Article title page Structured Abstract Purpose

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Article title page
A framework to attain brand promise in an online setting
Structured Abstract
Purpose: This study investigates how price and other service brand attributes (such as website
attractiveness, efficiency, privacy, fulfilment) determine e-brand promise/reputation and the e-loyalty
of shoppers in an online setting.
Design/methodology approach: Using the convenience sampling method, a survey research was
carried out during a two-day airline exhibition among experienced respondents who had purchased
online tickets in the past. To identify what determines online brand reputation and its effect on eloyalty, structural equation modelling using the two-step approach was performed.
Findings: Fulfilment and competitive price offers have the most significant impact on e-loyalty, with
a full mediation impact (via online brand reputation), whilst website attractiveness has a partial
impact. These simultaneously confirm the role of e-brand reputation as a mediator construct and its
antecedents and its relationship with e-loyalty.
Research implication: The mediation impact further increases the strength of brand reputation as a
construct when modelling consumer responses in an online setting. In particular, the full indirect
impact (price and fulfilment) was able to explain how online brand reputation was formed and
brand promise can be achieved.
Practical implication: The practical contribution of the study and its managerial implications can be
seen in the context of defining strategy and positioning. By confirming that different brand
enactments are found in different settings (for example, price, fulfilment, site’s attractiveness), this
study offers some insights into a company’s site strategic brand positioning and differentiation. For
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example, appropriate enactments, such as price, fulfilment and the attractiveness of the site, could be
addressed when designing and enhancing online brand reputation and e-loyalty.
Research limitations: Sample size limitation and generalisation is limited to within the Internet
airline setting.
Originality/value: While existing research mainly focuses on the effect of service quality and image
attributes of e-loyalty, the current research focuses on other aspects of brand differentiation – e-brand
reputation and the important influencing elements, such as price and website attractiveness – which
hitherto have often been ignored in an online setting. In other words, this study highlights
the most important attributes that will help to ‘meet’ the online service brand promise through ebrand reputation.
Keywords:
Online brand promise, e-service brand, online brand reputation, corporate brand
reputation, corporate brand promise, price, e-loyalty
Article Classification
Research paper
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1. Introduction
To gain customer e-loyalty (future revisits and repurchases), companies are seen to be competing in
order to improve their online brand reputation (Argyriou et al., 2006) by providing the best online
retail website (Reibstein, 2002). However, despite these efforts, generating a profitable business
online is still an ongoing key issue (Heijden and Verhagen, 2004). For example, consumers are faced
with disappointing company or corporate web experience (e.g. Wolff, 1998), lack of e-loyalty (e.g.
low online sales due to no repeat purchase) (Gould and Silberzahn 1996; Cowles, Kiecker and Little,
2002), particularly in a service-type company (Christodoulides, de Chernatony, Furrerb, Shiua and
Abimbola, 2006) such as airlines (Zins, 2001). One possible reason why e-loyalty remains low to a
specific service brand or website is because consumers may not be receiving the brand experience as
promised. It is proposed that marketers should try to focus on the brand building aspect by evaluating
what makes consumers feel that their brand promise is met (the covenant aspect of the firm or online
company) (Balmer, 2010) and to relate this with their e-loyalty. Furthermore, having a strong
corporate /online brand reputation could be seen ‘….as guarantee of quality, as an insurance against
risk of poor performance or financial risk” (Balmer and Gray, 2003, p.973) and thus, increases
customer confidence in products and services, advertising claims and the decision to buy (Fombrun
and van Riel, 2004).
To date however, little attention has been devoted to brand building or understanding the brand
promise in respect of the online service brand (Argyriou et al., 2006; Christodoulides et al., 2006).
Replicating offline brand marketing research in this context, however, is thought to be insufficient
(de Chernatony and Christodoulides, 2004 and Christodoulides et al., 2006; Da Silva and Syed Alwi,
2008). Yet online brand building requires different enactments (de Chernatony and Christodoulides,
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2004; Christodoulides et al., 2006). Thus, what is online brand promise? And, how does an online
brand promise explain e-loyalty?
A useful theoretical guideline provided by de Chernatony and Christodoulides (2004) will be used
for the current study. They have defined online brand using a framework known as ‘the brand
triangle’, which states that ‘a brand is a cluster of rational and emotional values that enable
stakeholders to recognise a promise about a unique and welcome experience’ (p.239). The brand
triangle framework will be used as the basis for developing the current study’s model as well as
testing it empirically. Due to the lack of online service brand research, (such as the airline setting),
this will then be set as the study’s choice for the empirical setting. The current study’s main objective
is to investigate what determinants influence online brand reputation (brand promise) and e-loyalty
in the context of the airline setting. In particular, the study will identify which enactment(s)
(represented by the rational elements known as e-airline brand attributes in the current study) will
explain the online brand promise (known as e-brand reputation-as mediator), represented by the
emotional construct, and, subsequently, e-loyalty. Accordingly, this study looks at:
(1) What are the constructs representing e-airline brand attributes?
(2) Does the e-brand reputation (online brand promise) construct mediate the relationship
between e-airline brand attributes and e-loyalty? In other words, what and which
enactment(s) explain the online brand promise and e-loyalty in the context of airline?
This paper is organised as follows. The first section presents the literature review and theoretical
framework of the current study. Specifically, the literature review focuses on (1) the need to study ebrand reputation, (2) e-brand reputation seen as mediator construct and (3) what derives online brand
reputation and e-loyalty. All the main variables of the study are outlined and the theoretical model is
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developed therein. Third, the methodology and results of the study are reported and the last section
discusses the results and implications of the study.
Literature review
Why e-brand reputation is a vital construct in modelling consumer responses?
