The Impact of Customer Empowerment on Observer-Based Brand Equity

of master thesis Author: Jordy Zodenkamp Title: The Impact of Customer Empowerment on Observer-Based Brand Equity Degree: Master of Science in Economics and Business Degree programme: Marketing Thesis advisor: Drs. Gert-Jan Prevo Year of approval: 2018 Number of pages: 71 Language: English Abstract The aim of this study is to explore the relationship between customer empowerment in new product development and observer-based brand equity, as well as the relevant contextual consideration moderating the relationship. In this study, customer empowerment is defined as the interaction between firms and consumers for the development of new business opportunities by means of creating and/or selecting products. The first part of this study consists of an extent research on customer empowerment and its effects on observer-based brand equity, which resulted in a total of six research hypotheses that are processed into the theoretical framework of this study. The main hypotheses of this study postulate that customer empowerment positively influences the observer-based brand equity. Additionally, it is posited that this influence will be stronger for companies with a low brand comprehension in comparison with companies with a high brand comprehension. The research data is obtained from an online questionnaire, resulting in a total sample size of 200. Empirically, the main hypotheses are tested through a multivariate analysis of variances, whereas the moderating effect is tested through a multivariate analysis of covariances. Before conducting the two types of analysis, an exploratory and confirmatory factor analysis were performed respectively to ensure reliability and validity of the constructs used in the study. The results of the multivariate analysis of variances support the main hypotheses, which means that a positive and significant relationship between customer empowerment and observer-based brand equity is found. The results of the multivariate analysis of covariances partly support the hypotheses regarding the moderating effect of brand comprehension, which means that a positive and significant relationship between customer empowerment and brand comprehension is found. This suggests that companies with low brand comprehension benefit more of customer empowerment in new productThe aim of this study is to explore the relationship between customer empowerment in new product development and observer-based brand equity, as well as the relevant contextual consideration moderating the relationship. In this study, customer empowerment is defined as the interaction between firms and consumers for the development of new business opportunities by means of creating and/or selecting products. The first part of this study consists of an extent research on customer empowerment and its effects on observer-based brand equity, which resulted in a total of six research hypotheses that are processed into the theoretical framework of this study. The main hypotheses of this study postulate that customer empowerment positively influences the observer-based brand equity. Additionally, it is posited that this influence will be stronger for companies with a low brand comprehension in comparison with companies with a high brand comprehension. The research data is obtained from an online questionnaire, resulting in a total sample size of 200. Empirically, the main hypotheses are tested through a multivariate analysis of variances, whereas the moderating effect is tested through a multivariate analysis of covariances. Before conducting the two types of analysis, an exploratory and confirmatory factor analysis were performed respectively to ensure reliability and validity of the constructs used in the study. The results of the multivariate analysis of variances support the main hypotheses, which means that a positive and significant relationship between customer empowerment and observer-based brand equity is found. The results of the multivariate analysis of covariances partly support the hypotheses regarding the moderating effect of brand comprehension, which means that a positive and significant relationship between customer empowerment and brand comprehension is found. This suggests that companies with low brand comprehension benefit more of customer empowerment in new product development than companies with high brand comprehension. All in all, this study broadens our understanding of the effects of customer empowerment in new product development and therefore contributes to the academical literature. From a managerial perspective, the findings suggest that customer empowerment in new product development can be a profitable approach to stimulate the observer-based brand equity, especially in an environment in which individual wishes and needs become more important. Master Thesis in Economics and Business IV