Assessing the impact of brand equity on customer loyalty: an empirical study at BIDV Bank, Thua Thien Hue branch - 1

First of all, I would like to express my sincere thanks to the teachers of the University of Economics, Hue University, especially Associate Professor, Dr. Nguyen Khac Hoan, Head of the Faculty of Business Administration, who guided me in the appropriate research direction and imparted valuable experiences to help me complete this topic well.

I would like to express my sincere thanks to the Board of Directors of BIDV Development Investment Bank, Thua Thien Hue Branch and the staff in the Planning and Synthesis Department for their enthusiastic help during my internship here. In particular, I would like to express my sincere thanks to the customers who enthusiastically cooperated during the process of conducting interviews using questionnaires to collect information for my research topic.

Due to limited research time, knowledge and practical experience. Although many efforts have been made, this topic cannot avoid certain errors. We sincerely hope that BIDV Thua Thien Hue Branch, teachers and all of you will contribute additional ideas to make the topic more complete.

Thank you very much!

Hue, May 2014 Student

Thai Thi Thanh Hoa

Student: Thai Thi Thanh Hoa i

Class: K44 B Business Administration

INDEX

PART 1. INTRODUCTION ............................................................

1. Urgency of the topic ..............................................

2. Research objectives ................................................................

3. Research object and scope ............................

4. Research method..........................................

5. Significance of the thesis topic ....................................

6. Thesis topic layout.......................................

PART 2. RESEARCH CONTENT.................................

CHAPTER 1. OVERVIEW OF THE RESEARCH PROBLEM OF THE THESIS

1.1. THEORETICAL BASIS...................................................................

1.1.1. Brand .................................................................

1.1.2. Brand assets ........................................................

1.2. PRACTICAL BASIS AND RESEARCH MODEL PROPOSAL

1.2.1. David A. Aaker's (1991) brand equity model

1.2.2. Millward Brown's (1996) model of brand equity

1.2.4. Young & Rubicam (Y&R) (2000) brand equity model

1.2.5. A brief overview of the practice of brand asset management of banks in Vietnam..........................................................................

1.2.6. Proposed research model for BIDV bank's brand equity

1.3. RESEARCH PROCESS .................................

1.4. CONSTRUCTION OF THE MEASUREMENT SCALE ...................................

1.4.1. Brand awareness scale for BIDV bank

1.4.2. Perceived quality scale for BIDV bank

1.4.3. Brand association scale for BIDV bank

1.4.4. Brand engagement scale for BIDV bank

1.4.5. Brand loyalty scale for BIDV bank

1.5. DATA COLLECTION AND DATA PROCESSING TOOLS

1.6. DETERMINING SAMPLE SIZE

CHAPTER 2. BIDV BANK BRAND ASSETS AND IMPACT

ITS IMPACT ON CUSTOMER LOYALTY

2.1. OVERVIEW OF BIDV INVESTMENT AND DEVELOPMENT BANK

2.1.1. Introduction to BIDV Bank Vietnam ........

2.1.2. Organizational structure and management apparatus of BIDV Bank, Thua Thien Hue branch......................................................................

2.1.3. Operational results of BIDV Joint Stock Commercial Bank for Investment and Development, Thua Thien Hue Branch over 3 years 2011-2013

2.2. RESEARCH RESULTS ......................................................

2.2.1. Information about the research sample ............................

2.2.2. Testing the normal distribution of data..............

2.2.3. Analysis of factors constituting brand assets of BIDV bank

2.2.4. The impact of factors constituting BIDV bank's brand assets through

Step-wise regression

CHAPTER 3. SOME SOLUTIONS TO IMPROVE CUSTOMER LOYALTY TO THE BRAND ASSETS OF BIDV BANK, THUA THIEN HUE BRANCH...........................................................

3.1. Group of solutions to ensure Customer Perceived Quality

3.2. Solution group Connecting BIDV bank brand in customers' hearts

3.3. Maintain frequent association of BIDV bank brand from customers

3.4. Solution group: BIDV bank brand awareness from customers

3.5. Maintain long-term brand loyalty of BIDV bank from customers

PART 3. CONCLUSION AND RECOMMENDATIONS ............................

