Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
Brand Equity Affecting the Competitiveness of the Day Spa
Business in Bangkok and Its Vicinity
Aphirada Bunkuea*, Somsak Khuhaswonvej** and Nuttawut Rojniruttikul***
This research aims to study the level of competitiveness of day spa
business in Bangkok and in its vicinity and analyze brand equity and its
impacts on day spa business competitiveness. Day spa customers in and
around Bangkok participated in answering questions from the research
questionnaires.
The
collected
data
were
analyzed
using
percentage,arithmetic means, and standard deviations. The multiple linear
regression analysis was applied to test the hypothesis. The research
results are as follows:
1) The competitiveness of the day spa business was at a high level.
2) Brand awareness, brand loyalty,brand association, and brand’s value
appreciation could affect the day spa business competitiveness with a
statistical significance level of 0.05.
Field of Research: Marketing Research
1. Introduction
Within the Asian Economic Community (AEC), Thailand is recognized as one of the most
medically-advanced countries. The country is renowned for its successful application of
high-end medical technology into its health service practices. In addition, Thailand also
enjoys being rich in a number of skillful medical practitioners in many healthcare centers
and hospitals spread throughout the nation. The services of these conventional healthcare
centers have incorporated high-end medical technology into their daily practices. Trends of
receiving healthcare services are undergoing changes in which more and more numbers
of people are turning to selective methods of treatment, originally part of Thai traditional
medical. The increasing popularity of traditional treatment is a result of its lower service
prices. In response to these higher demands, alternative Thai traditional health services—
seen most often in forms of Thai traditional massage and spa—have been opened for
services all over the country. Bangkok and the area around it are reckoned as some of the
hot spots for the day spa service. Traditional services do not only provide services for
physical and mental relief, but also incorporate medical treatments for some basic
illnesses; this further adds to the popularity of day spa services.
The term ―spa business‖ is from a Latin word ―sanus per aquam,‖ or ―sanitus per aquas,‖
meaning health from water, water therapy, and being healthy by using water. In this
research, ―spa‖ can conclusively be defined as treatment by water therapy under a
doctor‘s or specialist‘s supervision. The word spa generally denotes the feelings of resting
and relaxing that can affect the overall good health of an individual (Srilapan Naparat,
2004). Thai spa businesses have tracked their consistent growing rate at 5% to 6% per
year and the spa business, as a whole, is estimated to add about 15,000 to 16,000 million
*Ms. Aphirada BunKuea, Administration and Management College, King Mongkut‘s Institute of Technology
Ladkrabang, Thailand, Email: KhingChill@gmail.com
** Assistant Professor Dr. Somsak Khuhaswonvej, Faculty of Agricultural Technology, King Mongkut‘s
Institute of Technology Ladkrabang, Thailand, Email: kksomsa@kmitl.ac.th
***Assistant Professor Dr. Nuttawut Rojniruttikul, Administration and Management College, King Mongkut‘s
Institute of Technology Ladkrabang, Thailand, Email: krnuttaw@kmitl.ac.th
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
baht per year to the national income. The majority of customers, about 80%, observed in
Bangkok and the areas around it are reported to be foreigners. Most of the customers
obtaining spa services in Bangkok are from Singapore, Hong Kong, and America. In the
north, specifically in Chiang Mai, most of the tourists are Scandinavians and other
Europeans. Thai spas are also reputable among people from other Asian countries, such
as India, Korea, and China. There is an increasing demand for Thai spas among this
group of customers. The other 20% of spa customers are local Thais. Local Thai spa
entrepreneurs have created plans to promote more spa services to their local Thai
customers (Khiawsanan P., 2012).
Based on what is mentioned above, the researchers were interested in analyzing the
competitiveness of Thai spa businesses operated in Bangkok and its vicinity .Therefore,
this research will have beneficial effects on the development of Thai spa businesses in the
future.
2. Literature Review
Keller (1998) explains that brand equity is a pattern of behaviors that customers have with
respect to a particular existing brand, how a brand is represented, and the customers‘
impression of the brands‘ owners. These components of brand equity are key factors to
increasing the brand‘s market shares, i.e. the company‘s profit. Most importantly, solid
brand equity can result in solidifying the company‘s sales and outcompeting their rivals.
