CONSUMER BEHAVIOR

Consumer Behavior



Consumer Behavior

Introduction

In the era of rapid advances of technology and product parity, the range of options available to organizations to attract consumers is decreasing. In the face of the fierce competition, companies recognize a need for a value-adding strategy. Intangibles such as corporate credibility, integrity and corporate expertise increasingly influence consumer responses towards brands. As a result, a considerable amount of effort inside contemporary organizations is concerned with strategic positioning in relation to various consumer groups. (Balmer 2006: 963)

Consumers are becoming increasingly fickle and savvy. For organizations this implies placing more emphasis on the individual consumer needs and expectations as well as heavily investing in advertising. The determinants of consumer demand in the automotive commerce include vehicle prices, exchange rates, incomes, and vehicle innovation and consumer demography. According to the IBISWorld commerce report Motor Vehicle Manufacturing in Australia, the latter factor, namely, slowing population growth and the increasing proportion of the aged population, will lead to people to be less inclined to use and replace vehicles. In addition, as consumers are becoming more discerning and more educated, they will need a stronger justification for purchasing a car. (Batra 2006)This places extra pressure on automobile manufacturers to be innovative not only in product development but also in terms of brand communication. One way to compete in volatile markets and increasing product parity is to adopt a corporate branding strategy. Corporate branding represents an opportunity for organizations to enhance and sustain their distinctiveness through connecting corporate characteristics to products and services, thereby, allowing unique synergies to be developed. Despite the importance of corporate branding, technology companies not very often have corporate brand strategy and largely rely on the assumption that constant product improvement will sell itself. As Zambuni observes, high-tech branding is: “an area that is less well understood than fast-moving consumer goods or services branding”. Consistent with this point, Mazur, notes that a majority of high-tech companies have been “backwards about branding”. Therefore, in addressing some of these limitations, there is a potential for organizations to determine brand attributes that impact most on consumer loyalty. (Bhat 2006: 32)

Although there is recognition of the importance of strong corporate brands to organizations among both practitioners and academics, little is known about the impact of the effects of corporate brands on consumer perceptions and consumer loyalty. Whilst the existing frameworks are helpful for a general understanding of the multidimensional nature of consumer brands and corporate brands, an important area that is yet to be addressed is the relationship between corporate brand and consumer behaviour. As Dacin and Brown (2006:10) point out, each disciplinary line of branding has pursued its respective focus, and seldom has the existing research been integrative. Just recently have researchers began to investigate the relationship between the corporate brand and consumer behaviours(Gray 2006: 695). However, these attempts only partially examine the impact of the corporate brand on consumer loyalty. For example, Souiden et al. (2006:41) found the effects of corporate image on consumer product ...