The purpose of this paper is : (1) to investigate the effect of consumer value on brand equity when consumers purchase low-middle priced cosmetics; (2) to examine the relationship among consumer value, brand value, brand trust, brand affect, and brand loyalty; (3) to identify the indirect effect of consumer value, brand value, and brand trust.
The study’s hypotheses were tested using the data collected from a survey of 223 respondents of university students who have used low-middle priced cosmetics in Gyeongnam province. This study conducted a structural equation modelling(SEM) to test the hypotheses.
The results of paper showed that consumer value has a positive impact on brand value of low-middle priced cosmetics. Brand value has positive impacts on brand trust, brand affect, and brand loyalty. Interestingly, brand value has more effect on brand trust than the other two factors. Brand trust has a positive impact on brand affect and it does not influence brand loyalty. However, the indirect effect of brand trust on brand loyalty is significant at the level of 0.01. Brand affect is also strongly associated with brand loyalty.
The implications of this study are as follows. First, this paper suggested the sub-dimensions of consumer value as social orientation, health pursuit, environmental consciousness, material pursuit, and beauty pursuit. For factor loading, findings indicated that beauty pursuit(0.903), material pursuit(0.564), and social orientation(0.522) are the key factors in estimating consumer value, which implies their significant and positive impact on brand value. Thus, the product providers should strengthen consumer value to enhance brand value of low-middle priced cosmetics. However, environmental consciousness(0.186) is the least influence factor in estimating consumer value, indicating that consumers of university students are not sensitive to environmental matter.
In addition, since brand value, brand trust, and brand affect are identified to improve brand loyalty, the marketers should focus on managing brand equity of low-middle priced cosmetics. Although this research has achieved its objectives, it is not without limitations. as the limitation of this paper, as the samples are only university students in Gyeongnam province, so there is a limit to represent for all consumers. For future research, it is necessary to develop the different combinations of consumer value.