Brand value means the value that consumers will receive from buying the goods or using
the services of any brand (Mongkolsiri S. 2004). It can be either value that may not be
perceived directly but the consumers feel about such brand, for example, trust, reliability,
confidence to use it because it is more familiar or modernity. Kotler said that the brand
value is the added value of products and services. It reflects the way of thinking, feeling or
expressing of consumers by giving priority to the brand as same as price, market share,
and profitability. The brand value is an intangible asset with psychological and financial
value to the company (Kotler P., 2009).
Aaker (1991) explains that brand awareness signifies customers‘ ability in remembering
and recognizing brands. Brand awareness is a crucial strategy for creating brand equity
due to the fact that recognizing or being able to remember markers of a brand make
customers feel familiar with those products.Consequently, customers feel that the products
are reliable and that they possess some extent of standardization. This leads to the
customers‘ purchasing decision (Aaker 1991). Schiffman & Kanuk (2000) defined that the
perception is the process by which an individual chooses, organizes and interprets the
information in order to create a meaningful picture as an entire picture. Morison (1996)
defined that the customers can use the 5 senses which are seeing, hearing, tasting,
touching and smelling in recognizing the services, data of sale promotion or services of
business. Wongmonta S.(1999) defined that the perception is the process by which
humans choose to perceive, summarize the perception, and interpret the perception of
one thing in order to create an image in the brain that is meaningful and harmonious.
Brand association is how the quality of products under certain brands are integrated into
the memory of the customers. If positive aspects of brands are part of customers‘
perceptions toward the brands, then a positive attitude toward the brand is created. As a
result, the customers will always feel connected to the brand. The connection that
customers have with brands leads to the creation of brand equity. The working system of
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
this idea is that when customers have positive memories associated with brands they feel
connected to, they will value those brands over other brands with which they have less
connection to (Aaker 1991).
Brand loyalty means consistency of positive attitude that customers pay for the brands as
a result of either the brand‘s dependability, the brand‘s recognition, or the brand as being
the ‗right fit.‘ Brand loyalty can result from customers‘ repeated buying habits. No matter
what the main contributor of the brand loyalty is, once loyalty has been formed it can
efficiently cut costs for businesses due to the simple fact that keeping regular customers is
cheaper than convincing new customers. It is obvious that brands with high loyalty are
ensured to have higher benefits (Kapferer 1997). The brand value that causes the
consumers to be reliable will gain the loyalty and be easy to access. The consumers do
not need to spend or invest in finding the information. When the consumers want to
purchase a product, they will choose the brand which creates such good attitude. This
leads them to the Brand Loyalty. Apart from being the firm customer base, they may also
recommend more customers by telling their friends or close relatives. This is consistent
with the concept of Jagdish Shetz and Andrew Sobel (2004 referred in Krailert W. 2004)
defining, "Loyalty means to be loyal to our customers and give the priority to their needs or
interests". When the customers feel about the loyalty which the business gives to them,
they will be reinforced to understand the goodness and strengthened with the sense of
trust. When they trust more, they will use the services more frequently leading to the
blindness and loyalty in continuing using the services. But for people who feel themselves
to be in the third or fourth ranks of the business, they will feel that they are just one in
hundreds of customers of the business. They will never trust profoundly indeed.
Brand appreciation refers to the customers‘ conclusion about the overall quality of
products, which usually takes place after having tried the products. Brand appreciation
occurs if a customer is satisfied with a product. This is also another contribution to the
creation of brand equity (Kim 2005).
This competitive strategy refers to company‘s strength that makes it hard for that company
to be outperformed by its competitors. In order to chase out other companies with
competitive strategies, their rivals must reinvest with a huge amount of time and effort.
A company can increase their level of competitive strategy by strengthening their
innovation, institutional development plan, their administration, and even their creative
image. The processes applied in perfecting these company supportive factors can be fully
rewarding in turning a company into an institution with competitive strategy ( Porter M.