E-brand reputation is a source of brand differentiation and helps to explain the increased sales,
customer satisfaction and enhanced customer loyalty (Novak et al., 2003; Morrison and Crane,
2007). E-brand reputation (or corporate brand reputation) refers to the covenant aspect of an
organisation or online/e-brand, which refers to the profound promise made by the company to its
constituents (for example, consumer), and, thus, vital to the success of organisational performance
(Balmer, 2010). When a corporate brand promise is met (customers get what they expect from a
company), it helps to create a positive brand image in the minds of consumers (Argenti and
Druckenmiller, 2004). Selnes (1993) argues that brand reputation does not necessarily focus solely
on product and brand, particularly in the services industries, in that brand appears to be more
connected to the company reputation rather than the individual product (known as the company
brand reputation, e.g. IBM). Furthermore, brand reputation has been commonly associated with
credibility (Newell and Goldsmith, 2001). For example, through brand reputation (credible brand), it
explains brand equity for its products and intangible services (Aaker, 1991). Scholars argue that
when dealing with Internet reputation, the trust and credibility aspect is the most important because it
helps to explain customer confidence in products and services and advertising claims; consumer
loyalty (Fombrun and van Riel, 2004) and credibility, particularly in the service context, is about
company reputation (Newell and Goldsmith, 2001; Brodie, Whittome and Brush, 2009). The
contributing factors of credibility in services include company name, company reputation, personal
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characteristics of the contact personnel, etc., as they represent trustworthiness, believability and
honesty (Parasuraman, Zeithaml and Berry, 1985). In an airline website for example, potential ticket
buyers, having seen the ad campaign on special offers, directly or indirectly, or heard from peers via
social media (or online community) will have an expectation about the service brand. Then, after
experiencing it, and their expectation is confirmed, (i.e., that the brand (price) lives up to the brand
promise, the consumer will then likely evaluate the airline’s site (or e-brand reputation) positively,
such as fulfil their promises, which, in turn, may explain their e-satisfaction and e-loyalty (a form of
online brand equity).
However, what drives online brand reputation, other than that established through bricks and mortar,
is still unclear (Merrilees and Fry, 2002; Christodoulides and de Chernatony, 2004; Da Silva and
Syed Alwi, 2008). Generally, the existing studies were centred around e-service quality in the retail
sector, provide a general overview about how a brand should work online in a conceptual manner or
mainly focus on the sources of online brand equity, with limited explanation regarding the
importance of these sources or which source(s) will determine the brand promise or reputation
online. To understand e-brand reputation by focusing solely on the brand equity concept somewhat
represents a limitation (Ambler, 2003; Kapferer, 2012). First, the theoretical inference concerning the
sequence effect of cognitive and emotive state of brand and what/which brand enactment works in
the online brand promise/reputation and e-loyalty were not apparent (Rios and Riquelme, 2008).
Second, although strong brand equity is important, the concept itself is thought to be immense and
people have difficulty describing it (Kapferer, 2012, p.8; Christodoulides et al., 2006; Ambler, 2003;
p. 41). Consequently, it remains unclear how many indicators are needed to measure brand equity
(Kapferer, 2012, p.8). This is because different types of brand will have different types of equity
(Kapferer, 2012, p.8); websites tend to be different from each other (Chen, Clifford and Wells,
2002), and, different study environments may result in different dimensions (Aaker, Benet-Martinez
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and Garolera, 2001; Davies, Chun, da Silva and Roper, 2003). However, the role of online service
brand is about ‘delivering promises’ (Brodie et al., 2009; Christodoulides and de Chernatony, 2004)
and promises are associated with the credibility of a company, which reflects the brand reputation
(Newell and Goldsmith, 2001; Brodie et al., 2009). Particularly, in the online setting, customers rely
on trusted brand names or the corporate brand and reputation of the firm as it serves as an evaluation
of the risk when one is unable to evaluate a service brand (Balmer and Gray, 2003). Brodie et al.
(2009) suggest that future studies should attempt to test competing models, such as what derives
brand image and reputation and trust in the airline setting (p. 353).
Thus, the current study’s construct – e-brand reputation represents the corporate brand promise in the
online setting – can be measured through its credibility and the study proposes that e-brand
reputation (or online corporate brand reputation) could be understood using a cognitive psychology
(brand knowledge) (Aaker, 1996; Keller, 2003), which is used as foundation theory to explain the
brand triangle proposed by de Chernatony (2002).
E-brand reputations as a mediator construct
Using brand triangle framework, e-brand reputation is seen as mediator variable in this study.
Importantly, it is seen as the consumer reaction or result (such as a brand that fulfils its promises)
from their experiences concerning the cognitive evaluation of the online or e-brand, such as price and
other service attributes. For example, brand reputation or corporate brand reputation represents the
views through an accumulation of consumer reactions to the experiences they had with an
organisation (Davies et al., 2003, p. 178). As conveyed in their corporate reputation chain, Davies et
al. (2003) define their corporate brand and corporate reputation construct as an affective and
emotional construct. Corporate brand or corporate reputations have also been defined as representing
both elements – the cognitive and affective (see example, de Chernatony, 2002; Christodoulides et
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al., 2006; Fombrun, 1996). Using the brand triangle framework, e-brand reputation in the current
study represents consumer reactions, which are thought to be more affective (such as a brand that
fulfils its promises and has credibility), as it is the result of cognitive evaluation of e-brand attributes,
such as price and other services attributes .
Limited studies are available to understand the construct ‘e-brand reputation’ or its function as a
mediator (Selnes, 1993; Parasuraman, Zeithaml and Malhotra, 2005; Da Silva and Syed Alwi, 2008).