1. CONCLUSION ................................................................................

2. RECOMMENDATIONS................................................................................

3. LIMITATIONS OF THE TOPIC AND POSSIBLE NEW RESEARCH DIRECTIONS

REFERENCES ................................................................

APPENDIX TOPIC ..............................................................................

Appendix 1. Sample customer interview survey form ....

Appendix 2. Database on SPSS 19 ............................

LIST OF IMAGES

Figure 2.1. Brand from two traditional and synthetic perspectivesFigure 2.2. Brand Equity Model of Divid A. Aeker (1991)Figure 2.3. Brand Equity Model of Millward Brown (1996)Figure 2.4. Brand Equity Model of Keller (1998)

Figure 2.5. Young and Rubicam's (2000) Brand Equity Model

Figure 2.6. Model of factors constituting Brand Equity of Joint Stock Commercial Bank

Investment and development BIDV Thua Thien Hue branch .....

Figure 2.7. Organizational structure diagram of BIDV Thua Thien Hue BranchFigure 2.8. Statistics according to fan diagram on the characteristics of Gender of the sampleFigure 2.9. Statistics according to fan diagram on the characteristics of Occupation of the sampleFigure 2.10. Statistics according to fan diagram on the characteristics of Age of the sample

Figure 2.11. Fan diagram statistics on the Educational level of the sample

Figure 2.12. Fan diagram statistics on the sample's monthly income characteristics

Figure 2.13. Model of 4 factors affecting Brand Equity

of BIDV Bank, Thua Thien Hue branch .............

LIST OF TABLES

Table 2.1. Business performance of BIDV Bank, Thua Thien Hue branch over the years 2011 - 2013 ............................................

Table 2.2. Human resources of BIDV Bank, Thua Thien Hue Branch over 3 years (2011-2013) ........................................................................

Table 2.3. Capital mobilization activities in 3 years 2011 - 2013.....

Table 2.4. Situation of deposit mobilization of individual customers at BIDV bank, Thua Thien Hue branch over 3 years 2011 - 2013 .................

Table 2.5. Testing appropriate sample number KMO in quantitative analysis

Table 2.6. Komogorov-Smirnov normal distribution test of independent variables

Table 2.7. Results of confirmatory factor analysis for attributes affecting Assets

Brand products of BIDV Bank, Thua Thien Hue branch

Table 2.8. Step-wise regression model results measuring the impact of each factor on customer brand loyalty for BIDV Joint Stock Commercial Bank, Thua Thien Hue branch.................

LIST OF ABBREVIATIONS

BIDV Joint Stock Commercial Bank for Investment and Development Branch

CLCN Perceived quality

GKTH Brand Engagement

KMO Kaiser-Meyer-Olkin test for adequate sample size LTTH Brand association

NBTH Brand awareness State Bank of Vietnam Joint Stock Commercial Bank

TH Brand

PART 1. INTRODUCTION

1. Urgency of the topic

Branding as well as brand building and development have attracted the attention of researchers around the world for quite a long time.

One of the most famous and key concepts in Marketing that is widely discussed by researchers and theorists is “Brand equity”. One of the reasons is that Brand equity plays a strategic and very important role in the process of implementing management decisions and creating a competitive advantage for the organization over their customers. [20]

Brand equity gives the organization an advantage in maintaining market share in the competitive market [24] . In the list of the world's most valuable commercial names published annually by Inter Brand in Business Week magazine, Coca Cola brand has been at the top for many years. This brand was estimated to be worth about 65.3 billion dollars in 1997, constituting 54% of Coca Cola's market value [24] . This is an example of the power of owning Brand Equity to attract new customers and retain old customers. According to David Aker, Maintaining a good Brand Equity will help businesses increase the effectiveness of their marketing plans and help increase customer loyalty.

brand, reduces advertising costs and operating costs, enhances advantages over suppliers, distributors, etc., and creates a platform for growth through brand development. Therefore, Brand equity generates profits and drives cash flow in a business organization [25] . A strong brand can be considered the most valuable asset of a business organization because of the many advantages it brings [20] .