1985) W. Chan Kim (1986), the author of Blue Ocean Strategy, proposed the concept on
the same basis that the Differentiate under the Innovation can create new markets under
the new competition without entering to compete in the highly competitive market like Red
Ocean.
3. Methodology
Research instrument used for data collection consisted of questionnaires that asked both
closedended and openended questions. The questionnaires were divided into different
parts as shown below.
Part 1: Personal Information. This part was designed to obtain information relating to
seven aspects about the research participants, namely: gender, age, level of education,
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
average income, occupation, and frequency of spa attendance. There were also five
alternative questions in this section.
Part 2: Brand Equity Questions. This section helped the researchers gain information
about brand equity of the day spa business. The informants had to respond to the
questions by picking the most appropriate answers from the five-scale alternatives based
on the Rensis Likert‘s Rating Scale.
Part 3: Competitiveness Questions. The respondents were asked about businesses‘
competitiveness abilities and they had to pick the appropriate answer from the five-scale
alternatives based on the Rensis Likert‘s Rating Scale.
Part 4: Open Questions. This section of questions encouraged the participants to form
their own opinions and provide suggestions on what needed to be evaluated or readjusted
in order to make the day spa business more successful.
Hypothesis: Aspects of brand equity, such as brand awareness, brand loyalty, brand
association, and brand appreciation, contribute to the competitiveness of the day spa
business in Bangkok and the area around it.
This research studies brand equity and its contributing effects on the day spa business‘
ability to increase its market shares in the targeted spa business in and around Bangkok.
A numbers of research papers about brand equity have been reviewed. The research
framework was compliant with the principles of the brand equity optimization model by
Keller (1980). Marketing officials have attempted to find effective ways to evaluate the
solidity of brand equity and effective methods to create solid brand equity. The
independent variable for the research was the betterment of brand equity, which included
measures and practices, and the targeted business competitiveness was the research
dependent variable. The term ‗competitiveness ability‘ used in this research is based on
the model called ‗competitiveness strategy,‘ which was developed by M.E. Porter (1999).
Porter defines ‗competitiveness ability‘ as the desirable working strategy that makes any
business with this skill stand out from other businesses. This competitiveness strategy
equips a company with strength that makes it hard for that company to be outperformed by
its competitors. The competitiveness strategy can result in huge differences — between
the companies possessing this strategy and those struggling to use it — in terms of capital
for investment and for generating quick and positive feedback from clients. Therefore,
competitiveness strategy is a key factor to a more successful business. Based on the
factors contributing to the success of the day spa business, the research framework was
designed as is shown in Figure 1.
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
Figure 1 Conceptual Framework
Independent Variable
Dependent Variable
Brand Equity
1.Brand Awareness
2.Brand Loyalty
Competitiveness
3.Brand Association
4.Brand Appreciation
4. Result
Table 1 Personal Factors
Personal Factors
Gender
Age
Level of Education
Male
45
30.0
Female
105
70.0
Less than or equal to 25 years old
39
26.0
25-35 years old
68
45.3
35- 46 years old
33
22.0
More than 45 years old
10
6.7
Junior High school or lower
3
2.0
2
1.3
17
11.3
123
82.0
Higher than bachelor‘s degree
5
3.3
Less than or equal to 20,000 Baht
56
37.3
20,000 – 40,000 Baht
45
30.0
40,000 – 60,000 Baht
41
27.3
60,000 – 80,000 Baht
8
5.3
More than 80,000 Baht
0
0
Own personal business
26
17.3
Government official
12
8.0
High school/ lower certificate of
occupational college
Semi-degree/ higher certificate of
occupational college
Bachelor‘s degree
Monthly Income
Occupation
Frequency Percentage
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
Table 1 Personal Factors
Frequency Percentage
Personal Factors
Private section worker
57
38.0
State enterprise worker
15
10.0
Student
37
24.7
Other
3
2.0
It is shown in Table 1 that the majority of customers are female with an average age
between 25 to 35 years old. Most of the clients had completed their bachelor degree and
had an monthly income of between 20,000 – 40,000 baht per month. Most of the
customers work in private sectors and they purchase day spa services about one time per
month.