Selnes (1993) argues that brand reputation mediates the relationship between performance and
product quality and consumer loyalty. Davies et al. (2003) suggest that the satisfaction and loyalty
constructs result from the evaluation by consumers of the corporate brand or corporate reputation of
a company (the sum of the values that represent an organisation), such as agreeableness, competence,
enterprising, chic, ruthlessness, machismo, and informality. E-brand reputation is one means of
explaining whether or not the company’s brand promise (or promised brand experience) is being
achieved (by viewing the credibility of the company’s reputation before the consumer makes a
purchase decision) (Brodie et al., 2009). Thus, e-brand reputation is seen as a mediator, as a result of
the rational brand experience in the brand triangle framework (Christodoulides and de Chernatony,
2004). That is, the consumer may emphasise the rational and emotional values first, such as price and
other service quality elements (the e-airline brand attributes). They then progress to a higher level,
i.e. the promised experience (or e-brand reputation). This progression represents a hierarchical
structure in the consumer’s brand knowledge in an online setting (de Chernatony and
Christodoulides, 2004, p.240). Furthermore, most past discussions in branding, consumer behaviour
and psychology appear to suggest that the affective and emotional elements usually stem from
cognitive evaluation, such as price and service quality elements (Oliver, 1997, p.310; Franzen and
Bouwman, 2001, p.32). Thus, the study proposes that e-brand reputation mediates the relationship
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between the cognitive processing state of a consumer (which is represented by e-brand attributes and
e-loyalty).
What drives e-brand reputation and e-loyalty in an airline setting?
De Chernatony and McDonald (2003) explain that finding the point of brand differentiation in the
service context is crucial because of the service nature – intangible. They further argued that it is
imperative that the marketer tries to find this point of differentiation to tangibilise the intangible.
This is because the consumer usually depends on other tangible cues when evaluating a service
setting, such as price (Parasuraman et al., 1985, p.42; Sultan and Simpson, 2000, p.206) and
fulfilling promises or credibility of the brand (Parasuraman et al., 1985, p.48). According to
Parasuraman et al. (1985), consumers tend to rely on these important attributes (credibility and
tangibility – e.g. physical facilities, appearance of personnel) when evaluating a service brand. The
credibility or reputation of the company behind the website could be jeopardised if consumers are
unable to complete transactions, products are not delivered in the time promised or emails do not
receive a response (Parasuraman et al., 2005).
Moreover, calculative commitment (i.e., consumer loyalty) is a vital criterion in a consumer’s buying
decision (Zins, 2001). For example, the consumer buying decision is directed by cost-benefit ratios
or switching cost, particularly in the airline industry (Zins, 2001; Brodie et al., 2009) and in the
online setting (Liu and Arnett, 2000; Kapferer, 2012). Kim and Kim (2004) found that low cost (such
as no or low shipping/handling charge, fast delivery time, money-back guarantees) plays an
important role in determining online purchasing. Other than segmenting consumers based on service
quality attributes, price sensitivity has also been commonly used by marketers to segment their
consumers in the airline industry (Stern, 1989; Park, Robertson and Wu, 2004), particularly on the
website (Kapferer, 2012). Additionally, on an airline website, price is a crucial factor when
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consumers decide to buy an airline ticket (Zins, 2001; Chen and Chang, 2008; Brodie et al., 2009).
Chen and Chang (2008) found that price is an important determinant of airline brand equity. Jiang
and Rosenbloom (2005) stress that price and service quality are two important drivers that consumers
consider when returning to an online site. Online service quality involves unique issues, which
include price (Jiang and Rosenbloom (2005, p.152), and should be addressed responsibly and
consistently, and be balanced with other service quality attributes in the airline setting while still
attracting consumers (Sultan and Simpson, 2000). However, this unique attribute has been under
researched in the past (Jiang and Rosenbloom, 2005; Park et al., 2004). Thus, from the above
discussions, the price element may be as equally important as e-service quality when considering an
e-brand’s reputation and e-loyalty in an airline setting. In the current study, the drivers of e-brand
reputation (which are represented by e-service quality and price) are the rational aspect of evaluation,
as proposed in the brand triangle (Christodoulides and de Chernatony, 2004).
Specifically, six constructs were chosen to represent the e-airline brand attributes for the current
study: (1) efficiency of the site, (2) system availability, (3) privacy, (4) fulfilment (Parasuraman et al.,
2005), (5) site’s attractiveness (Cao, Zhang and Seydel, 2005), and (6) price (Brodie et al., 2009).
Using Christodoulides and de Chernatony (2004), Oliver (1997), Franzen and Bouwman (2001) as the
current study’s base for developing the theoretical model, these six constructs represent the rational
and emotional elements during online evaluation by consumers, which may then explain whether or
not the experience promised by the firm was met (this refers to firm’s brand reputation/credibility)
(Parasuraman et al., 1985; 2005; Nguyen and LeBlanc, 2001; Christodoulides and de Chernatony,
2004; Zins, 2001; Brodie et al., 2009; Chen and Chang, 2008). Thus, the following model explains
diagrammatically the theoretical propositions for the current study:
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Figure 1: The Study’s Conceptual Framework
E-airline brand
attributes
1. Efficiency of the
site
2. System availability
3. Privacy
4. Fulfilment
5. Site’s
attractiveness
6. Price
e-brand
reputation
e-loyalty
Method
The Measures
E-airline’s brand attributes
Using guidelines from de Chernatony and Christodoulides (2004) concerning the brand enactments
that represent functional and emotional values for an online brand promise, as well as from Jiang and
Rosenbloom (2005) that service quality and price are important for returning to online sites, the
previous section particularised the e-airline’s brand attributes. In summary, the e-airline’s brand
attributes are: (1) efficiency of the site, (2) system availability (3) privacy, (4) fulfilment, (5) site’s
attractiveness and (6) price. The first four variables, representing online service quality measures,
consisting of 22 items, were generated from Parasuraman et al. (2005) and Wolfinbarger and Gilly
(2003); site’s attractiveness (4 items) was developed from Cao et al. (2005) and price (3 items) was
developed from (Brodie et al., 2009; Sultan and Simpson, 2000), giving a total of 29 items
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representing the antecedents of e-brand reputation. In line with the study’s focus on what derives ebrand reputation, the measures for the current study were selected on the basis of (1) it needs to be
relevant in the context of measuring brand promise/brand equity/credibility of an airline and (2) in
the context of the Internet.
The first attribute, efficiency of the site, refers to customers’ ease of website access, simplicity of
using the site, ease of finding information, and fast check-out with minimal effort (Parasuraman et
al., 2005). Second, system availability is defined as “the correct technical functioning of the site”.
