Abstract:
In a competitive and brand conscious market, like Kenya, building brand equity of any product is a
challenging task. Companies need to assess the prior experiences and future aspirations of consumers
to possess these brands. In this context, we examine the
effect of advertisement and word of mouth on
brand equity. Data was collected from 384 shoppers from three supermarkets Eldoret town, Kenya,
through self-administered questionnaires using systematic sampling technique. Out of these, 346 were
used for the
purpose of this study, which provided a response rate of 90 percent. Multiple regressions
confirmed that
advertisement exerts a significant, positive effect on brand equity;
the results also
reveal a positive and significant moderating effect of word of mouth on the relationship between
advertisement and Brand equity.
These results add some new understanding to the literature on
advertisement, word of mouth, brand equity and their interrelationships which influence the
development of the retail industry in a developing country context.
Firms
need to put more emphasis
on advertisement by differentiating their ads from those of competitor’s brands, being creative in their
adverts,
improve reputation of their brands, focus effort on massage impression and opinion leaders
whose word of mouth influences brand equity.