According to Moody's latest assessment in 2013, the Joint Stock Commercial Bank for Investment and Development (BIDV) is the second largest commercial bank in terms of total assets, has a wide network of operations and has the leading payment system in Vietnam [19] . Therefore, with its importance and great influence in the entire banking industry, the BIDV brand is a valuable brand asset that needs a comprehensive and long-term development strategy.

With the awareness of the importance of Brand Assets in the process of taking solid steps towards branding with BIDV Bank, I chose the topic "Evaluating the impact of brand assets on customer loyalty: empirical research at BIDV Bank, Thua Thien Hue branch" to conduct my thesis research in 2014.

2. Research objectives

General objectives:

The topic is implemented to achieve the goal of clarifying the factors affecting the brand equity of the Joint Stock Commercial Bank for Investment and Development (BIDV) on customer loyalty. On that basis, the topic will make recommendations to further improve the brand equity of BIDV Bank in the coming time. Specific objectives:

* In theory: Generalize and analyze some issues about product branding, brand assets and factors constituting brand assets.

* In practice:

- Identify factors affecting the brand equity of BIDV Bank, Thua Thien Hue branch.

- Point out the limitations of the Bank that lead to negative customer reviews.

- Propose some basic solutions and recommendations to enhance the brand equity of BIDV Bank, Thua Thien Hue branch.

3. Research object and scope

- Research subjects:

+ Research object: Individual customers of BIDV bank, Thua Thien Hue branch.

+ Research object: Brand assets of BIDV Bank, Thua Thien Hue branch.

- Research scope:

+ Time range:

Secondary data was collected from January 2013;

Primary data were collected during the period March to April 2014.

+ Spatial scope: Hue City.

4. Research methods

The process of carrying out this thesis topic was extended through two steps.

main:

Step 1: Based on the summary of previous studies to build

Therefore, the factors that make up the brand equity of BIDV Bank, Thua Thien Hue branch. On that basis, develop common scales to quantify those factors. To do this, the author conducted interviews and talked with experts. The purpose is to shape the factors that make up the brand equity of BIDV Bank, Thua Thien Hue branch and the scales used in in-depth interviews with research subjects.

Based on the scales agreed upon in the first step, the second step of the formal research process is conducted using quantitative research methods. Information collected from face-to-face interviews with the above research subjects through questionnaires will be encoded in SPSS 19.0 statistical data analysis software through factor analysis techniques, causal relationship analysis through the stepwise linear regression quantitative model, to find out the components that make up the brand equity of BIDV Bank, Thua Thien Hue branch. Based on the results of data analysis, policy implications will be drawn from this quantitative research.

5. Meaning of thesis topic

The research topic is conducted to identify factors affecting the Brand Equity of BIDV Bank, Thua Thien Hue branch, in order to propose policy implications to enhance the loyalty of individual customers and support the bank in its continuous efforts to enhance Brand Equity. With that purpose, the research topic of this topic aims at the following objectives:

- Identify and recognize the factors that make up the Brand Assets of BIDV Bank, Thua Thien Hue branch and build a scale to quantify the factors that make up the overall Loyalty of individual customers in general.

- Research, analyze and evaluate the level of influence of Brand Asset factors on Loyalty through a research model on the overall Loyalty of individual customers towards BIDV Bank, Thua Thien Hue branch.

- Based on the results of research and empirical investigation on customers of BIDV Bank, Thua Thien Hue branch, the topic will propose and recommend to the competent managers of the Bank to enhance the Bank's Brand Assets, thereby improving and strengthening Customer Loyalty to the Bank.

6. Thesis topic layout

PART 1. INTRODUCTION

PART 2. RESEARCH CONTENT:

CHAPTER 1. Overview of the research problem of the topic

CHAPTER 2. Brand equity of BIDV Bank and its impact on customer loyalty

CHAPTER 3. Some solutions to improve customer loyalty to brand assets of BIDV Bank, Thua Thien Hue branch

PART 3. CONCLUSION AND RECOMMENDATIONS