Third, privacy, which is defined as the degree to which the site is safe and protects customer
information. Fourth, fulfilment, which is the most vital aspect in service type industries as it concerns
‘delivering promises’ to consumers (Parasuraman et al., 1985; Zeithaml, Parasuraman and Malhotra
2002), and, particularly, in online service quality (Parasuraman et al., 2005; Christodoulides and de
Chernatony, 2004; Wolfinbarger and Gilly, 2003). Consistent with previous literature, in this study,
fulfilment is conceptualised as: delivers order when promised, makes accurate promises about
delivery, truthful about its offering, delivers as promised, and has the stock it claimed it has
(Parasuraman et al., 2005). The fifth attribute – the site attractiveness – deals with how good the
content is, such as whether web pages are fun to read and subjectively pleasing (Cao et al., 2005).
Watson, Akselsen and Pitt (1998) suggest that the overall appeal is a key component of website
quality. No matter how good the content is or how reliable and easy it is to search the website, if
users do not find the site appealing, they are not going to spend much time there (Smith and
Merchant, 2001). The dimension is operationalized consistently with Cao et al. (2005), such as
attractive/appealing site, promotes customer excitement, fun and entertaining site. The final attribute,
namely, price is considered to have an important effect on e-brand reputation in the online context
(Kapferer, 2012; Parasuraman et al., 1985) and in the Asian region (Sultan and Simpson, 2000).
Specifically, consumer loyalty is guided by cost-benefit ratios or switching cost, particularly in an
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airline industry, and price information is reliable, as stated by the seller, will be evaluated by
consumers to judge a company’s promise or credibility and constitute vital criteria in a consumer’s
buying decision (Kapferer, 2012; Brodie et al., 2009; Zins, 2001; Liu and Arnett, 2000; Sultan and
Simpson, 2000). Thus, in the airline Internet context and in line with the study’s objective about
investigating the online brand promise, price has been defined as (1) competitive or monetary
cost/price, (2) low airline/handling charges (e.g. taxes, levies, surcharges paid) (Brodie et al., 2009),
and (3) responsibly stated price (Sultan and Simpson, 2000).
E-brand reputation
E-brand reputation as a mediator variable of the study refers to ‘the credibility of a company (Herbig,
Milewicz, and Golden, 1994; Newell and Goldsmith 2001; Nguyen and LeBlanc, 2001), emotional
and promised brand experience (mediator) as a result of the rational brand experience in the brand
triangle framework (Christodoulides and de Chernatony, 2004) and “is viewed through an
accumulation of consumer reactions to the experiences they had with an organisation” (Davies et al.,
2003, p. 178). It is measured through the credibility element, such as company X fulfils the promises
it makes to its customers, and global judgement, such as X has good reputation, better reputation
than other companies and good impression of X’s website (Nguyen and LeBlanc, 2001).
E-loyalty
E-loyalty as “The biased behavioural response, expressed over time, by some decision making unit,
with respect to one store out of a set of stores, which is a function of psychological (decision making
and evaluative) processes resulting from commitment”. This is consistent with other relevant
literature when the objective is to link brand reputation with consumer responses (or loyalty) (Davies
et al., 2003). Loyalty also creates the intention to continue doing business with the company in the
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future, seldom consider switching brand and always make the company the first choice when
customers are about to buy the product or service (Caruana, 2002). E-loyalty comprises seven
measures, which were developed from Zeithaml, Berry and Parasuraman (1996); Gremler (1995) and
Srinivasan et al. (2002), which include continuity of using the service, will repeat using it in future,
will choose the site as first choice and to do more business on the site in future.
All the above measures were developed on a seven-point scale (1 strongly agree to 7 strongly
disagree). Table 1 below provides details of the items for each construct.
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Table 1: The study’s constructs and measures
Study’s
construct
Variables
Price
Efficiency
Site’s
attractiveness
System
availability
e-airline
brand
attributes
Privacy
Fulfilment
e-brand
reputation
e-loyalty
Measures
Source
Company offering more competitive prices online
Low airline/handling charges (e.g. taxes, surcharge etc.)
Price information is reliable as stated by the seller
Brodie et al.
(2009)
Sultan and
Simpson (2000)
This site makes it easy to find what I need
It makes it easy to get anywhere on the site
It enables me to complete a transaction quickly
Information at this site is well organized
It loads its pages fast
This site is simple to use
This site enables me to get on to it quickly
This site is well organized
The web site is attractive/appealing
The web site promotes customer excitement
The web site is fun
The web site is entertaining
This site is always available for business
This site launches and runs right away
This site does not crash
Pages at this site do not freeze after I enter my order
information
It protects information about my online shopping
It does not share my personal information with other
sites
This site protects information about my credit card
It delivers order when promised
This site makes items available for delivery within
suitable time frame
It quickly delivers what I ordered
It sends out the items ordered
It has in stock the items the company claim to have
It is truthful about its offering
It makes accurate promises about delivery
In general X fulfil the promises it makes to its customers
X has a good reputation
The reputation of X is better than others
X’s website has a better reputation than its competitors
I seldom consider switching to another website.
As long as the present service continues, I doubt that I
would switch websites.
I try to use the website whenever I need to make a
purchase.
When I need to make a purchase, this website is my first
choice.
I like using this website.
To me this website is the best retail website to do
business with.
I believe that this is my favourite retail website
Parasuraman et al.,
(2005)
Christodoulides
and de
Chernatony,
(2004)
Wolfinbarger and
Gilly, (2003)
Nguyen and
LeBlanc, (2001)
Zeithaml et al.
(1996) Gremler
(1995)
Srinivasan et al.
