Brand Perception and Decision-Making in Luxury Segment Settings

Doctoral School of Management St. Petersburg 2022 St. Petersburg School of Economics and Management Brand Perception and Decision- Making Process in Lux Segment Settings Nadezhda V. Movchan 1styear Doctoral student Research advisor: Julia G. Trabskaya Candidate of Sciences in Economics, Associate Professor

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 2 Research motivation The luxury market is constantly growing, the total number of its consumers has tripled during the past twenty years (Petravi i t et al., 2021). The market is also challenged by democratization ( masstige phenomenon) and COVID-19 lockdown aftermath. To cope, luxury brands need to rebuild the existing business model to encourage customers to repurchase. According to Fisher (2001) acquiring new customers is 5 12 times more expensive than retaining customers. Brun and Castelli (2013) state that luxury businesses require specific management approaches due to its uniqueness, especially in emerging markets. Despite the considerable volume of research in the luxury branding literature, much remains to be uncovered about brand s perception and its connection to repurchase intension in unique luxury settings.

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 3 Research questions and main definitions How brand s perception influences customer s decision to repurchase in the luxury settings? What are the antecedents of a brand s luxury perception? How brand s management perceptions (referred to as identity) and consumer perceptions (referred to as image) differ in luxury settings? How brand s perception influence repurchase intention in luxury industry settings? Brand perception is the total impressionthat consumers have, based on their exposure to the brand (Van Gelder, 2004). Luxury defines beauty; it is art applied to functional items (Kapfefer, 1997). Luxury products enable consumers to satisfy both psychological and functional needs, and that is the main factor distinguishing them from non-luxury counterfeits (Nia and Zaichkowsky, 2000).

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 4 Theoretical framework Brand perception is viewed through several theories: theory of impression management (Goffman, 1959), social identity theory (Tajfel and Turner, 1979). Luxury perception is considered through the BLI scale, based on the Mason s work (1992) and theory of conspicuous consumption (Veblen, 1899; 1914). This study also uses theory of planned behavior by Azjen (1985) as the foundation to study behavioral intention the relationship between brand s perception and intention to repurchase.

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 5 Strategy of empirical study: Article 1 Antecedents of a Brand Luxury Perception in the Luxury Settings Sampling: A survey with Russian consumers of a specific luxury brand. Measurement: Multi-item measures, using a seven-point Likert scale. Questions focus on values presented by Vigneron and Johnson (1999): quality, hedonic, extended self, conspicuousness, uniqueness. Survey also includes comparing several product lines to examine value perceptions of classic luxury items, and those belonging to the masstige segment. Methods: EFA, CFA, SEM. Journals: Journal of Heritage Tourism.

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 6 Strategy of empirical study: Article 2 The Difference Between Brand Identity and Brand Perception in Luxury Segment Settings Sampling: In-depth interviews with managers of a particular luxury brand (e.g. Cartier) + a survey with brand s customers. Measurement: Interview questions focus on brand identity components by Harris and de Chernatony (2001): brand vision, brand culture, positioning, personality, relationships and presentation. Some questions are included from Aaker, (1997), Keller, (2001), Kapferer, (2008), for example, those concerning brand s equity and personality traits. Questionnaire is planned to include mix methods as Likert and attitude scale questions, as well as image-congruity approach (Cian, 2011). Methods: Semi-structured model of interview, coding, thematic analysis. Journals: Journal of Services Marketing.

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 7 Strategy of empirical study: Article 3 Brand Perception Influence on Repurchase Intention in Luxury Industry Settings Sampling: A survey with Russian consumers of a particular luxury brand Measurement: Cognitive-affective-conative model. The affective component feelings, emotions and impressions about brand; cognitive perception and beliefs about brand; conative behavioral intention to repurchase. Methods: SEM model, CTree. Journals: Journal of Business Research. According to Matthews et al., 2014: Cognitive components: Brand Awareness, Brand Image, and Brand Perceived Quality; Affective components: Brand Emotional Value and Brand Satisfaction; Conative components: Brand Loyalty, Purchase or Repurchase Intention.

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 8 Theoretical contribution Contribution to the existent conversation on luxury brand management by uncovering the antecedents of luxury brand perception. There are considerable cross-national differences in consumer response to luxury brands (Dubois et al, 2005). Contribution to brand development research: imply that consumers may not perceive the brand in a way that is intended (image (De Chernatony, 1999; Nandan, 2005; Janonis et al., 2007). Since existent literature mostly excludes the luxury market and its specifics (Fionda and Moore, 2009) this study adds to the generalization of research methodology in luxury market research. Studies in this research field should compare the consumer perception and behavioral response with specific luxury brands, since the luxury market is very heterogeneous (Hennigs et al., 2013)

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 9 Practical implication Since luxury market is unique, consumer behavior patterns are constantly changing. Identification of the relationship between luxury brand s perception and re-purchase intention will help brands to go through market changes with fewer customer losses. According to Nandan (2005) firms can enhance brand loyalty by ensuring a balance between brand identity and brand image. Finally, this research helps to explain actual experiences of consumers and their willingness to pay to specific brands, since all three papers are designed for a particular luxury brand research.

Doctoral School of Management Brand Perception and Decision-Making Process in Lux Segment Settings 10 1styear results: 1. Presentation of the research design at the 4thseminar of Research and Study Group Innovations in the field of culture and art . 2. Articles progress: Title Progress Antecedents of a Brand Luxury Perception in the Luxury Settings Survey creation The Difference Between Brand Identity and Brand Perception in Luxury Segment Settings Data collection Brand Perception Influence on Repurchase Intention in Luxury Industry Settings Writing a literature review 3. Plan to participate at the Analytics for Management and Economics Conference in April-May 2023.