Table 2 Mean ( ) Standard Deviation (S.D.) Level and Rank of Brand Equity
Brand Equity
1. Brand Awareness
2. Brand Loyalty
3. Brand Association
4. Brand Appreciation
Overall
3.489
3.874
3.718
3.793
3.719
S.D.
Level
Rank
0. 681
0. 655
0. 517
0. 612
0.495
Medium
High
High
High
High
4
1
3
2
-
It is shown in Table 2 that the brand equity observed in this research is, on average, at a
high level. More specifically, brand loyalty has the highest mean. Whereas, the brand
appreciation the brand association and the brand awareness were rated with second third,
and fourth highest means, respectively.
Table 3 Mean ( ) Standard Deviation (S.D.) Level and Rank of Competitiveness
Competitiveness
1. Capital
2. Brand Identity
3. Responsiveness
Overall
4.005
4.027
3.948
3.993
S.D.
Level
Rank
0.379
0.549
0.655
0.495
High
High
High
High
2
1
3
-
Table 3 shows that the competitiveness of the day spa business is at high level. The
brand identity is observed with the highest mean. Whereas factors like capital and
responsiveness are respectively placed with second and third their highest means.
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
Table 4 Multiple Linear Regression Analysis about Impact of Brand Equity on
Competitiveness
Variables
bj
t
Constant
1.545
7.343
Brand Awareness
0.391
7.704
Brand Loyalty
-0.206
-3.816
Brand Association
0.175
2.971
Brand Appreciation
0.325
5.733
2
R = 0. .779 ; R = 0.607; SEE = 0.31527; F = 55.900; p-value = 0.000**
Note ** with the significance level of .01
p-value
0.000**
0.000**
0.000**
0.003**
0.000**
Table 4 shows that brand recognition, brand loyalty, brand association, and brand
appreciation contribute to the creation of competitiveness with the significance level of
0.01. In addition, all the components of the brand equity are observed to be 60.7%
predicative to the variation of the competitiveness of day spa business.
Conclusion and Discussion
This research‘s assumptions — brand awareness, brand loyalty, brand association, and
brand appreciation are effective factors in creating the brand competitiveness strategy with
the significance level of 0.01 — are conclusive.
Brand awareness has effects on the creation of competitiveness strategies because
customers learn about the popularity or quality of products via word of mouth and from
different kinds of advertisements. This finding is compliant with Aaker (1991 a,b) who
argues strongly for brand building and maintaining brand equity. He cites brand name
awareness as one of the four major brand assets which add value to the product or
service and/or its customers. Investments in brand equity and in particular brand
awareness can lead to sustainable competitiveness advantages and, thus, to long term
value. (Aaker , D.A., 1991)
Creating brand appreciation can gear a company towards higher competitiveness strategy
because after customers have experienced satisfaction from quality products, they will be
more willing to continue purchasing that brand‘s products. Kim and Kim (2005) obtained
quite similar result in their research. They found that appreciation of quality is a dimension
that has positive influence on the creation of brand equity in service businesses. It is the
most important precursor of brand equity. Therefore, day spa businesses which have more
appreciation of quality will lead to more brand equity. As a result, this will lead to the
business having a competitive advantage.
Brand association also affects competitiveness strategy in that the brand will leave an
impression on the customer based on that brand‘s appearance or design, quality, and
other identities related to the products‘ quality. Furthermore, memories of good services
help customers to make decisions about whether they will keep buying that brand‘s
products. This finding is further supported by Aaker. Aaker (1991) defines brand
association — cited in Till et al(2011)—as ―anything linked in memory to a brand,‖ and
states that ―the core role of brand associations is to create meaning for consumers.‖ If the
attributes and features of the brand satisfy the customers‘ needs, then it will lead the
customers to having a positive impression about the product and about the brand.
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
Organizations will gain advantages and beat out competitors into its market and gain
sustainable competitive advantages.