(2002)
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The study’s context and data collection
The current study examines e-brand reputation in the context of the airline industry in Malaysia for
several reasons. First, the services industry is the largest sector in the Malaysian economy, with a
46% contribution to the gross domestic product (GDP) growth and is expected to grow compared to
other sectors (Ninth Malaysia Plan, 2006 - 2010). It is expected that these service providers may
support brand building and contribute to the progressive growth and development of Malaysian
brands. Second, in Malaysia, cheap airline tickets were unheard of before the establishment of
AirAsia in 2002. With the tag line of "Now Everyone Can Fly", AirAsia managed to transform the
airline industry in Asia to be more competitive, especially when all buying was restricted to online,
which resulted in the locals changing their buying behaviour and becoming comfortable with online
purchases. Inasmuch as this scenario has seen more local and international airlines competing in the
virtual environment with everyone trying to offer the best retail site, it is somewhat unclear what
makes them ‘the best site to attract e-loyalty among the Malaysian consumers. Third, it is reported
that airline travel tickets and hotel reservations are the most popular items bought online among
Malaysian consumers (A Nielson Global Consumer Report, 2010, p.5). Finally, with the emergence
of more reputable and renowned airlines from the Asian continent – Japan airlines, Malaysia airlines,
Singapore airlines and Cathay Pacific – further research should concentrate on how consumers make
decisions within this part of the continent/region (Sultan and Simpson, 2000).
Specifically, the empirical context being studied here is local and international airline companies that
operate in Malaysia in both the virtual and bricks and mortar environments. To meet the objective of
the study, namely, ‘having experienced respondents’, is based on the e-brand reputation definition set
earlier; respondents were screened first to meet the following conditions. They had to:
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(1)
use an airline’s website at least once in the past 3 months
(2)
have bought a ticket at least once in the last year through their chosen airline’s website
Respondents were approached at (1) the ‘Matta Trade Fair’, an airlines exhibition, which is held
annually in Malaysia, and, (2) before they left various travel agents located within the Klang Valley
area (city centre), which is located in the capital city itself – Kuala Lumpur. The travel agents located
within the Klang Valley were targeted as most of the respondents and travel agents are centred in
this location, which has good broadband penetration coverage and is accessible by a high number of
Internet savvy consumers (Malaysian Communications and Multimedia Commission, 2012, p.11).
Respondents were to complete the questionnaire either on the spot or in their own time to be returned
in a self-addressed envelope.
Results
Characteristics of the Sample
From a number of distributed questionnaires (550), the number of usable questionnaires was 240
(with a response rate of 43%). The average age of the respondents in the study sample was 32 years
old and 50.4 per cent were male. The age of the respondents was mostly centred at middle aged, and,
similar to previous studies in which the Internet users had an average age of 32 years with 78.7%
being male in the study of Evanschitzky et al. (2004) and 37 years in the study of Wilde et al. (2004).
The distribution according to ethnic group was 40 per cent Malay, 36.3 per cent Chinese, 15.8 per
cent Indian, and 7.1 per cent others. This correlates approximately with the actual proportion of
ethnic groups in Malaysia (Department of Statistics Malaysia, Malaysia, 2010). Moreover, on
average, respondents used the Internet more than five days a week ( accounted for 70 per cent) and
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purchased airline tickets from an airline’s website at least five times (accounted for 72.5 per cent) in
the last year.
Analysis and results
A Two-Step SEM approach (Anderson and Gerbing, 1988) was carried out to test the measurement
model’s validity and reliability (in step-one) and the step-two, where nomological validity of the
proposed theoretical model is dealt with. The first step, namely, the confirmatory factor analysis
(CFA), was run using the latest version of AMOS 18 by the default method – Maximum Likelihood
(ML) – which deals with the measurement model’s convergent, discriminant validity and reliability.
Running all constructs together at one time was preferable for this study, as the relationships between
indicators of different constructs are not considered if the constructs are examined individually
(Cheng, 2001). In order to assess the model’s acceptability and model fit, several fit indices were
chosen. Garver and Mentzer (1999) point out that there are two strategies concerned with selecting
which fit indices are appropriate for a study. They are (1) selecting fit indices which represent
different families of fit indices (e.g. fit that represent model parsimony, model comparison and
model fit) or (2) specifying more stringent criteria and selecting the more “ideal” fit indices that best
represent these criteria. The ideal fit indices are: (1) CFI, (2) TLI and (3) RMSEA. They recommend
that the researcher opts for the second strategy: this is the perspective taken in this study. In addition
to the above chosen fit indexes, the study also assesses the (4) chi square (-), (5) relative Chi-Square
(
2
/df) and (6) GFI.
The first chosen index is the chi-square (
2
) goodness-of-fit statistics.
method of measure in the past literatures, with a low value of
2
2
is the most common
at p>.05 (non significant)
indicating a good model fit, (Garver and Mentzer, 1999). Relative chi square tests (
2
/df <3) are
18
chosen where a value lower than 3 indicates acceptable fit (Kline, 1998). The third index is the
comparative fit index (CFI); this index ranges from 0 to 1 with .90 or greater indicating an acceptable
fit. CFI also has a good relative performance in relation to model complexity, (Hulland, Chow and
Lam, 1996). The fourth index is the Tucker-Lewis index (TLI or NNFI). The acceptable threshold
for this index is .9 or greater. According to Garver and Mentzer (1999), TLI compares the observed
or proposed model to a null or baseline model. TLI measures parsimony by assessing the degrees of
freedom of the null model and is resilient against variations in sample size and, thus, is highly
recommended. The fifth index is root mean squared approximation of error (RMSEA). A value
between 0.05 and 0.08 indicates acceptable fit, with 0.05 and lower indicating a well fitting model.
Finally, the most common fit adopted in past studies – goodness-of-fit index (GFI) – with values
close to 1 suggesting an excellent fit and values above 0.9 suggesting an acceptable fit, was
examined in this study’s analysis.
In order to assess the feasibility and statistical significance of all parameters (the items), two criteria
should be met. The first is in terms of the standardised factor loadings. Standardised values greater
than 0.5 demonstrate reasonably high factor loadings (Kline, 1998), at the same time supporting the
requirement for convergent validity of parameters in the proposed measurement model. The second
is in terms of parameters. All parameters must be significant with at least p<0.05 or below the
Critical Ratio value of 1.96. In other words, if all factor loadings are significant at p<.05 and above
0.5 standardised loadings, there is enough evidence to support the view that all items are effectively
measuring the same construct and thus achieve convergent validity (Kline, 1998).
