country origin, perceived value and food safety
R. Kimhttps://doi.org/10.17221/45/2012-AGRICECONCitation:Kim R. (2012): Determinants of brand equity for credence goods: Consumers’ preference for country origin, perceived value and food safety. Agric. Econ. – Czech, 58: 299-307.
Food safety is an important credence attribute that is increasingly being emphasized by the food industry, regulatory bodies and the consumers around the world. Consumers cannot predict ex ante performance of the product based on the credence attributes due to information asymmetry, and they need a signal that they can trust in purchasing a food product with high credence attributes. Consumers are likely to use a brand name as a surrogate of the quality and the safety guarantee in purchasing food products with credence attributes. An effective brand management appears to be a major prerequisite for the creation of superior customer value (i.e. brand equity) and successful positioning of credence goods. This study empirically validates four determinant conceptualization of brand equity for credence goods by utilizing the Latent Variable Structural Equation Modeling (LVSE). Findings support the four factor model of brand equity for credence goods. The main objective of this study is to illustrate how consumers place value on major product cues in making purchasing decision of credence products. The findings show that brand loyalty and attribute based components (i.e. perceived value) appears to have the dominant role in determining a brand’s equity.Keywords:
consumer preference, food safety, brand equity, branding