Brand loyalty can be considered negative for competitiveness strategy as it creates
several disadvantages for consumer, including higher cost, inconvenience, minimal variety
and brand tribalism. Another disadvantage of brand loyalty is reduced variety, because
brand loyal consumers will not purchase from their brand‘s competitors. This means that
brand loyal consumers will experience only what one brand in a particular category has to
offer, instead of taking advantage of the myriad choices available to them from other
brands (Emme C.,2002)
Recommendation
Based on the finding from this research, the following suggestions are proposed for the
benefits of spa business. It is recommended that spa business entrepreneurs put in more
strategies to develop their spa services which can best serve the needs of their clients.
The amendment of their products and services should be made regularly, for example,
new brand designs should be added to trigger positive movement of the brand and make
the brand always catchy to the customers‘ interest. The spa business owners‘ effort to
develop their brands also proves to clients about the popularity of the spa that also makes
the business becomes more competitiveness. With regard to the brand association, the
spa entrepreneurs should encourage positive memories about the spa among their
customers, make them see how better and more important your services are compared to
that of your other opponents. In order to increase brand‘s value appreciation the
betterment in goods ‗quality and service should be implemented. Most importantly, great
service from the spa workers can be true magnet that can draw the customers back to the
shop when taking their next time service. When everything is taken into account, new
loyalty will be created and old loyalty can be secured. It is worthy to try to keep customers
with loyalty, the reason lays on the fact that it is cheaper to invest in keeping old loyal
customers than in persuading the new comers. In order to raise the Spa to the ASEAN
standards and popularity, the Thai spa entrepreneurs should add in more of their
creativity, business knowledge, and sincere efforts to develop this promising business.
Reference
Aaker, D.A. 1991, Managing brand equity, Free Press, New York.
Aaker, D.A. 1995, Building strong brand, Free Press, New York.
Aaker, D.A and Alexander, L.B. 1993, Brand equity and advertising : Advertising’s
role in building strong brands, Free Press, New York.
Ariyapruchya, K, Oranthanaset, J, Karnchanasai, C and Monetary Policy 2006, ‗To
enhance the competitiveness of the sector : the road to success‘, Conference
paper. Bank of Thailland.
Assael, H 1987, Consumer behavior and marketing action.(3 rd ed), Kent publishing
company, Boston.
Bangkokbizweek, 2004, Bangkok, 26 November 2004, <http://gotoknow.org>
Butsyama, N and et al. 2003, Measuring brand value of Akiko products, Independent
Study, Master Degree of Mahidol University.
Center of Economics Research, 1997, To increase the competitiveness of the industry in
Thailand World Economy, Conference paper, Faculty of Economic, Chulalongkorn
University.
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
Chaudhuri, A.and Morris, B.H. 2001, ‗The chain of effects of from brand trust and
Brand‘ Journal of Marketing, 65, 81-93
Chaudhuri, A 2002, ‗How brand reputation affects the advertising-brand equity link‘,
Journal of Advertising Research, 42.3 ,33-43
Cobb-Walgrem, C.J. and Donthu, N 1995, ‗Brand Equity, Brand Perference, and
Purchase Intent‘, Journal of Advertising, 24 , 25-40
Cornwell, T, Bettina, Roy, Donald, P & Steinard, Edwar, A.II 2001, ‗Exploring
manager‘s perceptions of the impact of sponsorship on brand equity‘,
Journal of Advertising, 3, 41
David, W.C. 2000, Strategic marketing, no place, Boston.
Donald, R.L & Russell, S.W. 2002, Product Management.(3rded), McGraw-Hill.
Companies, New York.
Japan External Trade Organization, 2006, Comparative Survey of Labor Environment In
ASEAN, China and India, August 21, 2007, <www.jetro.go.jp>
Kelly, E.K. 1998, Strategic brand management, no place.
Kim, D.H.& Lehmann, D.R. 1990, The role brand equity in modeling the impact of
advertising and promotion sales, State of university of New York, New York.
Khaosa-at, M and et al. 2004, Competitive Benchmarking Project for Enhancing
Competitiveness ceramics and glass), 5 January 2007, <www.oie.go.th>
Kotler, P.& Armstrong 1996, Principle of marketing. (6 th ed), Prentice-Hall Inc., New
Jersey.