Step-One: The Measurement Model
All 29 items (e-airline brand attributes) were run together with e-brand reputation items (4 items) and
7 items of e-loyalty in the first order model. Six were dropped from further analyses due to
19
insignificant parameters, high modification indexes (MI), large standardised residuals (>2.58)
(Cheng, 2001) and cross-loaded items in more than one dimension were relaxed one at a time, as
proposed by Long (1983). It is worth noting at this point that two attributes, namely, system
availability and privacy, were dropped from further analysis. System availability cross-loaded
strongly with efficiency (MI: 56.98). Initially, the one-factor model was tested based on theoretical,
statistical and practical reasoning (Byrne, 2001); however, it resulted in a poor fit. The decision to
remove system availability was then taken (with only two items left), as Tabachnick and Fidell
(2001, p.71) proposed that if the item is not critical to the analysis, its deletion is a good alternative.
Interestingly, privacy was also removed due to two insignificant parameters. Kim and Kim (2004,
p.883) suggest that due to security, digital systems are now tremendously improved, and that the
privacy concerns among online shoppers have now been reduced. Thus, two constructs – ‘system
availability’ and ‘privacy’ – were removed from further analysis due to (1) insignificant parameters
for example, privacy items namely ‘it protects information about my online shopping’ and ‘it does
not share my personal information with other sites’ were p < .11 and p < .09 respectively) and (2) not
critical items/constructs, as well as overlap, as respondents may relate both efficiency and
availability of the system almost similar due to the heavily cross loaded items (MI: 56.98). For
example, the items for system availability, namely, ‘this site is always available for business’ and ‘this
site launches and runs right away’ cross loaded heavily with efficiency items, such as ‘it loads its pages fast’
and ‘this site is simple to use’, as well as ‘this site enables me to get on to it quickly’. These items were
thought to overlap with efficiency, as some of the items may present a similar meaning to the consumers, such
as the website runs/performs well and fast, and, furthermore, as the most bought product in this region is
online tickets, as highlighted earlier, the construct ‘system availability’ may not be an issue, particularly in the
context of an airline setting. Similarly, Wolfinbarger and Gilly (2003, p. 193) found that what represent their
‘Website design’ construct was a combination of both constructs such as ‘it is quick and easy to use the site’
(which could represent the efficiency of the site) and ‘this site doesn’t waste my time’ could represent site’s
availability (such as ‘this site launches and runs right away).
20
The internal reliability of the measures was performed using the Cronbach’s alpha test and they were
all above the recommended level, for example, efficiency (.902), fulfilment (.878), site’s
attractiveness (.91), price (.82), e-brand reputation (.92) and e-loyalty (.905). The step-one results
show an acceptable fit at ²=585.204, p<.001; ²/df=1.894; GFI=.862; TLI=.925; CFI=.934;
RMSEA=.061, with all standardised loadings being >.5 and statistically significant at p<.001, which
supports the convergent validity of each parameter estimate (Kline, 1998). The correlation (the
covariance) among the constructs is also low ranging from .28 -.69, (see Figure 2 below), thus
supporting the unidimensionality and discriminant validity of the model. All constructs were checked
for normality and the level of skewness and kurtosis ranged between -2 to +2, therefore, no variables
have departed from normality. Further normality was assessed using the guideline from Jaccard and
Wan (1996). They suggested that if the Maximum Likelihood method (ML) is used, the method in
itself is robust to many types of violation of normality (Jaccard and Wan, 1996) and could handle
slight to moderate departure of normality. In addition, should there be any departure, the CFI index
could be of reference as it is an index that is affected by the departure from normality (West, Finch,
and Curran 1995).
21
Figure 2: Step-one/the measurement model (confirmatory factor analysis)
Note: * indicates all loadings were significant at p<.001
Step-Two: The full model
The concern at the step-two approach is to test the study’s theoretical models (as presented in Figure
1) as well as the developed objectives. Both direct and indirect effects were tested using the full
structural model. The summary of the full model result with all direct and indirect effects is reported
in Figure 3 below. The step-two model indicates an acceptable fit at ²=664.806, p<.001; ²/df=2.14;
GFI=.852; TLI=.915; CFI=.914; RMSEA=.069, with no deletion of items. A more detailed
discussion on the study’s direct and indirect effects is provided next.
Figure 3: Step-two/The full structural model
22
Note: * indicates all loadings were significant at p<.00; NS indicates insignificant loadings
The full model – direct effects
Three e-airline brand attributes: (1) site attractiveness, (2) fulfilment, and (3) price were found to be
statistically significant explaining e-brand reputation (41% variance explained) with price and
fulfilment having the most effect (β = .33, p = .000 and (β = .25, p = .000, respectively, as exhibited
in Figure 3). E-brand reputation directly effects e-loyalty (β = .64, p = .000). Efficiency on the other
23
hand was found to be insignificant on e-brand reputation (β = .05, p = .204) and only explains eloyalty (β = .13, p = .001).
The full model – indirect effects
To establish whether e-brand reputation partially or fully mediates the effect on e-loyalty as
conceptualised in the earlier section, all significant e-airline brand attributes (i.e., site’s
attractiveness, price and fulfilment) were tested using guidelines from: (1) Baron and Kenny (1986)
and Kelloway (1995) concerning the notion of fully and partial mediated models; (2) Zhao, Lynch
and Chen (2010) for indirect or direct effect conditions; and (3) SEM’s standardised indirect effect
output. First, site’s attractiveness showed a partial mediation (or complementary mediation) with
both directions having positive significant direct effects on e-brand reputation with (β = .13, p =
.029) and e-loyalty (β = .19, p = .000) (Baron and Kenny, 1986 and Zhao et al., 2010). Full
mediation occurred on two attributes, namely, price and fulfilment, as only the indirect paths were
significant (Zhao et al., 2010; Baron and Kenny, 1986). For example price  e-brand reputation
e-loyalty (β = .33, p = .000 and β = .64, p = .000), while insignificant, was found on the direct path
between price  e-loyalty (β = .10, p = .160). A similar situation was found on fulfilment  e-brand
reputation e-loyalty (with β = .25, p = .001 and β = .64, p = .000), while insignificant on the direct
path between fulfilment  e-loyalty (β = .09, p = .207). To confirm this, individual examination was
performed through SEM on both attributes and consistent results favouring the indirect path (path 1)
over the direct where path 1 for attributes: (1) price [(a × b) = (.51 × .67) = .34 and insignificant on
path 2 or
(direct effect on e-loyalty) with (β = .10, p = .061)]; (2) fulfilment [(a × b) = (.45 × .71) =
.31 and insignificant on path 2 or
(β = .01, p = .861)]. Additionally, Zhao et al. (2010) emphasised
that to determine the mediation, whether via regression or SEM, only the indirect effects need to be
significant, i.e., a × b is significant and c being insignificant (p.205) and a full mediation occurs
when the beta coefficient is nearing zero or insignificant concerning the direct effect between X and
Y when m (mediation) is introduced (Baron and Kenny, 1986). Site attractiveness indicates partial [(a
24
× b) = (.28 × .65) = .18 and significant on path 2 or
(β = .22, p = .000)]. Second, the magnitude of
the indirect effect is given by the product of the standardised coefficients of the paths linking the two
variables (Bentler, 1992). According to the SEM output, price and fulfilment do have an indirect
statistically significant effect on e-loyalty via e-brand reputation (.249, p.000; and .158, p =.000,
respectively). In terms of the variances explained in the outcome variables (i.e., e-brand reputation
and e-loyalty), the predictor variables (i.e., the e-airline’s brand attributes – price, fulfilment and
site’s attractiveness) explain 41% of the variance in e-brand reputation and 60% in e-loyalty.
Apparently, this is consistent with other related studies. For example, 60% of the variance in online
store image explains the online purchase intention (Heijden and Verhagen, 2004); 60% online
corporate brand image of a bookstore explains online loyalty (Da Silva and Syed Alwi, 2006) and
59% online brand loyalty is explained by the dimension of trust (Rios and Riquelme, 2008). Table 3
below provides a summary of the direct and indirect parameter estimates.
Table 3: Direct and indirect structural path estimates
Constructs
Direct
Path
P
Estimates
Indirect path estimates
Result
Testing direct effects
Efficiency  e-brand reputation
Site attractiveness e-brand reputation
Fulfilment  e-brand reputation
Price  e-brand reputation
Efficiency  e-loyalty
Site attractiveness e-loyalty
Fulfilment  e-loyalty
Price  e-loyalty
E-brand reputation  e-loyalty
Testing indirect effects
Efficiency  e-brand reputationeloyalty
Site attractiveness e-brand
reputatione-loyalty
Fulfilment  e-brand reputationeloyalty
Price  e-brand reputatione-loyalty
.05
.13
.25
.33
.13
.19
.09
.10
.64
.204
.006
.000
.000
.000
.000
.207
.160
.000
Insignificant
Significant
Significant
Significant
Significant
Significant
Insignificant
Insignificant
Significant
Not significant
Path 1: β = .18, p = .000 vs
Path 2: β = .22, p = .000
Path 1: .31, p = .000 vs
Path 2: β = .01, p = .861
Path 1: .34; p = .000
Path 2: β = .10, p = .061
No
mediation
Partially
mediated
Fully
mediated
Fully
mediated
25
Discussion and implications
As highlighted earlier, the study’s main aim is to investigate what determinants influence online
brand reputation (or brand promise) and e-loyalty in the context of the airline setting, in particular,
what and which enactments explain online brand promise and e-loyalty (online service brand). Price,
fulfilment, site’s attractiveness and efficiency have been found to explain online brand promise and
e-loyalty. The following sections will elaborate further on these results where the theoretical and
managerial contribution of the current study will be discussed.
Theoretical Implication
Theoretically, the study contributes to the existing literature in two different ways. First, it provides
clarity in terms of what and which online brand enactments are significant when consumers are
evaluating online brand promise. Although previous works stress the concept of the need for
differentiation for online brand (Christodoulides et al., 2006), particularly in the context of online
service brands, such as an airline (Zins, 2001), the empirical studies of such remain limited (Rios and
Riquelme, 2008; da Silva and Syed Alwi, 2008) Thus, the current study proposes that by studying
what and which enactments of the brand are important in the evaluation of a website could provide
clarity in respect of differentiation. Although this type of research has been proposed conceptually in
the past by de Chernatony (2002), and de Chernatony and Christodoulides (2004) through their
online brand promise framework – brand triangle – the empirical understanding of exactly what and
which brand enactments define the promised experience, as suggested in the framework, remain
somewhat unclear. Furthermore, empirical studies pertaining to testing this framework are limited
(e.g. see da Silva and Syed Alwi, 2008), as the previous works mainly centred on building the online
brand equity concept as a whole (Rios and Riquelme, 2008). However, as proposed earlier, only
focusing on the brand equity concept itself presents a limitation inasmuch as the theoretical inference
26
concerning the sequence effect of the cognitive and emotive state of brand and what/which brand
enactments work in the online brand promise/reputation and e-loyalty were not apparent (Rios and
Riquelme, 2008).
In the current study, price, fulfilment and site’s attractiveness were found to help explain online
brand promise while efficiency directly explains the consumers’ e-loyalty. Comparing this to the past
studies, an online corporate brand promise in a bookstore is explained by interactivity, customer
care, ease of use and security (da Silva and Syed Alwi, 2008), and trust and interactivity in an e-tailer
corporate brand (Merrilees and Fry, 2002). Thus, by testing the theoretical model in different
settings, such as online and airline service, helps to enhance and provide clarity in terms of which
brand enactments work in a particular setting.