Kotler, P 1997, Marketing management : analysis , planning, implementation and
control.(9 th ed), A Simon& Schuster Company, New Jersey.
Kotler, P 2000, Marketing management. (10 th ed), Prentice-Hall Inc., New Jersey.
Laojavachakul, S 1999, Comparative advantage and factors affecting competitive
advantage of gems and jewelry industry. Graduate School Master of science
(Economics), Department of Economics, Kasetsart University.
Lawton, T.C. 1999, European Industrial Policy and Competitiveness, ST. MARTIN‘S
PRESS, New York.
Leamer, E.E. and Stern, R.M. 1970, Quantitative International Economics, Allyn and
Bacon Inc, Boston.
Lisa, W. 2000, ‗Brands and brand equity definition and management‘, Journal of Product
and Brand Management, 38/9 ,662-669
Name Massage of Thailand, 2013, Bangkok, 6 October 2013,
<http://panthaimassage.blogspot.com/p/blog-page.html>
Nicholls, J.AF. & Roslow, S 1999, ‗Brand recall and brand preference at sponsored
golf and tennis tournament European‘, Journal of Marketing, 33 ,365 - 387
Office of the Nation Economic and Social development Board, 2007. Develop educational
programs competitiveness of Thailand, 1 September 2007, <www.nesdb.go.th>
O‘Shaughnessy, J 1995, Competitive marketing : A Strategic Approach (3th ed)
Clays Ltd. : no place.
Oster, S. M. 1999, Modern Competitive Analysis, Oxford University Press, New York.
Phormlarp, T 2002, The Competitveness of thaitextile. Master of Science Program in
Technology Management, Thamasart University.
Porter, M.E. 1990, The Competitive Advantage of Nations: With a new Introduction,
THE FREE PRESS, New York.
Porter, M.E. et al. 2000, Can Japan Compete?, PALGRAVE, New York.
Riezbos, H.J. 1994, Brand-added value, theory and empirical research about the value of
brands to consumers, Eburon Publishers.
Rungruangphon,W 2001, Brand valuation in Real-estate business, Research report,
Proceedings of Annual Tokyo Business Research Conference
15 - 16 December 2014, Waseda University, Tokyo, japan, ISBN: 978-1-922069-67-2
Thamasart University.
Schiffman, L.G. & Leslie, L.K. 1994, Consumer behavior. (5th ed), Prentice-Hall Inc,
New Jersey.
Serirat, S and et al. 1998, Marketing Strategies, Marketing Management and case
Studies, Wisitpattana, Bangkok.
Serirat, S and et al. 1998, Marketing strategies last update, Wisitpattana, Bangkok.
Tao, H and Xiaoyue, S 2007, To eliminate/reduce trade restrictions/distortion of
laborintensive products to benefit trade, environment and development, August 21,
2007, <www.unctad.org>
Terry, B 2002, ‗Potential points of brand leverage : consumers‘ emergent attribute‘,
Journal of Product & Brand Management, 11 ,198 - 212
The Center for International trades Studies, University of The Thai Chamber of
Commerce, 2005. Education project : Industrial competitiveness Thailand to
sustainableDevelopment, Full report to the Department of Trade Negotiations,
Ministry of Commerce and The Committee on WTO.
Tokmoltum, J 1992. An anslysis of competitive advantages of Thailand's ceramic Industry,
Graduate School Master of science (Economics), Department of Economics,
Kasetsart University.
Walfried, L., Banwari, M.& Arun, S 1995, ‗Measuring customer-based brand equity‘,
Journal of Consumer Marketing, ABI/INFORM Global,12, 4
Weerasamrit, W 2010, Corporate social responsibility influencing the loyalty of
advance info service public company’ s customers . Graduate School Master of
M.B.A. (Marketing), Graduate School, Srinakharinwirot University.
Yamane, T 1973, Statistics: An Introductory analysis. (3 th ed), The harter International
Edition, Singapore.