In addition, the site’s attractiveness could be highlighted as an important finding for the current study
because consumers may find that the attractive and appealing information (or content, such as
packages offered through an airline promotional site) may influence their overall evaluation of the
brand’s promise and credibility of a brand. For example, some websites would offer an attractive
promotion on buying a holiday package (hotels and car rental included in the package for a lower
price) to a specific destination at a given time. This could trigger the emotional excitement of an
individual when evaluating the site. Site’s attractiveness was represented by exciting,
attractive/appealing and fun in this study. According to Cao et al. (2005, p. 105), the attractiveness of
a site concerns whether the web pages are fun to read and subjectively pleasing. Watson et al., (1998)
argue that the overall appeal of a site is vital for a quality site and consumers may not be interested in
spending a long time on a site if he/she finds the content or information is less attractive or not
appealing (Smith and Merchant, 2001). Thus, an airline’s site should be visually appealing or
attractive through its content, such as attractive marketing communication (destination/
27
price/package promotion), as this will induce consumer excitement when buying those packages,
perhaps at a good/competitive price, for an enjoyable luxury vacation. In addition, the combination
of price and site’s attractiveness to influence e-brand reputation, perhaps due to the emotional
sensitivity to price changes and the playfulness feature (site’s attractiveness), are among the aspects
consumers are looking for when approaching a website, especially in a highly motivated situation.
For example, Suri et al. (2003) explain that computer anxiety will lead to price sensitivity, and that,
in a highly motivated situation, consumers with a greater level of computer anxiety viewed high
price as indicative of higher value more than those with less computer anxiety who view low price as
better value (Suri et al., 2003).
Secondly, the study confirms (1) the mediator role of e-brand reputation (through the full and partial
mediation effect) as well as (2) the process that leads to the ‘promised experience’, as conceptually
proposed by de Chernatony (2002), (through the sequence effect of cognitive evaluation which is
evaluated first – price, fulfilment and site’s attractiveness), which then leads to emotional evaluation
of the brand (e-brand reputation/promise seen), which translates into e-loyalty. Therefore, by testing
the theoretical and mediator relationship or the sequence of events leading up to the brand
evaluation, such as the brand promise, and the role of the functional and emotional assessment could
be determined. Because the effect of brand reputation has been frequently uncontrolled (seen as
mediator) in past studies, the empirical results between perceived product or service quality/brand
attributes on consumer responses could be biased (Selnes, 1993, p.30), as consumer responses may
also be due to brand reputation. Furthermore, the study confirms the mediator effect as e-brand
reputation is not necessarily seen as a mediator in all contexts. For example, Selnes (1993) states
that, “in some segments, loyalty may be driven through brand reputation whereas in other segments,
loyalty may also be driven by customer satisfaction, (Selnes, p. 31). Thus, in the conceptual view,
using the Brand Triangle framework developed by de Chernatony (2002) using the
28
 emotion sequence confirms that when consumers evaluate an e-brand reputation, a
cognition 
rational thought process followed by the affective component is then taken into account, resulting in
the brand promise and e-loyalty.
Managerial Implication
There are clear practical implications arising from this study. The credibility of an airline’s claims
(through its online marketing communication) about delivering its promises shapes its credibility and
reputation. For example, in the current study, while fun and attractive websites with colours, in-flight
features, and attractive price and packages for a destination could be important, a ‘fulfilling’ site is
still crucial (Reibstein, 2002). Reibstein (2002) explains that price-sensitive customers may be the
least loyal and that it is still necessary to follow through with on-time delivery and customer support
services when needed. This confirms and increases the importance of brand enactment – ‘fulfilment’
(which was fully mediated by the e-brand reputation) – in the online setting and airline context.
Nevertheless, while price is argued to be controversial in the online purchase process due to the lack
of research in terms of its significant theoretically and empirically in the past (Jiang and
Rosenbloom, 2005, Reibstein, 2002), generally, customers point out that price still plays a significant
role in decision making in the online context (Reibstein, 2002). Thus, by confirming that different
brand enactments are found in different settings (for example, price, fulfilment, site’s attractiveness
and efficiency), this study offers some insights into a company’s site strategic brand positioning and
differentiation. What airline companies could learn is that in order to differentiate their online brand
they need to address these enactments – attractive price, attractive site, and fulfilment – while
continuing to provide an easy-to-use website (as efficiency was found to only directly influence eloyalty). These elements were found to be vital when consumers evaluated corporate brand promise
in the current study’s context. Hence, living up to their brand promise online will then be the
29
challenge and the factor to consider when trading in this sector. Not only should the company inform
their consumers about the low or attractive price offers, having the ticket at the time promised, and
attractive package, but, more importantly, being truthful and consistent about its offering, as that is
what determines the e-loyalty from the consumer’s perspective. For example, Balmer (2010)
explains that a company should not overstate its claims in its corporate communication activities
(including its product and services, Finally, through brand reputation studies, the relative seriousness
of service brand quality, as perceived by consumers, can be correctly determined (such as price,
fulfilment and site attractiveness), and ‘when a service provider knows how the service brand will be
evaluated by the consumer, only then we will be able to suggest how to influence these evaluations
in a desired direction’ (Groonroos, 1982) through which marketers will be able to position their
brand more efficiently (Knox, 2004).
Study’s limitations and recommendations for future research
First, the sample size of the current study was 240. Although it is acknowledged that the current
sample size is rather low, this is due to the lack of success in getting online consumers through
online means and the lack of access to databases of airline consumers. Fortunately, the study was
able to collect data from an important airline exhibition that is held annually in Malaysia. This
helped to increase the chances of covering relevant respondents (online airline ticket buyers), as the
exhibition normally attracts buyers from all states in the country. In terms of its effect on SEM, the
current study’s number of parameters (59) and 25 items are thought to fall within the range of the
minimum requirement of the ratio inasmuch as the number of parameter estimates multiplied times 5
samples = 295 respondents, and the study samples were 240. According to Anderson and Gerbing
(1988), when the total disaggregation method is used this situation is acceptable as long as the model
converges properly. Furthermore, although the study has confirmed the applicability of the brand
30
triangle framework, the generalisability of the results must be viewed within the context of the study.
Future studies could replicate the study in other Asian regions.
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